Laraib Sarwar Professor DabovicWRT 102Research PaperAn

Laraib Sarwar

Professor Dabovic

WRT 102

Research Paper

An American Nightmare: Tech Regulation

Success is as American as apple pie. The attainment of financial success is the pinnacle of the American Dream, yet at what point does the accruement of wealth delve into the abyss of self-destruction? Beyond the age of Standard Oil and General Electric, the debate between regulation and deregulation has lasted to the modern day in the form of huge technology corporations. In light of the 2020 Presidential Race, many democratic candidates have pushed to appeal to the far-left wing of the Democratic Party.

One potential candidate in particular, Senator Elizabeth Warren, vowed in her platform to advocate for the increased regulation and eventual break up of huge tech monopolies such as Google, Microsoft, and Apple. This advocacy for anti-trust rhetoric echoes the sentiments of past presidents, most notably William Taft and Theodore Roosevelt. Regardless, there are those who commit themselves to the idea that a laissez-faire approach to business is ingrained in American history, serving as the only way for economic success, in both the private and public sector.

Yet, regulation has always been an American tradition, protecting the common man against the tyrannies of huge companies that have no other bottom line than that of their profit margin. Citizens of the U.S. today fail to recognize the gravity of the threat posed to them from huge companies. The United States government has a responsibility to its citizens to combat the growth and reach of huge technological corporations through the use of congressional action to remedy the legislative inconsistencies and ethical dilemmas created by these monopolies.

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Regulation and restriction on corporate activity have been a forerunner of American economic policy since the early 1900s, with an emphasis on the rights of the average American. There was an importance placed on the protection of the common man against the wealth of power and money that large corporate entities held. Economic policy today displays a sharp contrast to decades of careful government intervention in the private sector (Stiglitz 5). The need for regulation relies heavily upon the goals of government compared to the goals of a corporation. A government is meant to represent its constituents equally under the law while a corporation’s sole reason of being is to generate profits for its stockholders. Through its regulation of corporate activities, the government essentially provides two services: insurance through the creation of regulatory structures and guaranteed certification (Stiglitz 4). The former can refer to things like building codes or sprinkler mandates in public buildings while the latter can refer to something like Food and Drug Administration labels, ultimately allowing the average person peace of mind in their everyday lives. The issue that plagues modern day legislators is how to adapt old forms of government regulations to new types of corporations, specifically huge tech conglomerates like Google. As stated by Brian Kranzich, the former CEO of Intel, “I look at data as the new oil” (Johnston). These tech corporations are not like Standard Oil; their main goal is not to drive out competition through unfair practices but rather to collect private data from their users to further their ability to retain power. Data gives corporations everything they need to know for advertising purposes and as far as the political alignments of their users. Coupled with their multi-billion-dollar values, the accruement of users’ personal data proves to be a 21st century advantage that tech companies have capitalized on as Congress continues to fall behind on legislative definitions to meet a changing economic frontier.

The collection of personal data has been on the forefront of news for big tech companies such as Facebook and Google as they violated many ethical boundaries regarding privacy. Due to a lack of legislative power behind the protection of personal information, regardless of a “supposed contract” with a third-party company, sites like Google and Facebook are able to collect and sell private information of individuals who use their services. In fact, of the two tech giants, Google has significantly surpassed the level and amount of data that can be collected from private individuals than Facebook. According to CNN reporter Heather Kelly, Google is comprised of many entities, ranging from their “Android mobile operating system, Chrome web browser…and publisher tools like Google Analytics and AdWords” (Kelly). This allows them to receive and take data from their users without asking for explicit permission or granting control measures. Google can track one’s location, commute to work, and is therefore able to create better advertisements catered to one’s supposed interest according to their algorithm. The issue stems from the fact that one can never fully escape Google’s reach, even when using their own settings to minimize tracking services and the like. According to Jason Kint, CEO of Digital Content Next, “It’s nearly impossible to do anything digitally without Google collecting data on you,” (Kelly). Even when users choose to turn off the location tracking services given by Google, users’ location data continues to be taken for to “improve services” (Kelly). However, these actions from Google have unintended consequences for American beyond that of their persona information being taken and used for advertising. Due to Google’s size and swath of information, they have the ability to sway political elections through the use of their many algorithm systems which have the ability to find out what affects Americans most. Behavioral experts, Robert Epstein and Ronald E. Robertson, claim “that unregulated election-related search rankings could pose a significant threat to the democratic system of government” (Epstein). Google creates search rankings based on minute, precise information found through the collection of data about where someone lives, their search history, the stores they shop at, the lifestyle they live as well as a multitude of other things. It becomes obvious that regulation is key when managing the welfare of Americans against huge tech corporation that have more than enough data to retain power.

