Before the house antitrust subcommittee lets get straight to kayla with the details. Reporter four hours in and a third round of questioning underway as republicans challenge apple, amazon, facebook and alphabet on political censorship and democrats take aim at the size and power the companies have amassed. Here is David Cicilini our founders would not bow before a king, nor should we bow before the emperors of the online economy reporter these four horsemen of the Technology Industry responded in kind saying, in fact, they each face healthy competition in their respective fields competition drives us to innovate and leads to better products, more choices and more choices for everyone. Customers have a lot of choices and there are products that face fierce Competition Companies like samsung, lg, huawei and google. Were okay with that. I there are concerns about the size of Tech Companies our services are about connection and our Business Model is advertising and we face intense competition in both. Reporter well so far the executives have largely side stepped controversy as they were probed over the app store, content policing, china policy, counterfeit goods, jeff bezos of amazon said that the company does, in fact, pursue aggressive pricing to promote its own products but that it doesnt harvest Third Party Sellers data to do just that. But perhaps, melissa, the most direct questions about whether the companies are too powerful and to big came to Mark Zuckerberg when he was asked about instagram and whether instagram and facebookshould b split up jerry nadler, the full committee chair, cited 2012 emails from zuckerberg saying that essentially they were taking out a competitor and zuckerberg said actually in hindsight, maybe you could sense that instagram would grow but at the time we didnt know how much it would grow. And with the same information that the company had, the ftc in 2012 approved it unanimously melissa. Kayla, thank you. And again the hearings are ongoing in washington, d. C well go to them occasionally as news warrants. But first, dan, if there was any company in particular that you thought suffered the most damage from these Congress People who were pretty aggressive in their questioning . They were pretty aggressive but i think they show that theyre outclassed, out of their league when asking questions of these titans and when you think about it, they came really hard for Mark Zuckerberg zuckerberg, though, went out of his way to kind of say that he is not the behemoth that some of the other counterparts who are in this hearing with him obviously, amazon, google with the size of their video platform, amazon with the growth of the ad platform and obviously apple with the, i think he even mentioned imessage the most widely used messaging app in north america. So he distinguished himself rather than being a battering ram, i think he caught a lot of questions. He has not fared so well in the past in these environments i think he did well sticking on skip here. But as kara swisher said this all of the time, and maybe at some Point Congress will listen to her, this is not how you do it, this is not how you grill these sort of people who built these sort of businesses so nobody was expecting too much here and i think were going to walk away and the guys are going to be like that was a walk in the park. It givesa glimpse into the minds of the Congress People when you listen to the lines of questioning. One question, tim, was to the effect of will you not rig the election base in favor the joe biden. Other line of questioning is why does the echo, the amazon echo, when you say buy batteries go to amazons batteries so there are a lot of pointed things to go to. Yeah. And it seemed like the democrats were more aggressive than republicans despite the fact that doj, which is where a lot of this is supposed to be emanating, is some sense this might be from the administration led. But i thought google was getting the biggest kind of shot across the nose and not that they cant handle it and i think Sundar Pichai was good and i think the humility and trying to give explanations to folks that might not understand. But the assessment that google is not the gateway to the internet but a Walled Garden and talking about how they quit working with the pentagon and yet working closely with china so there were these attacks. I just go back to the stocks first of all, they fell 3. 5 to 5 between the last four to five days off of blowoff tops that i dont know that were too far away from getting back to. This started in june of 2019 where that is really where you should have bought these stocks if youre worried about this because they rebounded substantially through the rest of the summer. And since then, largely havent looked back, subject to what has happened through the crisis. But this is right now, i dont think, much ado about anything the big issue for this company will come tomorrow when we talk about the earnings. It is interesting that you thought Sundar Pichai had more questions. This is as of 4 20 and granted the hearings are going on. But Sundar Pichai got 30 questions and cook got 12. Guy, i dont know what you walked away with in terms of who got the most heat. I guess it doesnt matter in the end as these guys have mentioned because the stocks are not doing anything yeah, i dont think it matters. If anything it just reinforced why the companies are so profitable and why their stocks do go higher they just made the case for them in the questions that they asked. The hypocrisy is what strikes me as most of the congress men and women will go home in their cars and google or use facebook to see how they did with their line of questioning and theyll wind up with their apple phones in their hands to the front porch and get their amazon boxes like we all do, by the way so the entire thing is folly and theater and weve talked about that the stocks are valuable for a reason i dont think anybody walked away with it injured i dont think anybody did any disservice to their companies and i think the theater that we typically see was on display again. It is