Technology and Politics (Exponent Podcast)

In 2014, Ben and James were talking about the system being “rigged”, anticipating political developments slightly more than 1 year later.


Are the recent debates on net neutrality, the protests of Google buses, even SOPA a sign of things to come? Building on Ben’s article The Net Neutrality Wake-up Call Ben and James discuss the intersection of technology and politics.

  • Why do people in technology tend to dislike politics?
  • Is net neutrality really that important and understanding open loop unbundling
  • The tech industry and creative destruction: is it good for society when companies go out of business?
  • The impact of money on politics
  • Why tech and politics are on a collision course
  • What we can do to effect change on an individual basis


I Compete With Facebook, and It’s No Monopoly

Ignore the misguided calls for antitrust enforcement. Net neutrality is the way to keep social media free.

I’m chief executive officer of a social network that competes with Facebook , so you might expect I’d agree with those seeking to break up Facebook in the name of fair competition. In fact, I strongly oppose the idea. I don’t believe Facebook is a monopoly.

Regulatory officials, presidential candidates and even a Facebook co-founder are among those who’ve asserted that Facebook has become so big and powerful that it stifles all competitors, leaving social-media users nowhere else to turn. Yet my company, MeWe, is not only surviving but thriving. The free market is alive and kicking.

One reason Facebook is vulnerable to competition is that its business practices are off-putting to social-media users. According to a 2018 Pew survey, 44% of users 18 to 29 deleted Facebook the prior year. As I’ve often said, Facebook is a data company masquerading as a social network. Facebook’s business is based on harvesting data from its users, both on the site and off, then charging advertisers to target them.

In contrast, MeWe is a full-featured social network engineered with privacy-by-design that’s freemium-based with no ads, targeting or newsfeed manipulation. Marketers and election meddlers cannot target or boost anything to anyone. These are significant competitive differentiations.

Those advocating Facebook’s breakup cite antitrust enforcements throughout American history as precedents. But they don’t square with today’s realities. In 1911, when the Supreme Court ordered the Standard Oil Trust to break up into 34 independent companies, it had rock-solid reason to do so. Standard owned 90% of U.S. oil production and engaged in the unfair practice of jacking up prices in areas with no competition and lowering prices where competition was active. Facebook cannot underprice its competitors out of existence because most social networks are free.

In U.S. v. Paramount Pictures (1948), the high court ruled against movie studios that used their ownership of theaters to ensure that only their own pictures were shown. This prevented smaller studios from distributing their films and moviegoers from seeing them. Today, content creators are free to distribute their content anywhere on the web, and Facebook has no way of preventing users from accessing that content.

In the 1970s, AT&T was the sole telephone provider in most of the U.S., and most phone equipment was produced by an AT&T subsidiary, Western Electric. This screamed monopoly, which is why the government forced AT&T to split into seven “Baby Bells” in 1984. A clear difference between the old AT&T and Facebook is that the former left consumers with no options. If you wanted to phone your aunt, you had to use AT&T. This is not the case with Facebook; there are other social networks to choose from.

Some have argued that Facebook’s ability to outspend smaller social networks makes it impossible for them to compete. I’ve seen firsthand that this is not a competitive barrier. MeWe has achieved breakout growth from word-of-mouth alone.

Others have pointed to Facebook’s aggressive acquisition strategy—92 companies since 2007. Most have been technology companies specializing in areas such as artificial intelligence and facial recognition, along with social-networking and messaging apps such as Instagram and WhatsApp. While this may look like an anticompetitive strategy, there are still successful social networks such as Snapchat, Twitter , YouTube and MeWe. If today Facebook were to acquire Twitter or Snapchat, this would be of greater concern.

The way to keep social media truly competitive is not to break up Facebook but to reinstate net neutrality. That would even the playing field and allow startups to compete on equal footing with giants like Facebook and Google. If internet service providers start charging for special privileges such as internet “fast lanes,” deep-pocketed companies would be able to squeeze out smaller competitors that can’t afford such costs.

While Facebook should be held to account for transgressions such as privacy violations and election interference, breaking up the company wouldn’t solve these problems. It would likely create a handful of mini-Facebooks that engage in the same practices. Let the free market, secured by net neutrality, do its work. As users discover new social networks that fit their values and tastes, they, not regulators, will decide which ones thrive. Millions are already making their voices heard.

Brett Kavanaugh Has Shown Deep Skepticism of Regulatory State

As an appellate judge in Washington, President Trump’s Supreme Court pick is known for ruling against regulators he sees as having overstepped their bounds

His dozen years on the U.S. Circuit Court of Appeals for the D.C. Circuit have been marked with dozens of votes to roll back rules and regulations. He has often concluded that agencies stretched their power too far and frequently found himself at odds with the Obama administration, including in dissents he wrote opposing net-neutrality rules and greenhouse-gas restrictions.

.. When a divided Supreme Court in 2015 rejected the Obama administration’s rules requiring power plants to cut mercury emissions and other pollutants, the majority opinion by conservative justices drew heavily from Judge Kavanaugh.

.. The high court cited his earlier dissent when he argued that the Environmental Protection Agency had failed to consider the costs of its regulations before moving forward. The EPA, he concluded, had ignored a requirement in the Clear Air Act that the agency determine whether an electric-utility regulation is “appropriate” before imposing it.

.. Too often, he found, judges were giving agency regulators the benefit of the doubt based on a doctrine that instructs judges to give more deference when the meaning of what Congress wrote isn’t precisely clear.That was the case, he thought, when the D.C. Circuit last year reviewed the legality of net-neutrality rules adopted by the Federal Communications Commission.

In a dissenting opinion, he said the FCC didn’t have the authority to classify internet providers as “telecommunications services” and ban them from splitting internet traffic into fast and slow lanes.

.. In a dissenting opinion, he said the FCC didn’t have the authority to classify internet providers as “telecommunications services” and ban them from splitting internet traffic into fast and slow lanes.

.. “He’s not coming with a machete and slashing through agency regulation,” said Mr. Adler, defending the judge’s record. “He’s holding agencies to a slightly higher standard than other judges.”

What About Social-Media Neutrality?

Facebook’s algorithms have outsize power, both culturally and economically.

If your holiday posts received half as many likes as in past years, it isn’t necessarily because your content is stale or your friends have lost interest. Instead, the platform you use might have changed its algorithms to compel you—and the entities vying for your attention—to spend more on posts. Even if you’re an amateur photographer or a recreational blogger, and particularly if you’re a sole proprietor or small-business owner, Facebook wants to convert you from an “organic” user to a paying customer who boosts posts and buys ads.

.. If you post a Facebook update without “boosting”—paying for it—the post may reach between 1% and 5% of the people who like your page. It probably won’t be seen by anyone who doesn’t already follow you on social media, unless a bunch of your fans or friends repost it. But if you boost that same post for $10, Facebook will show it to hundreds or thousands more customers.

.. Five dollars might allow you to reach 50 big-spending New England Patriots fans or 2,000 unemployed students. The cost to reach a particular audience shifts constantly and is not disclosed until after your ad has run.

.. Facebook’s nonneutral landscape is inscrutable and forbidding. Trial-and-error experiments help businesses and nonprofits improve their return on social-media investment, but many small entities can’t afford to do market research.

.. They should be regulated, ideally by a committee of representatives from the corporate, nonprofit and government sectors.