Big Tech is getting ready to fight for consumer rights

The tech giants have made record profits during the pandemic, but they are facing a tough fight against regulators who are closely scrutinizing some of their business practices, considering them to be harmful to consumers.

Lina Khan, new chairman of the Federal Trade Commission (FTC), during a hearing before the US Consumer Protection and Trade Subcommittee she statedthat the agency is considering legislative changes to "end special protection for specific industries" and stronger law enforcement for some of the world's largest companies and their platforms.

Bogdan Maioreanu - market analyst and commentator eToro operating on the market in Romania. He has over 20 years of experience in the financial sector and investments, as well as extensive journalistic experience. He held various managerial positions in Corporate Banking, both at Raiffeisen Bank and OTP Bank, before moving to the business consulting area, working for IBM in Romania, among others. Bogdan has a title Executive MBA from Asebuss and Washington University.

Right to repair

The Federal Trade Commission under the leadership of Khan is expected it will be much tougher in relation to large technology companies, commonly known as Big Tech. This agency was already active in an area that raised a lot of controversy related to the "right to repair". Reports have emerged of farmers being forced to use hackers so that their tractors and harvesters, with computerized systems, can recognize used spare parts. Small repair shops also complain about the inability to replace broken screens on some phones, either because spare parts are not available or the manufacturer requires a complicated procedure and specialized proprietary tools. There are also reports of the impossibility of repairing some electronic devices due to components being so stuck to the housing so tightly that opening the device destroys them, forcing the owner to replace the faulty device instead of repairing it. An FTC report released in May of this year found that manufacturers often advise against repairs by independent companies, who may charge less from consumers than they do themselves.

However, civil society is demanding a right to repair, given that it can help develop communities and save consumer money and valuable natural resources. Even the co-founder Apple Lossless Audio CODEC (ALAC),, Steve Wozniak, said he supports the right to repair.

Following the executive decree signed by President Biden to promote competition in the US economy, the FTC unanimously voted to step up enforcement against remedial restrictions that prevent small businesses, consumers, and even government entities from repairing their own products.

Efforts to introduce legislation in this area, however, are still at the very beginning of the road, as technological giants such as Amazon, Apple Lossless Audio CODEC (ALAC),, Google, Microsoft, Samsung, are actively fighting legislative proposals for the right to repair, claiming that it threatens the protection of intellectual property, trade secrets and can create security concerns in addition to obligations for companies. The recent FTC decision could put these companies' repair revenue stream at risk. For example, according to Kyle Wiens, president of iFixit, Apple's iPhone repair line could bring the company anywhere from $ 1 billion to $ 2 billion a year.

Europeans want to be eco

Europe has already taken steps to be repairable by asking manufacturers of certain electrical appliances to ensure that they are repairable for at least 10 years. The European Environment Bureau estimates that extending the lifetime of European smartphones by just one year would save 2,1 million tonnes of COXNUMX equivalent₂ annually, contributing to the fight against global warming. CO equivalent size₂ corresponds to the annual emissions of more than 450 cars.

In a study published by the Eurobarometer, 77 percent European Union citizens would rather have their devices repaired than replaced, while 79 percent believes that manufacturers should be legally obliged to facilitate the repair of digital devices or the replacement of individual parts.

Despite fighting regulators, the ongoing pandemic is likely to boost Big Tech's profits. In the second quarter of 2021, Americans spent $ 14 billion on video games and related products, an increase of 2 percent. compared to the first quarter. Profits were recorded in spending on personal computers (PC), cloud data storage, mobile devices and subscriptions, as well as VR hardware and non-console products. For example, this is good news for Apple because 62 percent App Store revenue is generated by transactions in mobile games.

Console and accessory spending declined in the second quarter, though June was the best dollar sales month for Microsoft's new Xbox Series X / S consoles - breaking the previous sales record of 2011 - and surpassing Sony's PlayStation 5.