Page 24 - March 2018 Disruption Report

TECHLASH
JAMNAURACRHY 22001188
“The consequences of Facebook’s failures are typically pegged as external hazards,” wrote TechCrunch’s Josh Constine. “You might assume the government will nally step in and regulate Facebook. But the Honest Ads Act and other rules about ads transparency and data privacy could end up protecting Facebook by being simply a paperwork speed bump for it while making it tough for competitors to build a rival database of personal info. In our corporation-loving society, it seems unlikely that the administration would go so far as to split up Facebook, Instagram and WhatsApp — one of the few feasible ways to limit the company’s power.”
In the Washington Post, Ryan Avent wrote:
Such a network [like Facebook] is a true public commons, however, and one whose worth is almost entirely attributable to the users themselves: the fact that they are there, the interactions they have, and the data they generate. Very little of Facebook’s worth as a corporation is associated with its employee headcount or the physical assets under its control (the value of the latter is just $14 billion). What gives Facebook its value is all of us. It is perverse, in the rst place, that the monetary value generated by this commons should ow overwhelmingly to a small group of Facebook employees and shareholders. That is especially the case since Facebook’s coders and executives, in their effort to exploit their network, are quite plausibly reducing its value to society.
...Perhaps Facebook will nd a way to save itself before that becomes necessary. Whether it does or not, we should be more aware of the extent to which tech giants have attained extraordinary valuations by monetizing what are essentially digital public squares. And we should understand that the accountability we expect markets to impose on those giants, to keep them working in society’s best interests, erodes as their power and dominance grows.
We should try to restore competition to such markets. But tech giants are increasingly in the business of providing fundamental, utility-like services. Their ownership and management, the regulation they face, and the pro ts and valuations they enjoy, should re ect that.
The political fallout for the Facebook scandal will likely begin in the EU, where regulators
have cracked down on privacy violations and are currently examining the role of data in online advertising. In May 2017, Vera Jourova, the EU commissioner for justice, consumers and gender equality, levied a $122 million ne against Facebook for lying to the EU about its ability to share data between its core platform and WhatsApp.
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