conversation on upcoming congressional action on infrastructure and reconciliation legislation as well as government funding and limit deadlines with drug or republican congressman buddy parker, budget committee and budget ways and means member democratic pennsylvania number in the hills talking about un speech and foreign policy challenges. ♪♪ ♪♪ executives from google and facebook testify on competition and privacy before senate judiciary subcommittee talking about consumer privacy rights and some of the negative impacts such as instagram on teenagers.

>> we've been joined by my friend and colleague so we are ready to begin the hearing and i call to order the hearing of the subcommittee on antitrust consumer rights implications for competition and consumers. good afternoon and before we begin, the chair of the committee can only be here for the first few minutes and as we

give senator grassley from i asked senator durbin if he could say a few words before we begin. >> thank you to our witnesses for giving me this opportunity to say a few opening words about big data collection. in 2018 we have mixed order hearing with the head of facebook, mr. zuckerberg who faced 42 senators who had questions for him because of overlapping jurisdiction in the committees so it was an ordeal for some period of time. i'm somewhere in the middle of the back and the question i asked him was very basic, would you mind sharing with us the name of the hotel you stayed in after an awkward pause he said no. i said would you mind sharing with us the e-mails you sent out in the last 24 hours and who you sent them to? he said no. i s said really, isn't that the issue we are getting down to?

privacy? my right too say there's a line in court to draw and you can't cross it legally to invade my space and my privacy? in today's world, information is economic power, companies are using it to make more money and i share the concerns of my colleagues out of enabled too much information by a selected few giant companies. there could be efficient to bigf data but they cost impact and they cause and impact that affect everyone including our children and i introduced a clean slate for kids all might act because i was concerned with the amount of data collected and stored on our children and grandchildren. every click a child makes on the internet leaves a trail of personal data thicken last a lifetime. companies with online products toward children or regulating mass and lots of personal data and the kids never have the chance to even consider giving informed consent. my bill would give every

american enforceable legal right to demand internet companies to leave personal information collected about a person when he or she was under the age of 13. kids deserve the right to request a clean slatele once they're old enough to appreciate consequences of data collection. the bill gives a basic privacy aconnection. it can i be manipulated and impacted on consumers and competition. today's hearing is an important part to chime light on big data collectors. >> and q very much and i wanted to make clear the hearing is one of its series of hearings we are conducting from bipartisan review of america's competition issues and i think my staff as well as senator lee and his staff for helping to plan the hearing. today we are going to talk about how competition is affected and

threatened by the use of big data. until the court of modern economy senator durbin pointed out, targeted advertising and driving artificial intelligence to select what products and services we are shown on mine and increasingly outline as well. in this hearing will explore companies that control the data about the state of competition and barriers to entry and effects of big data on consumer and their privacy. i'd like to be clear what we mean when weik say big data, technology companies such as google, facebook and amazon collect an enormous amount of information about daily activities in real time. they know what we buy, who our friends d are, where we live and more.ly they are very w business model t up around getting the information using it to profit.s

through services such as google, gmail and facebook and instagram, though services are offered for free, these companies and advertisers use the data they collect aboutd us to sell to other companies. in the end, youa can't get aroud it, we are the product that makes the company money. big tech companies are not the only one keeping tabs on all of us. data brokers including the sister company acxiom by process and sell information about consumers and they have been doing it since before we even knew what the internet was. they collect information from the department of vehicles from public and even other data brokers. ctoday they by browsing historis and guess how much money we make and what religion we practice. the data has immense competitive

value and the way it's collected and used has important impacts on consumers. the simple act of consumer visiting utilities company website to pay a monthly gas bill allows to profit off of her for the most part without her knowledge. facebook and google are likely to know about consumers paying her bill even though they had nothing to do withoo transaction if the gas company runs advertisements on facebook, facebook what happened in battered on the company's website. if she uses the world's most popular web browser from google with no websites you visited. both companies analyze this information a detailed profile of the consumer in giving advertisers access to online but not something she gets paid.

at the same time.brokers are buying and selling data from utility providers and the potentially know she paid her bill by paramount with her other purchasing habits, location data, financial information, family detail in her race and gender. they sell this information to government, advertisers, healthcare companies andth othe. a few years ago acxiom had a partnership with facebook to combine their data for advertisers share the profits. at that time facebook would have supplied consumers all might activity and acxiom would have provided off-line activities and advertisers could use them both to show her. facebook enter that in 2018 raising questions about whether massive technologyto companies have so much data they don't need to buy from data brokers. we will discuss how this kind of control over an enormous data

affects competition. data driven targeting confederate things we don't want show products that might beat of interest to help small businesses reach new customers and its functions as a gatekeepr to important services and opportunity so weo talk a lot about privacy concern and obviously there is concerns about that and a longtime advocate for privacyl legislation. i think it's time and i know we're looking at focusing resources into these privacy issues in the build debated in have to lookt we at another piece and that is real threats to competition from the massivef datasets and artificialre intelligence these companies make based on them. after years of complaints and federal lawsuit, facebook

reportedly is disproportionally showing data has serious implications for helping competitive markets like this. data can be a barrier to entry unless you have a lot of it you may not be able to reach consumers successfully. it allows you to target ads and create algorithms others who might want to enter the market can't do if they don't have the taylor and it can be another way powerful internet gatekeepers maintain control of how small businesses reach customers and outside profits from that control. the impact should be linked an important role in merger analysis as dominant digital platforms try to acquire other companies massive consumer data and antitrust agencies must

place greater emphasis determining competitive impacts obtaining even more data through mergers and why i talked about better laws have to be sophisticated as the markets we tonight operate in we all want opportunities for new innovative companies enter new markets to develop. big data inhibits competition by allowing those who have it to block access to market for those who do not, we need to step in and fix it. this means enforcing antitrust laws for updating antitrust laws to modern economy, business we've done in centuries past. every 50 years or sone we to mar uptake but the time has long passed. updating standards to prohibit mergers and anticompetitive conduct shifting the border to

companies to prove their position and mostt significantly exclusionaryo conduct doesn't turn competition. we have to make sure antitrust enforcers have resources to do their job and can't take on biggest companies some of the most complex product the world has ever seen with duct tape and band-aids. we got our bill through to update the merger which willf bring in $100 billion for both agencies and we are awaiting action in the house and we have every reason we will get it done but there's more we can do not only in reconciliation bill before us but in the year end budget to make sure agencies have what they need and we need competition reform targeting things like issues of interoperable and app stores recently, a major bill on the, bipartisan introduced as well as bills targeting discriminatory

conduct with tech company. as we explore, we see the dynamic is already changing. in recent months, apple rolled out an update about iphone and ipad users whether they want to be tracked online by facebook and other apps. i was a majorey could change and what we know so far? early reports indicateat consums have overwhelmingly opted out of being tracked more than 75% decided not to be tracked on apple devices when they have a simple straightforward question. as we push for consumer privacy we must make sure monopolists don't fool us into handing over all control of our data to them at the expense of their competition. we must fight monopoly and protect consumer data. we can do both at once but i

don't want us to not realize this brave new world we are in having the data at all completely advantage of certain companies who are the gatekeepers and makes it more difficult to have a competitive market. >> thank you, i like the band-aid and duct tape analogy. i had a friend whoho says you he a spool of wire, a roll of duct tape, you could fix anything. i'm sure he was not talking about antitrust. >> maybe not but thank, you. >> the title of today's hearing isis as data does itself by nate presents big questions about the answers might not always be what we expect. on the one hand, data is increasinglymi valuable and oftn

essential to developing and improving technologies. these technologies obviously have a bearing on consumer markets and retaill markets but they make analyst contributions security and national defense and likely influence global strategic thinking in countless ways. at the same time as more and more data about us is collected, risks of unauthorized disclosure increase considerably. more valuable and more useful our data becomes more companies will do to obtain it and the more we can expect more intrusions into our privacy and privacy can be what the most for market incumbents and provide them with pretext for excluding

competition and in some cases, evading it altogether. i see several key considerations going forward. the first is the value of our data, user data as a form of payment for all my services is no longer just a fear, is how the companies themselvesf and hw many antitrust enforcers view the market. it's time for lawmakers and the public to catch up. we need to reframe our understanding and expectations from supposedly free online services to realize they are not renal but they come at a cost that's often opaque, unstable and significantly greater than we may realize. the second consideration which flows naturally from the first is the need to reinforce ownership and control over our data and we recognize the value of the data we provide companies