amazing, bono, that throughout the course of the past couple of years each additional, whether it be by federal regulators or by state a. G. S, that the stocks continue to chug higher you could throw almost anything at them in terms of investigation and it doesnt matter to the price. Yeah, these things are pretty impervious and as a lot of the other panelists have said, the more this is a repetitive issue, it seems as if it comes across as if this is a witch hunt. Of the companies, i would say apple seems the most insolated in terms of the dynamics of its revenue attribution. But it didnt seem substantive and i dont understand the logic in terms of questioning these tech titans on the technicalities of their business again, in a wouldnt be the approach, not necessarily what i expected but ive just grown accustomed to throwing spaghetti ata wall and watching it slide down and buying the shares. Lets get more reaction to todays big tech hearings. Joining us now from facebook, al alex stamos. Great to have you with us. Thank you. Ill ask you the same question i asked the panel did any company emerge from this injured in any way im not sure. I think what were seeing is two different hearings layered on top of each other. From the democrats questioning, most of it was about antitrust. And i think in that area, there is a lot of legitimate complaints from the various representatives. The problem is that their all very different so the antitrust concerns for the four Different Companies come from very Different Directions theyre talking about amazons use of the knowledge to compete in the physical world. Of apple and google having platforms that they control. And a facebook buying or copies competitors. So while all of them took some shots im not sure there is any outcome for that on the republican side, it was mostly a litany of various complaints about other policies that are completely irrelevant to antitrust. And from that side, i think it is going to get some sound bites for the various representatives but there is not any real outcome from them pushing on this. So, alex, we just talked, there was a democratic side and a republican side. But isnt this antitrust battle that is coming for these tech behemoths going to come most likely from the eu we know there has been some dust kicked up there already. And isnt that what we would expect to see how they fare and then it comes back home to our showers. Yeah. I think for the ceos, if the biggest concern is with eu regulations, the competition, did you comp and investigations from that side because competition regulators are going to look at the impact of markets which is something that you didnt hear anything bib in this hearing. You heard very little about any actual harm to consumers where the europeans have a theory of the size of these companies harming european competitors and european consumers and in the long run that is much more effective than having the litany of complaints that cant be solved with antitrust do you think it is tim welcome and thanks for joining us do you think that there is any of the ceos, no one wants an antitrust breakup but a lot of people have pointed to that some of the companies are a lot more valuable based upon the sum of the parts. And how do you think these ceos are thinking about that . Do you think of them have contingency plans or this gets into more of a Corporate Tactical strategy, but as we look as this as investors, i wouldnt find it catastrophic, i think maybe the opposite, if doj really pushed hard. It is an interesting question again, it is such a different issue with each company. I think in some cases a breakup would at least change competition. So the facebook case, you could make facebook, instagram and whats app separate companies. And that might increase shareholder value over the long run to have them compete against one another, it might not. That is hard to make a prediction but it is a remedy for facebook. When you talk about apple and google, it is not realistic to break apple into multiple units that compete on iphone the issue there is the control of the app store and whether or not theyre using the app store to suppress competitors. Same thing with google and dominance in search. There is no good way to break up googles dominance in search so i think for those kind of companies, the outcome could possibly be some kind of Consent Decree or another agreement that keeps them from utilizing their incredible power and the amount of data they have in competition. I think the only company that probably should be worried about breaking up in facebook. And maybe amazon, although there has been very little discussion of the fact that amazon is both a massive retailer and the Worlds Largest cloud provider which is something that it talked about a lot in tech and here in silicon valley, that halloween made that hasnt made it to the floor yet. But the bottom line is you think all of the guys go home or maybe are already home and they just sort of think, wow, that was tough but im glad im done and life goes on nothing comes of it . Yeah. I dont think any of the ceos are worried for the outcome here im amazed at these hearings of the fact that the structure is to incredibly inefficient and it is so poorly designed to actually nail down these folks youre breaking it up into the five minute chunks for different representatives and going back and forth between republican and democrat means that you have no consistency in the questioning youre talking about actual competition and the moment get somewhere interesting, it is over and now youre talking about oh, this guy got taken down on twitter and it is not even there and all of the complaints about twitter who isnt even represented is one of the silly things going on right now. So i think if they want the hearings to be more effective, they need to find a model where somebody who knows what they are talking about is spending 15, 20 minutes asking questions. And then the ping pong in between the ceos is very disruptive alex, great to have you. Thank you. Alex stamos. It is a dogandpony show. Lets put it straight. Lets call