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TL;DR Section 230 of the Communications Decency Act has come under close scrutiny. Section 230 provides important immunity to online platforms for the content of third-party users.
Section 230 of the Communications Decency Act has come under close scrutiny. Section 230 provides important immunity to online platforms for the content of third-party users. Section 230 also guarantees legal immunity when platforms moderate objectionable content on their services: so-called “good samaritan” immunity.
Reform efforts are aimed at creating more carve-outs to Section 230 immunities, and limiting the scope of content platforms can moderate.
Many of these proposals would make bad policy by creating disincentives to moderate content in order to avoid a flood of litigation.
Read the full explainer here.
Presentations & Interviews Starting with the new antitrust investigation from state attorneys to kick off their discussion, Geoffrey Manne and Hal Singer take part in a conversation moderated . . .
Starting with the new antitrust investigation from state attorneys to kick off their discussion, Geoffrey Manne and Hal Singer take part in a conversation moderated by Adam Thierer about “Techlash”. This discussion is the second episode in the Federalist Society’s Tech Roundup podcast series. The full episode is embedded below
TOTM We explain how display advertising fits in the broader digital advertising market, describe how display advertising works, consider the main allegations against Google, and explain why Google’s critics are misguided to focus on antitrust as a solution to alleged problems in the market.
This week the Senate will hold a hearing into potential anticompetitive conduct by Google in its display advertising business—the “stack” of products that it offers to advertisers seeking to place display ads on third-party websites. It is also widely reported that the Department of Justice is preparing a lawsuit against Google that will likely include allegations of anticompetitive behavior in this market, and is likely to be joined by a number of state attorneys general in that lawsuit. Meanwhile, several papers have been published detailing these allegations.
Read the full piece here.
Presentations & Interviews TPRI Conference Slides on Killer Acquisitions & Kill Zones
ICLE’s Geoffrey Manne, Dirk Auer, and Alec Stapp presented at the Technology and Declining Economic Dynamism conference, hosted by Boston University’s Technology and Policy Research Initiative, on the topic of acquisitions by dominant firms. Full video of the panel can be found here, while the the presentation slides are here.
TL;DR Over the past 15 years, court decisions have weakened patent protections in the US. While some academics support such weakening, the evidence suggests that it may be having a detrimental effect on innovation.
Over the past 15 years, court decisions have weakened patent protections in the US. While some academics support such weakening, the evidence suggests that it may be having a detrimental effect on innovation.
Some academics argue that patent holders tend to charge excessive license fees to firms that implement their inventions, thereby impeding downstream innovation. The courts have responded by weakening the enforcement of patents in various ways, including by denying patent holders permanent injunctions.
By making it more difficult for patent holders to obtain injunctions, courts have effectively reduced the incentive for firms to invest in primary inventions. This has arguably had a stronger negative effect on overall rates of innovation.
TL;DR The First Amendment and Section 230 immunity work together to protect free speech on the Internet. Attempts at Section 230 reform based on how online platforms use their editorial discretion will run into Constitutional limitations.
The First Amendment and Section 230 immunity work together to protect free speech on the Internet. Attempts at Section 230 reform based on how online platforms use their editorial discretion will run into Constitutional limitations.
Complaints of anti-conservative bias by major online platforms have led to proposals to modify Section 230 immunity in ways that target the manner in which platforms moderate user-generated content. Proponents contend that absent some sort of liability these dominant digital “gatekeepers” of news and social opinion will skew their content-moderation practices to reflect their own political preferences, dishonestly labeling conservative views as offensive or otherwise in violation of the platform’s terms of use.
Online platforms have a First Amendment right to adopt whatever content standards they choose. With very few exceptions the government may not mandate speech. But a law requiring online platforms to adopt a particular set of content moderation practices — say, to maintain a “balance” of political views — would do just that. Conditioning Section 230 immunity on online platforms giving up their right to editorial discretion would be unlikely to survive the strict standard of review to which such government regulation of speech would be subjected by the courts.
Download the tl;dr explainer PDF here
TOTM Aboy throws a brick through a bakeshop window. He flees and is never identified. The townspeople gather around the broken glass. “Well,” one of them . . .
Aboy throws a brick through a bakeshop window. He flees and is never identified. The townspeople gather around the broken glass. “Well,” one of them says to the furious baker, “at least this will generate some business for the windowmaker!”
A reasonable statement? Not really. Although it is indeed a good day for the windowmaker, the money for the new window comes from the baker. Perhaps the baker was planning to use that money to buy a new suit. Now, instead of owning a window and a suit, he owns only a window. The windowmaker’s gain, meanwhile, is simply the tailor’s loss.
ICLE White Paper There is a danger that the UK is heading for a significant and potentially damaging overhaul of its competition policy on the basis of thin evidence, rushed analysis, and no attempt to measure the costs, benefits and risks of the approach being undertaken.
There is a danger that the UK is heading for a significant and potentially damaging overhaul of its competition policy on the basis of thin evidence, rushed analysis, and no attempt to measure the costs, benefits and risks of the approach being undertaken. The fact that the Digital Markets Taskforce consultation period was only one month is itself an example of this – one month is an unreasonably short period of time if the consultation was being taken seriously, and suggests that instead it is merely window-dressing to give procedural cover to whatever the government plans on doing anyway.
This would be a mistake. The two main documents that have led to the creation of the Digital Markets Taskforce, the Furman Report and the CMA’s digital advertising market study, do not provide strong justifications for the changes they propose, which are sweeping. Neither of them consider the trade-offs involved with the interventions they propose in any serious detail, let alone attempt to measure them quantitatively, yet these trade-offs and risks – lower investment, reduced competition, less innovation, fewer startups being founded in the UK, and worse productivity growth for the UK over the years ahead – are potentially enormous, and could weaken the UK’s technology sector.
Read the full paper here.
TL;DR Vertical integration allows businesses to innovate more. It may be bad for certain competitors, but it is rarely bad for competition.
Vertical integration allows businesses to innovate more. It may be bad for certain competitors, but it is rarely bad for competition.
Vertical integration refers to businesses performing a number of different and important roles in the supply chain for a particular product — for example, a manufacturer that sells its products directly to the public in its own stores. While all businesses are vertically integrated to some extent, some worry that vertical integration in digital markets prevents smaller businesses from competing.
Empirical research has consistently found vertical integration to be good for consumers through a number of mechanisms that allow for reduced costs and better product quality.
Read the full tl;dr explainer here.
