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Year in Review: With Key Hires On Antitrust and Looming Regulation, A Look Back at Big Tech in 2021

Big technology companies faced hurdles in 2021 — and it’s only the beginning of a Biden administration crackdown.

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Facebook CEO Mark Zuckerberg.

WASHINGTON, December 29, 2021 – While the world scraped through another year of the coronavirus pandemic, Big Tech was unable to escape unscathed, with the biggest names in the game facing potentially sector altering challenges.

With the rise of a number of key antitrust figures, including Amazon critic Lina Khan heading the Federal Trade Commission, Google critic Jonathan Kanter taking a position in the Justice Department’s antitrust division, and Tim Wu appointed to the National Economic Council, the focus on big tech is set for 2022.

That said, our second in a three-part series on a review of 2021 examines what happened to the big technology companies in 2021.

Section 230

At the outset of 2021, then-president Donald Trump was deplatformed by most major social media platforms in the wake of the January 6 riots at the U.S. Capitol Building. In response, Trump re-ignited the conversation surrounding Section 230 of the Communications Act of 1934, which shields tech platforms of being legally liable for the content their users post.

Even though it may seem that both conservatives and liberals in Congress can come together against Section 230, the reality is their perspectives could not be more at odds.

Republicans tend to believe social media companies are guilty of using Section 230 to stifle conservative speech – a claim that Twitter’s internal research has refuted, at least on their own platform.

Conversely, Democrats believe that these companies are hiding behind Section 230, shirking responsibility, and refusing to be held accountable for the real-life consequences of hateful and dangerous speech on their platforms.

The Big Tech companies have been accused of using Section 230 as a shield to deflect criticisms of how they choose to or choose not to moderate user content that is posted on their social media platforms.

Because of this ideological disconnect, despite all the rhetoric and chest thumping, the needle has not moved on Section 230 in Congress. There have been precious few alternatives put forward to replace Section 230 and protect the smaller companies that would be impacted by a full repeal.

Those who have lampooned Section 230 naysayers often point out that small companies will inevitably be the most impacted by a repeal of Section 230. While Facebook, Twitter, and Google will have the capital necessary to defend themselves in court and adjust their moderation policies, the reasoning goes, small companies will not, and it will simply be too risky for them to host user created content.

While Big Tech will be able to adapt to change made to Section 230, some argue, everyone else could find themselves pushed further to the margins to mitigate their own risk.

Facebook/Meta

Facebook, recently rebranded as Meta, has spent a lot of time in the doghouse this year.

In 2021, the company navigated whistleblowers, the Oversight Board, Section 230 debates, and more – it was even voted “worst company” in a user poll on Yahoo Finance.

Shortly after Trump’s expulsion from Facebook’s social media platforms, the Oversight Board upheld Facebook’s decision as part of its first round of judgements on January 28. In 2021, Oversight Board would pass down 21 binding judgements to Facebook.

The board was Facebook’s answer to mounting criticisms regarding their content moderation policies; Facebook’s critics argued that their policies appeared intentionally vague, and some called for more independent and transparent “oversight.”

Facebook also experienced a tumultuous conclusion to 2021. In October of 2021, Frances Haugen identified herself as the whistleblower behind what would become known as “The Facebook Files.” Haugen would later testify before Congress, claiming that Facebook was not only aware of how its platforms could negatively impact young people, but also that it was cognizant of the role they played in violence in developing nations.

Facebook rebranded itself as Meta on Oct. 21, after Haugen’s testimony.

Apple

Apple found itself at the center of several antitrust and competitive-based issues in 2021.

In Epic Games v. Apple, despite a favorable ruling that did not find Apple to be a monopoly or having had engaged in anti-trust behavior (in nine of ten counts), Apple was found to have to have engaged in anticompetitive practices through its anti-steering policies.

During the case, Epic received support from companies like Spotify and Hinge owner Match Group Inc., saying that they had dealt with similar anticompetitive behavior.

With a market cap of over $600 billion, Apple was also one of only six American firms (alongside Tesla, Microsoft, Amazon, Alphabet Inc., and Facebook) that would be recognized and targeted for additional antitrust bills.

One such bill is H.R. 3816, introduced by Antitrust Subcommittee Chairman David Cicilline, D-Rhode Island. This bill would go so far as to make it illegal for companies to give their own products preferential treatment on their marketplaces.

Among other things, this would likely outlaw the practice of pre-installed applications on phones and other smart devices – a practice that Apple is thoroughly engaged in, steering users to their own proprietary apps while potentially obfuscating alternatives.

Google

Google broke records in 2021, but not all to the company’s benefit. In July of 2021, the Competition Authority of France fined the company nearly $600 million – the largest in the authority’s history – over a failure to negotiate with digital publishers “in good faith” to fairly compensate them for their content, per European Union copyright directives.

Google was also simultaneously sued by 36 states and the District of Columbia over alleged Google Play Store abuses.

In January of 2021, Google squared off with the Australian Government. The case was not dissimilar to the one that would play out in July, whereby France fined the company for $600 million. When faced with legislation that would require Google to compensate content creators for content shared on their engine, Google’s parent company, Alphabet, threatened to shut down the search engine for the island nation.