While the American stance continues to be one of nonregulation against Silicon Valley, The European Union has taken legal measures against Google’s often predatory behavior in past years. According to Washington Post reporter Tony Romm, the European Union has taken steps to fine Google for 1.7 billion dollars for the utilization practices that break anti-trust laws (Romm). In the complaints, the EU states that Google forces all persons who buy their Android devices to have their specific apps pre-downloaded (Romm). Essentially this means that Google has not only the unfettered ability to track and record all users’ personal data but offers them no alternative to their systems. There is no ability for honest competition. Additionally, Google was charged with placing their own products at a higher search ranking, resulting in a dishonest advantage for their products in comparison to their competition. Google’s intent is to remove all other rivals in the marketplace and they have the resources to that. They have the market dominance to displace all other competition. Similarly, a case study done on Microsoft by Gail Ridley, displays the monopolistic tendencies of Microsoft and the inability of the government to effectively regulate them. Ridley explains that Microsoft was seen as the bridging gap between the private and public sector as they helped to create counter-hacker software to keep private information safe (Ridley 117). However, this dependence on Microsoft led to the Trojan horse malware hacking of 2009 that resulted in the theft of data (Ridley 117). Microsoft, being a monopoly of computer software, including such programs as their suites and Windows, was vulnerable in way that other companies would not have been. They were deemed too big to regulate and thus suffered a huge breach of information because no company is ultimately one hundred percent safe and secure. Problems will occur, and under current regulation policy the eventual loser will be the users, not the corporations.

Critics for the regulation of giant technology companies make the claim that the call for increased regulation is not due to actual monopolistic behavior by said companies, but rather a way to reduce the growth of economic success enjoyed by large tech companies. Additionally, opponents of regulation claim that the call for regulation is really a response to create new legislation adapted for a new digital age, not a call for the trust-busting ideology of the past. Often proponents of regulation use fear for the future as evidence for the immediate need for “regulation.” These fears tend to be on the speculative side, playing to people’s sensibilities rather than the facts. According to Larry Downes, best selling author of several books on tech regulation, “there’s no scientific method for estimating the risk of prematurely shutting down experiments that could yield important discoveries” (Downes). There is no way to know what a company’s success today could mean for tomorrow. Ultimately, regulation based solely on speculation of threats that do not yet exist is not legal and is unnecessarily punitive towards a corporation for being financially successful. There is also the added risk of potential censorship if the regulations placed are too harsh in controlling what type of content a company may be allowed to have. According to the New York Times’ reporter Adam Satariano, Europe has been prolific in creating regulation however these heightened laws have been “leading to accusations of censorship” (Satariano). Moreover, critics claim regulation can prematurely stunt the growth and potential of a corporation to thrive. Microsoft is a prime example of how supposed regulation can adversely affect a company’s performance in the long run. Due the prolific lawsuits and government interventions, Microsoft lost its “essential momentum” and lost out on the “mobile revolution” to other companies like Apple and Google (Downes). To the opponents of regulation, there is no reason to halt the progress of successful companies for the sake of an unforeseeable future based on speculative evidence.