it what it is and at the same time, if we get at some of the remedies that could be proposed, which company could be the most scathed, which would be the least guy . I think remedies the most potentially one hurt i would think facebook and i think the least one hurt would be apple. Just back of the envelope stuff. Maybe you could argument on facebook but i think it seems to me that apple is probably the most impervious to any of this my opinion. Tim, what do you say . Well, apple seems to me with the app store and the complaints from the developers and people like spotify, we heard the ceo offer the bell that seems the most vulnerable and i think apple and if you look at their revenue and their Services Revenue and ive heard dan talk about this, too to the extent that we have thrown so much in terms of a fresh multiple at apple on services, if you that seems to be the place where ultimately, look, the competitive environment is such where in an efficient market should settle that score it hasnt so far i think apple remains under pressure yeah. Byron, what do you think i think just in terms of again, in terms of revenue attribution, i believe the app store is about 10 of the apple overall revenue. So while there may be a higher probability that that thing becomes a headline issue, in terms of the overall business mix, i would think that theyre the least affected amazon to me seems like there is a bit of an issue there. At least from a headline risk. Facebook has been through the ringer and theyve been for lack of a better word exposed or pressured from amazons point of view, keeping data and using that to change the competitive landscape, i think that is something that could be probed more and theyll have to provide some pretty logical explanations and answers for. It is interesting how bezos came out saying who he was telling his story. He whas a child of a high school a teen mom and the whole nine yards it was a very convincing story and from the rich evident man perhaps on the planet at this po point, it was probably a smart move. Listen, bezos is the goat there is flo dou there is no t about it. That is the greatest of all time, guy. Yeah, guy his business is the least likely go ahead and try to spin out aws and all of a sudden youll have a top ten nasdaq 100 company on your hands that is just going to steam roll everybody else anyway so to me, i dont think there is a strong likelihood that that company gets broken up if anything, even with facebook, when you think about it, the discussion about instagram back in 2012, it was a no Revenue Company for 1 billion well what happened, you have seen facebooks proper vertical move over to instagram and instagram has a lot of risk right now. Mark zuckerberg, we talked about it last night and mentioned it today, tik tok is the real deal here and it is coming after them and then when you have upstarts like snapchat, which is a 2 billion Revenue Company but that commands a lot of mine share abelong teens, you have to be worried so me facebook is the one that i think posed the most risk. And we didnt even talk about trust and safety yet that is the grievance of the republicans in some ways, it is just kind of the pushing their voices down to the side. The democrats have a real argument on the trust and safety and if there is any ill toward action on that platform that affects our election in the fall, theyre coming for facebook with the picket with the pick forks there. Well continue to monitor the tech hearings and bring you any news as it develops. Meantime, lets turn to the other big story of the day and that would be the fed. Policymakers wrapping up a two day meeting with chairman powell lets bring in Steve Liesman he added a thinking to thinking about thinking about raising rates. Yeah, i dont know exactly how many thinkings there were. When i asked the question last time, it was not thinking about thinking and i think there is three now or there might even be four which means it is way down. And he kind of took the back of his hand and swatted away the question about inflation saying were just not worrying about that and it was a fun quote from the chairman if you will where he said, upside, were not worried about the upside, we know what to do. Were all prepared for that. And the opposite . Are they prepared for that well, thats where hes focused. And it has been a really interesting kind of dynamic here, where i think the fed has had this right but im not sure that following the fed having this right made anybody some money. And if you give me a second to explain. Powell has been hammering this idea of the uncertainty about the economic effects of the virus. The uncertainty about the course of the virus and i think if you go back and like look at him hammering that uncertainty, hes been correct about how things ended up. We were not coming back very quickly. There was a good chance we were going to have another spread of the virus. There was a good chance that were going to have another downturn that is a big part of what he emphasized today, is that the High Frequency data that theyre look at has gone flat to turning downward all of that has meant an enormous amount of stimulus from the Federal Reserve and that meant the stock market could go about its plmerry way, oblivious to what is going on with the virus and now the ensuing downturn or slowing of the pace of the recovery. So powell has had this right the fed has had this right but i think following them would have led you to a much too pessimistic of a view about what would happen with stocks. We had our panel on power lunch, you are part of the panel, steve, and mona had made the point that the next meeting in september is the last peting before the election. So the probability of making any sort of major move, whether it be, well with rate, that is not going to happen for the foreseeable future but any moves that could possibly change the market trajectory, changing language, et cetera, would be very unlikely . I dont agree with that i think this was a pause of a meeting. I think depending upon now, remember what the fed did today. It inserted t