like google and facebook exchange for their services and realize massive imbalance in bargaining power consumers had up until this time. i should compel us to take greater care data is truly ours and we have the ability to consent to its use and revoke that consent. each of these will help promote competition in market and rely heavily on data by forcing companies to compete the quality of services offered in exchange for our data and the right to continue using our data. speaking of data and equality, as claimed that better data will me better services but it depends entirely on how the data are put to use. intrusions on privacy are an obvious threat to quality but so, too, are the more insidious

threats like those uncovered recently about facebook. it may be the most pressing question when it comes to data access and aggregation is not whether monopoly but whether it's leading to the tech firms with disregard for the effects of their businesses on society at large. finally, immediate embrace concerns that focus on data access or aggregation. data is not a finite resource, it's constantly generated by in normal sources and no one company could offer control all data necessary to a competitors business. companies for up saint the data sets necessary to achieve economies of scale and scope smacks of penalizing success and it's not something we should be

doing. in the name of tearing down barriers to entry we next demand picture trade secrets and expertise and intellectual property with competitors? all of these questions and more should make for a deeply interesting and informative discussion both in today's hearing and inld the years t come. i look forward to it. thank b you, i'm sure. >> i'm going to introduce our witnesses now. some are remote and some are here were not. vice president on the public policy team ath facebook he leas the team responsible for developing and advocating for the company's positions on privacy and data related regulations. prior to joining facebook, he worked at bromley as a privacy lawyer. mr. erickson needs over of excellence, subject matter focus on the application of policy in respect to technology and the m

internet. prior to joining google, he was a partner at johnson. sheila, the global chief digital responsibility public policy officer at ipg and is responsible for leading the corporate data policy and digital responsibility strategies at the company. she previously worked at a a sister company, data broker acxiomt and public policy executive and served as staff assistant here in theco united states senate. i always like to add that. john, mr. robert is an author and in

the past, the competition policy director at public knowledge, a nonprofit dedicated to promoting freedom of expression and open internet and access to affordable communications. prior to joining public knowledge received served as an attorney with fcc and here in the senate as a legislative aide. ... o thank you. >> thank you. chairwoman klobuchar, ranking member lee and members of the

subcommittee, good afternoon and thank you for the opportunity to be here today. ibc am vice president of the privacy public policy on facebook where i focus on developing and insuring the company's perspectives on data recognition globally. i appreciate the interest in the topics of today's hearing and the work that you will do to ensure the competitiveness of the markets and to shape the data policy. i believe facebook has an important perspective given the substantial contributions we have made to the technology sector and the 20 years since our founding. we believe that many of the concerns expressed by congress and other stakeholders respect to privacy and content moderation can be addressed by appropriate legislation and we stand ready to be a productive partner in those efforts. as you know, our company is currently facing multiple lawsuits includingng those brout by the federal trade commission and a number of state attorneys general and that will limit what i'm able to address today. but i assure you we want to be

helpful where weim can and i lok forward to our discussion. like many services, facebook helps people share, connect, communicate or simply find entertaining content. each day millions of americans use facebook to connect with people and businesses, to share and view a wide range of content, to joinn communities of interest and to set up fundraisers for good causes among many other things. all of these support the mission to give people the power to bring the world closer together. and the data helps make all of this possible. if facebook analyzes the data responsibly to provide personalized user experience we also use the data to improve the products, u to provide measuremt analytics and othere. business services to promote safety integrity, security to communicate people who use the services and to research and innovate a for social goods including by connecting and

lifting up marginalized communities in addressing humanitarian crises. the data also helps us show people more relevant ads which keeps facebook free. we recognize we have an importantt responsibility to protect it and we worked around the clock to help protect people's accounts and build security into every product. we also offer a number of tools that provide control of the data that we receive and we have made improvements to the protections and controls we offer and we have a variety of tools to help the users understand the data. we also worked to develop technology that enhances the way people connect and communicate and data is key to that work.

we know we will fall behind. we had competitors with lots of user data that didn't protect those in competition. success comes from creating products the users value and joy not from how much data you have. as explained we believe that strong and consistent competition is vital because it ensures the playing field is level and it competes hard because we are up against other smart and innovative companies. we know the success isn't guaranteed especially in the global tech industry defined by the innovation and change. technological innovationon is creative in the environment and we invest heavily in the products and services to stay relevant and competitive committing are they an $18 billion to research and development last year. we are part of their record and will build and update the products to get people the best

experiences possible. thank you and i look forward to your questions. >> thank you very much. next up of google. >> chairwoman klobuchar, ranking member lee and distinguished members of the subcommittee. thank you for the opportunity to appear before you today. my name is mark and i met vice president of the government affairs and public policy at google where i oversee a global team of subject matter experts focused on the application of law andve policy to technology o the internet. data should be used to make the consumers lives better by improving the quality and diversity of products and services available whileua protecting the privacy and giving them control. in my testimony, i will describe how we will use this and protect data, the safe data mobility to

boost competition that data doesn't guarantee the products for consumers. data plays an important role in the amount people use everyday functional and helpful and we are committed to treating it responsibly and protecting privacy with strict protocols and innovative technologies. google combines the technology with insights from data to develop products that help people find directions, build businesses and search for information. on an individual level, what data is collected and how it is used depends on how each person usesrm the services and how they manage their privacy controls. data is one element of the business where it helps us connect with relevant advertisements. advertising is google's main source of revenue and it enables us to make many of the products available for free to billions of people around the world. the ads shown are often by search or page content but they

can also s be based on the users interest or their personal data and privacy settings. we do not sell the user's personal information to advertisers or to anyone. our business relies on ensuring the user's trust, specifically how we use and protect the data. we work to maintain that trust by offering industry-leading controls to manage privacy. 3 billion users visit the accounts every year where they can review and change the privacy settings and delete the data stored within their account. we constantly innovate to improve across the products and platforms. for example, privacy standoff is a collaborative initiative that aims to build a more private and secure web because many publishers and advertisers rely on online advertising to fund their websites and connect with consumers. we will continue to partner with the industry, civil society and governments to get the balance

right. in addition to the work to advance privacy preserving technology, we contribute data and expertise to the broad ecosystem. the data portability and powering consumers to choose services or online platforms based on quality and individual preference, not because they are locked in. since 2011, google take-out has enabled the users to move their content to competing services with more than 1 billion gigabytes exported from google products. additionally, through the leadership in the transfer product, google makes it easy for others to provide tools to seamlessly move data between the online services. we are also proud of the contribution to the open source community and many of the .largest successes in the machie learning ecosystem have come from data that is openly available on the web. senators, data by itself is not guaranteed. rather it's the investment, innovation and methods that

matter not just to the amount. cutting edge technology or new ideas allow the companies to succeed sometimes without any data at all. new entrants such as zoom, snapchat, specify, pinterest and many others have become successful because they provide an innovative product not because they have accesses to da from established companies. our focus is continually improving the products into the greatest source of innovation comes from extensive research and development. we spentrc over $27.6 billion on research and development which is nearly ten times what we spent in 2009. at google we are committed to protecting through privacy, security and user control and improving in a way that ensures more consumer choice and competition. we will continue to engage with policymakers and regulators as well as other stakeholders to support the regulation that

encourages and protects consumers for example we have long supported the federal privacy legislation in the united states and we are encouraging to enact such legislation. thank you for the opportunity to discuss the work and i welcome your questions. >> thank you very much.h. next up. >> chairwoman klobuchar, ranking member lee, members of the committee, good afternoon. thank you for the opportunity to speak today. i'd like to make several points about the importance of fair and open datai' use, the intersectin of the data privacy law and federall competition practices and their potential impact on today's connected marketplace. first, responsible companies are ready for the comprehensive data privacy law that is good for citizens and good for america. i work for a subsidiary of the interpublic group of companies

who are one of the largest and most data driven advertising agency holding companies in the world. we supportnd a national privacy law. the business is built on the four pillars of consumer trust, accountability, fairness, safety and transparency. we work hard with our industry partners to instill these values throughout data driven advertising. second, in today's economy, any privacy law functionally well be a competition law whether the legislature intends it to be or not. america needs a future for national privacy law and appropriately applied antitrust policy. in our connected marketplace, both of these have data availability use and control at their core. a federal privacy law should be people centered and an insured data is used to serve people limiting who can collect,

control and use data won't work. a privacy law that restricts who can collect the data would give control and thus market control to a few companies and unavoidably weak in competition. as we have seen in other jurisdiction market power belongs to whoever controls the data. a federal privacy laws should ld preserve data sharing for beneficial and innovative purposes while making company is responsible and accountable for harmful uses. the policy should ensure the companies with technology, better ideas and innovation but which may not have adequate data of their own or are not foreclosed from the marketplace. a company shouldn't have to create a first party platform to compete. it is dominated by companies who thrived thanks to the ready

access to the consumer data and the national laws in effect. the data intensive economy overly restricted to data use and sharing laws include robust competition, elevation and the possibility of the small company finding and serving its audiences. we emphasize how essential that the data availability open data flow and fair use of data are to innovation, competition and a vibrant market of connected participants. it's sharing that everyone can compete.

