WASHINGTON — President Biden on Friday will encourage federal agencies to crack down on the way major tech companies grow through mergers and gain a competitive advantage by leveraging reams of consumer data, as part of a larger executive order aimed at dispersing corporate consolidation throughout the economy.
The executive order includes several measures specifically targeting big tech companies like Google, Facebook, Apple and Amazon, people with knowledge of its contents said.
The order will tell the federal agencies that approve mergers that they should scrutinize the tech industry’s practices more closely. A second provision will encourage the Federal Trade Commission to write rules limiting how the tech giants use consumer data, a response to criticism that companies like Amazon can leverage what they know about users to gain the upper hand on competing services and businesses.
The order is Mr. Biden’s latest acknowledgment of concerns that the tech giants have obtained outsize market power, becoming gatekeepers to commerce, communications and culture. A growing group of lawmakers, academics and rival companies say government regulators failed to check the growth of the companies for more than a decade. To address the companies’ market power, they say, policymakers need to aggressively enforce antitrust laws and possibly rewrite them to better capture Silicon Valley’s business models.
Mr. Biden has already put some vocal critics of Big Tech in leadership positions. In the White House, he appointed Tim Wu, a Columbia University law professor and outspoken proponent of breaking up companies like Facebook, as a special adviser on competition. He named Lina Khan as chair of the Federal Trade Commission. Ms. Khan has also called for the breakup of big tech companies and worked on a House antitrust investigation into Amazon, Apple, Facebook and Google.
Big Tech’s critics also often argue that the economy on a whole has become more concentrated to the detriment of consumers — including in industries like agriculture, medicine and fashion. And some White House officials hope the order will hark back to the presidency of Franklin D. Roosevelt, who highlighted the rise of big business and installed government officials opposed to concentration, the people said.
But his administration is limited in its reach. The Federal Trade Commission and the Federal Communications Commission are independent agencies that enforce existing antitrust and communications laws. Those laws have barely changed since before the mass adoption of the internet.
House lawmakers have advanced a handful of proposals to strengthen the agencies’ hands, but those bills are expected to face fierce resistance. White House officials said the new directives, which are expected to be released in full on Friday, didn’t necessarily need an act of Congress to broaden the agencies’ abilities, the people familiar with their contents said. In many cases, regulators have held back on enforcing existing laws and creating new rules, they said.
One of the targets of the executive order are mergers where big tech companies buy small companies that could become fierce competitors, snuffing out a rival before it gets off the ground. The directives encourage the agencies to revisit the guidelines they use to assess proposed deals, including when a company is buying a young competitor or a major cache of data that could help it reach dominance.
The order will also ask the F.C.C. to adopt new restrictions on the practices of broadband internet providers like Comcast, AT&T and Verizon. Activists have long said consumers have too few choices, and pay too much money, for internet service.
Mr. Biden will also encourage the F.C.C. to reinstitute so-called net neutrality rules that barred internet providers from blocking certain content, slowing down its delivery or letting clients pay more to have their content delivered faster. The agency adopted the rules during the Obama administration and then rolled them back under President Donald J. Trump.
While Mr. Biden’s order encourages more aggressive enforcement of antitrust laws, it also underscores another fact: He has yet to appoint permanent leaders to several positions in the government that police competition.
He has not yet nominated anyone to lead the Department of Justice’s antitrust division. And he has yet to name a permanent chair of the F.C.C., although Jessica Rosenworcel, a Democratic commissioner, has been filling the role in an interim capacity.