Smaller Internet Companies Say They're Open To 230 Reform... To Keep Facebook From Being The Only Voice In The Room

from the no-good-options dept

Earlier this fall, Facebook was (not surprisingly) the first big internet company to cave and to tell Congress that it was open to Section 230 reform. I say not surprisingly, because it's done this before. Facebook was the company that caved in and supported FOSTA, which was the first major reform of 230. We heard from multiple people who said that Facebook recognized that it could weather the storm much better than its smaller competitors.

Indeed, Facebook's executive team seems to have recognized that reforming 230 is a strong anti-competitive weapon. It weakens smaller competitors, making them ripe for buying out, and scares off investors from funding new upstarts. It still strikes me as incredible that the same people who are demanding we dismantle 230 are also calling for antitrust actions -- because those two things work in directly opposite ways. Undermining 230 will do serious harm to competition. But that's why Facebook is so eager to jump on board. The company already admits that it spends more than all of Twitter's revenue on content moderation. So, it's not really relying that much on 230 anyway.

And, of course, it's advocacy for FOSTA has already paid off. After FOSTA passed, a number of dating sites shut down... just in time for Facebook to launch its own dating site.

Of course, when Facebook caved on FOSTA, what happened was Congress announced that "tech" was on board -- pretending that Facebook's move suddenly meant every other internet company approved too (when the reality was that every other internet company was basically furious with Facebook).

So, this puts many other internet companies in an impossible position: if they continue to completely fight changing Section 230 (as they should), then Facebook becomes the only voice in any reform "negotiations." And, seeing how Congress handled this last time, it likely means that Facebook gets to shape the "reform" in a way that helps Facebook and harms everyone else. But, Congress, of course, will pretend that Facebook's blessing means the rest of the internet agrees as well.

The end result, then, is that smaller companies, which absolutely rely on Section 230, feel pressure to get into the negotiations as well. And that's why the NY Times now has a story saying that Snap, Reddit and TripAdvisor have told Congress they're willing to talk about reform options:

On Tuesday, a group of smaller companies — including Snap, Reddit and Tripadvisor — plan to say that they are open to discussing reforms, too.

This is disappointing, but understandable. All three companies have relied heavily on 230 in a variety of lawsuits over the years. Snap just recently needed 230's help to get out of a really silly lawsuit. And TripAdvisor, which is a site that is made up almost entirely of 3rd party reviews, gets threatened with litigation over and over again, based on business owners angry about negative reviews. 230 is what enables Trip to remain in business, and the company has long been a strong advocate for 230's existence. The fact that it now says it will come to the negotiating table is truly a sad statement on the position that the 230 debate is in today.

Too many intellectually dishonest people have convinced Congress that Section 230 is a problem. And Facebook leapt in with wild abandon to help shape any reform in a manner that will most harm competitors. So now the smaller companies are put in the impossible position: continue to fight and be left out of the negotiations (where Congress will point to Facebook's participation as "support from internet companies") or agree to be a part of the process to push back on whatever awful ideas Facebook proposes for reform.

It's ridiculous that these companies had to do this, and now the anti-230 crowd will cheer on this dismantling of their own protections.

Filed Under: competition, intermediary liability, negotiations, reform, section 230
Companies: facebook, reddit, snap, tripadvisor