an analysis of the growth of the platform shows the role that acquisitions have played in the development of dominant data positions to protect people, that the use of the data and support a robust trustworthy and competitive marketplace federal law should promote fundamental privacy rights for citizens and enable responsible accountable use and sharing of consumer data by commercial enterprise. this allows the market to continue to provide a wide array of benefits to people including things like safer online payments, ready access to business and consumer credits, access to free content and platforms ander cost-effective d efficient advertising for all especially small business and market interests. we have built accountability and responsible data practices into everything we do. corporate america is ready to collect and share

consumer data and be accountable for the actions in doing so.ly we encourage the committee to protect the fair and open use of data as fundamental to competition. we urge the committee to help develop a federal privacy law that is future fit for the digital age and protects consumers and enables the connected marketplace in which all participants can compete fairly so long as they engage in safe and accountable data use and sharing. i think the committee for its attention and look forward to your questions. it's clearly already valuable. they become more valuable over time as they are integrated into all the products and services that will be sold in the next 20 or 30 years.

there are three major methods of dealing with the action. implementing the national security state. it's turned into something destroyed rather than embracing it that will affect the economic capabilities long-term reducing the capabilities to produce high-quality products in the future but it does better. social stability. then we have the u.s. which is still up in the air.

the framework on the economic the way we are treating the data right now is very futile. it's a feudal system where you have the corporations and owners of the data in the platforms. that will also create social instability.

that is controlled by the owner of the data were it to be pooled with others and resold or lent to organizations that will make use of it, useful in a variety of different ways. it could be open source efforts, not commercial university development. but putting the consumer, putting the individual in the driver's seat changes the whole equation and it could also be a source of royalties in their personal prosperity. it's allowed to benefit from the data as it moves forward. there's also the time between the big data to the national security component that's going to come into all of this.

it's left substantially and most of the shift has occurred within the context. they are embracing that and using the corporations to gather the data and control the society. the problem here in the united states is that there are any factors to prevent that from happening here. we don't have any protections against that overreach and we

don't have the free speech rights or the rights of access. we don't have the ability to resolve this connection to reduce the ability to operate. so we need a set of digital rights that we can exercise over to protect us against any type of corporate setting. >> thank you. next up, charlotte with public knowledge. >> chairwoman klobuchar, ranking member lee, thank you so much for the opportunity to testify today on behalf of public knowledge, a nonprofit working in the public interest for over 20 years. i'm the competition policy director and public knowledge. gatekeeper power is at the root of big text competition

problems. experts, policymakers and advocates the world over have identified the gatekeeper power, sometimes bottleneck power, sometimes strategic market status. as the power of the dominant digital platform over other businesses ability to reach their customers, right now big tech has the power. over us andnd our data. and we need to protect both users and a competitive market withth new laws and rules to promote fair competition against them. we will continue to miss out on the innovations that challenge the status quo for the power dynamics that have led us here interoperability, data portability and delegated

ability are the privacy protected ways to neutralize the power of that big data confers upon the dominant digital platforms. i don't have the option to leave because my friends and family, the businesses, groups andghow n schools they need to communicate with or on facebook. these platforms can abuse the power to freeze out would be competitors from the market and one of the tools for that anticompetitive discrimination is big data. the platforms can put their own products first on the page, give them the best attention grabbing design and appoint the users away from companies that pose a

competitive threat. while this offends the basic notion of fairness, it would be difficult to stop using our existing antitrust laws. we need a nondiscrimination law to reliably stop it and i'm so glad to see the news reports the chair is working on here in the senate. strict limitations by the dominant digital platforms and giving the federal antitrust enforcers the ability to break up vertically integrated platforms are also important parts of how we can address the gatekeeper power these bills were endorsed by the bipartisan group of 32 state attorneys

general. the markets act zeros in on the gatekeeper role that the stores play. purposeful narrowing of the antitrust laws while enjoying the courts have left the big business the antitrust is supposed to address, chairman klobuchar's competition and antitrust law reform act would help rein in the power of big data by updating the legal standards for the blocking mergers and stopping exclusionary conduct. competition isn't a panacea for the challenges of the big data we also need privacy laws to protect f users and a digital regulator to comprehensively address the policy questions surrounding the digital platforms. a comprehensive federal law can be procompetitive creating a level playing field for the

incumbents and interns alike. these largely unregulated platformss have been allowed to amass powerful gatekeeper roles where they need not fear competitions or government intervention for the users to have control, we need to have a real choice to leave these platforms. we need competitors and switching to be easy. congress has already done the laudable work of introducing the bills to combat these harms but that is time to pass them was ten years ago.

they both collected data about the consumers to enable the targeted advertising which is the principle way i believe the companies make money. the way that we look at it is building great products if not from how much data you have but if you could straight forward answer the question how important is thehe consumer data to the company? >> data is important to connect people to relevant experiences that includes showing relevant ads but i would say the success that we have had comes through

building great experiences and not from the amount of data that we collect. >> the mechanisms for the users to understand how the data is being collected and how the data is being used and meaningful tools to get the consumers the ability to see the data stored in their account and make choices likee delete the data or usety one of our auto delete tos to set up regulars where the information such as the search history or location history in the location could be regularly

deleted. they created the tools to give consumers the ability to take the data that they provided to us and because the data is with us. to go to the services and the technologies that suit their needs based on a competitive dynamic rather than any sense of locking. >> okay. let me go s to you. someone reported they were talking with a few friends on one of the sites about going back and forth online about being a female politician including atv makeup artist and this person said they referred to me online and within an hour

they got an ad for mascara linking the makeup artist with their adjective. what does? it mean for others if they don't have the data? >> i appreciate what the other witnesses said that there is a role played by their innovative engineers. it's absolutely right but the data is important and that's why we are concerned about whether it's being treated competitively or not. it's not always what's best for us but it's what's best for the platform. sometimes that is what it lines up and sometimes it doesn't so we need to make sure we have protections for users and the

competitive marketplace when we are looking at that problem. >> facebook reported that the advertising revenue per user in the u.s. and canada was $51.58. i want to ask a few questions about that. the comparable number for europe was $17.80 and in asia it is $4.13. the rest of the world you reported the revenue about three dollars. why is p it worth so much more o than the rest of the world especially when we are comparing ourselves to comparable countries in europe? >> i think there are a lot of factors that go into the average revenue per user numbers. >> that's not really an answer though. that's the beginning of an

answer. >> we are breaking down the revenue according to the number that we serve. that is what is reflected in the describing. you are >> do you think facebook should pay $51.58 for the use of their data that we now know is in the recent fiscal report may be the individual profit centers should actually give the money back? >> if you go on the data you would at least be able to compare offers and get paid for the usage. i don't think you would get the full amount obviously. >> but you could get a good chunk of it just like you do when you are a consumer and you go to buy something or sell something is probably theu betr example. if. >> that is correct. >> when the companies collect

data and sell or use it to target us with ads we are the consumer or the user anymore and we really have to start thinking about those because i think that when wer get on the platforms, e havee fun at, people do business but they don't realize every single second they are creating profits they are not reaping the benefits. we are in fact the data is a commodity but the consumers are not getting enough in return. i have discussed the idea of putting impacts on the data for the companies to pay. you've written about paying people for the data. in your opinion what is the argument to ensure that the tech a.companies have to pay for the consumer data that they collect andpa use and if facebook and google had to pay for the consumer data how do you think their behavior with change? >> the most compelling argument is that it would change the perspective. people have on the data if they were in ownership

rights over it. by unlocking it through ownership, you don't just limit the data to what facebook collects or google collects. you thent open it up to what all of these other companies can do with it and they can generate revenue. c people in control of the data, people that have ownership of the data they would be more willing to give more and they would feel more comfortable with it like they are participating in the economy. rather than being observers or treated as resources.

