
Regulation could protect Facebook, not punish it - shahocean
https://techcrunch.com/2018/03/25/the-regulation-moat/
======
beefield
I can think of three relevant regulations for (large) internet companies

1\. Strong anti-monopoly regulation. There is no reason for Facebook owning
Whatsapp & Instagram.

2\. Once your revenue exceeds x million USD on ad supported services that are
free for end users, you must offer the service also for money with reasonable
margin on top of the actual production costs, with strong guarantees that the
data of end user who has opted for paid service is kept private and not
monetized anyhow.

3\. Once your revenue on ad supported services that are free to end users
exceed y million USD, you must make easily available every single usage of the
end user's data. Also, user must have right to prohibit any specific type of
use of user's data.

~~~
JumpCrisscross
> _Once your revenue exceeds x million USD on ad supported services that are
> free for end users, you must offer the service also for money with
> reasonable margin on top of the actual production costs, with strong
> guarantees that the data of end user who has opted for paid service is kept
> private and not monetized anyhow_

I like the size threshold but not the solution. Toying with business models
should be a solution of last resort.

Simpler: for companies with more than X users or Y gross revenues, an American
GDPR. Consumers get an absolute right to audit and delete their data. Explicit
consent is required for each instance of third-party sharing. Companies are
liable to their users for breaches, with a minimum amount directly claimable
by users through an easily-accessibly regulator.

~~~
amluto
Why a size threshold? An American GDPR seems like a fine idea, especially if
it’a similar enough to GDPR that complying with one gets the other for free.

~~~
mattnewton
Size threshold is presumably to allow small startups to grow and explore
models without crushing compliance costs. That’s the kind of regulation that
protects incumbents who can afford the lawyers and software tools to do
compliance properly.

There tends to be an inverse relationship between regulation in a space and
incumbents springing up, for better or for worse

~~~
amluto
There's a fine line between "grow and explore models without crushing
compliance costs" and "break all the rules so you can outcompete established
players". Hi, Uber!

------
twblalock
It's well known at this point that regulations tend to protect incumbents in
many industries by making it more expensive for startups to compete.

Industry support for regulations can seem counter-intuitive -- why would a
company want to increase its cost of doing business? But it makes sense when
you consider that the costs are an anti-competitive weapon. One example is
when Philip Morris supported FDA regulations of cigarettes:
[http://www.slate.com/articles/business/moneybox/2002/07/smok...](http://www.slate.com/articles/business/moneybox/2002/07/smoke_screen.html)

So, we should be very careful about how we regulate companies' use of customer
data, lest we make it even more difficult for Facebook's competitors.

~~~
bitumen
I really don’t care if building codes, automotive safety regulations, and
standards of medical care make it hard on new businesses. My priorities are
not dying in a car crash, my home not falling on my head, and avoiding
incompetent doctors. Regulation on tobacco may have helped incumbents stay
incumbent, but it also led to record judgements against the, and the rapid
decline of their industry in the developed world. That it’s harder for a
tobacco startup to get off the ground is a bonus.

~~~
brrrrr
Except Facebook isn’t cigarettes, dude. No matter how much you want it to be
cigarettes, it just isn’t.

Facebook is a boredom cure at best, and at times it can be a version of the
cold, hard, cringey truth. You might complain that Facebook harms mental
health, but the reality is that sometimes the truth is the most depressing
thing to learn.

If Facebook does harm by preventing enough escapism, there’s no regulatory
cure to fix that. You’ll just have to wait for the tide to shift. But hey,
look at that, today’s your lucky day...

~~~
dwaltrip
Facebook, and large scale social media in general, does harm by substituting
for genuine real-world social interaction, by warping our perception of other
people's lives (highlight-reel effect on steroids), by pushing us to become
egotistical "self-marketers", and by hijacking our attention via insidious
manipulation of the lizard brain.

~~~
brrrrr
Hmmm, not quite. See, that’s the part about the boredom cure I mentioned.

People really are that bored. People’s lives are frequently very lackluster
and uneventful. This is plainly obvious, because whenever someone delightfully
ordinary (yet comfortable with that) comes along, it seems like such a breath
of fresh air amongst all the puffed out try-hards that grab so much attention.

The cringey reality check is the depressing part that creates the anxiety of
never wanting to leave the house. People have a hard time differentiating
between bullshit and not bullshit.

It’s not entirely correct to blame Facebook in particular for the inadequacy
felt, when comparing one’s self to someone else’s carefully currated (yet
seemingly natural) photo album.

