Commentary

Social Media And Messaging Giants Will Feel PM's Wrath

Interesting times ahead. For the social media and messaging companies, things are about to get a little less cosy. That's the pitch of the Conservatives' manifesto, anyway.

Yesterday's London Blog picked up on the small line that got virtually no coverage in the media, that Section 40 and Leveson 2.0 is being dropped. It means newspapers sticking with their preferred regulator will no longer face the unfair prospect of having to pay both their own costs and those of anyone suing them, regardless of the outcome of the case.

Today, after yours truly has had a chance to wade through the 88-page tome (82 is the page to focus on), we have an altogether different outcome for the tech giants online. While the newspapers have been spared a harsher regulatory approach, it looks like one is about to come into being for social media and messaging companies. 

Now, to be straight, the manifesto -- as observers have lined up to agree -- is short on detail but very long on principles and outlining the direction of travel. To paraphrase a pretty loosely phrased manifesto, that direction is now firmly headed toward a heavier hand on Internet regulation. 

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Theresa May's opinion that people should be able to erase posts once they turn 18 is well known. What was more of a surprise is a promise to more heavily regulate the tech giants to protect against extremist content and fake news. The threat is repeated in the manifesto, which warns that punitive sanctions will be put in place for those who fail to keep to the standard expected of them. Whatever that may turn out to be will presumably be fleshed out later.

What we had no way of knowing, until yesterday, was that the PM believes the social media and messaging giants need to be on the receiving end of a levy that will pay to raise awareness of and counter the harms their services may cause. 

The news couldn't come at a worse time for, in particular, social media sites as a poll of teenagers shows they have a negative impact on their mental well being. It also comes in the same week that Facebook was fined, again. This time it was 110m Euros for what Facebook put down to innocent errors on its regulatory filings when it took over WhatsApp. It promised data would not be shared between the two. The European Commission was then rather annoyed to find out that was not necessarily the case.

Remember that we are still waiting on the size of the likely penalty Google will have to pay for anti competitive behaviour in search and the apps that come pre-loaded with Android. Throw in a boycott, which includes the UK Government, on YouTube over the site inadvertently allowing advertisers to fund hate and terror content, and the picture looks more bleak.

Do also feel free to throw in the tax arrangements of the huge tech companies and then wonder why they would expect anything other than fines and a new levy when they appear to consider tax rates in the low single digits the norm. Come on guys -- if you do that much business in the UK, you can't expect a pat on the back for channeling funds out of the country (often via Dublin) to avoid UK tax. And if you're deemed to be causing problems and not paying your way, then trust me -- there will be no vote of sympathy when a levy comes in to redress the balance slightly.

So, patience is running out with the social and messaging giants. The Conservatives' manifesto clearly shows this and the direction of travel it points to may be a bumpy road. While newspapers will be raising their glasses to the new manifesto, Facebook, Google, Snapchat and Instagram, et al, may well end up drowning their sorrows.

The one thing they might find solace in is talk of creating a digital framework with other countries. If levies and a harsher regulatory environment will be brought in, it seems there will be a lot of negotiation ahead. Last time I checked, the next UK government will be pretty busy talking with its EU neighbours for the next couple of years.

So social and messenger firms can probably not expect unilateral action in the near term. But mark these words -- the direction of travel has been clearly signalled.

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