for the nasdaq active management is back. a lot of trading volume is tran transacting. i remain long on the nasdaq. >> we appreciate that. thanks, everybody. it will be interesting as we count down to the hearing on capitol hill with the tech titans with that i hand it over to kelly evans and "the exchange. >> thank you, scott. hi, everybody. welcome to "the exchange." it's a big day for investors and for washington the ceos of the world's biggest tech companies are about to testify before the house antitrust subcommittee it was supposed to begin an hour ago. it was delayed, that's why we're here now, but it should begin any moment as you just saw from that live shot of what's going on on capitol hill this is the first time that all four executives, jeff bezos, tim cook, sundar pichai and mark

zuckerberg have testified in front of congress. three of them have a market cap of over a trillion apple is the largest at 1.6 trillion and only facebook is below the trillion-mark threshold. let's dig in to what we can expect, and with that we go to elizabeth dwoskin. william kovacic and ed lee is a reporter at the "new york times" and cnbc contributor we have a visual of you, so i'll turn to you first. what exactly is the expectation of where the line of questioning will start and what the most important objective is here today? >> a few things. this will happen over a cisco w webex call so it's not going to

be the same kind of sweat on your brow feeling you get in other hearings these guys will grandstand for a few minutes whether it's bezos or sindhar or mark to answer the questions. i think they'll have some things to say just to show they know what the contours are, then we'll see how serious they are about antitrust and whether there needs to be different kinds of legislation or different kinds of enforcement i'm expecting mostly theater to start. >> interesting william kovacic, let me turn to you. i also mentioned this tweet by the president just in the past half hour or so. it gets into this kind of battle between and among regulators as to how there is a government response to big tech here. the president said, if congress doesn't bring fairness to big tech, which they should have done years ago, i will do so

myself with executive orders the people of our country are sick and tired of it you're formally with the ftc bezos makes the argument this should be decided by congress because it will require new laws and not just remedies like fines that we've seen in the past. who do you think is the most effective body to deal with big tech >> it's a combination of both. the federal trade commission and the department of justice and the attorneys general are currently running major investigations, which i think are going to result in cases in this calendar year they're going to be the first to act. that's a crucial element of the regulatory process so the notion that nothing is going on, i think, is mistaken indeed, my guess is that by the time the election takes place, we'll see big cases running from the federal and state antitrust enforcement agency

>> go ahead, and i suppose my follow-up question in that regard would be, okay, so we have these cases by the states what power do they have and what kind of results are they trying to achieve >> the states and the feds both have the power to make structural remedy, to impose controls on conducts and to change the way the firms operate. and there's evidence from a lot of past experience that that can have a big impact on the companies. again, i think that's going to happen this year soon >> interesting elizabeth, let me turn to you with one of the larger questions that looms over what happens with big tech, and it's whether antitrust law continues to change or evolve so it's not the computer harm that needs to be demonstrated but more the competitive harm are we headed down that path do you expect questions to hint in that direction, and what happens if so? >> to me that is one of the key questions around some of the cases, particularly the ftc.

what i've heard from sources is that right now the government agencies, the ftc that is investigating facebook, for example, their view of the harm to consumers is very much focused on -- still on price so it's this idea of if the service is free, how can you harm a consumer by hiking up prices on them because you're a monopoly you can't because the service is free however, there are readings of antitrust law that find there's harm to privacy, there's harm to the commission, and when they become so dominant, they get to do, effectively, whatever they want your data, so there's harm to your data because you can't easily connect with people or use other services so i don't see, from what i'm hearing, those kind of arguments

rising to the fore in the government agencies where they're doing investigations, but i think definitely it's going to come up in the hearing today, and that's going to cement an idea potentially in the public eye of the kinds of harm these companies can cause >> absolutely. it's interesting to go back to that idea of consumer harm, ed, and read the opening statement by jeff bezos, which, in fact, we are about to hear both from the big tech ceos and we'll girngs actu begin, actually, with the subcommittee as the hearing gets underway >> in 2019, the chairman and the ranking subcommittee requested information to the four firms that will testify at today's hearing. since then we've received millions of pages of evidence from these firms as well as documents and submissions from more than a hundred market participants we also conducted hundreds of hours of interviews. as part of this investigation, we have held five hearings to

examine the effects of innovation and entrepreneurship, privacy of the press and individuals in the marketplace we have talked to 35 stakeholders in support of our work this investigation has been bipartisan from the start. it's been an honor to work along my colleague, the subcommittee's ranking member, as well as the ranking member of the full committee, congressman doug collins. we work closely with all members of the subcommittee on both sides of the aisle who are taking this work seriously and studied these issues carefully as my colleague congressman ken buck recently commented, and i quote, this is the most bipartisan effort i've been involved with in five and a half years of congress, end quote the purpose of this hearing is to examine the dominance of amazon, apple, facebook and google amazon runs the largest online marketplace in america, capturing 70% of all online marketplace sales.