That part of the debate is just the bulemia-caused-by-waif-as-fashion-model-
redux. You can’t fix that by removing Facebook from the equation, because
people will never stop beautifying their profile pics and cherry picking
exclusive-yet-swollen friend lists.

So we’ll cure it by all jumping ship to Mastodon, where the photo albums will
be crappier and less enviable, and we’ll all be less cringey? That’s the plan?

This isn’t about elections at all, is it?

~~~
dwaltrip
That's why I mentioned broader social media in general. This problem isn't
specific to Facebook alone.

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walterbell
[https://www.eff.org/deeplinks/2018/03/how-fosta-will-get-
hol...](https://www.eff.org/deeplinks/2018/03/how-fosta-will-get-hollywood-
filters-theyve-long-wanted)

 _" The not-so-secret goal of SESTA and FOSTA is made even more clear in a
letter from Oracle. “Any start-up has access to low cost and virtually
unlimited computing power and to advanced analytics, artificial intelligence
and filtering software,” wrote Oracle Senior VP Kenneth Glueck. In his view,
Internet companies shouldn’t “blindly run platforms with no control of the
content.”

That comment helps explain why we’re seeing support for FOSTA and SESTA from
odd corners of the economy: some companies will prosper if online speech is
subject to tight control. An Internet that’s policed by “copyright bots” is
what major film and record studios have advocated for more than a decade now.
Algorithms and artificial intelligence have made major advances in recent
years, and some content companies have used those advances as part of a push
for mandatory, proactive filters. That’s what they mean by phrases like
“notice-and-stay-down,” and that’s what messages like the Oracle letter are
really all about."_

~~~
tehwebguy
People who think like this should be VP of anything, I’m not surprised he’s at
Oracle.

------
AndrewKemendo
_Techies take the job because they wake up each day believing that they’re
having a massive positive influence by connecting the world._

I don't think this is really the case anymore - at least from the FB engineers
I know.

Great engineers are at FB because they get to deploy really interesting
projects on the largest platforms in the world with best in class
technologies, or get to work on cutting edge AI research (FAIR) or interfaces
(Oculus).

The whole "connect the world" thing seems to be an afterthought at best for
most.

~~~
rock_hard
I don't find that to be true for the people I know who work at FB
though...they all deeply believe in connecting the world.

Deploying code to a billion people is only thrilling the first time anyways

------
bsbechtel
A good way to think about regulation and Facebook might be, would you rather
continue using Facebook, knowing the government is supposedly regulating them,
but you can never know for sure, or would you rather move on to a new and more
interesting platform where privacy and security defaults are integrated into
the platform from day one? Regulation that Facebook can point to and say,
"See, we are following to rules!" will make it harder to convince your friends
to leave Facebook.

~~~
majewsky
That's implying that your friends would consider leaving Facebook _at all_
because of privacy issues. If, instead, your choice is between "friends on
unregulated FB" and "friends on regulated FB", I'd prefer the latter option.

~~~
bsbechtel
Then how do you confirm Facebook is complying, and how do you confirm that the
regulation they need to follow is sufficient, and if it's not, how do you
really create any change to make it sufficient?

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arzt
In investment parlance the government would build them a moat. Companies with
capital to maintain compliance will have a head start on any startup looking
to unseat them. Should this come, it will be a lot harder to start a startup.

------
protomyth
If regulators really wanted to stop the abuse by Facebook and every ad
company, they would outlaw the collection of any tracking data of users on any
website except the ones you own (website operators have security needs).
Embedded content in other websites (via any means including iframes) not owned
by your company could not record tracking data or insert data into the user's
browser (e.g. cookies, custom urls, Web SQL Databases). Any sharing of user
data with other companies is illegal. Cannot abuse what you don't have.

I expect any legislation to make competition with Facebook very difficult.

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andrew-lucker
privacy regulations = Facebook loses. compliance regulations = Facebook wins.

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cinquemb
I think that future (social) data-mining startups will need to address these
things in order to be regulatory agnostic (on top of the general
product/market fit):

\- solving the decentralized infrastructure: as nodes get taken offline, they
can replace themselves, and service is still usable

\- solving payments for services to third parties that aren't directly the
users: cannot rely on traditional payments infrastructure, since that is
easily co-opted by regulatory bodies and be used agaisnt the developers/owners
of such services since those have traditionally tied ones identity to such
payment information.

------
IBM
Privacy regulations have value independent of its effects on competition.
Making a Rube Goldberg argument about how it might end up benefiting Facebook
ignores that fact.

The solution to market dominance is antitrust enforcement.

