Elizabeth Warren recently pledged to break up tech and online companies which have a monopolistic chokehold on their particular space. (She named Facebook, Amazon, Google and, later, Apple as some examples.) I read the written version of her proposal, which is much more detailed than the talk she gave at SXSW.
I have three comments I want to get out of the way initially:
Firstly, I was kinda surprised by it. In a positive way, I mean. I expected that it would probably just be a salad of lazy populist-fawning and empty stick-it-to-the-data-barons grandstanding. [Look, hyphens were on sale at the punctuation store. What am I supposed to do? Not buy in bulk?!] And… sure… there are a few requisite sprinkles of both. Politics is still politics after all. And cheap emotive rhetoric remains the gold standard. But those exceptions notwithstanding, I found it to be a fairly substantive, soberly-written proposal with, regardless of my opinion on them, some well-considered points. It shows a certain respect for the reader (i.e. the potential voter) which I think is creditable. In relative terms at least. Most politicians — by which I of course mean their speechwriters — talk to their audiences as though they’re drooling simpletons who will likely need painstaking instruction on how to insert the ballot into the ballot-box. This causes any discourse which dares to rise above a third-grade reading level to suddenly seem like fucking ‘War and Peace’. Go figure.
Secondly, you have to admire that she’s hunting for big game. And in a way which goes against her own interests. Because anyone who has even slightly been paying attention knows that the titans of Silicon Valley have aggressively fostered a symbiotic relationship with the Democratic Party. Naturally, at the rank-and-file level, this alignment was in some sense inevitable. As most people who work for tech/online companies are already left-leaning. (Trying to deduce why this might be runs into somewhat of a chicken-or-the-egg dead-end.) And so… ‘easy allies’ and all that. However, at the executive level, it can hardly be doubted that the courtship is just a matter of prudent strategy. I’ll state the matter plainly. Generally speaking, the Republicans have shown that they’d rather burn American flags using their cherished pocketbook-sized copies of the Bible and the Constitution as kindling than aid the social media companies they view as… well… unfriendly to conservative politics. Which includes just about all of them. And in a two-party system, when one of them gives you the cold shoulder, the remaining option is your only hope. So you had better do whatever you can to stay in their good graces. This is why you then take your endless wheelbarrows filled with
grubby cash… legal bribes… various forms of direct and indirect campaign donations over to the Democrats. Especially favouring any of their elected officials who have so much as a fingertip even just barely resting on the levers of power related to regulating the internet. Yet, Warren… has gone rogue. By having her thank-you card for all that money take the form of a swift punch in the throat. This is ballsy. Normally you wait until you’ve actually got the impunity of sitting in the Oval Office before you casually betray the factions who financed you. At the very, very least, it’s fun to see someone reverse this chronology.
Thirdly, I think her concept of denying giant online companies the right to compete on their own marketplaces (e.g. Apple-made apps on the App Store, Amazon-branded products sold on Amazon) is probably a step too far. For my taste, that goes beyond the level of control the government should be able to exert. I also suspect that it’s likely a pretty minor factor in those companies establishing and retaining their monopolies. Mergers and buyouts are surely way, way more effective. Furthermore, it will be an easy rule to circumvent. The conceivable loopholes are plentiful, and tricky to police. Let’s revisit those earlier examples. Apple could just sell their iPhones and iPads with all its own premium apps pre-installed; you’re stuck with the bare-bones trial version until you make an in-app purchase to unlock the full version. Amazon could just charge preferred third-party manufacturers a much higher fee than normal for using its service, and then give them the prominent placement it once gave its own offerings; this would allow Amazon to de facto adopt certain product lines as their own and recoup some of the revenue they’re losing out on. And, look, those workarounds are merely off the top of my head. I’m just some dude sitting at my laptop clacking out a blog-post and eating blueberries. Whereas these are billion-dollar companies, you know? They can afford to hire a platoon of geniuses to squander their talent by solely devising clever ways to bypass any attempt to stymie the maximisation of profit. So one would be wise to choose the areas in which to try and outfox them sparingly.
Okay, with all that ludicrously-long preamble issued, I’ll get to the main point. I’m going to focus in on, specifically, the idea of trying to rein in the big social media companies. Warren only namechecks Facebook, but I’d say it’s likely that the ethos of her mission here will require trying to significantly decrease (by encouraging radically stronger competition) the market share of all its similarly gigantic kin. She may not explicitly say that’s her aim, though she does sow a couple hints, but it kind of has to be, right? If she’s not seeking to hobble the digital goliaths, in what sense is this really an anti-monopoly battle she means to fight? That slingshot is just a chic fashion accessory if it goes unused.
