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The challenges for regulation are two-fold, in my opinion: 1. It just doesn't work. Legal and regulatory solutions are too slow and poorly designed to be effec

The challenges for regulation are two-fold, in my opinion: 1. It just doesn't work. Legal and regulatory solutions are too slow and poorly designed to be effective, see for example the EU browser consent decree applied to Internet Explorer. IE didn't fail because Microsoft was forced to offer a choice of browser; it stumbled because of other nimbler competitors (particularly Chrome) that were able to innovate despite Microsoft's historical success. Similarly, Windows' monopoly of the 2000s was nothing like as entrenched as a business like oil: the dominant player is always at risk from technological shifts (e.g. browser-based apps) that render old advantages (Win32) less profound. 2. The marketplace is global. Heavy regulation of US or EU companies is a competitive disadvantage when Chinese companies operate in a very different dynamic. The US could hypothetically force the dismantling of Facebook into its constituent products or the EU could add stricter rules on how it could monetize its services, but that just plays to the advantages of Tiktok and other companies that they have even less control over. It's unclear that this is in the interests of America or Europe. [Disclosure: I work for Google, but it's Sunday and I don't speak for them; I'm just another muggle posting on the internet.]

skummetmaelk 6y ago
So no regulation at all then? Just allow companies to use and abuse their "users" however they please? This is a return to the era of robber barons. We must try to ensure that companies have incentives to do better, otherwise we have seen time and time again that they will do anything they please as long as it is profitable. Consumers will not "just choose the ethical option" because they either cannot afford to, they don't realise the consequences, or they just don't care.
- timsneath 6y ago
  I wouldn't say that. But doing _something_ isn't automatically better than doing nothing, particularly when the tools are blunt and those wielding them are inexpert in the domain to which they're being applied. There are no easy solutions here. But I agree strongly with your premise of "incentivizing companies to do better", and I suspect there are other means than regulation to achieve that goal.
  - aspenmayer 6y ago
    Can you give some examples of the alternatives to regulation you refer to?
    - timsneath 6y ago
      Historically, companies as well as individuals respond well to economic incentive (both positive and negative). As an example from a different industry, carbon credits have created a market that encourages and rewards green activity; taxation on products and services that are perceived as "negative" acts as a constraint on supply and demand. Equally, the government itself is a huge purchaser of services and has undue influence in how companies behave. The desire for companies to win federal and military contracts allows governments significant leverage; perhaps not in the Facebook case, but certainly in areas like cloud.
arrosenberg 6y ago
1. I don't think point this is self-evident. At a minimum you could tighten up the M&A rules so that the big guys can't just buy every potential competitor. Legislative solutions are probably too slow, but we could certainly form a regulatory agency that can deal with rule-making as new issues come to the front. 2. I don't think it's self-evident that regulation would disadvantage US and EU companies. Regulation that encourages competition and innovation is an economic advantage - not a disadvantage. Tiktok might be less attractive if there was a vibrant marketplace of federated social media services that don't send your data to the CCP.
- nradov 6y ago
  How exactly could M&A regulations be written to prohibit purchasing a potential competitor before it becomes a significant actual competitor? Like what legally enforceable language could you actually use? At some level every business has the potential to become a competitor of every other business.
AnthonyMouse 6y ago
I think there is a major difference between "regulation" (e.g. CFAA, DMCA, SESTA) and antitrust, which is that monopolies are slow and stable and hard to get rid of in any other way. Chrome defeated Internet Explorer by leveraging a different monopoly. That meant it had copious funding without needing to make money itself and it got a huge amount of free marketing by being featured on google.com. But just trading one monopoly for another isn't competition. Internet Explorer was a monoculture controlled by a single player, now Chrome is, is that better? Was Microsoft going to add features that allow the platform-independent web to compete with Win32 apps? Is Google going to add features that protect privacy and allow users to keep their data on their own machines? Are they going to care about not making things so complicated that no upstart can create a third party browser ever again? Getting away from that requires actual competition. Meanwhile the actual antitrust enforcement actions we've seen have largely been stupid garbage (pretty much as expected), but they've also been painful and expensive stupid garbage, which gives the targets an incentive to avoid attracting their attention. And, most importantly, antitrust pretty much by definition only applies to really huge companies. If all they did was show up at the doorstep of any company with more than 50% market share and beat them with clubs until they're weak enough that someone else can take market share from them, that's still doing something useful, and most importantly it isn't doing the most dangerous thing regulation can do, which is the opposite of that -- impact smaller more fragile competitors and upstarts more than huge incumbents, which destroys competition.
tannhaeuser 6y ago
I partially agree that regulations are slow or even atrocious. But, on the web, what true game-changing innovations were there in the last ten or so years? By and large, we're doing just the same things (poorly) on the web we used to in the 2000s. But "network effects" now place barriers to entry on a medium that once was supposed to be an easy means for self-publishing (for example, why don't more musicians put their songs on a paywalled web page for self-distribution? It's the kind of thing the web was made for, yet they have to go to endless pains with idiosyncratic and ever-changing web conventions, payment providers, SEO, and promotion on platforms to get a handful of clicks). What we're experiencing is a large consolidation end-game. In that situation, I think regulation is necessary, as "the web" can't get out of this without political will. I also disagree that the EU's ruling for IE had no impact; Firefox opened the door for browser diversity and merit. The same principles could be applied today to Android, to stop Google mandating bundling of their "services" and making Android phones cheap when the price to pay is privacy invasion and monopolism. The marketplace being global might not very much longer be the case. For example, the EU court of justice has ruled (again) that personally-identifiable info just can't be transferred to the US under the "safe harbor" doctrine. And hasn't Google pulled out of China because they were required to give data to the government which however they weren't willing to on matters of principle?
- NzmlKax 6y ago
  It would be interesting to hear an insider story about the fall of AOL and Altavista. It's clear that Google and Facebook are the problems and practically equivalent to the AOL walled garden. I'm not sure that it would be impossible to disrupt them. What is lacking? Is it the fighting spirit?
swiley 6y ago
> Chinese companies operate in a very different dynamic. Chinese companies have their own regulations to deal with. I’m not sure it’s necessarily a disadvantage.
dwaltrip 6y ago
> 1. It just doesn't work. * Unleaded gasoline * Earthquake-proof building codes * Air pollution (https://en.wikipedia.org/wiki/Clean_Air_Act_of_1963#Effects https://en.wikipedia.org/wiki/Clean_Air_Act_of_1963#Effects) These are just a few that I quickly came up with off the top of my head. Obviously, not all regulation works. But it is so incredibly false to say there doesn't exist effective regulation that has made our lives much better.
- timsneath 6y ago
  Yes, totally. But the topic is “regulating technology”. In general this space is evolving far faster than oil or building codes, and regulating innovation is much harder than regulating established standards.
- lebuffon 6y ago
  From the top of another head: Banning DDT, Removing Freon from AC systems, mandatory seat-belts and airbags in cars, Residential ground fault detection outlets, Electricity system codes, Gas line codes, Building safety codes ...

