President Biden is going to call on the Federal Trade Commission to crack down on the repair restrictions the tech industry has been imposing on consumer electronics.
On Friday, Biden is slated to sign an executive order meant to promote healthy competition in the market. As a preview, the White House released a fact sheet, which reveals that the executive order also covers the internet and technology industry.
The order will please the Right to Repair movement, since it specifically calls out “cell phone manufacturers” for blocking independent repair shops from fixing consumer electronics.
“Tech and other companies impose restrictions on self and third-party repairs, making repairs more costly and time-consuming, such as by restricting the distribution of parts, diagnostics, and repair tools,” the fact sheet says.
In response, Biden’s executive order will “encourage” the FTC to issue “rules against anticompetitive restrictions on using independent repair shops or doing DIY (do-it-yourself) repairs of your own devices and equipment.”
The order seems to leave the size and scope of the enforcement up to the FTC. However, the federal regulator already agrees that repair restrictions need to be reined in.
In May, the FTC sent a report to Congress that found "scant evidence to support manufacturers’ justifications for repair restrictions." The same report said the FTC was also mulling “reinvigorated regulatory and law enforcement options, as well as consumer education” to tackle the problem.
Going After 'Killer Acquisitions'
Biden’s executive order also calls out “corporate consolidation” in the tech industry, citing the danger of larger players buying up the competition. No company was named, but the wording immediately brings to mind Facebook, which acquired WhatsApp, Instagram, and Oculus VR, despite federal scrutiny.
“Over the past 10 years, the largest tech platforms have acquired hundreds of companies—including alleged 'killer acquisitions' meant to shut down a potential competitive threat. Too often, federal agencies have not blocked, conditioned, or, in some cases, meaningfully examined these acquisitions,” the fact sheet says.
Another company the executive order seemingly targets is Amazon. The fact sheet notes the White House is concerned with the largest internet companies hoarding too much data from consumers and small businesses that sell goods on their platforms.
“For example, companies that run dominant online retail marketplaces can see how small businesses’ products sell and then use the data to launch their own competing products. Because they run the platform, they can also display their own copycat products more prominently than the small businesses’ products,” the fact sheet says.
As a result, the executive order will direct the FTC to create rules covering the “surveillance and the accumulation of data,” and “unfair methods of competition on internet marketplaces.”
Net Neutrality Returns (Again)
On the networking front, the executive order is calling on the Federal Communications Commission to crack down on broadband providers’ efforts to reduce the choices consumers have in picking a service provider.
Specifically, the order will call on the FCC to prevent internet service providers from reaching deals with landlords to provide only one broadband option to tenants living in a building. “This impacts low-income and marginalized neighborhoods, because landlord-ISP arrangements can effectively block out broadband infrastructure expansion by new providers,” the fact sheet says.
The order also directs the FCC to limit excessive termination fees broadband providers can impose on consumers, which the Biden administration says can reach up to $200. In addition, Biden wants to prevent ISPs from selectively slowing down the internet for certain services. So the executive order will call on the FCC to restore the Obama-era net neutrality rules, which were revoked in 2017 under the Trump administration.