Winning friends and influence in Washington isn't cheap. Big Tech has taken a lesson from Big Pharm and spent a fortune on lobbyists.
Led by Microsoft's $2.9 million in spending on lobbying in the first quarter alone,
the IT industry is on track to set a tech lobbying spending record of $119
million in 2008, beating last year's $110 million.
According to numbers compiled by eWEEK from OpenSecrets.org,
a database of political contributions and lobbying spending by the Center for
Responsive Politics, Microsoft is projected to spend more than $10 million on
lobbying in 2008. In 2007, Microsoft spent $9 million in lobbying.
Following Microsoft in amount of projected 2008 lobbying spending are IBM
($7.5 million), Oracle ($4.7 million), Electronic Data Systems ($3.7 million)
and Texas Instruments ($3.6 million). Rounding out the top projected spenders
are EMC ($2.9 million), Yahoo ($2.5 million),
Google ($2.4 million), SAP ($2.3 million)
and Intel ($2.2 million).
"As tech becomes more mainstream, you'll see even more spending on
lobbying," Microsoft spokesperson Ginny Terzano said. "At Microsoft,
we feel it is our responsibility to help shareholders and consumers to get good
policies in place."
And that means spending big dollars to influence members of Congress and
government agency officials. The payoff, though, can be handsome. As
OpenSecrets.org notes, "The money that industries, companies, unions and
issue groups spend on lobbying is often just a drop in the bucket compared to
what they can reap in return if their lobbyists are successful."
For Microsoft and the tech industry, spending on lobbying has increased
every year since OpenSecrets.org began keeping records in 1998. That year, the
industry spent $39 million on lobbying. Since 1998, the tech sector, annually
led by Microsoft, has spent more than $700 million on lobbying.
"Ten years ago, tech lobbying was virtually nonexistent," Terzano
said. "The tech industry has really grown over the last decade and the
issues continue to evolve."
While that $700 million over the last 10 years is impressive, it pales in
comparison with spending by the pharmaceutical industry, which spent $1.3
billion over the same period to win influence in Washington.
Just behind pharmaceuticals was the insurance industry, with $1.1 billion in
lobbying expenditures. The telecommunications industry has spent more than $900
Individually, Microsoft doesn't even make OpenSecrets' list of top 20
lobbying spenders. In 2007, for instance, Microsoft's $9 million was far below
the U.S. Chamber of Commerce's $52.7 million on lobbying. General Electric came
in second with $23.6 million. AT&T spent almost $17 million and Verizon
laid out $12.7 million in lobbying dollars.
"We're a very young, robust industry," Terzano said. "So many
issues that are critical today were totally off the radar 10 years ago. You're
going to see an increase [in lobbying spending] because the [tech] issues are
so much more prevalent."
For the tech industry, those issues include patent reform, immigration
reform and a continuing push for free trade agreements. In the 110th
Congress, tech has so far made only limited progress on those issues.
The U.S. House passed a patent reform bill but the legislation has stalled
in the Senate, largely blocked by pharmaceutical interests. The broader fight
over immigration reform has trip-wired tech's specific interest in more H-1B
visas. Lawmakers are even finding that free trade agreements, a staple of both
Democrats and Republicans, have become sensitive issues.
"You have to work hard to inform lawmakers on those issues,"
For the tech sector, that translates into even more