skummetmaelk 6y ago

So no regulation at all then? Just allow companies to use and abuse their "users" however they please? This is a return to the era of robber barons. We must try to ensure that companies have incentives to do better, otherwise we have seen time and time again that they will do anything they please as long as it is profitable. Consumers will not "just choose the ethical option" because they either cannot afford to, they don't realise the consequences, or they just don't care.

timsneath 6y ago
I wouldn't say that. But doing _something_ isn't automatically better than doing nothing, particularly when the tools are blunt and those wielding them are inexpert in the domain to which they're being applied. There are no easy solutions here. But I agree strongly with your premise of "incentivizing companies to do better", and I suspect there are other means than regulation to achieve that goal.
- aspenmayer 6y ago
  Can you give some examples of the alternatives to regulation you refer to?
  - timsneath 6y ago
    Historically, companies as well as individuals respond well to economic incentive (both positive and negative). As an example from a different industry, carbon credits have created a market that encourages and rewards green activity; taxation on products and services that are perceived as "negative" acts as a constraint on supply and demand. Equally, the government itself is a huge purchaser of services and has undue influence in how companies behave. The desire for companies to win federal and military contracts allows governments significant leverage; perhaps not in the Facebook case, but certainly in areas like cloud.

arrosenberg 6y ago

1. I don't think point this is self-evident. At a minimum you could tighten up the M&A rules so that the big guys can't just buy every potential competitor. Legislative solutions are probably too slow, but we could certainly form a regulatory agency that can deal with rule-making as new issues come to the front. 2. I don't think it's self-evident that regulation would disadvantage US and EU companies. Regulation that encourages competition and innovation is an economic advantage - not a disadvantage. Tiktok might be less attractive if there was a vibrant marketplace of federated social media services that don't send your data to the CCP.

nradov 6y ago
How exactly could M&A regulations be written to prohibit purchasing a potential competitor before it becomes a significant actual competitor? Like what legally enforceable language could you actually use? At some level every business has the potential to become a competitor of every other business.