Now, I ask that you forgive me. Because I’m going to make a very elementary observation: representative democracy necessitates and facilitates crude popularity contests. And so, the most indispensable rule for parsing what politicians say is remembering that their primary objective is to tell the people what they want to hear. (I know, I know, “everyone already realizes this!” Funny then, how quickly the hordes will yet again buy into the wish-fulfilment fantasy of some principled maverick politician-messiah who ‘does not’ care about opinion polls at all.) Due to this dynamic, politicians are actually a useful weathervane for different sections of society itself. Because they try, at the expense of all dignity or coherency, to slavishly mirror the beliefs, fears, prejudices, hopes, etc, of demographics they are hoping to win votes from.
This is why it’s so interesting that Warren is heading down this particular path.
Not just because she’s got some chance of winning the Democrats’ crowded presidential primary. But more so because she’s seeking to enact what people claim they want to happen, even though they don’t really want it to happen. I’m intrigued by how this mismatch will resolve itself if push should come to shove when signing executive orders at the Resolute desk. In the meantime though, I’ll just try to make my case for why I think it exists.
The reason why people find such value in these regnant social media sites is their ubiquity. That’s what gives them their utility. Because almost everyone is on Facebook, that makes it extremely useful. You want to find someone online? You don’t have to trawl through a whole bunch of Facebook-clones, each with their own small chunk of the population, you just go to Facebook. And it’s the exact same thing across the board. I mean, take Youtube. You’re trying to find a certain video? Go onto Youtube and search for it and you’ll have a comfortably near-certain likelihood of finding it there. That convenience is absolutely everything. Certainly, these companies have tried their hardest to get themselves to this position, but what’s often missed by the out-of-touch commentariat is that the people themselves have helped them do it because the upside is making the services more useful.
Tech writers think that everyone is frantically, desperately worried about how much power companies like Facebook have. But here’s the deal. Suppose you take the average person (like your largely technophobic uncle) and explain why Facebook is too big and is throwing its weight around too much. They’ll probably reply, “jeez, that does seem wrong, they shouldn’t be able to do that.” And then if you tell them that, accordingly, incoming legislation will force Facebook to lose a big slice of market share (aka users)? That if they want to find someone’s general-purpose profile online they may well have to try their luck at a dozen of the smaller competitors which will spring up to fill the vacuum? This is what they’ll say: “fuck that, that’s fucking stupid. Why should I have to waste my time doing that when right now I can just go on Facebook and find them in five seconds?…” Love it or hate it, that’s the reality. When it comes down to it, the end-user ultimately just cares about utility and ease of use. Abstract notions about oversized corporations wielding unfair influence or robust competition deterring mediocrity do not really register. Not in the face of incurring some even minor inconvenience down the road.
Until we are all ready to honestly reckon with the fact that in some sectors, people can, subconsciously or otherwise, prefer monopolistic services, this debate has disastrously inaccurate first principles. And the galling thing is that we do recognize that this complacent selfishness is at play in so many other aspects of life. I mean, how could we not? It’s a glaring constant of human psychology. Personal benefit and convenience always, always top most people’s hierarchies of priority. This is why voters care ten times more about politicians promising a one-off tax rebate (which could end up being no more than a few hundred dollars) than about fixing foreign policy (which could help reshape the entire world for the better.)
To be clear, I’m not saying that this psychological hindrance is a good thing. Not at all. I’m just pointing out that it exists, that it’s very pervasive and that it’s very potent. Moreover, I do generally believe in the validity of antitrust constraints. I don’t think that big companies should be able to just gobble up the smaller ones who are competing with them. Nor should they be able to employ dirty tricks to deter other companies from gaining more market share. Also, I don’t think umbrella-company conglomerates should be able to amass a comprehensive range of monopolies. For example, the fact that Google’s parent company owns Google search, Google ads, Chrome, Gmail, Android, and Youtube (to truly name just a few) is insane. It’s both comical — in the way that cartoon tycoons lugging around sacks emblazoned with dollar signs make you giggle — and quite dark. But the more you ruminate on it, the less funny and the more disquieting it seems.