Contrary to what is believed by critics of regulation, there has been sustained evidence of anti-competitive behavior displayed by large companies such as Apple and Google. Specifically, in reference to Google, the European Union found significant evidence that displayed Google ranking their own products higher in searches so as to influence consumers favorably towards them (Romm). Similarly, Apple has been accused of pushing their own music app, known as Apple Music, over other competitors like Spotify or Pandora (Romm). Spotify has gone as far as filing complaints with the European Union against Apple in this controversy. Additionally, the ultimate ramifications of regulation on corporate success are minute compared to the benefits that the common people will be able to attain. There will be increased competition which benefits the consumer but also set standards that will be controlled by governmental groups. According to Diane Coyle, professor of public policy at Cambridge University, “by providing assurances about the safety or effectiveness of new products and services, and setting minimum mandated standards, regulation gives consumers the confidence to try something new” (Coyle). Not only are new markets created but consumers have the luxury of knowing that there will be accountability in the products they buy and the services they subscribe to. The regulation of large tech corporations is reliant upon facts and inevitably may result in temporary detriment to a company’s financial standing but ultimately serves to protect the consumer at all costs.

The regulation of tech companies is not a partisan issue but rather an American issue. It serves to protect those who are most vulnerable to the effects of corporate manipulation and create an economic forum in which everyone can freely participate. There is a shared understanding that there is a need for legislation adapted for a 21st century United States alongside 21st century business models. There is a gap between the rise of tech corporations and the legislation needed to protect the rights and privacy of American citizens. There are those who may place the financial success of a few choice corporations over the rights of an American family to freely choose the business they want to support and what information they wish to disclose. Regardless, it remains the job of the governemnt to best protect its people against corporate interests who can only kowtow to the worth of a dollar. It becomes difficult to imagine a world in which one can have their pie and eat it too, but through the creation of regulations by Congress to reign in huge tech companies, Americans can have the rights to their personal data in addition to a fair economic market and enjoy them too.

Works Cited

Coyle, Diane, et al. “3 Ways That Regulation Benefits Economies.” World Economic Forum, 18 July 2018, www.weforum.org/agenda/2018/07/three-cheers-for-regulation.

Downes, Larry. “How More Regulation for U.S. Tech Could Backfire.” Harvard Business Review, 21 Feb. 2018, hbr.org/2018/02/how-more-regulation-for-u-s-tech-could-backfire.

Epstein, Robert, and Ronald E. Robertson. “The Search Engine Manipulation Effect (SEME) and Its Possible Impact on the Outcomes of Elections.” Proceedings of the National Academy of Sciences, vol. 112, no. 33, 2015, doi:10.1073/pnas.1419828112.

Kelly, Heather. “Google’s Data Collection Is Hard to Escape, Study Claims.” CNNMoney, Cable News Network, 21 Aug. 2018, 12:26, money.cnn.com/2018/08/21/technology/google- data-collection/index.html.

Johnston, Micheal. “The Future of Tech Regulation.” Evergreen Gavekal, 9 Nov. 2018, blog.evergreengavekal.com/the-future-of-tech-regulation/.

Ridley, Gail. “National Security as a Corporate Social Responsibility: Critical Infrastructure

Resilience.” Journal of Business Ethics, vol. 103, no. 1, 2011, pp. 111–125., doi:10.1007/s10551-011-0845-6.

Romm, Tony. “Google Fined Nearly $1.7 Billion for Ad Practices That E.U. Says Violated

Antitrust Laws.” The Washington Post, WP Company, 20 Mar. 2019, www.washingtonpost.com/technology/2019/03/20/google-fined-nearly-billion-ad- practices-that-violated-european-antitrust-laws/?utm_term=.7afb57d91484.

Satariano, Adam. “Europe Is Reining In Tech Giants. But Some Say It’s Going Too Far.” The New York Times, The New York Times, 6 May 2019, www.nytimes.com/2019/05/06/technology/europe-tech-censorship.html.

Stiglitz, Joseph E. “Government Failure vs. Market Failure: Principles of Regulation.”

Government and Markets: Toward a New Theory of Regulation, edited by Edward J. Balleisen and David A. Moss, Cambridge University Press, Cambridge, 2009, pp. 13–51.

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Laraib Sarwar Professor DabovicWRT 102Research PaperAn. (2019, Nov 26). Retrieved from http://paperap.com/laraib-sarwar-professor-dabovicwrt-102research-paperan-best-essay/

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