AnthonyMouse 6y ago

I think there is a major difference between "regulation" (e.g. CFAA, DMCA, SESTA) and antitrust, which is that monopolies are slow and stable and hard to get rid of in any other way. Chrome defeated Internet Explorer by leveraging a different monopoly. That meant it had copious funding without needing to make money itself and it got a huge amount of free marketing by being featured on google.com. But just trading one monopoly for another isn't competition. Internet Explorer was a monoculture controlled by a single player, now Chrome is, is that better? Was Microsoft going to add features that allow the platform-independent web to compete with Win32 apps? Is Google going to add features that protect privacy and allow users to keep their data on their own machines? Are they going to care about not making things so complicated that no upstart can create a third party browser ever again? Getting away from that requires actual competition. Meanwhile the actual antitrust enforcement actions we've seen have largely been stupid garbage (pretty much as expected), but they've also been painful and expensive stupid garbage, which gives the targets an incentive to avoid attracting their attention. And, most importantly, antitrust pretty much by definition only applies to really huge companies. If all they did was show up at the doorstep of any company with more than 50% market share and beat them with clubs until they're weak enough that someone else can take market share from them, that's still doing something useful, and most importantly it isn't doing the most dangerous thing regulation can do, which is the opposite of that -- impact smaller more fragile competitors and upstarts more than huge incumbents, which destroys competition.

tannhaeuser 6y ago

I partially agree that regulations are slow or even atrocious. But, on the web, what true game-changing innovations were there in the last ten or so years? By and large, we're doing just the same things (poorly) on the web we used to in the 2000s. But "network effects" now place barriers to entry on a medium that once was supposed to be an easy means for self-publishing (for example, why don't more musicians put their songs on a paywalled web page for self-distribution? It's the kind of thing the web was made for, yet they have to go to endless pains with idiosyncratic and ever-changing web conventions, payment providers, SEO, and promotion on platforms to get a handful of clicks). What we're experiencing is a large consolidation end-game. In that situation, I think regulation is necessary, as "the web" can't get out of this without political will. I also disagree that the EU's ruling for IE had no impact; Firefox opened the door for browser diversity and merit. The same principles could be applied today to Android, to stop Google mandating bundling of their "services" and making Android phones cheap when the price to pay is privacy invasion and monopolism. The marketplace being global might not very much longer be the case. For example, the EU court of justice has ruled (again) that personally-identifiable info just can't be transferred to the US under the "safe harbor" doctrine. And hasn't Google pulled out of China because they were required to give data to the government which however they weren't willing to on matters of principle?

NzmlKax 6y ago
It would be interesting to hear an insider story about the fall of AOL and Altavista. It's clear that Google and Facebook are the problems and practically equivalent to the AOL walled garden. I'm not sure that it would be impossible to disrupt them. What is lacking? Is it the fighting spirit?

swiley 6y ago

> Chinese companies operate in a very different dynamic. Chinese companies have their own regulations to deal with. I’m not sure it’s necessarily a disadvantage.

dwaltrip 6y ago

> 1. It just doesn't work. * Unleaded gasoline * Earthquake-proof building codes * Air pollution (https://en.wikipedia.org/wiki/Clean_Air_Act_of_1963#Effects https://en.wikipedia.org/wiki/Clean_Air_Act_of_1963#Effects) These are just a few that I quickly came up with off the top of my head. Obviously, not all regulation works. But it is so incredibly false to say there doesn't exist effective regulation that has made our lives much better.

timsneath 6y ago
Yes, totally. But the topic is “regulating technology”. In general this space is evolving far faster than oil or building codes, and regulating innovation is much harder than regulating established standards.
lebuffon 6y ago
From the top of another head: Banning DDT, Removing Freon from AC systems, mandatory seat-belts and airbags in cars, Residential ground fault detection outlets, Electricity system codes, Gas line codes, Building safety codes ...