it operates across a vast array of businesses to computer production to logistics and small business lending amazon amaz amazon recently reached $3 trillion apple sells millions of telephones alone they also make apps and games. despite a litany of privacy scandals and recordbreaking fines, facebook continues to enjoy booming profits, $18 billion last year alone. lastly, google is the world's largest online search engine, capturing more than 90% of searches online. it enjoys more than a billion users across six products including browsers, smartphones

and digital maps prior to the covid-19 pandemic, these corporations already stood out as titans in our economy in the wake of covid-19, however, they're likely to emerge stronger and more powerful than ever before. as american families shift more of their work, shopping and communication online, these giants stand to profit locally owned businesses, meanwhile, mom and pop stores on main street, face an economic crisis unlike any in recent history. as hard as it is to believe, it's possible our economy will emerge from this crisis even more concentrated and consolidated than before these companies serve as critical arteries of commerce and communications because these companies are so central to our modern life, their business practices and decisions have an outside effect on our economy and democracy any single one action by these companies can affect hundreds of millions of us in profound and lasting ways although these four corporations differ in important and meaningful ways, we've observed

common patterns and problems in the course of this investigation. first, each platform is a bottleneck for a key channel of distribution, whether they control access to information or to a marketplace these platforms have the incentive and ability to exploit this power they can charge exorbitant fees, impose excessive contracts and extract valuable data from the people and businesses that rely on them. second, each platform uses its control over digital infrastructure to seizuurveil or companies. each company has used its power for buying or cutting offer access of any potential rival. third, these platforms abuse their control over current technologies to extend their power, whether it's through self-prefacing, credit pricing, they have wielded their power in

destructive, harmful ways in order to expand. in today's hearing we'll examine how each of these companies have used its playbook to achieve and maintain dominance and how their power affects our daily lives. so why does this matter? many of the practices by these companies have harmful economic effects. they discourage entrepreneurship, destroy jobs, hike costs and degrade quality simply put, they have too much power. this power staves off new forms of competition, creativity and innovation and while these dominant firms may still produce some new innovative products, their dominance is killing small businesses, manufacturing and overall dynamism that are the engines of the american economy. several of these firms also harvest and abuse people's data to sell ads from everything from new books to dangerous so-called miracle cures. when america learns how much of their data has been mined, they can't run away fast enough in many cases there is no escape from the surveillance because there is no alternative.

people are stuck with bad options. open markets are predicated on the idea that if a company harms people, consumers, workers and business partners will choose another option we're here today because that choice is no longer possible in closing, i'm confident that addressing the problems we see in these markets will lead to a stronger, more vibrant economy because concentrated economic power also leads to concentrated political power, this investigation also goes to the heart of where the we as a people govern ourselves or whether we let ourselves be governed by private monopoliemos american democracy has always been at war with monopoly power. over our history, we've learned that concentrated markets and concentrated political control are incompatible with democratic ideals when america confronted a monopoly in the past, be approximate railroads or tycoons in the past, we took action to make sure no corporation controls our economy or our

democracy. we face similar challenges today. as gatekeepers of the digital economy, these platforms have the ability to pick winners and losers, break down small businesses and influence themselves they upend entire sectors and inspire fear to represent the powers of a private government our founders would not bow before a king, nor should we bow before the emperors of the online economy with that i recognize the ranking member for his opening statement. >> thank you, mr. chairman i want to thank the ceos who are speckly wo specifically working with the subcommittee that appear today this hearing is vital to our oversight work, and i appreciate your flexibility throughout my long time in congress, i have prioritized oversight as one of our seminole responsibilities part of that responsibility is