In September of 2021, Australia struck at Google again, labeling it a monopoly and announcing that it would be taking steps to hamper Google’s ability to sell ads.

Amazon

Google was not the only company breaking records. In 2021, Amazon passed Walmart as the world’s largest retailer outside of China.

In 2021, Amazon acquired Metro-Goldwyn-Mayer for nearly $8.5 billion — nearly its largest acquisition to date, second only to Amazon’s purchase of Whole Foods Market for $13.7 billion in 2017 — and one of the largest mergers in 2021.

The acquisition was one of the most significant moves made in 2021 as the “Streaming Wars” have only heated up. Despite this, Amazon has largely managed to skirt the antitrust conversations that have swirled around the other companies on this list.

But with Khan as the head of the FTC, Amazon is also looking at possible regulatory issues. In fact, earlier this year, it requested that Khan recuse herself or be recused from all matters related to the company due to past statements she has made.

Much of the criticism Amazon has faced has surrounded knock off products hawked by third-party retailers that maintain a presence on Amazon.
For its part, Amazon mostly denies responsibility for the third-parties it platforms, though H.R. 5502, co-sponsored by Rep. Jan Schakowsky, D- Illinois, could change that.

“What we’re saying now is very simply that online marketplaces will have to verify that the identity of their higher volume sellers, so they have to take some responsibility,” said Schakowsky during a hearing on the bill in November.

Though the bill was passed in the House Committee on Energy and Commerce, it still has a long way to go before being passed into law, as it must still pass the House and Senate.

Reporter Ben Kahn is a graduate of University of Baltimore and the National Journalism Center. His work has appeared in Broadband Breakfast, Washington Jewish Week, and The Center Square, among other publications. He primarily covers Big Tech and spectrum policy.

Free Speech

Former GOP Congressman and UK MP Highlight Dangers of Disinformation and Urge Regulation

Will Hurd and Member of Parliament Damien Collins say disinformation on social media platforms a worry in midterm elections.

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Photo of Will Hurd from March 2016 by Paul Morigi used with permission

WASHINGTON, January 11, 2022 – Former Republican Rep. Will Hurd said that disinformation campaigns could have a very concerning effect on the upcoming midterm elections.

He and the United Kingdom’s Member of Parliament Damien Collins  urged new measures to hold tech and social media companies accountable for disinformation.

Hurd particularly expressed concern about how disinformation sows doubts about the legitimacy of the elections and effective treatments to the COVID-19 virus. The consequences of being misinformed on these topics is quite significant, he and Collins said Tuesday during a webinar hosted by the Washington Post.

The Texan Hurd said that the American 2020 election was the most secure the nation has ever had, and yet disinformation around it led to the insurrection at the Capitol.

The British Collins agreed that democratic elections are particularly at risk. Some increased risk comes from ever-present disinformation around COVID and its effects on public health and politics. “A lack of regulation online has left too many people vulnerable to abuse, fraud, violence, and in some cases even loss of life,” he said.

In regulating tech and media companies, Collins said citizens are reliant on whistleblowers, investigative journalists, and self-serving reports from companies that manipulate their data.

Unless government gets involved, they said, the nation will remain ignorant of the spread of disinformation.

Tech companies need to increase their transparency, even though that is something they are struggling to do.

Yet big tech companies are constantly conducting research and surveillance on their audience, the performance of their services, and the effect of their platforms. Yet they fail to share this information with the public, and he said that the public has a right to know the conclusions of these companies’ research.

In addition to increasing transparency and accountability, many lawmakers are attempting to grapple with the spread of disinformation. Some propose various changes to Section 230 of the Telecom Act of 1996.

Hurd said that the issues surrounding Section 230 will not be resolved before the midterm elections, and he recommended that policy-makers take steps outside of new legislation.

For example, the administration of President Joe Biden could lead its own federal reaction to misinformation to help citizens differentiate between fact and fiction, said Hurd.

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Antitrust

CES 2022: Patreon Policy Director Says Antitrust Regulators Need More Resources

To find the best way to regulate technology, antitrust regulators need more tools to maintain fairness in the digital economy.

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Larent Crenshaw (left), head of Patreon's global policy team

LAS VEGAS, January 7, 2021 – The head of Patreon’s global policy team said federal regulators need more resources to stay informed about technology trends.

Laurent Crenshaw told CES 2022 participants Friday that Congress should provide tools for agencies like the Federal Trade Commission to enforce consumer protection standards.

“I’m not going to say that big tech needs to be broken up, but there should be appropriate resources for federal regulators to understand the digital marketplace,” he said. “We’re are still living in a world that is dominated by big actors, and we’re debating about whether to even give federal regulators the power to understand how the marketplace is moving toward digital.”

Crenshaw of Patreon said that more resources were necessary at the FTC in order to understand the digital marketplace. Patreon is a membership platform that provides a subscription service for creators to offer their followers.

Such resources would empower the agency to place appropriate safeguards for smaller technology innovators. “So in 10 [or] 20 years, it’s not just the replacements of the current Google, Apple, or Facebook, but something entirely new,” he said.