i thought it was interesting when apple unleashed allowing people to opt out of the 75% did that because i think it is because they did it in a straightforwardec way. i don't know if i opted out and it's complicated for people or ithey make me opt in to try too something and i can't figure it out and you'd are just trying to order something online. you've spoken about giving the consumer's privacy preference first and giving the ability to change what is collected and usedco about them. and i can understand how you think that protects the user privacy but from the policy perspective, it seems like we look beyond what the benefits and individual user even if millions give you permission to collect and use their data, shouldn't we be concerned about the competitive impact of your exclusive access u to their data would you use to compete with companies that don't have the

data, would you want to answer that first? >> sure. thank you, senator for the question.. at google we do want to make sure they understand how the data is being collected and used and we want to give a meaningful choice about the use of their data. unlike facebook the user can use the services for free. they do not need to establish an account or provide any personal identifiable information. we never sell the personally identifiable information even when they do sign in and they can delete that information at any time. most when they are using online services of similar information if not the same information to multiple online services so in that, it isn't really from the competition standpoint. it's easily by others that want

to purchase the data for instance data brokers or other entities. but the key is to put them in a position where they have meaningful choices and control about the use of their lparticular data. >> do you want to take a crack at that one from facebook's perspective? >> facebook services are also free. but to your question, the statistics are interesting the average user has like 46 apps that they are using every month. there is more than 100 on the average phone and people are sharing more data in more places than they ever have before.

do you think that they know they are sharing that data? >> on facebook, they do. do you think that we need, by the way the companies are not coming to one privacy legislation after opposing it with various iterations after all the states have started to get into the act which is kind of a pattern we have seen in other areas here but, if you wat to respond to this quickly and

then i should let the senator asked some questions. there are many that do not know they are sharing the data and i also think if they know about the data they are sharing, it's quite complicated to understand what it can be used for. it can be to figure out additional information so they may be making a decision to share some data not realizing what it actually could tell the company about who they are and theirr preferences. i also think -- i want to report on the point made that google doesn't sellll your data. it's to exploit without ever mselling it because they have e advertising system. so they can both collect the data and explain it to advertise so the necessity isn't there and they can still be exploiting it just as effectively.

>> thank you very much. senator lee. >> i would like to start with you by asking about some recent reports aboute facebook. first is at the "washington post." he did a deep dive into facebook's collection ofof user data including revealing that facebook's own financial modeling estimates facebook's user data is worth an average of about $164 per user per year. this would seem to confirm my own view and that of several state attorneys general including my home state attorney general in utah that facebook isn't actually a free service as hyou suggested a moment ago but rather it is one that we pay for with our data. what is concerning is that there is so little transparency in the

transaction and you sort of confirmed that moments ago by saying that it's completely free. i'm never toldd what my data is worth and not even acknowledging it is worth anything or any kind of transaction involved. what i get in return is always subject to change. systems that post review with it is prioritized, basic antitrust laws that you look for symptoms and signs and one consistent sign of monopoly power and involves the ability to set the prices and control output. what could be a better example of that very thing than facebook's ability to demand data from its users as it does without telling them it's value or even acknowledging that it has a value at all while providing a service whose qualities and features and the termsof service and terms of use

subject to change at any moment and they do frequently change at any moment. could you answer that question for me. >> thank you, senator. respectfully, i think we see things differently. we don't see data as something people give in exchange for providing ourth service. we see it as something we use to provide value for them. >> so you disagree that when there is a service that reports to be free, you are the product. you are sort of what's being served. i get your point. nobody is paying out of pocket with money. they are not paying in literal coins or tokens, but you are in fact a for-profit business enterprise and profitable.

you do that because there is something of value. we are quibbling over nonsense distinctions between literal payment, which i didn't say nor did i imply. i guess to answer the question, accepting the premise that i think all the rest of us in this room and pretty much every other american would acknowledge exists, which is the premise that your service is in fact paid for in the sense that people contribute their time. they give their time and with their time you acquire data and you are able to monetize that. i'm asking you it is a basic principle of antitrust law that one sidee of monopoly power is the ability to set the control

output with of that premise what is your response to that? i'm asking what better example could one find once one accepts the premise than that of the ability to demand the data from its users without telling them the value of the data and when dealing with the service quality we will move onto the next question. for "the wall street journal"

relates to a series of bombshell reports last week with stunning lapses in the ability to protect facebook's consumers, the users from being harmed by the platforms this looks like the behavior of monopolies that ared so sure the customers have nowhere else to go that it displays a reckless disregard for quality assurance and even just being honest with its users about the obvious safety risks that it's subjecting its users to. in light of these reports, doesn't it look to you like they lack competition? >> senator, thank you. the journal you are raising

brings up important questions but i think that it misses the mark in terms of what we are trying to do in the matters that it describes. >> how does it miss the mark any more than revelations years ago about tobacco companies, how does that miss the mark any more than the revelations about tobacco? >> i think what is being discussed in these issues are ones we've identified ourselves and we are attempting to work through in the company. this is research we are doing ourselves to identify gaps and issues and to address them to make the platforms safer. so i think that these are self identified issues and internal deliberations for one thing which is making the platform a safer place for the people who usens it. >> i would like to turn to you.

the reason we haven't used antitrust law to address the problems in big tech has everything to do with things that could be accomplished with the law. it's not just because the courts have said no. and enforcers have taken these things repeatedly and the courts have smacked them down. that hasn't been the case. it's rather than because they simply didn't bring the case to beginat with. now look at to the obama administration. president obama's antitrust enforcers led google off the

hook after a monopolization investigation is ignoring rather specific recommendations. they failed to stop facebook from buying instagram and failed to stop them from buying whatsapp. nascent competitors that they acquired at the time and they failed to stop google from way to dominance of the digital advertising. in thele last year of the trump administration alone just the last year of the administration, that finally filed the cases against google and against facebook that the obama administration had c turned dow, they blocked 27 mergers. so far in 2021 they now supposedly run by hawks has filed seven merger cases one of

which is the case against facebook, and five of which were filed in fact by the outgoing trump administration. can we agree that it isn't adjusted the law but it lacks antitrust enforcement? >> thank you, ranking member lee. we absolutely need to improve antitrust enforcement. be verye it will important to improve the antitrust law but there have been lapses in enforcement. i think there are some situations where the antitrust enforcers have correctly identified that it wasn't there for them. but there are cases that they missed that i wish they had brought so this is definitely an important part of this effort.

>> i want to ask both of you this question. "the wall street journal" and "the new york times" reported about a yearsk ago facebook and google entered into an agreement to partner together with regards to digital advertising setting aside the question of whether can be a barrier to entry, shouldn't we be concerned when two companiesri with possibly te greatest access to user data secretly agree not to compete with each other for the primary way in which the data is to n be used in the digital advertising and we will start with you first, mr. erickson. >> thank you, ranking member. at the time of that agreement, we publicly announced the participation in the open bid platform as well as 25 other companies that are participating

in that platform. we thought it would be useful to thees publishers and that we wod have multiple networks competing for the publishers inventory and having large networks like facebook benefit consumers. there's no truth to the allegation that it's somehow in facebook's favor if they provide the highest bid that they will win. if they don't, they will lose. but at the end of the day those 25 companies, and peace because one of them, creates more competition and more demand for the publishers inventory. >> so you are saying that just one or two of the companies and you are in fact the two biggest, arguably the two biggest buddies with access to this much data and you don't see that there's any antitrust implications associated in this?

when two companies with possibly the greatest access to user data agree not to compete with each other? when it comes to digital advertising. you see no implications for that? >> respectfully, that's not the tagreement. there is no prohibition for facebook to provide their ad network and compete on other auction systems. competing on a google's system with other ad networks creates more competition and dynamic that ends up benefiting the publishers that are selling their inventory. >> myit time is expired. could you respond to the same question? >> i don't have anything to add. we can be hard or compete fairly. we did here so as well. >> i'm not surprised that you don't think there's any

unseemly. we will get back to that later. my time is expired. >> i was in the other room doig a hearing and i can see that you've used your time well. we thought we would turn it over to senator blumenthal he believed -- >> i want to thank you and the ranking member for holding this hearing and i hope that it will be the beginning or another step in the effort to forge a bipartisan effort on the privacy law i've been working with one of our colleagues on a draft for quite some time. we have come very close and i am very hopeful that we will continue to make progress because this issue of privacy is one of the central ones of our time. there is no question as you pointed out so well the data is

the source of pay and power to these companies. it is not only a source of fast revenue. it's also the fulcrum of dominance and the ability to prevent others from entering the market. the companies learned how to do it and have adapted to the challenges that have been put to them by the kind of answers we have seen today. and i want to return to those issuess that my colleagues have raised but let me first ask a few questions about "the wall street journal" investigative report that was published last week showing the destructive impact of instagram.