to periodically review the effectiveness of our laws, and i think it's a good and timely thing that we are now turning our attention to technological innovations, which brings us to all of your companies. our country stricken by a pandemic becomes an illustration of the extraordinary reliance americans have on technological innovations. in these unexpected and unprecedented times, your companies have provided innovations so our nations can meet a myriad of our daily needs. the delivery of groceries, virtual visits with doctors, connecting socially distant families or keeping our small and large businesses connected with that responsibility comes an increased scrutiny of your dominance in the marketplace i want to reiterate something i said throughout this investigation. being big is not inherently bad. quite the opposite in america you should be rewarded for success we are here to better understand

the role your companies have in the digital marketplace, and importantly, the effect they have on consumers and the public at large you lead some of today's more powerful companies, and my colleagues and i have a great interest about what your companies do with that accumulated power. we also know that the tech marketplace is driven by data, so it follows that those who control the data, in essence, control the marketplace. there are broader questions surrounding data, however. who owns the data? what responsibilities do companies have to share it with their customers or their competitors? what is the fair market value of that data? is there anything monopolostic about acquiring this data and what about monetizing it these are questions that even your own companies are wrestling with in the current

technological landscape, and the answers to which we owe the american consumers since the tech investigation began, we heard rumblings from many who are quick to say your successful companies have grown too large. since this hearing was announced, it seems those complaints have gotten even louder while i find these complaints informative, i don't plan on litigating each of these complaints today antitrust law and the consumer welfare standard have served this country well for over a century. those laws have provided the framework and creativity to make way for some of our most successful and innovative companies. i will be the first to highlight that however, as the business landscape involves, we must make sure that our existing antitrust laws are applied to meet the needs of our country and its consumers. i share the concern that market

dominance in the digital space is ripe for abuse, particularly when it comes to free speech as we know, companies like facebook, google, youtube and twitter have become the public square of today where political debate unfolds in realtime but reports that descending views, often conservative views, are targeted or censored is seriously troubling. conservatives are consumers, too, and they need the protection of the antitrust laws the power to influence debate carries with it remarkable responsibilities so let the facts be our guide here your companies are large that's not a problem your companies are successful. that's not a problem, either but i want to leave here today with a more complete picture of how your individual companies use your size, success and power and what it means to the american consumer.

i yield back the balance of my time >> thank the gentleman the chair now recognizes the distinguished chairman of the full committee, the gentleman from new york, mr. nadler, for his opening statement. >> we're going to pick it back up here, get a little reaction to what we just heard from both sides of the aisle we heard from the chair, a democrat, and we just heard from representative sensenbrenner we hope to hear from the big men of these companies today we have kayla tausche, julia boo boorstin and deirdre bosa. let's talk about this.

he said your size is not a problem, and he emphasized some of the free speech issues and some of the bias concerns that conservatives have when it comes to these platforms that to me says there is still a fair amount of distance between the parties on what the big move might be on big tech >> kelly, there could be problems with company dominance. they feel like dominance could have surveillance with customers on the right it has to do with free speech being shared on the platforms. that being said, you heard the chair on the subcommittee, david sisiline, how these companies are part of the digital economy and talking about comparisons to railroad tycoons of the previous century and the ability of these 800-pound gorillas to use their power for evil we did see that from ranking

member sensenbrenner's comments following that these executives will have a lot of tough questions to answer, millions of pages of data having been provided to the committee, and they already heard from the heads of these committees and able to craft questions for this moment right now with the heads of these companies in front of them or on camera, rather, on cisco webex, to answer all these questions they've had for close to a year to put together. to be sure, these companies are set to say we've had humble beginnings these are only in american success stories, and we're actually quite different from company standpoints. apple says it's a hardware company, facebook says it's a community platform and apple and amazon are their own businesses. kelly? >> who would you say is the first and foremost concern among

regulators, because they will take a different approach with each company here. is it google, is it apple, and would we expect tim cook, for instance, to try to turn the narrative back to the practices of facebook and google in order to deflect from the real concerns and questions that will be asked about their market powers as it relates to the app store. >> i think they all are, but if we're going to pick a few, i do think apple on one hand and amazon on the other. bezos hasn't testified before congress before, so i think they'll take that opportunity. he's also the richest of a group of very rich people. regarding some of the different approaches here, i want to point out, i don't know if people noticed, but the woman sitting behind the chairman is lena khan, the professor and author of the famous paper, the paradox around amazon, that these