I guess I just think that things like, say, Twitter are very different from… well… a nefarious ‘forced’ monopoly. By which I mean instances where some big company buys up nearly all of a particular finite resource and then everyone simply has to purchase it from them. Because in that case, other options literally do not exist. But when it comes to Twitter, it’s more like people originally just flocked to it en masse because ‘micro-blogging’ (gosh, what a surprise that that dorky term’s life-span would barely rival an opened carton of milk left in the desert…) was new and strange and alluring. And then that kept snowballing because Twitter demonstrated enduring utility and worth to them. Thus, enjoying the first-mover advantage, it just happens to end up with the majority of the market share. That’s why it really makes no sense to me that those same people should turn around and say: ‘we chose to make your service popular; how dare your service get so popular, it’s dangerous.’ That’s not a cogent stance. It’s just not.
Besides, I have to say… frankly, I do wonder whether this might all just be a moot point. I suspect that if the government did nudge the market in order to forcibly, artificially downsize the big social media companies’ userbases, they would probably just organically reform. (This resilience reminds me of something I just read in a fascinating article. It details how if you try to blow up an approaching asteroid to save the Earth, the gravitational pull of the core remnant left intact may just draw all the exploded pieces back together, repairing the damage. I think this is a serviceable comparison because of all the histrionic doomsayers who act as though Twitter is also a catastrophic danger to human civilisation.) Or else a competitor would step in and establish their own reign of dominance. Soon becoming a bloated, incontestable monopoly itself. And so the more things change…
I also think that encouraging the government to meddle with such things is a potentially dangerous precedent to set. I won’t mince words here. I’d much rather Twitter have too much power — because there can be a voluntary mass exodus away from it at any time — than the government have too much power in its ability to minutely tinker with the free market.
Hmm, I want to bring up something else too. What annoys me is that no-one ever wants to take responsibility for their choices online. This is just as worrisome a problem as powerful companies making bad, high-handed decisions, and yet it’s vaguely taboo to point out for some reason. But I think it ought not — or, really, cannot — be ignored. It speaks to the very heart of why people opt to self-servingly delude themselves about how these companies function, how they even make money. For instance, Facebook has been to many people a very useful service (or so one suspects must somehow be the case). But Facebook is free to use. Which, as always, means that the captive user is the commodity the service is selling to third-parties. And Facebook seeks to use every part of the buffalo. No, wait, buffalos are too noble, too untamed. I rather mean to say, they use every part of their tethered cash-cows. They peddle their users’ data, habits, pageviews, click-throughs, etc. This point is so obvious it pains one to state it plainly. However, when it was ostensibly ‘discovered’ several years ago, and bleated by journalists like an earth-shattering scoop, people were very surprised and became very scared. “What do you mean this free service isn’t really asking absolutely nothing of us?” they hysterically demanded to know, with no sense of irony or self-awareness whatsoever.
I hope it goes without saying that the profoundly irresponsible ways in which Facebook deluged private data to unscrupulous third-parties is, naturally, an entirely different matter. That was fucked-up and people were right to be upset about it. And the scarcity of truly weighty legal repercussions for what Facebook did there is appalling.
But what I’m talking about is strictly limited to the legitimate, disclosed ways in which Facebook monetizes its users. Like, when Facebook gets paid to put, say, ads from a handbag brand on your screen because you keep posting status updates about how much you love handbags, that’s the trade-off you were willing to make to use their service. Whether you realized it or not. Caveat emptor and whatnot. Personally, I think that Facebook offers a pretty lame, rudimentary service which doesn’t at all warrant anyone paying this price — which is why I’ve never even set up a profile there — but other people are free to make their own value judgments. Even if they’re foolish. Even if they’re extremely foolish.
[UPDATE: Incidentally, there has just been a minor flap about Facebook temporarily removing some of Warren’s ads, advocating for her anti-monopoly position, from its platform. This seems like much ado about next-to-nothing because the particular ads were allegedly deleted for using Facebook’s logo, which is against their advertising rules. Whereas other ads she had on there to promote the exact same cause were unaffected because they did not include it. I have to say, this policy seems fairly reasonable to me. But, of course, Warren and her campaign shrewdly seized the opportunity to paint Facebook as silencing debate on the issue, seemingly further proving their point. And then came the predictable resolution. Which, by the way, totally counteracts the narrative that untouchably colossal social media platforms like Facebook can still make unfair and self-serving censorship decisions without caring about what people think. Because as soon as the largely misinformed backlash began to intensify, they kowtowed right away. They reinstated the ads in question, contravening their own rules, just to avoid the appearance of targeted retaliation. I guess no-one told the frightened execs at Facebook that the best part of being a mad king is never having to back down…]