This is an email from Pattern Matching, a newsletter by OneZero.
Biden Has a Chance to Reshape Tech. Will He?
For all of Donald Trump’s railing against Amazon’s “monopoly,” social media “censorship,” and Section 230 protections for internet companies, his administration did very little to take on the technology industry. Its most notable acts were the repeal of net neutrality, sanctions on Chinese tech firms, and the launch of antitrust investigations and lawsuits against U.S. tech giants, which will be left to the Biden administration to pursue. Trump also moved late in his term to restrict H-1B visas; the fate of those rules will be in Joe Biden’s hands as well.
Despite their occasional dust-ups with Trump, the largest U.S. tech firms reaped tremendous gains under his watch. They emerge from his presidency bigger, stronger, and more powerful than ever, flourishing even amid a pandemic that has battered much of the economy.
Trump’s predecessor was arguably even better for Silicon Valley: Barack Obama viewed tech giants as allies rather than adversaries, and his administration greenlit mergers that vastly expanded their reach while cheerleading their disruption of old industries and norms and limiting privacy enforcement to wrist slaps.
Biden arrives at a moment of bipartisan backlash to Big Tech’s power and has an opportunity to dramatically reconfigure the regulatory landscape, for better or worse. Will he?
How Biden could reshape the internet — or not.
There are two schools of thought. One recalls the Obama administration’s cozy relationship with Silicon Valley, notes Vice President Kamala Harris’ ties to companies such as Uber, points out Biden’s reliance on tech allies as advisers, and predicts a relatively easy ride for Big Tech over the next four years. We might see some new regulations around online privacy and content moderation, but they’ll be crafted with close input from the industry and tailored in ways that the largest firms are well-equipped to comply with. We might see some new antitrust regulations or enforcement actions but nothing that truly threatens the largest platforms’ dominance.
You can find ample support for this view in a December 21 article by Reuters’ Nandita Bose headlined “Big Tech’s stealth push to influence the Biden administration.” The influx of industry veterans to the new administration has continued since then, and tech-friendly names continue to be floated for key positions, most notably that of antitrust chief in the Department of Justice (DOJ). Google and Amazon alum Renata Hesse, a leading candidate for that job, has publicly downplayed concerns about Google’s monopoly power in the past, the American Prospect’s David Dayen and Ryan Grim pointed out — which is awkward, given that the DOJ just filed a suit alleging that Google is an illegal monopoly. Meanwhile, tech giants are already tripping over each other to align with Biden on issues like immigration and Covid-19 relief.
The other school of thought observes that momentum for stronger oversight of Big Tech has been building for years on both left and right, that Biden seems personally irked by social media misinformation and has expressed skepticism of Section 230, and that some of his early appointments to tech-relevant positions have been vocal critics of the industry. In this view, the Biden administration is poised to enact sweeping reforms on multiple fronts, and while the industry may have some input, corporate interests will come second to a progressive agenda that prioritizes consumer protections, worker rights, platform accountability, and trustbusting. We’ll get a federal online privacy act, protections for gig-economy workers, a reworking of Section 230, and tough new antitrust legislation that could lead to breakups.
This week brought fresh evidence for that outlook in the form of Biden’s appointments of Rebecca Kelly Slaughter as acting chair of the Federal Trade Commission (FTC) and Jessica Rosenworcel as acting chair of the Federal Communications Commission (FCC). Both have been advocates of tougher enforcement on their respective commissions. NBC News’ April Glaser had an in-depth profile of Rosenworcel, who, in addition to being a net neutrality supporter and an advocate of expanded broadband access, is a working mother and podcaster. Kara Swisher and Scott Galloway’s Pivot podcast interviewed Slaughter about why she felt Facebook got off too easy in its record-setting FTC settlement.
One caveat here is that both Rosenworcel and Slaughter are only acting chairs, a position that historically has not always led to becoming permanent chair of those commissions. However, Recode’s Jason Del Rey reported on Friday that a leading antitrust advocate, Lina Khan, is “gaining traction” as a candidate for the other open FTC seat and possibly the chair. Khan’s legal scholarship has been instrumental in making the case that internet platforms are monopolies, and she was one of the architects of last fall’s House antitrust subcommittee report that recommended sweeping new limits on digital platforms. That report had tech critics on the left practically salivating. Khan did not return OneZero’s request for comment Friday.