behemoths are getting bigger and bigger she's saying, we've been trying to apply the rules do these big companies lower costs for consumers? if so, that's fine there was talk around, well, are they just getting too big and crowding out other potential businesses the democrats are looking for more the reading from professor khan who, you know what, we should take a broader view rather than simply does it lower prices that's what all these guys will talk about they'll talk about how amazon has lower prices for consumers, facebook is free, google is free that's what will be challenged, at least on the democratic side. >> and on that note, if they do go down this path of reexamining government powers for reasons

that aren't just consumer harm, does it open the door towards using this power in a way that might achieve other social issues, and is that a path we want to go down? we'll check your audio, sir. we'll be right back with you >> kate, i'll turn back to you and ask those questions as well. what are the rumblings on capitol hill about just how far not just the antitrust law could go as it relates to big tech, but how this might set a precedent with how we see big power in the future? kayla? >> oh, kelly, well, i think it really depends on what happens in november, right because right now you have a democratic house, you have a republican senate, and there is very little that the two sides

can agree on, and we've seen that come to a head in recent months over some of these stimulus packages, not least of which this issue is a galvanizing issue for both sides of the aisle also what happens in the presidential election, because the ftc/doj, the agencies with jurisdiction over a lot of these issues could get new leadership themselves come early next year, and it's not expected that there is much that could be done between now and november we've seen the rubber takes a long time to meet the road on a lot of these issues, especially with billions of dollars of lobbying money being thrown behind this effort from silicon valley, too. >> deirdre, on that note, i've seen the opening statement from jeff bezos from amazon the opening statements on all these guys are out what do you think the opening statements to particularly hit here >> a common theme of all of them, this was mentioned

earlier, is they're basically talking about their own experience, how they were able to achieve the american dream. how they came from humble beginnings i thought it was so interesting that representative sisiline talked about some of the common threads they found throughout this 13-months long investigation. these companies have the incentive and the ability to exploit their power. he also talked about harmful economic effects such as destroying jobs and hindering entrepreneurships. when you look at jeff bezos' prepared remarks, he addresses these issues head on amid the pandemic, amazon has been hiring tens of thousands of workers. he would argue that they promote entrepreneurship through their third party merchant, so they have their remarks prepared, they know what's coming. the lawmakers will have to dig in deeper. talk about some of these nuances that are becoming more and more clear to consumers for amazon, for example, how they use their data to potentially compete with their

third party merchants, how consumers, perhaps, are getting the best or right products because amazon is promoting their own. those are some of the arguments we'll hear from bezos, and i think we'll hear them from other ceos, too, particularly sundhar, how he grew up in india with little technology. >> the internet is censoring conservatives. are these parties able to demonstrate that they do not have a bias with speech that they disagree with >> i suspect they anticipate an attack this is an argument they've been dealing with for quite a long time it's really interesting, if you look at the allegations of conservative bias, also concerns about the spread of hate speech, though these are not intrinsically about antitrust, we do expect those issues to be in focus, particularly for

google as well as its youtube unit as well as for facebook, kelly. >> although, again, we've seen them try to deflect these concerns in the past, but not substantively. mark zuckerberg in particular has been kind of out of the consensus on his stand for free speech when it pertains to political advertising and the rest of it do you expect him to have a different philosophical take here than we might hear from, say, sundhar picai of google >> mark zuckerberg has been open particularly when it comes to this issue of free speech. he wants us to be a free and open platform. there is intrinsic value, he believes, in facebook offering free speech. on the other end of that spectrum is how much they're willing to sensor racial content. this is a line they've been grappling with right now in particular, there is this boycott of advertisers of

facebook, a number of hundreds of major brands boycotting facebook in the month of july to push facebook to take a stand on the issue of racist content on the platform so i think that zuckerberg is trying to be cognizant of the fact he has to speak to both issues, the need for free speech and the fact they need to pull down racist content, and there is this allegation they're pulling down conservative content more than they are content on the other side of the aisle. all difficult things for him to balance, all issues he's been faced with in the past, but right now in particular, facebook earnings tomorrow, a lot of questions are going to mention the fact they're incredibly profitable, and also the fact they have this boycott going on a number of balls in the air for zuckerberg >> there is a lot of support for these big four companies the favorability ratings are very high even along the drama of a company like facebook over the last couple years. how important is that for lawmakers who want to have an issue in election year that's

