Big Tech Can’t Stop Telling On Itself

🌈 Abstract

The article discusses the Federal Trade Commission's (FTC) complaint against Amazon over the company's tactics to trick customers into subscribing to its paid Prime service. It also examines the FTC's new, more aggressive approach under the leadership of Lina M. Khan, and how tech companies often incriminate themselves by documenting their unethical practices in writing.

🙋 Q&A

[01] The FTC's Complaint Against Amazon

1. What were the key issues raised in the FTC's complaint against Amazon?

• The FTC argues that Amazon knew its customers were accidentally signing up for Prime and were unhappy about it, but the company deliberately chose not to fix this confusion because it was making too much money from these accidental signups.
• Amazon also deliberately made it harder for customers to cancel their Prime subscriptions, and celebrated that the new, more complex process resulted in fewer cancellations.

2. Why did the FTC target Amazon specifically, rather than other companies with similar practices?

• The FTC targeted Amazon because the company admitted in writing that it knew its customers were being confused into signing up for Prime, and that it deliberately made the cancellation process more complex to reduce the number of cancellations.
• This written documentation of Amazon's intent to mislead and confuse customers made it easier for the FTC to build a case against the company, compared to other companies where such clear evidence of intent may not exist.

[02] The FTC's New Approach Under Lina M. Khan

1. How does Lina M. Khan's leadership differ from the FTC's previous approach?

• Prior to the current administration, the FTC had been in a 40-year decline, being underfunded and timid. But under Lina M. Khan's leadership, the FTC has taken a more muscular, "take-no-prisoners" approach, working closely with the DoJ antitrust division and other agencies to reawaken their regulatory powers.

2. How have tech companies and critics responded to the FTC's new approach?

• Many tech bloggers were skeptical or even derisive of the FTC's complaint against Amazon, arguing that customers don't accidentally sign up for Prime and that it's not hard to cancel.
• The business lobby has been more conspiratorial, accusing Lina Khan of pursuing a personal vendetta against Amazon due to her well-known scholarship on the company's problems.

[03] The Importance of Written Evidence of Intent

1. Why is written evidence of a company's intent so important for prosecution?

• Proving a company's intent to engage in unlawful or unethical practices is often a high bar for prosecutors. However, when companies document their intentions in writing, it becomes much easier to demonstrate their culpability.
• The article cites examples of tech companies, such as Amazon, Meta, Google, and FTX, that have incriminated themselves by putting their unethical plans and intentions in writing, making it harder for them to deny wrongdoing.

2. What are some examples of tech companies documenting their unethical intentions in writing?

• Amazon's "Gazelle Project" plan to squeeze brutal discounts out of small publishers
• Mark Zuckerberg's email to his CFO outlining Facebook's plan to acquire Instagram to eliminate a rival
• FTX's internal "Wirefraud" group chat