The Decentralists

Hot Topix: Big Tech Braces for Both Biden and Trump

October 22, 2020 Mike Cholod, Henry Karpus & Chris Trottier
The Decentralists
Hot Topix: Big Tech Braces for Both Biden and Trump
Chapters
The Decentralists
Hot Topix: Big Tech Braces for Both Biden and Trump
Oct 22, 2020
Mike Cholod, Henry Karpus & Chris Trottier

No matter the outcome of the U.S. Presidential election, if you’re one of the FAANGs (Facebook, Apple, Amazon, Netflix and Google), this election does not bode well—both Biden and Trump want to regulate Big Tech. Whether Republicans or Democrats control the U.S. government, Big Tech is in for a reckoning.

Democrats want to break up Big Tech because of antitrust concerns. Republicans want to dismantle Section 230—which frees Big Tech of liability for the content their users post on their platforms. Both possibilities scare Big Tech.

Is Big Tech abusing their monopolies? Who should be liable for content posted on social networks? How much does regulation threaten Big Tech?

In this episode of The Decentralists, we delve deep into the regulatory quagmire. There’s a tough road ahead for Big Tech.

Show Notes Transcript

No matter the outcome of the U.S. Presidential election, if you’re one of the FAANGs (Facebook, Apple, Amazon, Netflix and Google), this election does not bode well—both Biden and Trump want to regulate Big Tech. Whether Republicans or Democrats control the U.S. government, Big Tech is in for a reckoning.

Democrats want to break up Big Tech because of antitrust concerns. Republicans want to dismantle Section 230—which frees Big Tech of liability for the content their users post on their platforms. Both possibilities scare Big Tech.

Is Big Tech abusing their monopolies? Who should be liable for content posted on social networks? How much does regulation threaten Big Tech?

In this episode of The Decentralists, we delve deep into the regulatory quagmire. There’s a tough road ahead for Big Tech.

Henry: Hey everyone. It's Henry, Mike and Chris of the Decentralists and it's Hot Topix time. We're calling it Big Tech Braces for Both Biden and Trump, because honestly, from what we've been able to discover, both parties are a little worried about the outcome of the US election in November. Mike, Chris, I know you got a couple of things to reflect on and some of them are kind of funny.

Mike: You know, I mean, Henry, I mean, I think the first thing we might as well do is, you know, that title is really long, so we're just going to start calling it Brump. I mean, it seems like you know, no matter what happens, if you're one of the fangs, you know, Facebook, Amazon, and all these guys, the big companies in big tech companies in the Valley, you're you might as well have a permanent suite at the Capitol Hill motel six. And we might as well make this something that is very newsworthy. I mean, they called it Brexit in the UK, and this is regardless of which way this presidential election turns out, it looks like big tech is in for a huge reckoning. So rather than say trouble with Biden and Trump, I think we just call it Brump.

Henry: Brump.

Mike: And it becomes an actual thing, Brump.

Henry: Like Brexit.

Mike: Like Brexit. Yeah. I mean, okay. So, let's get serious here though. I mean, there's a problem for Facebook and Google and Amazon and all these folks. You know, I mean, it seems like not another week goes by where there isn't some kind of chat about you know, somebody being hauled in front of a congressional committee or things like this, but what's starting to shape out now is that there are, the government is clearly positioning themselves that no matter which way this election goes, there is going to be a reckoning for big tech right now. And what is interesting about it is that if you are on the Republican side of the house, you have one view as to what you're going to do with big tech and how you're going to control them and what the problem is. And if you're a Democrat, you have a different view.

Henry: So, what are the views?

Mike: Well, you know, I mean to put it, you know, in simplest terms, if you look at what the Democrats are saying, they are basing all of their cases around legislation for antitrust violations. Okay. So this is, you know, their assertions that the problems with people like Facebook and, you know, Apple and Amazon and Google is that in the businesses that they play in, which is literally basically everything, they have so much size, so much power and so much money that their businesses do not allow for fair competition in any of these sectors.

Henry: I remember that when I was very much younger, they said the same thing about Microsoft.

Mike: Absolutely. Absolutely. And with Microsoft, if you recall, the end of the, kind of the net result was they didn't break Microsoft up, but they made them peel their Explorer browser out of the, out of the box set when you bought office.

Henry: Correct.

