The US Senate Intelligence Committee’s grilling last week of Facebook, Google, and Twitter told us something we already knew: Russia manipulated the US election results. Only the scale of the effort, which reached roughly half the US population, was a surprise.
It also told us something that we knew, but had forgotten: industry self-regulation rarely works. From turn-of- the-century railroads, through energy markets in the 1990s, to the financial industry circa 2007, there are many examples that bear this out. The tech industry is only the latest case in point.
The contrition and apologies of the executives who sat in front of the committee did not add up to any significant shift, either in business model or philosophy. Rather, their vague promises to “do better,” and claims that they simply can’t track the complexity of their own algorithms just underscores the need for a cohesive regulatory framework around companies that have become monopoly powers, and should ultimately be seen as public utilities.
The problem, of course, is that smart regulation is very tough to craft. Finance is, again, the perfect example of this — the complexity and global fragmentation of the post-2008 regulatory landscape has introduced its own risks into the system.
So how do we create a framework for government oversight of Big Tech that protects consumer and societal interests, curbs growth-dampening monopoly power, and allows us to keep the internet services we depend on? I would argue for a focus on three core principles — transparency, simplicity and size.
Starting with transparency, the internet giants should be required not only to report politically related advertising as other media do (and as the proposed Honest Ads Act would require), but also to use both people and algorithms to track hate-driven search results. As the academic and tech-critic Jonathan Taplin put it to me, “the notion that it’s impossible for Facebook, Google and Twitter to police their platforms is a big lie. They currently do a very good job, using AI, of keeping all pornography off their sites.”
Complexity (or the illusion of it) is too often used to avoid legitimate public interest questions, such as how propagandists get their messages across
This implicitly argues for a re-examination of the legal loopholes in the Communications Decency Act that allow platform companies to eschew responsibility for what is on their sites. And in fact, there has been a significant move in that direction; under pressure, the Internet Association finally announced support late last week for a bipartisan bill to eliminate federal liability protections for websites that knowingly assist, support, or facilitate online sex trafficking, something they had resisted since it would open the door to further tweaks to the act’s liability exemptions.
Transparency for users would also be increased with “opt in” provisions that allow them more control over how their data are used (as is the case with the EU’s General Data Protection Regulation). Ideally, this would be a first step towards a better understanding of how companies themselves value data. As one senior policymaker’s aide pointed out to me, the monetary value of data currently gets shoehorned into “goodwill” on financial statements or, more often, is left out entirely.
Big tech companies should also be required to keep audit logs of the data they feed into their algorithms, and be prepared to explain their algorithms to the public. “A recurring pattern has developed,” says Frank Pasquale at the University of Maryland, “in which some entity complains about a major internet company’s practices, the company claims that its critics don’t understand how its algorithms sort and rank content, and befuddled onlookers are left to sift through rival stories in the press.”
This relates to the point about simplicity. Complexity (or the illusion of it) is too often used to avoid legitimate public interest questions, such as how propagandists get their messages across, or how users are tracked and valued. Companies should help us understand all this by opening the black box of their algorithms. This needn’t be a competitive disadvantage; research has shown that it is the amount of data plugged into an algorithm, rather than the cleverness of the algorithm itself, that is the key here. To the extent that users trust what companies are doing, they may be more willing to part with precious data.
Finally, regulators need to address the size issue. Yes, the services big tech companies offer are great, and mostly free, which allows them to avoid antitrust legislation in the US system, where consumer pricing is considered the measure of power. Yet there are myriad examples of the largest players using their size to steal smaller companies’ ideas and “lowball” them during dealmaking, or to reshape the regulatory framework to serve their own interests.
It is all too reminiscent of the power held by 19th-century railroad barons. They, too, dominated their economy and society. And they, too, were able to price gouge, drive competitors out of business, and avoid taxation and regulation, largely by buying off politicians.
Yet eventually, they were curbed by the creation of the Interstate Commerce Commission. It included some provisions that the industry favoured, as well as many it lobbied against. Rather than crush innovation, the ICC ushered in a period of prosperity by allowing technology benefits to be widely shared. It is time to think hard about whether we need another ICC — an Internet Commerce Commission — to do the same.
rana.foroohar@ft.com
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