~~~
ianai
I wanted to make this comment but you made it for me.

Only breaking at least one tech giant up will ever change the status quo. In
FBs case that could be very simple - in theory. They’re only allowed to
operate over specific geographic regions, say states in the US and feature (IM
separate from profile separate from gaming) In practice, though, they're
probably too big and global to be broken up.

------
otakucode
That is the typical situation. Regulation protects the entrenched large
organizations who are mostly 'grandfathered' in and set the standard for what
is permissible. And it then shelters the giants from competition coming from
smaller organizations. This is how companies ossify themselves into the larger
structure of government.

------
908087
The whole "we shouldn't regulate Facebook because it will help Facebook" thing
really seems like an underhanded attempt at tricking privacy advocates and
others to fight against their own best interests.

In reality, it depends entirely on the details of the regulations.

------
osteele
danah boyd wrote in a 2010 essay (“Facebook is a utility; utilities get
regulated”,
[http://www.zephoria.org/thoughts/archives/2010/05/15/faceboo...](http://www.zephoria.org/thoughts/archives/2010/05/15/facebook-
is-a-utility-utilities-get-regulated.html)):

“In my post yesterday, I emphasized that what’s at stake with Facebook today
is not about privacy or publicity but informed consent and choice. Facebook
speaks of itself as a utility while also telling people they have a choice.
But there’s a conflict here. We know this conflict deeply in the United
States. When it comes to utilities like water, power, sewage, Internet, etc.,
I am constantly told that I have a choice. But like hell I’d choose Comcast if
I had a choice. Still, I subscribe to Comcast. Begrudgingly. Because the
“choice” I have is Internet or no Internet.

“I hate all of the utilities in my life. Venomous hatred. And because they’re
monopolies, they feel no need to make me appreciate them. Cuz they know that
I’m not going to give up water, power, sewage, or the Internet out of spite.
Nor will most people give up Facebook, regardless of how much they grow to
hate them.”

and

“Thus far, in the world of privacy, when a company oversteps its hand, people
flip out, governments threaten regulation, and companies back off. This is not
what’s happening with Facebook. Why? Because they know people won’t leave and
Facebook doesn’t think that regulators matter. In our public discourse, we
keep talking about the former and ignoring the latter. We can talk about
alternatives to Facebook until we’re blue in the face and we can point to the
handful of people who are leaving as “proof” that Facebook will decline, but
that’s because we’re fooling ourselves. If Facebook is a utility – and I
strongly believe it is – the handful of people who are building cabins in the
woods to get away from the evil utility companies are irrelevant in light of
all of the people who will suck up and deal with the utility to live in the
city. This is going to come down to regulation, whether we like it or not.

“The problem is that we in the tech industry don’t like regulation. Not
because we’re evil but because we know that regulation tends to make a mess of
things. We like the threat of regulation and we hope that it will keep things
at bay without actually requiring stupidity. So somehow, the social norm has
been to push as far as possible and then pull back quickly when regulatory
threats emerge. Of course, there have been exceptions. And I work for one of
them. Two decades ago, Microsoft was as arrogant as they come and they didn’t
balk at the threat of regulation. As a result, the company spent years mired
in regulatory hell. And being painted as evil. The company still lives with
that weight and the guilt wrt they company’s historical hubris is palpable
throughout the industry.

“I cannot imagine that Facebook wants to be regulated, but I fear that it
thinks that it won’t be. There’s cockiness in the air. Personally, I don’t
care whether or not Facebook alone gets regulated, but regulation’s impact
tends to extend much further than one company. And I worry about what kinds of
regulation we’ll see. Don’t get me wrong: I think that regulators will come in
with the best of intentions; they often (but not always) do. I just think that
what they decide will have unintended consequences that are far more harmful
than helpful and this makes me angry at Facebook for playing chicken with
them. I’m not a libertarian but I’ve come to respect libertarian fears of
government regulation because regulation often does backfire in some of the
most frustrating ways. (A few weeks ago, I wrote a letter to be included in
the COPPA hearings outlining why the intention behind COPPA was great and the
result dreadful.) The difference is that I’m not so against regulation as to
not welcome it when people are being screwed. And sadly, I think that we’re
getting there. I just wish that Facebook would’ve taken a more responsible
path so that we wouldn’t have to deal with what’s coming. And I wish that
they’d realize that the people they’re screwing are those who are most
vulnerable already, those whose voices they’ll never hear if they don’t make
an effort.”

------
mkempe
What other reasons would there be for Zuckerberg to _invite_ regulation of the
social networks his company dominates?