Mike: Right. So that was the result, but the Republicans have a different view. Chris, what are the Republicans mad about?

Chris: So, Trump is threatening to roll back section two 30, which is the piece of legislation that says that platforms are immune from whatever content their users post

Henry: The old publisher concept.

Chris: Yeah. And if you recall, that's a power that a few other industries in America have.

Henry: Right.

Chris: Okay. Because if you were called with newspapers, newspapers are, you know, can be very liable for what gets printed in their newspapers.

Henry: Very, they get sued all the time, every day,

Chris: Exactly. Tech platforms, not so much. So, Trump is threatening to remove that protection and if that happens, boy oh boy.

Mike: Well, and I mean, you know, at the, at the knot of it, right, it's not, you know, because if you read kind of, not so much between the lines, but the actual lines of a lot of the arguments that a lot of Republican lawmakers are making is it's not that they're talking about removing section 230, which essentially makes these guys not responsible for the content. Okay. And it's very important. They call it content. They're not responsible for the content on their platforms. They're saying it’s; they're talking about removing that protection because conservative voices are being stifled or limited on the platforms.

Henry: In other words, the majority of the people who are using those platforms disagree with the conservatives.

Mike: Yes.

Henry: In other words, most of America.

Mike: Well.

Henry: Or the world.

Mike: We hope so, but think of the subtle difference though, right? I mean, a lot of times people talk about this, this issue in context of his law, this 230 laws. Okay. So, you know, people like we were talking with Daniel Bernhardt to plan an upcoming podcast with the forensic Canadian broadcasting. And he was saying that one of the challenges that you have is that in, when you look at a newspaper or a television station, some kind of journalistic outfit, okay. They have editorial and kind of publishing responsibility for what puts is out in that newspaper, that magazine or their online equivalent.

Henry: Correct.

Mike: So, if they have a journalist who goes out and publishes, researches and publishes an article, right. That is factually wrong, then they can be called out, taken to court and pay a big fine.

Henry: Right.

Mike: This argument with the Republicans is not saying we are angry with these platforms for allowing them to publish factually wrong information. They're saying that the conservatively written, factually wrong information is not being allowed to be disseminated freely.

Henry: Yeah. So, they are taking it personally and they're trying to control them.

Mike: Absolutely. Absolutely. You kind of makes you wonder if basically there was no fact checking of, you know, conservative voices, like you could say Donald Trump, you could say, you know, Alex Jones and Breitbart and all of these guys, if that was not happening, would they be in supportive, repealing this law?

Henry: Well, of course not. So essentially what's happening is they are taking advantage of probably the world's largest legal loophole for their own benefit.

Mike: Sure. But it's, but they're also kind of trying to stop it when it doesn't suit them.

Henry: Right. So, you know, I mean, I think the issue here is, is, you know, and I'm not trying to come out on any side of anything. Okay. But to me, if you are a government regulator anywhere, okay. But let's focus on the States for now and you are going after technology companies like a Google, where they do everything from, they control search, which basically controls, you know, where you go to buy things. So, they in effect have their fingers in e-commerce...

Mike: Or learn about things.

Henry: Or maps.

Mike: Maps. Right, I mean, everybody basically uses Google map. Heck probably the freaking military uses Google maps to drive their stuff around. You know what I'm saying? It's more accurate than all this other kind of things. And the maps are now pictures of your houses and inside of buildings. Like, I mean, it's literally, they're creating a virtual world and they own all of this and any money that's made off of that, they either make it all or they make a cut. So, if you're somebody that is a fledgling company or even a larger company, and you want to get into the business of geolocation, providing maps, providing search results, or any of these things, are you in a competitive landscape?

Henry: Okay, now hold on. Mike, what you're talking about there must be the Democrat antitrust world.

Mike: Totally. Well, this is what I'm saying. I mean, like I said, I'm not trying to come out on either side of the political spectrum. It just seems to me that, you know, the, the argument that you want to break up the text and, or punish them somehow for exercising, a monopoly position that in the long run does not benefit innovation in the economy in the United States. We let alone global. Right? If that's what you're doing, that to me seems like the kind of thing that government should do. Oh, okay. You know, they broke up the phone companies because you remember back in the days, Henry had to look through the front of the phone book to find out how much it was going to cost you per minute to call your Aunt in Nebraska. Right? And whereas the other side, you know, I think there is great wisdom actually in considering that law, that 230 law, because I actually do believe that this is the, you know, one of the biggest loopholes in the internet...