the simple fact of the matter is that facebook has known for years that it's directly involved in an increase in mental health issues and suicidal thoughts especially for teenage girls. despite that, facebook is now dead set on pushing to even younger children. far from being transparent about this danger. they've been blatantly deceptive and disingenuous about it. last month on august 4th, senator blackburn and i wrote and asked specifically about

this issue. we asked, and i'm quoting, has the research ever found that its platforms and products can have a negative effect on children and teens mental health or well-being such as increased suicidal thoughts, anxiety, unhealthy usage pattern, negative self-image or other indications of lower well-being. it wasn't a trick question. it proceeded to the reports in the journal. we had no idea about the whistleblower documents that were ultimately revealed. facebook dodged the question. we are not aware of a consensus among studies or experts about time is too much. we are not aware. we all know now that that

representation was simply not true. onernal documents reported by "the wall street journal" demonstrate that facebook has known for years that instagram arms children and young people and studies have found links between instagramhi and mental health problems. and it was common knowledge in the company so that the response was a clear attempt to mislead congress and misinform parents. i would ask that the report of september 14th be made a part of the record. >> it will be. thank you. >> so, the comparison to big tobacco made by senator lee he is entirely apt and i know something about a big tobacco because i sued big tobacco.

and i remember the revelation of the documents that showed not only that they knew but they had done experiments proving that cigarettes cause cancer. they've denied issues years. they have the knowledge about the damage done to people who smoke. my question toto you is why did facebook misrepresent the research on mental health and teens when it responded to me and senatoror blackburn? >> senator, thank you. respectfully, i don't agree with that characterization but i do appreciate the concern that we are hearing about these reports. the safety and well-being on the platform is a top priority for the company.

we are going to continue to make it a priority. this is important research and we are proud that we did it. we are going to continue to study these really important issues. >> why did you conceal it? >> senator, we didn't make it public because we know that a lot of the research is an important way of encouraging free and frank discussion within the company about these hard issues. >> donk you have more research a that shows this platform? >> senator, i am not aware of any other research. i don't work on these issues are privacy data. >> are you not aware in the same way that the company responded that it wasn't aware when in fact a it's new about the research? >> senator, i am not familiar with the context of what went into the response. what i can tell you is we think ntit's important to have a dialogue with congress on these

issues and we are prepared to work with you and your team going forward. a.a. >> will you work with me and my team by appearing on september 30th at a hearing that we have invited you to do? >> senator, i know our folks have been in touch with your staff to discuss that. it's something we are discussing right now. >> we are asking for the commitment that your company will send a high-ranking qualified and knowledgeable representative to the hearing on september 30th. senator blackburn and i respectively the ranking member and chair man, but it includes senator klobuchar and lee. we need to hear from someone capable of answering these questions and it should be next week. would you commit to having

someone at that hearing? >> senator, we are going to follow up promptly. we know these are incredibly important issues and we want to work with you and your staff going forward. >> i just want to point out that your company, contrary to what you told the committee, is continuing with its really unfortunate charade. vice president doubled down on the misleading statement in fact this weekend when he said the research is, quote, still allegedly nascent and evolving. ..ti.

>> and i do think that it was accurate we can commit to you and going forward on these issues. >> has facebook ever conducted research to find instagram was more toxic to teens than other social media platforms?

>> we are happy to follow up with you and your staff. >> will you follow up on septemh by having someone at that hearing who can tell us the answer? by the way the answer is you have found instagram is more toxic than tiktok. it's more of a facebook problem your own research has shown i would like somebody to come and provide an answer and then explanation on september 3. >> we will get back to you promptly, senator, i can commit to that. >> maybe a shed for a second round quick. >> we well. >> thank you. >> thank you madame chair for

holding this hearing and to the witnesses for being here it is such an important topic and will pick up where senator blumenthal left off i would just like to ask a fundamental question are teenagers safe on any of your platforms? >> senator we are working really hard to make that that case. >> they are not now? >> senator we are investing a lot in safety and integrity across all platforms we have invested billions of dollars. you concerned that teenagers are currently subject to all kinds of potential predators and the social effect? you say you hope so but are they not safe now quick. >> itre is our responsibility to invest the resources that we need to make sure these things don't happen that is why we are investing billions of dollars to have billions of dollars. >> 32 percent of teen girls

say they felt bad about their bodies instagram made them feel worse we make body issues worse for one out of three. teens blame instagram for increases of the rate of depression this was unprompted and consistent across all groups teens who struggle with mental health say instagram makes it worse. social comparison is worse on instagram. aspects exacerbate each other to create a perfect storm when it comes toe body issues, identity, depression and anxiety. that doesn't seem like a very safe platform but that is from your own internal research. what do you have to say about that quick. > we do have teens working with body image and well-being and so forth and we're doing

research like this to address them and we will continue to do so. >> we make the research public? >> senator, again, generally the way we approach research we keep it confidential to encourage free and frank discussion internally. >> that sounds like a now. >> these are really important issue. >> that sounds like it is no. the research is completed r you have done it. you know the results you know the data and have actively misled congress for years even senator blumenthal was just putting in on the record. will you make it public? yes or no? >> i strongly reject those characterizationsse the issue of greater transparency.

>> will you release the research? t yes or no. >> it is something we are looking into how to provide greater transparency with greater appropriate context. >> what is the context of 32 percent of those teen girls? is or something i'm missing what do parents need to know what is the context exactly? i am intrigued. >> it's a broader impact of services. >> just like the terrible effects on teen girls so how much money does instagram make for facebook every year? >> i don't know the answer to erthat. >> how much money do you make

from teens being addicted to instagram every year? >> i would not agree with that characterization. >> how much money to make from your teenage users every year? >> senator i don't know the answer to that question. >> i bet it is a lot. you won't release the research because it is a cash cow anyone answer our questions because you makebe a lot of money is a whole reason mark zuckerberg wanted to get instagram in the first place in 2012 uber to his own chief financial officer that buying instagram would give us time to integrate their dynamics before anybody else can get close to their scale. we know why facebook but instagram to getit rid of a competitor and gobble up the data now it makes teenagers sick and destroying their mental health. that it is lucrative. would you commit to suspending any efforts with the product to target children under the

age of 13? >> we want them to have an experience is a good one and a healthy one. >> like teenage girls are having on instagram right now? that type of experience? >> respectfully these are issues we take seriously and that we are investing in. there is no more important priority than the safety and well-being of those who use our products. >> [laughter] i camp not believe youe are saying that. looking at these other big tech companies you always disassemble and mislead but i cannot believe given the research that you have conducted that you can sit there and say that teen health

and security and safety is a top priority. clearly it is not. you don't share the data you are stonewalling every member of the committee. word you have these commit to keeping behavioral advertising out of any product? >> we have made changes with respect to teens under 18. >> you will not reveal the research are restrict t advertising and those toxic energy and the health and well-being is a top priority did i miss anything. >> i'm not sure i said any of

that. these are incredibly important issues to the accompany we are committed to have a constructive dialogue we will continue tove invest heavily. >> i'm t sure you well. no doubt about that that is probably the chua statement you have madeav today you will put money into instagram as long as you can extract money from it and that teenagers whom you are exploiting. here is a final question. why should you be able to advertise to teenagers at all? given the dangers inherent collecting data why should you be able to advertise to them i should we prohibit that? >>hy advertising supports our service we do think additional protections are appropriate we put those in place we will continue to look into ways to

keep teenagers safe on services well-being able to support them. >> you and i both know product is in safe it is dangerous you stonewalled us and the public it is time for some accountability and all i can say is accountability is coming. thank you madame chair. >> before s internet over i want to say something when i was asking my questions that could give some information. payment on —- facebook publicly reported last quarter revenue advertisingn per user which i presume includes teenagers us and canada $51.58 per user so to follow. >> the only breakdown i am aware of is way you referenced.

