Editor’s note: Investor and entrepreneur David Gardner is founder of Cofounders Capital in Cary and is a regular contributor to WRAL TechWire.
CARY – I received a lot of comments last year on my article, Living Through an Amazon Excommunication. Partly in jest, that article pointed out just how intertwined and dependent my day-to-day life had become on using various Amazon services and technologies. Some jumped to the conclusion that I must believe that big tech companies have too much power and control over us.
This has been a hot topic of late with the controversy over Twitter banning former President Trump’s use of the platform. With so much of our news and opinions coming now from the big social media platforms like Facebook, Youtube, Instagram and TikTok, could these big tech companies restrict or limit points of view they don’t like? Most of the debate on this topic is a “Freedom of Speech” argument which does not apply. The Constitution states that “Congress” will make no laws to limit our freedom of speech. Private companies can do whatever they want. When we agree to use a platform, we agree to that platform’s terms of service. If a user violates that agreement then the platform has every legal right to restrict the violating users.
Now, just because something is legal doesn’t mean it is right. Could these companies change their user agreements to restrict certain points of view? The answer is “yes they could” followed quickly by “why would they?” The one thing you can count on with big companies in general is that they are coin-operated. Social Media giants got to be giants by appealing to the largest base of customers possible. Put simply, they have not cared so much about what you posted so long as you posted it on their platform. That’s how they make money and keep their investors happy.
Imagine the CEO of a national retail shoe brand trying to explain to his board how from now on he is going to implement policies that alienate a large segment of his customers so that they will have to buy their shoes somewhere else. I doubt that the board and investors would respond well to that strategy or the CEO’s continued employment.
So why do social media platforms remove some content and ban some users?
Nearly a third of active Twitter users followed Trump’s tweets. For the already financially troubled company, Trump was a godsend. Banning Trump was tantamount to cutting off a third of the company’s revenue. If big tech is, as I say, “coin-operated”, why would Twitter do something so harmful to its income statement?
The answer again is that these companies fear for their profits. They do not want more government regulation that could hold them liable for damages users may incur from posted content on their platforms nor do they want legislation that requires them to implement costly detailed moderation of billions of posts. However big the losses were for Twitter, the management team must have calculated even greater losses if it did not moderate Trump’s tweeting. I can’t imagine how they must have agonized over choosing between these two horrible business choices.
The major social media platforms have two great fears: the fear of losing users and the fear of government regulation because both of these mean big reduction in profits. These big tech companies have argued repeatedly that they are not responsible for what is posted on their platforms but that argument is getting increasingly more difficult to make.
For example, let’s say you own a property along a street with a lot of walking traffic. To monetize that property you let people rent booths to sell items to the public. Let’s say that one of your renters starts to sell Clorox-laced lemonade marketing it as a cure for Covid and some of its customers start getting sick or even dying. Suppose you know about this but choose to continue to rent that space anyway because you need the rental income. Are you liable for any of the damages people incur from the lemonade stand? Let’s suppose that the local authorities start voicing suspicions and wanting you to appear for questioning. You don’t want to lose the revenue from that booth but making a good, albeit painful, business decision, you decide to cancel the lemonade stand’s lease figuring it is better to lose some revenue now then run the risk of being held liable for potentially millions in personal injury damages or being shut down entirely by the local authorities. Welcome to the Twitter management team’s dilemma.
In summary, big tech does not want to control our free speech in any way. They would have more users and make more money if they could just let all of their users post whatever they want. Nor are these platforms our virtuous guardians of the truth either. They have no secret political agenda or clandestine plot to manipulate the thinking of the masses even though that does make for some cool conspiracy theories. No. They are just struggling management teams trying to navigate ominous waters while keeping their investors happy and holding onto their jobs.