Regulating the tech industry is the talk of Capitol Hill. The question is how to do it.
With great power comes great responsibility. And not everyone thinks Big Tech is up to the task.
Big Tech often refers to four tech companies that dominate our lives: Apple, Amazon, Google, and Facebook. Sometimes Microsoft is thrown in with the group. These tech companies are some of the most valuable companies in the US.
Let’s run through some stats.
Founded: By a turtleneck lover (aka Steve Jobs) and his friend Steve Wozniak in 1976
Wallet size: $265 billion in revenue in 2018
Plus ones: App Store, Apple Music, iCloud, Apple TV+
Fan base: According to the company, there are 1.4 billion active Apple devices out there in the world. Everything from iPhones to Apple Watches.
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Founded: By Jeff Bezos in 1994 as Barnes & Noble’s worst nightmare
Wallet size: $232.9 billion in revenue in 2018
Plus ones: Whole Foods
Fan base: Bezos holds Amazon stats close to the vest. But last year he said that there are more than 100 million Prime members in the US.
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Founded: You’ve seen the movie. Mark Zuckerberg and friends. Dorm room. Harvard. Circa 2004
Wallet size: $56 billion in revenue in 2018
Plus ones: Instagram, WhatsApp
Fan base: 2.45 billion monthly users on Facebook
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Note: Last updated in April
Founded: By Larry Page and Sergey Brin in 1998
Wallet size: $136.8 billion in revenue in 2018
Plus ones: YouTube, (recently announced) Fitbit, and Google Maps
Fan base: More than 2 billion people use the co’s Android operating system. Many of its other products have more than 1 billion users (Gmail, Google Maps, Chrome).
In the past few years, the feds, Congress, and state officials have become increasingly concerned that these companies hold too much power over things like prices, have been misusing users’ data, and have too much control over both their respective platforms and the services marketed on them.
Think about it this way: Apple created the App Store, and has control over which apps get featured on it, including its own. Google has its search engine, but it also has services and products that it promotes through that search engine, like Google Shopping. These fall under antitrust concerns. Here are the main issues people are raising with Big Tech:
Antitrust. The question here is: has Big Tech gotten so big that it’s violating antitrust laws by squashing its competition and ultimately hurting consumers? For example, some people think Facebook unfairly maintained a monopoly in social networking by acquiring Instagram and WhatsApp. The Justice Dept, the FTC, state AGs, and Congressional lawmakers are all looking into potential antitrust violations by tech companies. Skimm Notes breaks it down for you:
Election interference. Some point to 2016 as the turning point in growing distrust of Big Tech. Ahead of the presidential election, Russia used social media platforms including Facebook and Twitter to spread disinformation and create division among American voters with the goal of helping President Trump win. Since then, Big Tech has gotten a lot of criticism for not doing more to crack down on foreign interference in the election. Ahead of 2020, the companies have met with gov officials to brainstorm ways to avoid a repeat.
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Privacy. These companies are all up in our business. They know where we are, what we search for online, who we’re calling, how often we check Instagram. And this data is used to target ads to the right customers. That’s only part of the concern. The other part is the fact that there have been multiple data breaches in the past few years and allegations of companies improperly using and sharing consumer info. Last year, Facebook got a lot sh*t after disclosing that data linked to as many as 87 million people might’ve been improperly shared with a co that does targeted political ads. This year, YouTube agreed to pay a $170 million settlement to the FTC over allegations that it illegally collected the info of children. And these are just a few examples.
Good question. California is set to enact a new consumer privacy law next year. But there are concerns about states individually taking on this issue, creating different laws across the country. Congress and the White House agree there needs to be a federal law regulating how companies gather and use data. But there’s been little progress on actually crafting that legislation. Although lawmakers have held multiple hearings on Capitol Hill where they’ve grilled big-name tech execs like Zuckerberg and generally made it clear that they’re not happy with Silicon Valley. In the meantime, here’s what you can do to protect yourself.
These companies are under a microscope. There are now around a dozen inquiries or investigations into these companies across the federal, state, local, and congressional levels. Plus a few resolved cases that ended in Google and Facebook paying hundreds of millions, and in some cases billions in fines.
They’re being asked to answer to the public. Executives have been grilled by lawmakers in public hearings on Capitol Hill, on everything from how they operate their marketplaces to whether they censor conservative voices. And there’s bipartisan support (shocking, we know) for keeping a leash on these companies by regulating.
They’re dealing with growing mistrust. Polls show that close to half of Americans think social media is hurting free speech and democracy, and about half support regulating tech companies. But 40 percent say ‘leave them be.’ So it’s pretty spilt. More recently, Twitter and Facebook have gotten caught up in a showdown over political ads. Facebook policy allows political ads even if they include false or misleading info. Zuckerberg has defended the policy by citing “free expression.” Twitter on the other hand announced plans to ban political ads. It’s just one example of the larger debate about whether and how these platforms should police content, and whether they can self-regulate.
Big Tech revolutionized 21st century life. The way we shop, the way we communicate, what we watch, what we listen to, what we read. Now it faces a reckoning over whether that revolution has harmed consumers. And what happens next could shift the balance of power for some of the most influential companies in the world.
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