A good rundown of the argument that Biden will be tough on tech came from Vivek Wadhwa and Tarun Wadhwa in Foreign Policy last month. Among other factors, they noted that the Democratic Party has moved left since Obama, with fighting corporate power and inequality now a higher priority than appearing innovative or business-friendly. And they noted that, unlike in the Obama era, scrutiny of Silicon Valley is increasingly coming from within the industry itself, with ex-Facebook executives speaking out and current workers protesting and organizing.
I think that last point is underrated a bit by the folks who note the prevalence of Silicon Valley alums on the Biden team. No doubt some will be cheerleaders for the industry. But more and more of those tech veterans are turning into critics once they’re out. Think of people like Dipayan Ghosh, who joined the Obama administration directly from Facebook and quickly evolved into a leading critic of the company and social media more broadly.
There’s one more reason to suspect we’ll see at least some substantive regulation in the years to come: The industry itself expects it. At this point, even the CEOs of top tech companies are cautiously calling for the government to step in on specific issues, such as privacy and content moderation. (For example, Mark Zuckerberg wrote a 2019 op-ed in the Washington Post with the headline “The Internet needs new rules.”) While they’ve made piles of money in the absence of strong oversight, they’ve also been pilloried for their practices and have seen their public images and legacies tarnished. Zuckerberg in particular seems desperate for someone other than Facebook to make decisions like whether to ban Trump from its platform; Microsoft president Brad Smith would rather see the government regulate face recognition than race against Amazon and others to build it. And they’re hardly a unified bloc: Facebook seems eager to support the antitrust case against Apple while Apple has decried Facebook’s privacy practices.
This is not to say, however, that tech critics will get everything they want in the next four years. Biden’s top priorities are the pandemic and climate change. Congressional Republicans will likely stand in the way of aggressive legislation. The courts will decide the DOJ and FTC’s antitrust cases. And even as their top executives pay lip service to the need for regulation, the tech giants will keep spending a fortune on lobbying to protect their underlying business models, as we saw Uber and Lyft do to pass California’s Proposition 22.
Specific Predictions for Tech Under Biden
It’s a relatively safe bet that we’ll see quick action on some of the things Biden and the independent commissions can do unilaterally and a much slower and messier process on the things they can’t. Specific predictions are much harder, and I stand by these with a 0% guarantee, but here are some wild guesses as to the sort of outcomes we might see over the next four years:
- Quick reinstatement of net neutrality and reopening of high-skill immigration pipelines, with perhaps some limits on the latter to protect U.S. workers.
- A significant push to expand broadband access in poor and rural areas, especially if Rosenworcel becomes the permanent FCC chair.
- An unceremonious end to Trump’s quixotic attempt to ban TikTok but a continuation in some form of the “Clean Network” push to lock Chinese firms out of 5G infrastructure.
- The formation of some new bureaucratic apparatus focused on digital rights and protections, such as the Digital Platform Agency proposed in a Shorenstein Center white paper last year. (One of its authors, Gene Kimmelman, advised Biden’s transition team.)
- A major federal privacy bill that will get lots of attention but ultimately either stall or pass in a watered-down version while failing to dismantle the targeted-advertising model, along the lines of the California Consumer Privacy Act.
- An ambitious antitrust bill, based on the House subcommittee’s Democratic staff report, that struggles to overcome opposition from pro-big-business Republicans.
- Some basic protections for gig workers that avoid reclassifying them as employees and leave the gig economy largely intact, along the lines of Prop 22.
- A parade of proposals to reform Section 230, none of which ultimately get very far because few can agree on what the reforms should be.
- A mixed bag of results from the big antitrust cases, with perhaps one stunning decision (such as a Facebook split-up) while others reach more modest settlements.
But honestly, I have no idea. If you do, please feel free to share your own predictions in the comments.