Regulating Facebook will be a grave mistake
Technology companies must take the measures needed to convince users that they care about their privacy
The problems at Facebook and others, real and perceived, at Google, Amazon and Apple have led to an easy consensus: The large technology companies should be regulated. Such an outcome would be a bad mistake — bad for the companies, of course, but also bad for us, their users.
I do not pretend to be unbiased in writing this. While I am about as tech-savvy as your average 72-year-old, I met Mark Zuckerberg when he was 20, and spent six years on Facebook’s board. As publisher and later chairman of the Washington Post, I watched the rise of Google, Facebook, Amazon and Apple, sometimes with hope, sometimes with awe and sometimes with horror for what it meant to the news business.
To start with the basics: The big technology companies ought to obey the laws that apply to all businesses. They should pay their taxes and comply with antitrust laws. If they make mistakes, they should admit them quickly and act transparently to fix them. Facebook, in particular, faces a huge challenge in convincing its users that they can trust it to safeguard their data.
So why not regulate these companies more?
First: Google and Facebook are platforms where a great deal of today’s political speech and reporting of news takes place, and regulation is an inherently political act. If you want a Technology Company Regulation Commission, its chairman and its members will be appointed by presidents and will reflect their policies.
Do presidents really play a role in regulation or enforcement? Well, you can listen to the Watergate tapes and hear former United States president Richard Nixon direct his advisers John Dean and H.R. Haldeman to use the Federal Communications Commission’s (FCC) regulatory process to take away TV stations owned by the Washington Post Co. Challenges to stations’ licences by Nixon supporters did ensue and, had Nixon not resigned, they would have been heard by an FCC led by the former chairman of the Republican National Committee. It is difficult to convince me that regulation is apolitical.
If you want Google, Facebook and other tech companies regulated, you are asking for a system in which United States President Donald Trump — or (perhaps in the future) a President Elizabeth Warren — plays a role in deciding what goes on your Facebook page or what flows from your Google search. Is that really what you want?
Second: Regulators often do not or cannot talk face-to-face with those being regulated to understand the consequences of what they are doing. The conversation is conducted through lawyers on both sides. Is there a set of regulators in Washington who would understand how Google or Facebook is put together?
Facebook and Google argue they have one goal in their principal businesses: Innovating to satisfy their customers. Regulation introduces a different goal: Not offending the regulators. Technology companies must move fast; regulation slows things down, sometimes drastically. Almost inevitably, this hurts a company’s performance. Money, time and, above all, management attention that might be focused on innovation and satisfying customers are focused elsewhere.
From the day it began accepting advertising, Facebook has walked a line, sometimes carefully, sometimes not. It promised advertisers the ability to target ads at users who were interested in their products; it promised users that their data would be private. Careful compromises should have been able to maintain trust with both sets of users.
The most important control over Facebook — greater than anything governments could come up with — is the ability of its users to quit. Zuckerberg has a huge incentive to keep our data private and to prove that Facebook has done so (the standards that permitted Cambridge Analytica to access user data were changed three years ago). Facebook needs to go to any possible length to convince its irritated users that it can be trusted.
Taken together, the big tech companies constitute a rare area where America leads the world. If you don’t believe they are important to the country, look at how they are treated elsewhere. In Europe, the home of many unsuccessful competitors, they are fined and regulated not because they are lawbreakers, but because they are American. And in China, Facebook and Google — as well as Twitter, YouTube and Wikipedia — are banned because they encourage free speech and free thought.
Instead, the Chinese have created massive competitors such as Tencent and Baidu, sheltered from western competition in their enormous home market. If Google and Facebook slow down — remember that most of the world’s users are outside the US — these competitors will easily pass them by.
I hope the technology companies are wise enough to take the measures needed to convince users that they care about their privacy. And I hope the US is wise enough not to regulate them.
- Donald E. Graham, chairman of Graham Holdings Company, was publisher of Washington Post from 1979 to 2001. Source: Washington Post