Washington, D.C. – TechNet, the national, bipartisan network of innovation economy CEOs and senior executives, today commented on a new white paper from the Data Catalyst Institute outlining the potential harm antitrust legislation, particularly the American Innovation and Choice Online Act (AICOA), would have on America’s startup economy and, more broadly, the innovation economy. The study explains how provisions in AICOA and other antitrust legislation could limit startup access to vital tools and financing that have allowed the American startup ecosystem to increase fourfold over the last decade.  The following can be attributed to TechNet President and CEO Linda Moore:

“This study makes clear: Now is not the time to fundamentally disrupt our economy through rushed antitrust legislation rife with unintended consequences. America’s startup ecosystem is booming, and the creation of new companies, and the jobs and innovations they bring, have been a key driver of our economy for decades. As written, the AICOA would cause substantial collateral damage to America’s startups and small businesses, hampering their ability to compete, which would hurt U.S. innovation and our ability to keep pace with foreign competitors, like China.

“Following the implementation of General Data Protection Regulation in Europe, there’s been a sharp decline in startup creation and prosperity. Those economic pitfalls await the U.S. if Congress moves forward with this legislation. Instead, Congress should seek specific solutions to foster innovation rather than arbitrary, vague provisions that would hurt small businesses, our global competitiveness, and national security.”

The Data Catalyst Institute’s white paper outlines several direct and indirect harms to the startup ecosystem including:

  • Raising barriers to effectively implement tools created by ecommerce and advertising startups.
  • Decreasing monetization opportunities for startups and apps by harming viability of software development kits.
  • Reducing publisher revenues and incentives to create apps with ad-based business models.
  • Limiting access to, quality of, and quantity of tools available for small businesses and tech startups.
  • Reducing effectiveness of capital markets by reducing incentives for providers of capital to invest in innovation ecosystems.
  • Decreasing incentives for platform owners to offer free or affordable high-quality tools in cloud computing, storage, databases, content delivery, and analytics that enable small businesses to create value.

You can read the Data Catalyst Institute’s white paper here.