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European Lawmakers Asked Mark Zuckerberg Why They Shouldn't Break Up Facebook (theverge.com)
European lawmakers questioned Mark Zuckerberg in Brussels today for almost an hour and a half, asking him to address concerns about the Cambridge Analytica data leak and Facebook's potential monopoly. German MEP Manfred Weber asked whether the Facebook CEO could name a single European alternative to his "empire," which includes apps like WhatsApp and Instagram in addition to Facebook. "I think it's time to discuss breaking up Facebook's monopoly, because it's already too much power in only one hand," said Weber. "So I ask you simple, and that is my final question: can you convince me not to do so?" Belgian MEP Guy Verhofstadt then chimed in and asked whether Facebook would cooperate with European antitrust authorities to determine whether the company was indeed a monopoly, and if it was, whether Facebook would accept splitting off WhatsApp or Messenger to remedy the problem. The Verge reports: The panel's format let Zuckerberg selectively reply to questions at the end of the session, and he didn't address Verhofstadt's points. Instead, he broadly outlined how Facebook views "competition" in various spaces. "We exist in a very competitive space where people use a lot of different tools for communication," said Zuckerberg. "From where I sit, it feels like there are new competitors coming up every day" in the messaging and social networking space. He also said that Facebook didn't hold an advertising monopoly because it only controlled 6 percent of the global advertising market. (It's worth noting: this is still a huge number.) And he argued that Facebook promoted competition by making it easier for small businesses to reach larger audiences -- which is basically unrelated to the question of whether Facebook itself is a monopoly.
This problem is more complex than it looks. If they split Facebook, WhatsApp and Instagram apart from each other, it may help with privacy and user choice a little. There may be less trading of information between affiliates and/or less requirement to sign up with one service to make use of another. But each of these companies will still be quasi-monopolies in their respective areas. The same goes for Google.
This may be inevitable -- anytime there are economies of scale in a market, you can get a natural monopoly, where no one can afford to compete with the incumbent firm(s). It cost a lot of money to build Google's search database Facebook's user network. It's nearly impossible for anyone else to come into those niches and compete with them. And do you even really want them too? How many people just use Google because it's good enough (extremely good really, compared to what came before), or Facebook because that's where their friends are?
The traditional answer to natural monopolies is regulation or government ownership. Regulation consists of the "utility compact" -- give the company a guaranteed monopoly, but regulate the prices they charge and the type of service they provide (e.g., require universal access). That's a no-brainer when dealing with essential services -- landline phones, electricity, water, bus service, and maybe Internet access (I would argue that this was the issue at the heart of network neutrality -- are ISPs common carriers or optional products?).
But does the idea of natural monopoly apply to "non-essential" services like Facebook and Google? Or maybe the cost of these services is just so low that we can ignore the inefficiency of having multiple providers in favor of innovation (e.g., people can signup for both WhatsApp and Skype, so what's the problem)? My instinct is that big tech companies may be edging into a gray area. Clearly people have alternatives to these companies, but on the other hand, due to their incumbent status, these companies have a huge advantage and are de facto the default provider for these services, a position they can abuse. We don't regulate electric utilities because they would cutoff service if we didn't; we regulate them so they can't abuse their dominant position. Should the same apply to big tech? I'd lean toward "probably not" at this point, but it's interesting to think about.
https://www.economist.com/grap...
MAY 20th will mark the end of “mental-health awareness week”, a campaign run by the Mental Health Foundation, a British charity. Roughly a quarter of British adults have been diagnosed at some point with a psychiatric disorder, costing the economy an estimated 4.5% of GDP per year. Such illnesses have many causes, but a growing body of research demonstrates that in young people they are linked with heavy consumption of social media.
According to a survey in 2017 by the Royal Society for Public Health, Britons aged 14-24 believe that Facebook, Instagram, Snapchat and Twitter have detrimental effects on their wellbeing. On average, they reported that these social networks gave them extra scope for self-expression and community-building. But they also said that the platforms exacerbated anxiety and depression, deprived them of sleep, exposed them to bullying and created worries about their body image and “FOMO” (“fear of missing out”). Academic studies have found that these problems tend to be particularly severe among frequent users.
What would be the public and government response be if these same symptoms were caused by something in our drinking water or in the air or in food?
It is much more difficult to regulate the conglomerate than the subsidiaries, if the time comes. You simply get to a point that they can say "this is the way it works," and there isn't really much you can do. The incentive to break them up is in keeping them from being too ingrained that you cannot kill them.