>> does that include instagram companywide? so compared to some of the other countries so we have to look into that how much revenue. >> the first questions for you, does axiom or any other ipg company went to data about us persons? >> informally at part of the ipg family. so axiom data we do have

clients that are multinationals and clients that operate in other markets around the world and part of p the services we provide our data enabled services marketing and advertising, yes. >> and with those persons to federal agencies. >> talking about axiom it does have shortly to be retired identify —- identity authentication which is made up of regulated data for regulated service so to know your customer obligations we are exiting that business shortly concentrating on

marketing andt advertising. >> is that the only product or service that you sell to any public sector in the united states? we supported and add counsel advertising campaign and to help with the pandemic another example i canp think of is helped the american red cross when hurricane e katrina hit, we hope to get data to them for some marketing communications to go out and find audiences so they could find out about health and services for the american red cross we have a few other campaigns like that that i t am aware of.sh

or the intelligence community or federal or state or local law enforcement. i don't know the answer right off. >> can you provide that for the record? >> i promise i will go research it get you an answer so i can be certain. of course but i'll be glad to get him answer. you are not personal aware of heard of any financial research relationship between the department defense us intelligence or any federal state or law enforcement agency? i do know that axiom of course, i am not there now and

historically it has had some relationships with some of that community. >> what are you aware of? what do you recall i am not there now but there are some governmental agencies we have worked with most like veterans administration with advertising to do outreach to the veterans community. rather than fish around if you allow me i will go with research and get you the right answer. what about any products or services to these entities quick. >> not to my knowledge how do

other eight others activity have device identifier like the ime i number? >> so we operate in the digital advertising and marketing space and we run unified ethical framework as a basis for data governance. when we source data, we undergo a due diligence process. not all data is the same and not all data users are the same. device id is a connecting piece of data we use to activate digital advertising campaigns on behalf of our clients. so maybe it flows in from one of the connected partner ecosystem providers like an

advertising network and we sit in the middle as a connector. that is typically how the data flows.

a very long time ago there was a business that axiom on to that divested that served ten or 15 years ago so the answer is no. >> which firm was that? >> it was we operated for a

few years and then we sold and iti apologize i cannot recall that he might now. >> thank you madame chair i may return for a second round if we have the opportunity. >> thank you madame chairman, let me go to you first i know you are aware that senators blumenthal and klobuchar and i filed our bill to address google and apple and the stranglehold on the market so very quickly how does practices factor in and do they incentivize the app store developers to continue the monopoly? how are they manipulating the

marketplace very quickly quick. >> thank you senator blackburn we were so glad to see the introduction of the open at market active think that will be important not just big data back gatekeeper power when it comes to the app stores but in particular with regard to big data the app stores in the operating systems have this privileged position where they can treat users or decisions about their data differently based on whether the app is owned by the app store or a competitor. one thing that is important to make sure they are treated the same to have a level playing field for competition. >> that is important to note. and you mention that gatekeeper and how that applies to other application whether publishers and other

forms of content development. i think this is an important bill that we get past on the record and quickly on filter bubbles and then you mention how do you think we could address the filter bubble and platform secret algorithm that manipulate that consumer experience online? >> one of the ways the data is used to decide what products to show the users those that show the gatekeeper role that is baseded on an algorithm for the data collecting from users so those decisions about what to showcase those are decisions that platform can make and that is limiting the options the user sees. >> the open at market act so

they tried to address that with a online consumer is more private and genuine experience so we are looking forward and those implications at large. >> so with this data you're collecting teenagers, and from working with whistleblower and at this point we are concerned

about this amount of data that you are keeping on teenagers basically building a virtual you for the teenagers. is that a violation of the children's online privacy act that you are building the files on these children? >> we are complying with law. it is important to provide protections around teens experiences. these are things we have been investing in and consulting with experts. >> who are the third-party experts you are consulting with? when we talk to teachers or parents or pediatricians orac psychologist and we look at the data you have collected from teens and the changes

they have recommended that you make to your platform, it is like you are turning a blind eye because you are chasing the dollar. bring some clarity to bear on that. >> this is an something i work on i will have to get back to you. >> that if you are privacy in public policy thinking you were going to have a stakeholder position and what they choose to do and that issue are you not involved and how to protect the virtual you for what they are using the platform quick. >> and talk about the safety experts and of course i'm involved in privacyin issues.

>> do you have any plans in the works to use the data that you have collected the information and they gave you when they participated in your mental health survey. are you going to use that to protections in place on your site? yes or no. >> all of the research that we do informs the decision-making in the company so it is certainly something. >> it shows your making decisions that allow you to be more profitable not making decisions based on the welfare. if you do not use it to improve that user experience

and then to improve the user experience so for the record what you are using this data for? >> senator we are using the data and that we are advising our younger siblings not to use instagram or be a part of the online community. because they feel you are not following what they are asking you to do. what are using the data for? is it for micro targeting and to go in and target advertising? are you using it to push them further down past if you click

on something you feed more of that so for the record tell us what you are using the data you have dreams of it. >> when it comes to the data we collect when people use our services we do a couple of things. to provide the service and improve the service. >> what improvements have you made to keep teens healthier and safer? give me three examples of things you have done to keep teens healthier and safer as they use your platform? >> with respect to instagram we have made changes to the way in the way that people can comment and that they are with

the harassment and make those resources available and then the number of investments over the years. >> are you aggressive or are you going to nibble around the edges now human traffickers or drug traffickers use your platform whether the us is that the improvement you are making? >> senator, absolutely not. >> it happens. there is a mexican drug cartel that has been on your platform and you did not take them off. >> that organization was banned on the platform that you are referring to that is from the wall street journal article. >> i have grandchildren.

two grandsons and a granddaughter my grandsons are 12 and 13 and my granddaughter is one year old. i tell my grandsons that they cannot trust you with information and then and then knowing how this data that when they know that this is taking place on your site? that you have all hesitated to answer the question but we do look forward to have a representative from your

company to answer the questions that we have in our hearing and we like forward to hear more from google and apple about the open market apps and i yelled back my time. >> let me just say that if you fail to have someone here on seh there is only one reason that you areso continuing the concealment. you have been sent here to defend the indefensible but at some point muster on —- mr. zuckerberg to get the message, houston we have ato problem better to be here on september 30 then continue to evade responsibility thank you to my colleague senator

blackburn to put it so societally and eloquently. i just want to point out that behind the numbers and perhaps the seemingly abstract questions there are real human beings women and men who are deeply hurt. by these images with that self-worth that comes along one study of teens in the united states and in the uk according to the journal article, facebook found more than 40 percent of instagram users were reported feeling unattractive, since they began on the app and about one quarter of the teens said the

feeling started there and many felt "addicted"to the app and felt they were deprived of self-control. that that exploitation that attraction even the addiction i really do hope there is that accountability that senator blackburn has said and then to

shift to the issue that senator blackburn also raised on a bipartisan bill open market act. to promote competition and strengthen consumer protection and thinking to the senator for her leading c role as a cosponsor of the bill from antitrust experts and that public knowledge that you companies of google and apple have gatekeeper control that those that allow them to

dictate the terms for everyone. they areto duopoly allows them to set the terms and they do if app developers don't like the terms and there is nowhere for them to go then that is what we call a broken market. not even facebook is immune to the gatekeeper control as powerful as it is, it is not immune. apple has blockedwe the facebook gaming app from the app store at least five times and it is prohibited other cloud gaming services from the app store it has also forced facebook to remove a notice informing consumers about the so-called apple tax the infamous 30 percent rent feed they extract from digital goods and services.

but the little guy is as much a victim as the big guy like facebook. and the open at markers act would protect competitive prices with lower prices and give consumers the right to make their own decisions about the app that a install and it is competition and a free market to me that facebook and others don't have to pass the apple tax on to consumer and small businesses. it means that iphone users can put gaming directly onto their phones if apple continues to block the app. these are basically pro- consumer and pro- competition.

would facebook support congress with fair and clear enforceable rules on those that prevent apple and google from using the gatekeeper power to extract excessive rent and block competition like what happened to you? >> senator, thank you looking at the bill and we are providing the normal channels and continuing toha work with you and the other cosponsors to provide that feedback. >> what are normal channels? >> communicating with your staff and others. >> let me point out in case it is an obvious that facebook should support these kinds of rules that is in favor of competition and open markets and not just for you but for others.