going to be broadly appealing? >> you pointed out something that i think is important, which is consumers like the products but they don't necessarily like the executives running the product. so even if people like facebook and instagram that they're heavy users of, of which there are billions, they may not like mark zuckerberg, they may not like the controversy of it. part of what we're hearing around these hearings are holding these people accountable as well as the companies the way the silicon valley sort of sprang into existence, it was a founder ethos. i think google and apple have matured on where they have these executives in place. that is sort of the nuance here in terms of what's being criticized and what potential critical points that people might be trying to score i'm not saying that's necessarily the point of this hearing. i think there are some real legitimate concerns they're trying to get at it, but that, i

think, is the nuance of trying to separate the person, these billionaires, from the products people use >> all right let's turn back to the hearing where the ceos themselves are about to make their opening statements first up is jeff bezos who has never testified on capitol hill. excuse me, i'm going to remind members of this committee, unless you are speaking, our rules require you to wear a mask according to the attending physician -- no, i'm speaking about another member of this committee. i'll begin again it is now my pleasure to introduce today's witnesses. our first witness is jeff bezos, the chief executive officer of amazon.com mr. bezos founded amazon as an online bookstore in 1994 since then it has become the most successful online store mr. bezos received his bachelor of science from princeton

university our second witness, sindha sindhar picai, is the ceo of alphabet and its subsidiary google he joined google in 2004 and has been responsible for a lot of products including google chr e chrome mr. picai received a degree from metallurgical engineering from the institute of technology, a master's degree from stanford university and an mba from the wharton school of pennsylvania our third is tim cook, ceo of apple. he started apple in 1978 and served as chief executive officer under steve jobs he was later named as ceo. he launched developments and products and services such as apple pay, apple watch, apple

card mr. cook received a bachelor of science from arbor university and an mba from the school of business our last ceo today is mark zuckerberg, founder and chair of facebook he launched facebook in order to connect college skutudents at a school more easily since then it's grown into the largest single platform with 1 billion daily active users mr. zuckerberg left school full-time to focus on facebook now we'll begin by swearing you in before i do that, i want to also remind you that you are the only ones from your respective companies invited to testify today, and that in accordance with normal house practice and section g of the house remote proceedings regulations, your sworn testimony must be your own. please let me know if at any

point in the hearing, you wish to mute yourself so you can confer with your counsel will you please unmute your microphones and raise your right hands. do you swear or affirm under penalty of perjury that the testimony you're about to give is true and correct to the best of your knowledge, information and belief, so help you god? >> yes >> yes >> let the record show the witnesses answered in the affirmative. thank you, and you may remain seated please note that your written statements will be entered into the record in their entirety accordingly i ask that you summarize your testimony in five minutes. to help you stay within that time, there is a timing light in webex. when the light turns from green to yellow, you have one minute to make your testimony when it turns to red, it signals your time has expired. thank you, mr. bezos, you may begin. >> thank you, mr. chair and members of the ranking subcommittee i was born into great wealth not monetary wealth, but instead

the wealth of a loving family, a family that fostered my curiosity and encouraged me to dream big. my mom jackie had me when she was a 17-year-old high school student in albuquerque being pregnant in high school was not popular. the school tried to kick her out, but she was allowed to finish after my grandfather negotiated terms with the principal. she couldn't have a locker, ext extracurriculars and couldn't walk across the stage for her diploma. she graduated, determined to finish school, and brought me, her son, to school my dad was 16 when he came to the u.s. from cuba by himself shortly after castro took over my dad didn't speak english and he did not have an easy path what he did have was grit and determination. he received a scholarship to college in albuquerque, which is

where he met my mom. together with my grandparents, these hard-working, resourceful and loving people made me who i am i walked away from a steady job on wall street into a seattle garage to found amazon, fully understanding that it might not work it feels like just yesterday i was driving the packages to the post office myself, dreaming that one day we might afford a forklift customer obsession has driven our success, and i take it as an article of faith that customers notice when you do the right thing. you earn trust slowly over time by doing hard things well, delivering on time, offering everyday low prices, making promises and keeping them, and making principle decisions, even when they are unpopular. and our approach is working. 80% of americans have a favorable impression of amazon overall. who do americans trust more than

amazon to do the right thing only their doctors and the military the retail market we participate in is extraordinarily large and competitive. amazon accounts for less than 1% of the $25 trillion global retail market and less than 4% of u.s. retail there is room in retail for multiple winners we compete against large established players like target, costco, kroger and, of course, walmart, a company more than twice amazon's size. 20 years ago we made the decision to invite other sellers to share in our store, to share the same real estate that we spent billions to market and maintain we believe that combining the strength of amazon store with the vast selection of products offered by third parties would be a better experience for customers, and that the growing pie of revenue and profits would be big enough for all. we were betting that it was not a zero sum game.

