Small Business Group Speaks Out Against Klobuchar Bill Creating New Restrictions on Digital Platforms

Connected Commerce Council (3C) Executive Director Rob Retzlaff made the following statement regarding legislation unveiled today by Senators Klobuchar and Grassley that creates new restrictions on digital platforms:

“Perhaps Chair Klobuchar and Sen. Grassley missed the memo, but the United States already has powerful, decades-old competition laws that prohibit abusive anti-competitive behavior. Coopetition – competing against one’s business partners – is not anti-competitive; it has been business-as-usual for decades. Walmart, Macy’s, and every grocery chain use data from sales, loyalty cards, and coupons to develop store-brand products that compete with their seller partners. Outlawing competition because it is tied to a digital platform is absurd, and will hurt small businesses that rely on digital platforms and particularly their integrated services.

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“When large public companies like Yelp and TripAdvisor whine about Google Reviews or search results, Congress should be suspicious and ask small businesses that utilize these platforms if robust online competition helps or hurts small business success. When large companies complain about the unfair Amazon Marketplace or Apple App Store practices, ask small businesses if the benefits of these platforms outweigh their concerns.

“This bill, like its companion in the House which has not been moderated at all, demonstrates, again, that Members of Congress do not understand how the digital economy works, or perhaps they are putting politics and optics over our nation’s post COVID recovery and small business success. Millions of small businesses rely on Amazon Marketplace to grow, but this bill is so broadly written that it could define Amazon’s warehousing, logistics, and transportation activities as unfair competition against longtime Amazon partners UPS and FedEx. Additionally, Google My Business and reviews are very important to small businesses. Will Congress outlaw Google My Business because Yelp and TripAdvisor complain?

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“When Congress tries to drastically micromanage business models and ignores market realities, there are always unintended consequences that hurt small businesses. Large digital platforms are important foundations for millions of American small businesses that need certainty and simplicity to succeed. Political grandstanding that breaks proven digital business models is not helpful to any business, large or small.”

3C recently published the Digitally Driven report, a survey of more than 5,000 business owners which documented that Big Data-powered free and low-cost digital tools were a substantial pandemic survival weapon.

According to the report, nearly three–fourths of New York small businesses (71%) increased their use of digital tools during COVID–19, and most (54%) intend to increase their use of digital tools post–COVID–19.

The Bronx, Brooklyn, Manhattan, Queens, and Staten Island Chambers of Commerce signed a letter earlier this year calling on New York’s Congressional Delegation to keep in mind the impact on New York City small businesses and start-ups when considering antitrust legislation aimed at the technology sector.

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