The verified Twitter Inc. page of Cambridge Analytica, displaying their logo and company name, sit on an iPhone against a backdrop of the Facebook Inc. sign. (Photographer: Luke MacGregor/Bloomberg)

Facebook Set Lobbying Record Amid Cambridge Analytica Furor

(Bloomberg) -- Facebook Inc. set a lobbying record in the first three months, just as an uproar flared up the leak of data on millions of users’ without their permission.

The company spent $3.3 million, according to disclosures filed with the government Friday, up from the $3.21 million it spent in the same period a year earlier, which represented the company’s prior high.

The world’s largest social-media company lobbied on issues including federal privacy legislation, online advertising, internet privacy and security, the filing said. It also referred to "general discussions on data breach," without providing further details. A company representative didn’t immediately respond to a request for clarification about what the data breach lobbying referred to.

Toward the end of the first quarter, Facebook was hit by revelations that data on millions of users had been improperly obtained by Cambridge Analytica, a firm that worked on President Donald Trump’s 2016 election campaign. Chief Executive Officer Mark Zuckerberg was grilled on the issue by Congress in April and some members of both parties are considering privacy legislation.

Tech Under Scrutiny

Tech companies including Alphabet Inc.’s Google, Facebook and Amazon.com Inc. are being scrutinized in Washington over their responsibility for online content, potential market dominance, and competition for government contracts. Some on Capitol Hill are calling for more regulation of the sector.

Among the tech giants, Google spent $5.02 million on lobbying in the first quarter, up 43 percent from a year earlier and 14 percent from the last quarter of 2017, according to its filing. Firms representing its subsidiaries had yet to report as of Friday evening. The company, which is routinely the top spender in the tech sector, set a company record of $5.93 million in the second quarter of 2017.

Microsoft disclosed spending $2.3 million on lobbying in the first quarter, including on the data-request bill, the same as a year earlier and up 6 percent from the fourth quarter. Amazon spent $3.38 million in first three months, up 17 percent from a year earlier and 2 percent higher than the fourth quarter, the disclosures show. Apple Inc. spent $2.14 million, up 53 percent from a year earlier and 33 percent from the fourth quarter.

Facebook lobbied the White House, the Senate, the House of Representatives and government agencies including the Federal Trade Commission and Federal Communications Commission, the company also said in its disclosure.

Endured Criticism

The social media site had already endured more than a year of criticism for its role in the spread of fake news, online extremism and Russia’s campaign to swing the 2016 presidential election to Trump.

Facebook also disclosed lobbying on a bill that would increase transparency requirements for online political advertising -- a measure that the company announced it would support as it responded to Cambridge Analytica fallout in April.

Google worked on issues including tax reform, antitrust and legislation that curbs the online sex trade. The bill, which became law in April, creates liability for sites that knowingly facilitate sex trafficking. It represents one of the first U.S. efforts to weaken legal protections for online platforms and many companies in the tech sector spent the first three months of the year focused on the legislation.

In addition to the companies’ spending, the Consumer Technology Association trade group spent $1.07 million during the quarter, according to filings, up from $1.05 million in the first quarter of 2017.

Anti-Tariffs

The association is one of several lobbying groups in Washington that have criticized Trump’s proposed trade tariffs, arguing they will hurt U.S. consumers and the economy. The CTA lobbied on the North American Free Trade Agreement and proposed tariffs, according to its filing.

More than 100 representatives from technology, retail, agriculture, manufacturing and other sectors have joined a rare coalition of business groups that say the tariffs on $150 billion in Chinese goods are counterproductive to the goal of holding Beijing accountable for alleged intellectual property theft and other trade practices.

Several tech companies -- including Facebook, Google and Microsoft -- also disclosed lobbying on a measure introduced in Congress Feb. 6 to clarify the handling of cross-border data requests from law enforcement. They had previously disclosed their support for the measure.

Cloud Wars

In addition to battles over legislation and regulation, several tech companies are competing over a multibillion dollar contract to provide the Defense Department’s cloud computing. Oracle Corp., a late entrant into the cloud market that provides several federal agencies with its flagship databases, led an informal coalition that also included Microsoft, IBM, Dell Technologies Inc. and Hewlett Packard Enterprise Co.

The group’s goal was to make sure that the award process is opened up to more than one company and to unseat Amazon as the perceived front-runner for the award, which could last up to a decade.

The anti-Amazon group has already claimed some significant victories, including Congress’s directive to the Pentagon in the $1.3 trillion spending bill passed in March to explain why it’s planning a single source award for the cloud contract.

In Pentagon responses to industry concerns, the department made clear it doesn’t plan to budge from its decision to award a single contract while emphasizing eventual winner could be made up of a team of companies.

Cloud Act

The bill landed as the Supreme Court considered a case focused on U.S. law enforcement requests for data held overseas by Microsoft. The high court heard the case Feb. 26, and several justices expressed support for the government in its battle with the company. The measure, known as the Cloud Act, was then tucked into a massive spending bill that Congress passed in late March, and the Supreme Court dropped the case April 17.

Several of the companies also disclosed lobbying on immigration. Many of them employ high-skilled immigrants and have thrown themselves into debates and lawsuits over the fate of undocumented immigrants who were brought to the U.S. as children.

©2018 Bloomberg L.P.