apple has claimed that if we allow consumers to make their own decisions really horrible terrible things but unlike apple google has allowed better developing access on android from the very start given apples alarming claims would you characterize everyone's apple phone as insecure? were vulnerable to cybersecurity risk because that is what apple says will happen if we eliminate the apple tax of 30 percent. >> senator, thank you for your question let me step back. we share the values that you

and senator blackburn have that consumer should be able to choose those applications toul download and there should be competition in the marketplace. taking a look at your legislation as well and we would be happy to engage with you going forward. we do believe we provide a very safe and secure ecosystem for the app developers to reach a global audience and then for those applications. >> you do believe android is secure? >> senator, yes. >> let me just close this round of questioning because i know my colleagues may have other questions. and i cannot help but to make

this observation but just over the last weekend by google and apple at thend behest of vladimir putin to censor the apps for this democratic protest in russia apple has taken down thousands of apps from the app store at china's request, almost one third relating to human rights and it includes hong kong protest and lgbtq rights. and a tweet i analogize what is going on and the attempt to appease germany. i do it with the same kind of

appeasement of vladimir putin and the communist party and china. i think it was winston churchill who said about neville chamberlain that if he had to choose dishonor or war he would choose dishonor but at the end of the day you will not appease the totalitarians not even apple or google or any of the big tech companies would win by appeasement when it comes to human rights. so it is pandering and it undermines our national interest. and i yield the floor madame chair. >> thank you senator

blumenthal. > thank you very much. my next question, what are the ramifications of our personal data having become the method of payment for online services? >> it is a lot to control and loss of income and we are looking at a snapshot right now of the tech industry and focusing on marketing and the big players that exist today but this will evolve i have been in the tech industry for decades and that was will be for facebook or google even existed that could happen in the next 20 or 30 years is that the data will persist and we need to gave individuals

control of that data so they can learn how to exercise their control and set permissions and make money on the commercial apps that use it to build products and services. >> what if anything can we reassert our ownership and control over our own data? >> the key way to do that is to get the data off the platforms that are aggregating it and putting it into a central repository that is managed by the individual and if they do that they are in control and the focal point to combine that data of who is using it rather than third parties by third parties and in ways they don't have any jurisdiction so the individual at the center of the equation

that makes life more complicated but it is c essential to move forward to be able to do this successfully long-term otherwise we are caught so it is just the obstruction of data and the resident solving trthe problem. >> is that an obstacle or an aid to consumers to regain control of their data? >> theg fact they are combining data from multiple sources and acting in opposition too blight individual should be able to do if you have the individual at the center of the equation you don't need axiom. they could cut deals for the data repository.

butct in and to set the standards i and then to lay out those standards to compete to standards.those just like we build in terms of architecture. >> and then to do business with individuals but. >> but in the last year of google and stop servicing third-party cookies in the chrome browser, if google's announcement said the purpose was to protect consumers and their data. left unsaid was that how this

can impact google's competitors and also leftt inside is the amount of information that google collects from consumers. >> so how is it that consumers are any more protected if google collects this data and competitors can't? help me understand that. so with that announcement you point out we would stop supporting intrusive tracking technologies of third-party cookies. we made the announcement in to have more privacy. we did not unilaterally withdraw support for that.

and those with that ad supported ecosystem and then to reach consumers but to engage with regulators and other stakeholders to explore more privacy protected technologies. >> i'm not sure you are grasping my question or maybe are not answering it. i appreciate the thoughtful conversation that this is in your business interest in me has been and that is within your right. i am asking you to explain your apparent assertion our consumers any more protected if you collect the data and competitors can't? that is your assertion that you are making in that announcement.

you are not service the third-party cookies in the chrome browser. >> so that we are transparent with the use of the data and with a meaningful choice including to decide they don't want to see targeted ads they can choose not to see those were toee appear on third-party sites there are many advertisers in the ecosystem with the access to data for consumers and that and that

are provided to some as we see regulators with those technologies to chart a course and there are competitors out there urging competition authorities to have a sleeve more personally identifiable information and we went to engage in the's conversations and that they would have a business model you can always

point to area where things can get worse with personally identifiable information on the web or otherwise it is significant that these things you are talking about would be competitors from the marketplace and in circumstances in which google provides advertisers with an alternative to make them more dependent on google do you agree with the google statement our consumers better off with only with only google being able to curl one —- collect this type of data? >> i don't agree with that statement i don't think users privacy is improved but we are being presented with a false

choice there is another alternative that some data should not be tracked at all. >> i just realizing dangerous the overtime the chairwoman has been very indulgent i apologize. thank you. >> up next senator cruz. > . >> my questions are for you last week the wall street journal ran a damning article entitled facebook knows that instagram is toxic for teen girls company documents show. the tagline below is a significant team mental health issue that facebook lays down in public i know about this because my wife heidi who

reads a journal every day said read this now and i read it word for word all of us know these products are addictive companies like facebook designed and in this waydd to maximize addiction to capture eyeballs and data venues to sell advertising butax for years facebook has beenn publicly insisting that they are not harming teenagers and not harmful. facebook warrant to destroy too many teenage girls facebook knew this because it conducted its own study how instagram and found that it is harmful to a sizable percentage andts in fact in 2019 summarize the research and i said we make body image issues worse for one out of

three teenage girls. another facebook slide said teens blame instagram for increase in the rate of anxiety and depression. another said team to struggle with mental health say instagram makes it worse. most egregiously, one presentation said among teens who reported suicidal thoughts, 13 percent say british users and 6 percent of american users traced their desire to kill themselves to instagram. but instead they committed to push to make sure more used instagram because more users including teenagers whatever theo human cost this is

appalling. so the wall street journal article states the research with top facebook executives cited in the presentation given to mark zuckerberg is this accurate? did he have personal knowledge of the facebook research? >> i don't know the answer to that question. back to your other points i would strongly disagree with the notion our products are not safe i strongly believe they are. >> did youon have knowledge of this research? >> i read the wall street journal article. >> .

>> senator generally i am aware we do research on our products. >> are you familiar with this research quick. >> not outside of the context of the journal article, no. >> your title is vice president of public policy you had no idea about facebook's own research that you are violating the liveses of teenage girls you don't know about is that what you are testifying? >> senator a large company we have a y lot of teams working on a lot of different issues i don't work on these issues. >> you did not know about it. >> i did not. other people did. >> you had zero knowledge of mark zuckerberg knows about it or not? >> i don't know that. >> you knew you are coming to testify at ts hearing i am guessing you read the journal article before you showed up to testify? >> i came to testify on data issues.

did you read the journal article? >> yes i did. >> and presumably prepared for today's testimony? >> yes i prepared. >> to that preparation involve inquiring if the wall street journal was accurate with p the said when it said mark zuckerberg was aware the research? >> . >> i cannot get into the issues we discussed with my lawyers. >> you are here testifying on behalf of facebook andeb i am asking if you inquired or if the journal was right that zuckerberg knew about this research did you inquire or remain willfully blind and didn't want to know if he knew? >> respectfully, here to testify about data and antitrust issues. i don't work on these issues. >> you are the vice president of privacy inss public policy. putting in place policies that result in martin suicide does not fall within your purview?

>> i don't agree with that characterization. >> we make body image issues worse for one out of three teenage girls. is that an accurate statement? >> we do this research to inform hard conversation. >> i didn't ask why you did the research but i asked of the statement that was the result of your research is true. >>he senator. >> was at a conclusion of research? yes or no. >> i am aware ofas the wall street journal article i read the wall street journal article. >> also the face for research concluded that 13 percent of british users in 6 percent of

american users traced the desire to kill themselves to instagram is that a conclusion of yourl research? >> respectfully we have those that work on these issues. >> respectfully are not answering the question it is a simple binary question didho your research concluded that are not and show us the research that did not and if it is common in the question is what is the culpability of the company that knows it is contributing to expanding teen suicide so did your research conclude 6 percent of american users traced theirat desire to killed himself to instagram? yes or no. >> senator, the issues i work on at the company i'm happy to bring folks in for a briefing. >> i understand you would rather have a briefing without the public being aware but i'm the father of two girls including a teenage girl so in your judgment and with facebook ishe increased teen suicide and acceptable

business risk? >> of course not. >> have a quantified how many additional teenagers took their life because of your products? >> with respect these are not the issues i work on i came here today to talk about data and antitrust. >> what would you say about a parents of a teenager her took her own life because of your products? and those that you conducted that concluded products would contribute to expand teen suicide what would you say to appear on behalf of facebook facing that horrific tragedy quick. >> obviously that is devastating o i have children i take these issues incredibly seriously myself. > does facebook? pick of course we do. >> you got these results two

years ago what conduct changed? you don't get to say you take these issues seriously if you continue to do exactly to profit off of applications endangering the lives of teenage girls. >> what did you do differently? >> to inform decision-making we have consistently made. >> did anything change? did anything change? did anything change? . . . . tog

on data because we have opportunity to move legislation that will be helpful but first i mentioned right in front of us before the house the bill senator grassley and i have to modernize the fees we also have opportunities in this budget and reconciliation and you know my view a is and i will ask you. the end for servers peak an issue of executive orders but if