Henry:            It is.

Mike: ... is the fact that, you know, a social media platform cannot only take content from a legitimate journalists and not reward them for it and just repost it on their own platform and say, look, here's ABC and CBC and BBC, but they can also give the same type of reach and control the reach of content that is coming from non-legitimate news outlets. You know, they pop up every day, they call them, you know, friends of constitution news. And it's actually run by a bunch of Russian hackers.

Chris: But Mike, if section 230 were repealed that would essentially change the entire internet as we know it.

Mike: At least the social part.

Chris: Well, not just the social part, literally everything.

Henry: Change it for the better.

Chris: Well, I don't know. I don't know. Let me play devil's advocate here. Okay.

Mike: Please do.

Chris: Alright. So, you know, Amazon right now allows user reviews of their products. Okay. And that's probably one of Amazon's most popular functions on their website. Does that mean reviewers of products being sold on Amazon does that make Amazon liable for whatever review gets posted?

Mike: No, because like a newspaper that the reviews would be positioned and made obvious that this is a private citizen’s editorial view.

Chris: But under section 2 30, right? It becomes murkier. There's no question or on Google. Does Google become liable for whatever results happened in search? Right. We could keep going on and on, you know. Like social media is very clear cut, right?

Henry: Yeah.

Chris: You know, maybe social media should be liable. Like social companies should be liable for what their users posts because it's a free for all.

Mike: Well see, now I'm going to step in there and I'm going to say that's where I think it makes it there's a problem. And that's where I think it becomes interesting. So, let me ask you this, Chris, you know, you've been in the social media world for a long time. Okay. One of the real problems with this 230 is that as this law applies, this platform, like, let's just pick Facebook because I like picking on them... Is host, right? Publisher and moderator. Right? And so, the idea is you know, somebody who just posts a little thing that says, you know, I like kittens or whatever it is, that's a user-generated content. But then some person that creates a front on Facebook that says they are a legitimate journalism outfit and uses the platform to radicalize people. They're not okay. They shouldn't be treated the same. That's the first thing. But the second thing is, is do you think it would have a difference because I guarantee you, one of the issues that the social media companies are saying is, well, we're not actually in control of this content. It's an algorithm that's doing it. So how do you Sue a mathematical equation for libel.

Henry: Well whoever owns the copyright.

Chris: Well, but not only that, right. Who makes the algorithm?

Henry: Right.

Chris: I mean, algorithms don't spontaneously appear, that would be a miracle.

Henry: That would be AI.

Chris: Yeah.

Mike: Think about it. Right. I mean, if I just to play devil's advocate on Zuckerberg side, right. I sit there and I say, look, we've got these algorithms and, you know, nobody really understands them, right. There's probably 10 people who really understand these algorithms. And they just say, look, this algorithm looks at somebody's search patterns. Right. It would be like, Henry, you know, you get the paper every day. Okay. Let's say the national post or the globe and mail when they sent it to you, it would come to you where the first section was the sports section. Okay. And then the second section was, you know, cottage life and it was all the way. And the news was the last one, because they knew that you read them in that order. Right? Now, that's basically the argument that these guys are making with their algorithms.

Henry: I see, okay, it's a benefit.

Mike: Well, they're saying, Hey, look, you know, just because this algorithm is placing this content somewhere or not placing it somewhere. And remember, this is being used on both to answer both of these people's issues, right? Google will tell you, well, the search results are not preferred by us. They just, the algorithm delivers them. I mean, we all know that that's, you know, a freaking, you know, they're standing on a knife edge there, but the truth of the matter is, is, is an algorithm. Basically, just something that orders where all the information is on that newspaper when you read it. Right? And that order could put all of the conservative stuff on the last page where most newspaper readers know they used to say, right. Get on the front page.

Henry: Right.

Mike: The same as get on the first page of Google.

Henry: Yes.

Mike: Okay. So, this is kind of, let's throw that one out there. I mean, I'm not saying that it's, you know, because newspaper people, people owned newspapers and they determined where things went. But the difference between the two was is that if you went to the New York times, back in the days, and they published a big article that said, you know, that exposed or like the Washington post, when they expose Watergate and the Republican party and Richard Nixon goes after and sues them for libel, they go into court. They prove that it's all, here's their sources. Here's their information. If the judge says it's true, then Nixon loses. He gets in a helicopter. He says, goodbye.

