California’s Attempt to Regulate Big Tech Self-Preferencing Thwarted by Intense Lobbying
In a significant development within California’s legislative landscape, the proposed Blocking Anticompetitive Self-preferencing by Entrenched Dominant platforms Act (BASED Act), or Senate Bill 1074, has been halted following a vigorous opposition campaign led by major technology companies. This bill aimed to prevent trillion-dollar tech corporations from favoring their own products and services over those of competitors, thereby promoting a more equitable digital marketplace.
Overview of the BASED Act
Introduced by State Senator Scott Wiener in March 2026, the BASED Act sought to address concerns regarding self-preferencing practices by dominant digital platforms. The legislation proposed several key measures:
– Prohibition of Self-Preferencing: Companies with a market valuation of at least $1 trillion would be barred from prioritizing their own products and services over those of competitors. This includes manipulating search results or rankings to favor their offerings.
– Restrictions on Third-Party Data Usage: The bill aimed to limit how these companies utilize data obtained from third-party businesses, ensuring that such information is not exploited to gain an unfair competitive advantage.
– Enhancement of Interoperability and Data Portability: The legislation sought to prevent covered providers from restricting interoperability or data portability. This would allow business users and consumers to obtain copies of their data in a useful and portable format, fostering greater competition and consumer choice.
Opposition and Lobbying Efforts
Even before the bill’s formal introduction on March 18, 2026, a robust opposition campaign was initiated. Leading this effort were the California Chamber of Commerce and the tech industry trade group Chamber of Progress. The latter, established in 2020, includes prominent members such as Amazon, Apple, Google, OpenAI, and Uber.
The opposition’s strategy involved mobilizing constituent calls to legislators, arguing that the BASED Act could degrade popular products like Google Search and Apple’s App Store. Campaigns suggested that the bill would result in less useful search results, slower delivery services, and less secure smartphones.
Despite initial progress through committee stages, the bill ultimately failed in a key privacy committee. This outcome occurred despite support from influential entities like Y Combinator, which attempted to counter the opposition’s narrative.
Statements from Senator Wiener
Senator Scott Wiener expressed his concerns regarding the overwhelming lobbying efforts against the bill. He stated, They absolutely flooded the Capitol with lobbyists to trash the bill and spread misinformation. It was a tidal wave lobbying effort, and we were at a real disadvantage.
Despite this setback, Senator Wiener indicated that the initiative might not be over, urging observers to stay tuned as he considers future steps.
Contextual Background
The failure of the BASED Act is not an isolated incident but part of a broader pattern of tech industry influence over legislation aimed at regulating their practices. Similar scenarios have unfolded in other states:
– Arizona’s App Store Antitrust Bill: In 2021, Arizona’s attempt to pass legislation allowing developers to bypass app store payment systems was withdrawn after lobbying by Apple and Google. The bill had aimed to enable developers to avoid the 15% to 30% commission fees charged by these companies.
– New York’s Right to Repair Law: In 2023, a lobbyist representing Apple, Google, Samsung, and others succeeded in diluting the impact of New York’s Right to Repair law. The lobbyist provided suggested wording to the governor, which was inserted verbatim, placing limits on the spare parts that tech giants are required to make available to consumers and independent repair shops.
– Federal Lobbying Expenditures: Reports from 2022 indicated that Apple significantly increased its federal lobbying expenditures, spending a record $4.6 million in the first half of the year. This surge in spending was largely in response to potential antitrust legislation that could threaten the company’s App Store model.
Implications and Future Outlook
The defeat of the BASED Act underscores the formidable influence that major technology companies wield in shaping legislation that affects their operations. The extensive lobbying efforts reflect the industry’s commitment to maintaining control over their platforms and the competitive advantages they hold.
For policymakers and advocates seeking to implement regulations that promote fair competition and consumer protection, this development highlights the challenges posed by well-funded and organized opposition. It also raises questions about the balance of power between state legislatures and multinational corporations in the digital age.
As Senator Wiener contemplates the next steps, the conversation around tech regulation continues to evolve. The outcome of this legislative effort may serve as a catalyst for renewed discussions on how to effectively address the dominance of major tech platforms and ensure a competitive and fair marketplace for all stakeholders.