we don't have the resources to take on the world's biggest companies is it going to work? >> we need more funding for the antitrust enforcement agencies and for that alone it's not going to be sufficient. for important pieces of the puzzle as well that's an important one we ought to be able to get done. we haven't seen a lot of antitrust enforcement against mergers or anti-competitive conduct based on the issues raised by what this hearing has for the most part focused on which is data. it's clear that it does raise complex competition issues but i'm doubtful when you see some of these court cases as recently that in my mind have gone in the wrong t direction to begin with,

but then we have a complex area ofir data and what that means that's why the competition and antitrust law enforcement act that i introduced with senators lahey, blumenthal and many others would update the laws. could you talk about how this would address the competition issues raised by big data? >> thank you so much, madam chair. ioi think that's absolutely rigt that recently and not so recently it's been going on for decades now the antitrust laws have been narrowed by these court decisions and so now that we are facing the difficult challenges of big data, it's very difficult to bring a case for example where innovation harms are an important part of what the agencies are trying to argue so i think it will be helpful to have your legislation

in placece that updates the legl standard both for mergers and exclusionary conduct, exclusionary conduct in particular is how a lot of the big data concerns are happening. and it's been difficult to bring the exclusionary conduct to cases which is a problem beyond big data but it's particularly relevant here. maybe we could talk a little bit about that relevance of it as we look at privacy legislation. and i know you talked about privacy legislation and in your kwritten testimony passed a blog post you wrote about the need for congress to enact it to create rules to govern the platforms to use, analyze and share data. what restrictions do you think the u.s. government should put on targeted advertising both from a privacy and competition perspective and should such

legislation be limited to platforms like facebook, google and amazon or should it apply to the datati brokers? >> thank you, senator. the comprehensive legislation was incredibly important to take up and pass in terms of who it should apply to across-the-board for the personal data for the components like basic rights around the data and the right to access, correct, delete and move heyour data to another service e think that companies should be required to think about privacy when they build their products and services. so i think those are the basic components of the framework that we would advocate for. >> what anyone else like to comment on the rules the federal government should put in place to ensure the market for targeted advertising remains competitive, which is a little

different than just privacy? >> i would liketi to jump in and say that i think we need an accountability-based law. we've been advocating for almost 20 years, and we believe it's very important for all americans to have the same rights and for businesses to have predictability and certainty and the accountability construct is one that says it's important for digital advertising that you should use data for the benefit and you are responsible and answerable for detecting and preventing harm. r i love what senator blumenthal said earlier that it's an abstract of a person and i believe it deserves all the dignity people should have so when you process data and activate for digital advertising it's about fairness, not manipulation y and that's the wy we govern data and believe and advocatet' for in addition to te basic rights we parse the

privacy out and it's the right to an area of seclusion where we canwe be free, the right to agency, access and then the right to fair processing that is the third piece of privacy and that is in the digital age, the reality of digital is getting so complex people do not want to sit in front of a space station panel and say yes, no and it has to be thee participants accountable for do no harm and do good things and service to people. it is privacy but i design. >> you may want to add to that but one of the goals of the competition privacy is to ensure there is a broad range of choices. if the answer targeted based on the company's collected on each of us and the inferences they've

made, does that raise concerns about the consumer's ability to choose the products and services best for them ranging from financial services, housing healthcare employment opportunities and more when the some of f them are being targetd because of their data that they didn't really know they shared? compared to other competitors? >> that is something we are very concerned about. i do think that creates an opportunity for anticompetitive discrimination and an opportunity for discrimination, racial discrimination and gender discrimination. we've seen the instances of that happening. so i think these are very serious harm that we need to be addressing. but to focus on the anticompetitive discrimination, i do think that in addition to the consumer choice limitation we are concerned about the impact this has on businesses if a business is assessed to not be

popular with a certain category of users that can make things difficult for them because of the power of the platforms because they occupy that role. it's much different than the brick and mortar grocery store sedecides not to show your product. with these gatekeeper platforms that isn't a practical option for companies, so there's a variety of harm that come from them. what is your company doing to ensure that f competition is not being distorted by your targeted advertisingg system? >> consumers need to have transparency over how the data is being used and meaningful choices about the use of the data. so on the platform we do provide an easy way for consumers to see exactly what data is stored relative to their account and it

can delete that data to say they don't want to behavioral advertising targeting ads. they don't want to see, they want to mute the ads on third-party sites. so i think the important thing here is to ensure consumers have transparency and meaningful choice and we think privacy legislation should reflect those values as well. >> earlier in my opening i talk about apple rolling out an update to its users prompting them to opt out. early indications as i noted to suggest they are doing it it's not like 75%. has google considered doing something for its android operating system? >> senator, thanknk you. google has announced that they will stop supporting privacy

intrusive technologies and the same time we've opened up a dialogue in the sandbox initiative to have a discussion with advertisers and publishers how they can move to more privacy enhancing and privacy protective business models that still allow the small businesses website owners to be able to have ands and and is supported for the products and services to consumers. through the initiative the sandbox initiative you mentioned some of the changes that you made through your web browser. however, from a competition perspective, the changes have raised concerns that google will have access to the data but others won't. how do you respond to those concerns? >> when we announced that we would see support of these devices, we also announced we

wouldn't substitute those for alternative tracking mechanisms but rather the idea behind the privacy to move the industry titowards the privacy secure ttechnologies that would still support the ecosystem but in privacy enhancing ways. the privacy sandbox creates a situation where google is still getting the data so they may call that privacy because fewer companies are getting the data. i don't think that is giving the users more privacy. and my last question of you is i asked you some questions on the record on the mergers and things like that and my bill but just kind of the broad question here

in your opinion do we need new laws to address the competition issue raised that's called a softball. >> we need new laws and that is something we are working very hard on. we need to use all the tools at our disposal so we need to increase with the current laws that we u have. we need to push with the current laws that we have but at the same time it is so important that we have improvements to the antitrust laws and sector specific focused on big tech. >> i think that says it all if you would like toro add anything because we want to have a four hour hearing, not just three and a half. >> i will keep this brief. what's going to happen to the employees and providing the

least documents to "the wall street journal"? are they going to be retaliated against? >> i can't discuss hr issues in a public forum. >> assuming they broke the law would it be appropriate to retaliate against them? >> it wouldn't be appropriate to retaliate against anyone. >> will you issue to me that they will not retaliate against them? >> senator, yes, i will commit to that. >> i appreciate that. >> i want to thank everyone for coming. there's a lot going on. we have a bill before the committee for the mark upon the venues senator lee and i have done together. we have the proposals that are

ripe for action right now. we have other bills that are technical specific with senator blumenthal and senator blackburn and myself. then we have a discrimination bill for exclusionary conduct and the like that we are in the middle of fe right now working n the house of course has proposals. but we've been working closely with our counterparts which is representative says cellini and representative back and also we havee' broad bills. we had a hearing on the meatpacking consolidationon area and senator lee and senator grassley have a broad a bill on antitrustt and i have another e

with a number of cosponsors with similarities in the bill. so we are also working on that across industry lines about things that we can do that are not just about tech that hit the fact we are seeing consolidation across the country from everything. it's not good to end with the word coffin, so although we are not too far from halloween but i just want to thank the witnesses and assure you that we continue to want to work with everyone but we know we need to change. but keeping going like we are and saying everything is fine and we trust you, it's just not enough. we are glad the companies have been successful. we have compared some of our data over the years, so i'm not going to reveal that although

you already know so there. but at the same time, we believe in capitalism and rejuvenating capitalism and a lot of what's going on right now is the obvious privacy concerns. so much dominance in the barriers to entry that make it impossible to allow competition and that in turn in the long term allows for the same few. it allows for companies to start referencing themselves and while we have seen incredible development in technology, we do not deny that. we will never use some of the bells and whistles if we didn't have facebook by instagram or whatsapp.

justam as we did during the days of the breakup to figure out whatso we can do to make this aa more competitive. thank you we will keep the record open. okay, very good. okay. thank you. the hearing is adjourned.

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for three years when his successor stunned a close gathering of officials with a litany of his predecessors abuses meant to clear the way for reform from above, the secret speech of february 205th, 1956 shattered the myth of the infallibility. this is the way harvard university press introduces the book moscow 1956 the silent spring offered by georgetown university professor kathleen smith. author and professor kathleen smith on this episode of booknotes plus. listen on c-span.org podcast or wherever you get your podcast. >> next a look at the supreme court's upcoming term from the cato institute. they previewed