Henry: Which happened.

Mike: Which happened. Right. But if, you know, but there was always some responsibility. And so, I just see that that's the Gulf, right? The argument they're trying to play is this is not the newspaper, but I actually think it is, it's just a question of whether a judge rules that these companies are in charge of these algorithms or not.

Henry: So, you know, that whole topic about 230 and responsibility, whether you're a publisher or you're just simply posting content, that's pretty easy to understand. I have a question for both of you and it's regarding the Democrats point of view. And, you know, it's been said that they are looking to curtail big tech power because of anti-trust reasoning. Tell me, what do you think the political advantage is to go after big tech from an antitrust perspective? After all these companies are American.

Mike: Chris take that one.

Chris: Well, what the Democrats are arguing is that we're back in the oil tycoon era, right. When that first got off...

Mike: Oil, railways, all that stuff.

Chris: Yep. And to give further contacts about that. The oil companies got into the railroad business because, you know, whoever controlled the railroads controlled the distribution of the oil, if you didn't own a rail line that meant you couldn't get your oil to market. So that's what Democrats are saying is going on with big tech that by being in one industry. Okay. That and then using their market position to enter another industry. Okay. They are abusing their market position to get more and more market dominance.

Henry: Okay. So, Mike, do you think the average American that the Democrats want to earn support from cares about that?

Mike: Well, you know, I would say in a non COVID world, maybe because I think that there has been, you know, I mean, it's clear that like, let's say inequality, right? The rich are getting richer, the poor are getting poor. That's been a reality kind of ever since the founding of the union and all over the planet.

Henry: Yes, the world.

Mike: You know what I mean? And I think that and, you know, given the general hostility to anything that refers to say an equal distribution of anything from wealth to healthcare to education is called socialist communism down there, which is crazy. Okay. But that's the general attitude. Right? But I think what's changing things now is the fact that, you know, the governments, I mean, I think, you know, Canada's now got, I think it went from a $35 billion deficit to a $350 billion deficit because of COVID and counting.

Henry: Yeah, yeah.

Mike:            You know, the Americans have already approved what two or three stimulus packages worth $4 trillion. Okay. And we're not anywhere near out of this thing yet. And so, I think that what you're going to see is, yet through this thing you know, Jeff Bezos and all the billionaires, it was just reported yesterday their average fortune has gone up 27% since COVID the tech guys. So, I think that what you're going to see is this antitrust is basically being motivated that from the point of view, that at some point, okay, if what they need to do is pay down a $6 trillion debt, there's two ways to do it. You could turn the government printing presses on, and then the taxpayer pays the bill.

Henry: Which they've been doing for quite a while now.

Mike: But all of a sudden, you're like, we got no paper left and there's no ink. Right? Because we used it all. So, what you do is you say, if we go after Bezos, because we could take a trillion dollars off of Bezos probably, they wouldn't even notice it.

Henry: Well.

Mike: Right. I mean but these guys are getting to be that rich, they're talking about Apple, Apple blew when it went from 1 trillion to 2 trillion in less than six months in valuation.

Henry: Okay. So, you're thinking that this is a way that the government can actually get some funds?

Mike: Totally you're not hurting.

Henry: Interesting.

Mike: What do you think, do you think the average customer, the average internet consumer user in the United States, or globally cares whether Mark Zuckerberg fortune goes from 60, 80, 90 billion to 6 billion.

Henry: Okay. Okay. Okay.

Chris: Well, you said something very interesting Mike, on your LinkedIn. Yow, basically, and I'm just going to quote you, you know, about all these billionaires reaching a record high in their valuations. You said, and I quote, some might see this as success, but I regard it as a big fat failure.

Henry: Right.

Chris: And you said as the rest of the world burns billionaires are getting richer business is not a zero-sum game. We can do better.

Mike: Right.

Henry: Bravo

Chris: And that's where the Democrats play.

Mike: Yeah.

Henry: Okay. Okay, good. No, that answers my question. That makes sense. Okay. Here's another one from the articles that I've been reading America's not the only area or jurisdiction. That's putting a lot of pressure on big tech it's happening in Europe as well. Any detail about that?