fortunately, we were right there are now 1.7 million small and medium-sized businesses selling on amazon. the trust customers put in us every day has allowed amazon to create more jobs in the united states over the past decade than any other company. hundreds of thousands of jobs across 42 states amazon employees make a minimum of $15 an hour, more than double the federal minimum wage and we offer the best benefits, benefits that include comprehensive health insurance, 401(k) requirement and parental leave, which includes 20 weeks of paid maternity leave. more than anyplace on earth, entrepreneurial companies start, grow and thrive here in the u.s. we nurture our entrepreneurs and start-ups with the stable rule of law, the finalest universiesy system in the world and risk taking

of course, this corporate world of ours is far from perfect. even though we honor john lewis and his legacy, we are in the middle of a race reckoning we also face the challenges of climate change and income inequality and we're stumbling into the crisis of a global pandemic still, with all our faults and problems, the rest of the world would love even the tiniest sip of the elixir we have in the u.s. people such maze das my dad seea treasure this is they can see it more clearly than those of us lucky enough to be born here it is still day one in this country, and even in the face of today's humbling challenges, i have never been more optimistic about our future i appreciate the opportunity to appear before you today, and i'm very happy to take your questions. >> thank you, mr. bezos. mr. picai, you are now recognized for five minutes. >> thank you, mr. chairman,

ranking member sensenbrenner and members of the subcommittee. before i start, i know this hearing was delayed because of the ceremonies to honor the life of your colleague, representative john lewis. because of his courage, this world is a better place. he will be deeply missed a discussion about competition is a discussion about opportunity. this has never been more important as the global pandemic forces dual challenges to our health and our economy expanding access to opportunity through technology is personal to me. i didn't have much access to a computer growing up in india, so you can imagine my amazement when i arrived in the u.s. for graduate school and saw a lab of computers to use whenever i wanted accessing the internet for the first time set me on a path to bring technology to as many people as possible it inspired me to build google's

first browser, chrome. i'm proud that 11 years later, so many people experience chrome for free google takes pride in the number of people who choose their products we are even prouder of what they do with them from the 140 million students and teachers using g-suite for education to stay connected during the pandemic, to the 5 million americans gaining digital skills through global google, to all the people who have gone to google for help, from finding the fastest way home to learning how to cook a new dish on youtube. google's work would not be possible without the innovation and the pride in its future. we employ 25,000 people across the u.s. in many states. we estimate that in 2018 we made more than $20 billion in the u.s., citing us as the largest

capit capital. one way we contribute is by building helpful products. research found that free services like search, gmail, maps and photos apply thousands of dollars to the average american many are small businesses using our digital tools to grow. stone dimensions, a family-owned stone company in wisconsin uses google to draw more customers. a family-owned appliance store in bristol, rhode island credits google helping them reach customers online during the pandemic nearly one-third of small business owners say without digital tools, they would have had to close all or part of their business during covid. another way we contribute is by being among the world's biggest in research development. at the end of 2019, our span had

reached tenfold in ten years from $2.8 billion to $26 billion, and we have invested over $9 billion the last five years. our engineers are helping america remain a global leader in emerging technologies like artificial intelligence, self-driving cars and quantum computing. just as america's technology leadership is not inevitable, google's services are not guaranteed new competitors emerge every day, and today users have access to more information than ever before competition drives our team and leads to better products, more choices for everyone for example, competition helped lower online uprising costs over the past decade with savings passed down to consumers platforms like android was made to support the innovation of others thousands of owners and operators buy and sell their

products without paying fees to us this has offered billions of consumers to cutting edge platforms, some under $50. whether building platforms for small businesses, google is part of it. google is committed to keeping your information safe, treating it responsibly, putting you in control and we have long supported the compensation of privacy loss i've never forgotten how access to technology and innovation changed my life. google brings opportunity to everyone no matter where you live, what you believe or how much money you make. we are committed to doing this responsibly in partnership with lawmakers to ensure every american has access to the