Panelists echoed Crenshaw’s point that consumer welfare should guide competition policy. Tyler Grimm, chief counsel for policy and strategy in the House Judiciary Committee, said that antitrust should bend to the consumer welfare standard. “Antitrust should leave in its wake a better economy,” he said.

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Section 230

Greene, Paul Social Media Developments Resurface Section 230 Debate

Five days into the new year and two developments bring Section 230 protections back into focus.

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Georgia Republican Representative Marjorie Taylor Greene

WASHINGTON, January 5, 2022 – The departure of Republican Kentucky Senator Rand Paul from YouTube and the banning of Georgia Republican Representative Marjorie Taylor Greene from Twitter at the beginning of a new year has rekindled a still lit flame of what lawmakers will do about Section 230 protections for Big Tech.

Paul removed himself Monday from the video-sharing platform after getting two strikes on his channel for violating the platform’s rules on Covid-19 misinformation, saying he is “[denying] my content to Big Tech…About half of the public leans right. If we all took our messaging to outlets of free exchange, we could cripple Big Tech in a heartbeat.”

Meanwhile, Greene has been permanently suspended from Twitter following repeated violations of Twitter’s terms of service. She has previously been rebuked by both her political opponents and allies for spreading fake news and mis/disinformation since she was elected in 2020. Her rap sheet includes being accused of spreading conspiracy theories promoting white supremacy and antisemitism.

It was ultimately the spreading of Covid-19 misinformation that got Greene permanently banned from Twitter on Sunday. She had received at least three previous “strikes” related to Covid-19 misinformation, according to New York Times. Greene received a fifth strike on Sunday, which resulted in her account’s permanent suspension.

Just five days into the new year, Greene’s situation – and the quickly-followed move by Paul – has reignited the tinderbox that is Section 230 of the Communications Decency Act, which shields big technology platforms from any liability from posts by their users.

As it stands now, Twitter is well within its rights to delete or suspend the accounts of any person who violates its terms of service. The right to free speech that is protected by the First Amendment does not prevent a private corporation, such as Twitter, from enforcing their rules.

In response to her Tweets, Texas Republican Congressman Dan Crenshaw called Greene a “liar and an idiot.” His comments notwithstanding, Crenshaw, like many conservative legislators, has argued that social media companies have become an integral part of the public forum and thus should not have the authority to unilaterally ban or censor voices on their platforms.

Some states, such as Texas and Florida, have gone as far as making it illegal for companies to ban political figures. Though Florida’s bill was quickly halted in the courts, that did not stop Texas from trying to enact similar laws (though they were met with similar results).

Crenshaw himself has proposed federal amendments to Section 230 for any “interactive computer service” that generates $3 billion or more in annual revenue or has 300 million or more monthly users.

The bill – which is still being drafted and does not have an official designation – would allow users to sue social media platforms for the removal of legal content based on political views, gender, ethnicity, and race. It would also make it illegal for these companies to remove any legal, user generated content from their website.

Under Crenshaw’s bill, a company such as Facebook or Twitter could be compelled to host any legal speech – objectionable or otherwise – at the risk of being sued. This includes overtly racist, sexist, or xenophobic slurs and rhetoric. While a hosting website might be morally opposed to being party to such kinds of speech, if said speech is not explicitly illegal, it would thus be protected from removal.

While Crenshaw would amend Section 230, other conservatives have advocated for its wholesale repeal. Sen. Lindsey Graham, R-South Carolina, put forward Senate Bill 2972 which would do just that. If passed, the law would go into effect on the first day of 2024, with no replacement or protections in place to replace it.

Consequences of such legislation

This is a nightmare scenario for every company with an online presence that can host user generate content. If a repeal bill were to pass with no replacement legislation in place, every online company would suddenly become directly responsible for all user content hosted on their platforms.

With the repeal of Section 230, websites would default to being treated as publishers. If users upload illegal content to a website, it would be as if the company published the illegal content themselves.

This would likely exacerbate the issue of alleged censorship that Republicans are concerned about. The sheer volume of content generated on platforms like Reddit and YouTube would be too massive for a human moderating team to play a role in.

Companies would likely be forced to rely on heavier handed algorithms and bots to censor anything that could open them to legal liability.

Democratic views

Republicans are not alone in their criticism of Section 230, however. Democrats have also flirted with amending or abolishing Section 230, albeit for very different reasons.

Many Democrats believe that Big Tech uses Section 230 to deflect responsibility, and that if they are afforded protections by it, they will not adjust their content moderation policies to mitigate allegedly dangerous or hateful speech posted online by users with real-world consequences.

Some Democrats have written bills that would carve out numerous exemptions to Section 230. Some seek to address the sale of firearms online, others focus on the spread of Covid-19 misinformation.

Some Democrats have also introduced the Safe Tech Act, which would hold companies accountable for failing to “remove, restrict access to or availability of, or prevent dissemination of material that is likely to cause irreparable harm.”

The reality right now is that two parties are diametrically opposed on the issue of Section 230.

While Republicans believe there is unfair content moderation that disproportionately censors conservative voices, Democrats believe that Big Tech is not doing enough to moderate their content and keep users safe.

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