Chris: Last podcast we discussed what was going on in Ireland and the EU with specifically Facebook and how basically Facebook has been playing a game of chicken with the EU and their regulators.

Henry: Oh yeah.

Chris: And now they're threatening to pull out. Well, we're seeing a lot of the same things in many ways happening with Google and Apple. We're seeing things like GDPR, the right to be forgotten more and more regulations. And the EU has basically said, hey we're not willing to play as fast and loose with data as the US.

Henry: Right now, Chris we know what GDPR is. Could you explain it to some of our listeners or Mike, could you explain it?

Mike: Sure. So GDPR is the general data protection regulation. So essentially it means that if, you know, it's kind of, if you have any data, if you do business with anybody in Europe and you have any data in a database that belongs or could belong to a European citizen, it has to be protected to a certain level. Like personal information cannot be exposed. If you take personal information, you have to guarantee and take responsibility for protecting it so that it cannot be breached, right? One of these impossible kinds of things, and it combines also a right to be forgotten, right? Which is this idea that you can send note to any one of these providers, Google, Facebook, any of that. And you can say, I need you to remove all references to me...

Henry: Permanently.

Mike: Permanently, and an audit side on this is, is I remember when GDPR was just coming out, it's been out for probably two or three years.

Henry: Is this Germany, or all of Europe?

Mike: All of Europe.

Henry: Okay.

Mike: And it's now used as the bellwether for the data protection. So, this idea, the Irish data, you know, commissioner threatening Facebook it's because the US's version of GDPR is called safe Harbor and it's basically a piece of Swiss cheese. So right? With like basically the holes, all lead to NSA and CIA and stuff. So, they're like, no...

Henry: Oh, that's great.

Mike: Right. They're like, no, that's not good enough. GDPR basically has huge penalties but they have also some unforeseen circumstances. So, we had a GDPR kind of internet security lawyer out of the UK, his name's Jonathan Armstrong and he did a presentation to us once at a sales conference. And he said, Mark, my words, the first group of people that are going to take advantage of GDPR are going to be criminals because they want to expunge any information online...

Henry: Of course.

Mike: That refers to their criminal records and they basically were lining up. Guys with brass knuckles and tattoos on their fingers were lining up to have their stuff removed. But I mean, you know, let's kind of, I mean, GDPR is used as the basis. Right? But you know what I think where Europe is really leaning. Okay? So GDPR from their perspective has covered their people from a privacy perspective. Okay? So, for them, that is something that is, it's done, it's dusted and I think that nobody even knows how to deal with it. Every company is afraid of it, which is what they want, where Europe has always been focused is on antitrust because, and especially now in this new weaponized data world that we live in Henry you know, if you're European and you're a European company like Spotify, you're competing against Apple music.

Henry: Right.

Mike: Okay. And if all of a sudden Apple decides to just like they do with every other service that they make money off of refuse to let you load Spotify on your phone....

Henry: Oh yeah.

Mike: ... through the app store for some reason. Right? You know, they do this all the time. I mean, I know guys personally, who've started companies that have things to do with safe browsing or you know, like stopping the phone, being used while you drive your car. And they both basically just got buried by Apple and right into the OS. So, you know, iOS 15 comes out. It has, you know, Apple music only, and Spotify is now dead, that's antitrust. And so, Europe in a weaponized data world needs to basically prepare to incubate local European companies that have the quality and reach to be able to serve their population when this new reality of the internet, which a bunch of walled gardens around, you know, kind of trading blocks. Right? So, if you live in China, you use the Chinese versions of all these apps. If you live in Russia, you use the Russian versions of all these apps. You know, the American apps will be the ones that everybody in the America that we're familiar with now. I mean, we'll probably have a Facebook "A" or something like this in Canada. And, you know, this is the way that people are preparing is for a fractured, you know, internet world. And that's why the Europeans are all over antitrust because it's a way that they can now establish a basis for their own innovation and their own companies.

Henry: Okay.

Chris: Well, I just want to echo something, Mike. So, the internet, as we know it, the worldwide web was invented by Tim Berners-Lee in a European laboratory.

Henry: Yup. Good point.

Chris: And that's obviously the biggest innovation of the last 50 years.

Henry: Last a hundred years.

Mike: Right.