incredible opportunity technology creates thank you. >> thank you, mr. pichai mr. cook is now recognized for five minutes >> chairman nadler, ranking members simpson and jordan, members of the subcommittee, thank you for the opportunity to offer testimony. before i begin, i want to recognize the life and legacy of john lewis i join you in mourning not only a hero but someone i knew personally whose example inspires and guides me still every american owes john lewis a debt, and i feel fortunate to hail from a state and a country that benefited so profoundly from his leadership. my name is tim cook. i've been apple's ceo since 2011 and a proud employee of this uniquely american company since 1998 at apple, we make ourselves a

promise and our customers a promise. it's a promise that we'll only bill things that make us proud as steve put it, we only make things that we would recommend to our family and friends. you can try to define this difference in a lot of ways. you can call it the seamless integration of hardware and software you can call it simplicity design or a great ecosystem. all of those things are true but if you want to put it simply, products like iphone just were. when customers consistently give iphone a 99% satisfaction rating, that's the message they're sending about the user experience but we also know that customers have a lot of choices and their products face fierce competition. companies like samsung, huawei and google have built successful businesses with different approaches we're okay with that our goal is the best, not the

most in fact, we don't have a dominant share in any market or any product category where we do business what does motivate us is that timeless drive to build new things that we're proud to show our users. we focus relentlessly on those innovations, on deepening core principles like privacy and security, creating new features. in 2008, we introduced a new feature of the iphone called the app store launched to 500 apps, which seemed like a lot at the time, they entrusted apple users to get more out of their phone we knew the users at the time didn't work well brick and mortar stores charged high fees and had limited reach. things like cds had to be shipped and were hard to update. from the beginning, the app store was a good alternative

they never pay for shelf space we provide every developer with cutting edge tools like compilers, program languages and more than 150,000 essential software building blocks called apis the app store guidelines ensure a high quality, reliable and secure user experience they are transparent and applied equally to every developer for a vast majority of apps, developers keep 100% of the money they make. the only apps that are subject to a commission are those where the developer a kwicquires a customer on an apple device and where the services and experience would be consumed on an apple device. in our ten-year history, we have never raised a commission or charged a single fee in fact, we've added additional categories i'm here today because scrutiny is reasonable and appropriate.

we approach this process with respect and humility but we make no concession on the facts. what began 500 apps is now more than 1.7 million, only 60 of which are apple software if apple is a gatekeeper, what we've done is open the gate wider. we want to get every app we can on the store, not keep them off. the app store's economic contributions are significant. the ecosystem is responsible for 1.9 million jobs in all 50 states and it facilitated 158 billion in commerce in the u.s. in 2019 alone. i share the committee's belief that competition promotes innovation, that it makes space for the next great idea, and that it gives consumers more choices. since apple was founded, these things have defined us the first mac brought opportunity and possibility into the home the ipod helped musicians and

artists to share their creations and be paid fairly for it. this legacy does much more than make us proud. it inspires us to work tirelessly to make sure tomorrow will be even better than today thank you very much. i look forward to responding to your questions >> thank you, mr. cook mr. zuckerberg is now recognized for five minutes >> thank you before i begin, i want to add my voice to those honoring congressman john lewis and his service to our country america has lost a real hero who never stopped fighting for the rights of every person chairman sisiline, ranking members of the subcommittee, thank you for the opportunity to testify. the tech industry is an american success story. the products we build have changed the world and improved people's lives our industry is one of the ways that america shares its values with the world and one of our greatest economic and cultural exports. facebook is part of this story

we started with an idea, to give people the power to share and connect. and we built services that billions of people find useful i'm proud that we've given people who have never had a voice before the opportunity to be heard and given small businesses access to tools that only largest players used to have, since covid emerged, i am proud that people have used our services to stay in touch with friends and family they can't be with in person, and to keep their small businesses running online when physical stores are closed i believe that facebook and the u.s. tech industry are a force for innovation and empowering people, but i recognize there are concerns about the size and power of tech companies. our services are about connection, and our business model is advertising we face intense competition in both many of our competitors have hundreds of millions or billions of user. some are upstarts, but others are gatekeepers with the power

to decide if we can even release our apps and the app stores to compete with them. the most popular messaging service is imessage. the fastest-growing app is tiktok the most popular app for video is youtube the largest ad's platform is google for every dollar spent on advertising in the u.s., less than ten cents is spent with us. i think the true competition is much broader they could compete with the capable industry when amazon bought whole foods they could compete against kroger's ands -- and we could compete ben telcoms

