Rick Rycroft/AP Photo
Front pages of Australian newspapers blasted Facebook after the platform blocked Australians from sharing news stories.
Tech firms have led a pretty charmed life for the bulk of their existence, especially with regard to government regulation. With lawmakers unwilling to shackle companies they perceive as innovative, and hungry for the monetary support that accompanies corporate success, the law hasn’t really been an obstacle. A famed Silicon Valley dictum is to ask for forgiveness, not permission. Breaking the law has had no consequences, and policymakers have not been too exercised to create new laws for Big Tech to follow.
This has begun to change, as lawmakers on both sides of the aisle and around the world seek solutions to weaken the power of the tech platforms and benefit society. And it’s been fascinating to see the reaction. Amazon, Apple, Facebook, and Google have all been put in this situation in recent weeks, and by and large their responses have shown a lack of respect for any legal constraints on their businesses.
Take Amazon, the nation’s second-largest employer, whose surge of employment during the pandemic has coincided with massive profits, but also brutal conditions, constant surveillance, low pay relative to the rest of the logistics industry, persistent union-busting, and a $61.7 million fine for stealing tips from delivery drivers. New York Attorney General Letitia James has been investigating Amazon over one of its ghastliest practices: failing to adhere to proper social distancing or sanitation measures in warehouses. Nearly 20,000 Amazon employees had contracted COVID-19 as of last October, well before the most recent spike in cases.
Faced with this, Amazon did what any upstanding corporate citizen would: It preemptively sued James to stop the lawsuit, dubiously asserting that states lack authority to police workplace safety. Amazon also alleged that James threatened legal action unless it met certain demands, including the reinstatement of Staten Island warehouse employee Christian Smalls, whom the company retaliated against for protesting work conditions. Amazon’s lawsuit goes on and on about its self-described sterling safety record, which is immaterial to a claim of improper jurisdiction.
This power play didn’t stop James from bringing a case, but it is pretty brazen to countersue before the fact, almost as much as claiming “industry-leading” safety measures when there are hundreds of thousands of witnesses to warehouse conditions. But navigating law and regulation through intimidation is par for the course for Amazon. Internal documents revealed by Reuters this week show the company favoring big sellers in India, while executives instructed their charges to “test the boundaries of what is allowed by law.”
What’s been taking place in Australia is even more outlandish. Rod Sims, the country’s competition and consumer protection chief, has insisted that Google and Facebook pay for news content shared on their sites, from which they massively profit through dominating digital advertising. Google does pay publishers in countries like France, but the Australian proposal would have left the payment price to an independent arbitrator that the platforms couldn’t control.
First, Google vowed to block its search engine from all of Australia if it was forced to pay the fees. Google down-rated Australian news sites in search, previewing its power. It even got Tim Berners-Lee, one of the World Wide Web’s inventors, to plead on its behalf that paying for links violates the spirit of the internet. (Actually it would be an up-front sum to news outlets, not a per-link fee.)
Eventually, the search giant stood down. Google reached agreement this week with News Corp., the last in a series of content-sharing deals with Australian news publishers, averting the nuclear option. But Facebook went in a different direction. On Wednesday, before the publisher law was finalized, it blocked news sharing in Australia, and prevented every Facebook user around the world from sharing Australian news sites. The publishers have been kicked off the site, but Facebook’s target was wider; civil society groups and nongovernmental organizations in Australia have also seen their pages rendered useless.
Facebook banning an individual for violating terms of service is one thing. Banning an entire array of organizations, not just news sites but trade unions, legal aid, charities, domestic-violence hotlines, police departments, and even health services, from essential communications infrastructure is outright dangerous. It’s almost as if Google and Facebook are playing a good cop/bad cop routine to try and blunt the law. More important, it signals a warning to stop other countries from even thinking about going through with such a hassle to get news publishers paid.
This has become the modus operandi for Big Tech: pick fights, escalate disputes, and operate as if they exist outside the law. It’s what has led Facebook and others to declare Mexico’s effort to reform social media as a violation of the recent North American trade pact. (This was completely predictable, after the U.S.-Mexico-Canada Agreement included a digital-trade chapter that protected tech firms from liability for pirated or illegal content.) It’s what has led Amazon, Google, and Facebook’s lead U.S. trade group, the Internet Association, to sue to block a new law passed in Maryland that would for the first time tax online ad revenue.
This has become the modus operandi for Big Tech: pick fights, escalate disputes, and operate as if they exist outside the law.
Companies lobby, sue, and seek to influence public policy all the time. But what’s happening among Silicon Valley monopolists goes a step beyond. It speaks to a combination of extreme arrogance and what I’m sure will come out as a deliberate strategy to come in so hot to make governments cower.
Or maybe it just reflects concern among the platforms that decades of skirting regulations, thumbing their nose at the law, and disadvantaging rivals, partners, and everyone else in their path is catching up to them. This week’s bombshell that Facebook knew for years that it was defrauding advertisers by inflating viewing metrics is just an example of this decades-long crime spree. Big Tech could maybe handle this when nobody with commensurate power was willing to mount a challenge. If governments get the idea they have agency, all bets are off.
And that’s the thing about this Big Tech bullying campaign: It’s not quite working. New York AG James still sued Amazon. Australia’s still moving forward on its content law, and other countries, seeing Facebook’s gangsterism, have called for their own crackdowns. Yes, Apple lobbying prevented North Dakota from passing a law allowing state app developers to avoid App Store fees. But Arizona is putting forward the same bill. Amazon is fighting the union drive at an Alabama warehouse, but Google employees are also organizing. The House Antitrust Subcommittee hauled in Big Tech CEOs to testify last year, and they’re bringing them in again next month, with a goal this time not of fact-finding, but producing reform legislation.
You can see some cracks in Big Tech’s unity. Apple and Facebook are at each other’s throats over privacy, with Apple seeking to prevent data collection on its phones. Microsoft has urged the Biden administration to copy Australia’s rules, and force the digital ad giants to share revenue with publishers. And little companies are growing bolder in standing up to the platforms—even tiny newspapers in West Virginia are suing Facebook and Google.
Courage is contagious. By taking on Big Tech, national governments are forging a path forward, despite the vociferous blowback. There won’t be a straight line to regaining democratic control over the platforms—see the Nevada proposal to allow tech companies to establish their own local governments. But people are learning that they don’t have to accept monopoly power, and the harms it causes. After all, you beat a bully by punching them in the nose.
