It’s hard to avoid paying your dues to big tech, even if you’re running a campaign to break them up.
That is the conundrum in the 2020 field. Yahoo Finance looked through hundreds of thousands of “disbursements” from the presidential campaigns (another way to describe purchases) – on everything from airline tickets to office chairs.
According to the data, the presidential campaigns (including those that have since dropped out) paid over $46 million for goods and services directly from big tech companies like Facebook and Amazon, as well as smaller outfits like Lyft and Spotify. The total cash that ended up in the companies’ pockets last year is likely much much higher and will only grow in 2020.
Sen. Elizabeth Warren’s campaign is a great example. She has a well-publicized plan to break up Amazon (AMZN), Google (GOOG), and Facebook (FB). At the same time, her campaign paid $9.3 million directly to those three companies last year for a range of services: $5.8 million to Facebook, mostly for advertising (including an ad on Facebook mocking the company); $3.2 million to Google for things like advertising when people search for the senator’s name; and just $241,551 to Amazon mostly for “office supplies.”
A range of candidates have made attacking big tech a part of their campaign. Sen. Bernie Sanders has also discussed breaking up the companies. President Trump has repeatedly criticized a perceived liberal bias and noted that “obviously there is something going on in terms of monopoly,” when he was asked about the companies last June.
Each of the nine leading campaigns paid some amount of money - either directly or indirectly – to 4 of the 5 so-called FAANG companies. Facebook, Amazon, Apple and Google received millions. (Netflix was the sole exception with no disbursements showing up.)
Cash for a range of products and services
The big reason these companies are unavoidable is that candidates need digital advertising platforms – that’s how they get access to voter eyeballs. The campaigns paid $28.5 million directly to Facebook and almost $10.6 million directly to Google in 2019. The Google expenditures included advertising, as well as other products like cloud storage and email service.
The campaigns also spent big – around $88 million – on what was categorized as “online” or “digital” advertising, but it wasn’t paid to tech companies. That money largely went to firms with names like Aisle 518 strategies (for Bernie Sanders), Rising Tide Interactive (for Tom Steyer), and American Made Media Consultants (for Donald Trump).
The campaigns pay these political consulting firms, which then buy ads on sites like Facebook and Google. American Made Media Consultants (Trump’s group) was reportedly set up by the campaign itself to handle ad buying.
Other tech companies – even those without advertising platforms – still got significant amounts of money from candidates last year. Amazon got over $1.2 million from the campaigns, largely for purchases of things like office supplies. Apple (AAPL) was paid nearly $1.4 million for laptop computers and iPhones.
The Donald Trump campaign spent plenty on Apple products in 2019 (over $15,000) but leaned more in the PC direction, sending almost $80,000 on Microsoft and Dell products.
Uber (UBER) and Lyft (LYFT) were also big recipients of campaign cash. Most of the rides taken by campaign staffers in 2019 were itemized (around 18,000 instances in total, according to Yahoo Finance’s count) for a grand total of nearly half-a-million dollars in spending (with a few Uber Eats orders in the mix).
Trump’s campaign racked up the biggest ride-sharing bill with a total of $55,905 spent in 2019.
A massive infusion of money from Bloomberg
The filings also show the blizzard of money that entered the race in late 2019, thanks to Mike Bloomberg’s entrance in November.
Much of the early attention focused on the former New York City mayor’s astronomical spending on traditional TV ads but his campaign also spent $8 million for digital advertising on Facebook last year – $1 million went to the company on Nov. 12 (before he’d even announced); $5 million more was spent on Nov. 26 (two days after the campaign became official). And another $2 million was disbursed on Dec. 20.
In spite of being in operation for less than two months in 2019, the Bloomberg campaign was the No. 1 direct purchaser of Facebook ads for the entire year.
The Bloomberg campaign also spent big to get people on the payroll: his campaign paid LinkedIn $43,653 for “staff recruitment.” That apparently was money well spent as the Bloomberg campaign has gone from zero to more than 2,000 staffers in a matter of weeks.
Then he had to equip all those new employees with computers. Bloomberg was the No. 1 campaign for Apple purchases, with a whopping $708,105 spent on Apple products in just a few weeks.
A window into campaign cultures
The spending on smaller tech products also provides a peek inside the different cultures of these campaigns.
Some of the campaigns paid money to Slack, the omnipresent workplace instant messaging platform (that might or might not help productivity). The Biden, Bloomberg, and Klobuchar campaigns were the only Slack-free workplaces among the nine leading presidential campaigns (or at least they didn’t pay the company any money directly).
A number of campaigns used Airbnb, the site for arranging lodging primarily in privates homes, when they were traveling. Andrew Yang’s campaign was by far the biggest spender on the site, dropping over $135,000 in 2019.
One place where that money might have gone is on “group homes” that Yang’s campaign reportedly set up in Iowa during the caucuses for its out-of-state precinct captains. A house in Davenport was reportedly dubbed the "Sorority of Yang."
All the other campaigns combined paid spent about $142,000 on Airbnb.
Pete Buttigieg’s campaign paid for services at perhaps the widest variety of tech companies. Disbursements showed up going to companies like DoorDash, Instacart, Pandora, Roku, and Snapchat. Mayor Pete was one of the biggest spenders on WeWork (for office space) and also bought campaign ads on Microsoft’s Bing search engine.
Much more spending to come
The Federal Election Commission data currently cuts off at the end of 2019. New information will be added each month in 2020.
One of the safest bets in 2020 is that spending will skyrocket overall and on tech companies in particular.
The Trump campaign alone ended 2019 with over $100 million in the bank. Sanders has already announced his fundraising totals for January, bringing $25 million into his campaign to spend on what is looking like it could be a long primary campaign.
Ben Werschkul is a producer for Yahoo Finance in Washington, DC.
Read more:
Why the Iowa caucus fiasco probably helps Mike Bloomberg
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2020-02-07 17:14:00Z
https://finance.yahoo.com/news/presidential-campaigns-are-paying-millions-to-big-tech-companies-while-also-bashing-them-171434676.html
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