It was her critical attitude towards the tech companies that convinced US President Biden to make the lawyer the powerful head of the authorities.
(Photo: AP)
new York The head of the US Federal Trade Commission (FTC), Lina Khan, is not afraid of big names. The 33-year-old proved this again when she filed a lawsuit against Microsoft’s planned takeover of the computer game manufacturer Activision Blizzard.
The software group wants to take over Activision for around 69 billion dollars. It would be the biggest deal in the gaming industry, and it would make Microsoft the third-biggest player in the world after Sony and Nintendo.
According to Lina Khan, that’s a size too big. Since Microsoft already controls other game studios with well-known titles such as “Doom” and “Minecraft”, it would significantly strengthen its market position with the takeover. Khan worries that Microsoft could keep popular games to itself and keep competition out with its own Xbox gaming platform.
For Lina Khan, however, Microsoft and Activision are not so much about the fair distribution of video games as they are about nothing less than rewriting US antitrust laws for the big tech companies.
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Above all, it was her critical vision of Big Tech that convinced US President Joe Biden to bring the lawyer to the head of the powerful authority. Democratic Senator Elizabeth Warren is also one of her biggest supporters. Before Khan took up her post in June last year, she had been instrumental in a congressional inquiry that declared Apple, Amazon, Facebook and Google monopolies and proposed “structural separations.”
>> Also read: US antitrust authority FTC wants to block Activision purchase by Microsoft
Despite being only 33, Khan is the best-known and most powerful representative of a new antitrust legal school of thought, “which leans more towards the European legal and political line than the American one,” according to James Keyte, director of the Antitrust Institute at the prestigious Fordham University in NYC.
Lina Khan also takes on Facebook mother Meta
The lawyer caused a stir in 2017 with her academic article in the Yale Law Journal entitled “The Amazon Paradox”. In it, she dissected the weaknesses of antitrust law in relation to the online retailer. The digital platform acts as a gatekeeper and “suppresses competition with all dependent retailers,” Khan denounced at the time. Khan’s article has been read thousands of times, including by laypeople.
Khan makes no secret of the fact that she sees breaking up Big Tech as a priority, or at least wants to prevent Big Tech from getting any bigger. Their core argument is simple: Decades-old antitrust law, which is linked to price developments and consumer benefits, does little to prevent the abuse of competition in services that are often free and that do their business with data.
Using the example of Microsoft, Khan now has to show whether she can also enforce her new world view in antitrust law in court.
Microsoft is not the only case the new FTC boss is currently fighting against Big Tech. The trial against the planned takeover of “Within” by Facebook parent Meta has also begun in San Jose these days. Within is the provider of the popular fitness app “Supernatural” with so-called virtual reality, an artificial reality created by special hardware and software.
Khan wants to litigate and not negotiate
The FTC argues that Meta is “already a critical player at all levels of the virtual reality sector.” Therefore, there is a risk that the purchase of Within would reduce competition in the future in the still young virtual reality market. So Facebook is already securing its future dominance – and in Khan’s eyes, this must be prevented.
Meta and Within are about a much smaller takeover than Microsoft and Activision. But there, too, it is primarily about the principle and about obtaining a court decision.
Khan has made it clear several times in the past that she wants to bring as many cases as possible to court and does not want to agree on any out-of-court settlements with fines. “We will focus our resources on litigating and not on reaching out-of-court settlements,” she told news website Axios.
Khan’s goal is to obtain judgments that look not only at current but also at potential future competition, and that don’t just measure price and immediate consumer benefit. Such a possible new case law is even more important in the American legal system and could also influence future processes. That would be a tremendous achievement for Khan and her school of thought. A nightmare for Big Tech.
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