What exactly is What is "American Act of Innovation, Choice and Technology Online Act"?

...and how does it impact the small-scale business you run?

Recently this year, an amendment to the American Innovation and Choice Online Act (AICOA) was proposed to reduce the power of tech firms. If approved, this legislation would prevent self-preferencing in businesses such as Amazon and Google.

In this article we'll look at the purpose that is the goal of AICOA. Then, we'll show you how it could affect the small-scale business you run. Let's get started!

A Brief Introduction to the American Innovation and Choice Online Act (AICOA)

The AICOA is a proposed bill by bipartisan senators on the 18th of October 18, 2021. The legislation is designed to stop the tech giants from using their power to attack smaller competitors.

The bill is applicable on "covered platforms" These are web-based businesses with at least 50 million monthly active users or 100,000 monthly business users. If passed, the legislation would affect large companies such as Amazon, Apple, Alphabet and Meta.

Senators introduced the legislation in order to prevent large companies from promoting their own products. If a company favors its products over other rivals, it may be subject to civil fines.

One of the senators who introduced the bill, Senator John Kennedy, claims that the bill will broaden consumer options. According to Kennedy, the bill would "help offer consumers more options with competitive pricing from companies online, which is what it is that the American economy should do best".

The potential pros and cons of the AICOA

Now that you're aware of the American Innovation and Choice Online Act Let's talk about some possible benefits and drawbacks to the legislation.

Pros:

Advocatesof the AICOA claim that the bill will restrict the influence of large tech companies. Through preventing self-preferencing, the bill could enable smaller businesses to gain more visibility and the ability to increase sales.

Industry groups such as the National Association of Wholesaler-Distributers (NAW) claim that big tech companies control and abuse the ecommerce market. This bipartisan bill could address these concerns and allow consumers to purchase products offered by smaller to mid-sized enterprises.

Cons:

Although this bill could offer certain benefits, there has been some resistance. Opposersof the bill say they believe that the AICOA could actively harm consumers.

A few companies, including Amazon are looking for less expensive options for their customers. The bill may stop them from performing this kind of service. Instead of identifying products that may appeal to consumers, big tech companies may start recommending items based on the regulations of government.

In this case, Fulfillment by Amazon could mark less items as being eligible for Amazon Prime, leading to the buyers having fewer choices:

Furthermore, this situation might hinder smaller firms from selling on Amazon. As such, it can reduce the overall revenues of businesses.

How the AICOA Could Impact Small Business Owners

Even though the AICOA concentrates on large technology companies, it could impact small companies.

If the bill is approved, Google may be prohibited from listing this vital information. Applications like Google Maps may not be able to integrate correctly..

This means that when users use the internet to search for local businesses, they may not find relevant information, including storefront opening hours, address, and contact information:

However, the AICOA may have some benefits. If approved, it will aid small businesses in competing on the internet against large tech firms.

A majority of small and medium-sized businesses have voted in support of the bill as it targets self-preferencing. In a letter sent by the Senate Judiciary Committee, business proprietors claimed it would "help restore competitiveness in the online marketplace and eliminate barriers that hinder consumers to pick the service they want".

If big tech firms such as Amazon expand and dominate the e-commerce market, they may become dominant and make it difficult for smaller businesses to compete. The new law could reduce the power of large corporations and let consumers back smaller companies.

Conclusion

Here's a quick breakdown. If passed, the American Innovation and Choice Act (AICOA) may impact the following aspects:

• Big tech companies would have no more the ability to market their goods against their competitors.
• This could lead to more publicity for smaller businesses.
• However, it can also remove useful devices.
• Could potentially limit the number of choices available for customers.

Are you having any concerns concerning the effects on the American Innovation and Choice Act on your business? Let us know in the comment section below!

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