Sundar Pichai, chief executive officer of Google, is sworn in during a House Judiciary Committee hearing in Washington, D.C., U.S., on Tuesday, Dec. 11, 2018.
Andrew Harrer | Bloomberg | Getty Images
As the biggest U.S. technology companies face increasing scrutiny from regulators related to privacy practices and market control, they’re spending a lot more money to try and influence lawmakers. No company in America is pouring more money into those efforts than Google.
Last year, the company spent $21.7 million on lobbying, according to the Center for Responsive Politics. For two straight years, it’s been the top corporate spender, outranking traditional front-runners like Boeing and AT&T. Amazon and Facebook also reached record levels of lobbying expenditures in 2018.
For years, with their market caps climbing alongside their consumer influence, the largest U.S. tech companies have prepared for the day when their business practices would be more thoroughly scrutinized. It appears that time is now. Between last Friday and Monday, reports surfaced that the Justice Department is preparing an antitrust probe of Google and has been given jurisdiction over Apple as part of a broader review into the tech industry. The Federal Trade Commission has assumed oversight of Amazon and Facebook.
Even before the latest regulatory developments, lawmakers on both sides of the aisle were ratcheting up pressure on tech companies. One of the biggest critics is Massachusetts Senator Elizabeth Warren, a Democratic presidential candidate, who’s been promoting a “break up big tech” campaign.
Lobbying spending by tech companies has been on a steady rise in recent years and is way up over the past decade. In 2009, Google spent just $4 million dollars on lobbying, a number that increased fivefold by last year, according to the Center for Responsive Politics.
The company started spending more on lobbying in 2011 and 2012 as it faced challenges from the FTC. In 2012, Google paid more than $22.5 million in fines to settle FTC charges related to privacy, and the next year it agreed to change some of its business practices following concerns that the company was stifling competition.
Amazon, which spent $14.4 million on lobbying last year, and Facebook, which doled out $12.6 million, are also among the top 20 U.S. corporate spenders. Facebook’s costs rose 45% from 2016 and almost sixtyfold from 2009. The company expects to be fined up to $5 billion from an FTC investigation that began after last year’s Cambridge Analytica scandal, probing whether Facebook violated a 2011 agreement it made with the agency that required getting explicit consent to share user data.
Amazon’s spending climbed 27% from two years earlier and almost eightfold over a decade.
Microsoft poured $9.6 million into lobbying, up from about $8.7 million each of the two previous years. And Apple spent $6.68 million last year, down slightly from 2017 but well above 2016. The companies are spending on issues ranging from competition to privacy.
The U.S. is well behind Europe in enforcement. In March, Google was slapped with a $1.7 billion fine, which it’s appealing, from the European Commission for stifling competition in online advertising. Since 2017, the EU has charged the company with two other fines totaling close to $8 billion for anti-competitive practices.
While the amount of money big tech firms are spending on political lobbying is a tiny fraction of their large cash hoards, the increased allocation shows the significance decisions made in Washington, D.C., could have on their future growth.