Chris: Yeah. And so, Europe has no problem with innovating, there's a lot of innovative companies.

Mike: Totally.

Chris: But there is not one of the things is based out of Europe.

Mike: Yup.

Chris: Those are all American companies and that's a problem because if you were you know, if you're Europe, if you're the EU and you've, you've got all these innovative companies and not one of them has the market valuation of Facebook or Netflix or Apple or any of them, you got to start asking why. What's going on with these American companies that's giving them dominance?

Henry: Interesting. Okay. Last question, gentlemen. Regulation is not going to be the simple fix for everything dealing with, you know, big tech. Is there anything else that private citizens, concerned citizens, he everyday people like us can do?

Chris: Decentralize.

Mike: I love that word. It's a great word.

Henry: Right on.

Mike: But it's true. Right? I mean I think, and, you know, not like in a technical way, right? I mean, I think what people need to do is, is part of the reason why Google dominates search is, is part of it. Yes. Is anti-trust type stuff where, you know, the default browser in an Android operating system is Chrome or the default search engine is Google. But they also dominate because people let them be dominated. It's easier than downloading duck, duck go. Or one of these kinds of say decentralized alternatives that actually does a real search of internet results. So, if we wanted to make a difference, we need to change and make the decisions ourselves. And if enough of us start doing this, you know, we talked a little bit about this fed averse in the past, you know, you're getting kicked off Twitter, this fed averse federated alternative, which is owned by no one, except the people who, you know, have servers that are hosting the, the accounts called Mastodon is growing at 20,000 users a day. So, there's people out there that are making the right decision. There are people out there that are going, I'm not going to wait for the regulators, right? I'm not going to wait for the regulators to Chris's point. A lot of this regulatory stuff in the States is just window dressing to keep everybody occupied that the Americans are going to take care of their own backyard. Do you think they really have an interest in taking the five biggest tech companies in the world away from the United States and sprinkling them around the world? Lot of chance.

Henry: Yeah. Yeah.

Mike: So....

Henry: Okay.

Mike: I think that the end of the day, if we want to kind of fix this, we have to take responsibility ourselves and that comes through decentralization like Chris.

Henry: And Mike, I mean, Chris, again, it's just it's another reality that points to what peer social is developing many, one, you know, the fact that a decentralized private a social media platform where you own and create everything yourself.

Mike: But it's based on your identity, remember that, Hey, self-sovereign identity a digital stake in the ground. Start from one place your place, and then build outwards. Don't start from the big place and kind of try to filter it down to you.

Henry: No, no, no, no.

Mike: Right.

Henry: Yeah. Start from the core. Start from yourself.

Mike: It starts at the bullseye and goes outward. You don't draw the big ring on the outside and then circle into the bullseye.

Chris: Now I want to say something, Mike. I attended activity pub conference last week and there was something that was said that really echoes in my mind it's colada law. And it basically says anything that can centralize will centralize. So therefore, if decentralization is the goal, you have to build something that is decentralized at the core.

Mike: There you go.

Henry: You know what that reminds me of that reminds me of, I mean, go ahead and laugh, but gravity, it drives everything in the universe.

Mike: Absolutely and it comes to one point.

Chris: Yeah. And that's why starting with identity is just so darn important, right. Because if you start with identity and you don't start with just saying blanket feature or...

Mike: Content.

Chris: ... content exactly. You know, human societies decentralized. So that should echo, social media should echo society.

Henry:             es. No, only that but all of nature is decentralized. That's why there's these different regions all across the world.

Mike: Different species, evolution.

Henry: Okay. So, Mike to wrap here, I understand you're making some fantastic progress with many one. Where are you now? What are the next few months?

Mike: Well, the next few months, I mean, hopefully in the next, I'm hoping in the next week or two, we have an alpha. So that means it'll work. It'll be buggy but we've got something to get out into people's hands where they can start establishing their own kind of identity and connecting with others without sharing any personal information if they don't want to. And so that's the basis for us to build a technology that will help change the world.

Henry: That's fantastic. I can't wait to get my hands on it.

Mike: Nether can I.

Henry: It'll be great and I'm willing to wait, but I just can't wait. If that makes sense. Mike, Chris, thank you for another illuminating time. Appreciate it. Can't wait to talk again.

Mike: Thank you, Henry.

Chris: Thank you, Henry.