that's competition new companies are created all the time all over the world. history shows if we don't keep innovating, someone will replace every company here today that change with often happen faster than you expect only three still make that lith today. a decade ago the vast majority were american. today almost half are chinese. aside from the competition there are other serious issues, including questions about election, harmful content and privacy. while these are antitrust and not specifically the topic of today's hearing, i recognize we're often at the center of the discussion we share platforms for sharing ideas, and important debates play out across our services i believe this ultimately leads to more progress, but we often find ourselves in the middle of

deep disagreements up. >> that's why last year i made the case there needs to be new regulation for the internet. >> these are fundamental values for most of us, but not for everyone in the world, not for every company we compete with or the companies they represent as global competition increases, there's no guarantee our values with win out i'm proud of the services we build and how they improve people's lives we compete hard. we compete fraherly. we try to be the best. that was what i was taught matters in this country. when we succeed, it's because we

deliver great experiences that people love. thank you, and i will forward to answering your questions >> thank you i thank the witnesses for your opening statements before i begin recognizing members for questions, without objection i'm going to enter into the hearing record documents and exhibits majority members will be referencing in their questioning today. these materials have been distributed to the witnesses i will now recognize myself for five minutes mr. pichai, more than 89 positive of searches go through google a about is may sink or swim on google's decisions alone businesses tell us google steals its -- in ways that profit google and crush everyone else most businesses ask to stay anonymous because of retaliation. the one said his website was thriving until google stole his content after the decision to his website dropped 80%, had to

down size his business if somebody came to me with an idea, i would tell them to run, run as far away, launch a lawn care business or dog grooming business, something that google can't take away as soon as he or she is thriving. my first question, mr. pichai, why do businesses steal content from honest businesses >> mr. chairman, with respect, i disagree with the characterization just last week i met with many small businesses in fact today we support 1.4 million misses supporting other $385 in economic activity. we see many businesses thrive, particularly even during the pandemic businesses, an example kettle cakes -- >> i have a limited amount of time, i don't want to interrupt, about you my question is very

specific we heard throughout this investigation that google has stolen content to build your own business these are consistent reports so your testimony that that doesn't happen is really inconsistent with what we have learned during the investigation, but i will move on mr. pichai, many americans believe what that google shows are the most relevant results, but increasingly it shows whatever is most profitable for google, be it google ads or google's own sites threat as fundamental conflict of interest, which incentivizes -- on google's own sites. >> we have always focused on providing users the most relevant information we rely on the trust for users to come back to google every day. in fact, a vast majority of --

we don't show ads at all we shows ads only for a small subset of inquiries, where the internet is highly commercial. for example, they may be looking at something like tv sets or so on. >> what is the value of the part that you do use the google ads for? it's a substantial part of your business, what is the actual value? $200 billion $300 billion >> in terms of revenue it's about 100-plus. >> that's a lot of money, mr. pichai let me move on really the google business model is the problem our documents show that google evolved from a turn stile. google started to fear competition from web pages that could divert surge traffic appeared revenue from google google staff discussed the proliferating threat, is how it was described, that these web

pages posed to google. any traffic loss to other sites was a loss in reserve. one of google's memos was certainly sites were getting too much traffic, so google decided to put an end to that. you've been at google since 2004 were you involved in these discussions about the threat from vertical search >> without knowing the specifies, it's not really clear on the context for example, when uses come looking to shop online, independent studies shows that over 55% are amazon, and over 70% originate with major e-account commerce companies. we re vigorous competition with travel, real estate, and we are working hard for -- >> let me ask specifically, the evidence we collected shows that google pursued a multipronged

attack first it began to steal other web pages' content it stole restaurant reviews from yelp to bootstrap its own rival local search business. do you know how google responded when yelp asked you to stop stealing their review this i'll tell you, our investigation was it was a threat to delist yelp entirely. let is steal your content or effectively disappear from the web. mr. pichai, isn't that anticompetitive? >> when i run the company, i am focused on giving users what we want we conduct ourselves to the highest standards. >> as to identify --

>> just like under businesses, we all decide to understand trends from data which we can see. but we are really -- that, of course, is sundar pichai. we're getting the latest decision on interest rates for the fed. steve liesman has the details. >> maintaining the 0 to 0.25, and saying it will maintain that rate, or that target range until it's confident the economy has weathered recent events. it will -- it's pledging to increase the holdings and mortgage-backed securities to support the economy. economic activity, this is a new addition, it says an employment picked up somewhat in recent months, though these node that both of them, the commission and employment have remained well below levels