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The free market is the best way to curtail power of technology firms

The free market is the best way to curtail power of technology firms
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Mark Zuckerberg of Facebook and Jack Dorsey of Twitter testified before the Senate Judiciary Committee last week over social media bias and the censoring of political content. It was the most recent federal hearing for technology executives and came less than a month after several of them testified before the Senate Commerce Committee on similar issues.

Bipartisan frustration with how social media companies handle political content has led to calls for the end of liability protections in Section 230 of the Communications Decency Act. Technology companies are mostly excused from liability for user content. If such protections are removed, social media companies would be regulated more like traditional media and would have liability for user content posted on their platforms.

President Trump signed an executive order this spring that called for new rules that will strip Section 230 protections from social media companies that engage with the censoring of political content. Senator Josh Hawley introduced a similar effort by Congress. Leading Democrats also support this repeal of Section 230. Joe Biden declared on the campaign trail that the provision should be revoked for Facebook and other platforms.

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Yet such social media regulation could backfire. The censoring of content could rise in an effort by the platforms to avoid liability for the content. As Dorsey said in the hearing last week, an elimination of Section 230 would have the opposite effect and could result in “increased removal of speech, the proliferation of frivolous lawsuits, and severe limitations on collective ability to address any harmful content and protect people online.”

The regulation of social media companies as traditional publishers could also entrench their oligopoly. New burdens would be so costly to comply with that it would prevent new competitors from entering the market. The actual threat to social media platforms is not government regulation. It is the smaller competitors which could take advantage of any censoring by capturing disaffected audiences. The best way to curtail the power of the technology companies is to support these competitors that would cease to exist in the free market if Section 230 protections are removed.

Facebook backs increased regulation of the internet likely because its first mover advantage would hurt new competitors more than other burdens it would endure. “I believe we need a more active role for governments and regulators," Zuckerberg said in a former Washington Post column.

Facebook benefited from internet rules in Europe under the General Data Protection Regulation because smaller competitors have not been able to handle compliance costs, including hiring more coders and lawyers. After the General Data Protection Regulation was enacted, the market share for the social media giants increased. It is no wonder Zuckerberg crowed that it would be beneficial for the internet if more countries used rules like the General Data Protection Regulation as the framework of platforms.

Republicans are justifiably angry over social media censoring, notably the blocking of the New York Post story over Hunter Biden. My group has also been prevented from pushing political content on social media. However, conservatives must be careful that new rules will not do more harm than good. We also have to avoid making political bedfellows with Democrats whose aim is not fairness but to stifle ideas with further regulation.

Consider the words of Senator Ed Markey, who at the Senate Commerce Committee hearing claimed, “The issue is not that the companies before us now are taking too many posts down. The issue is they are leaving too many dangerous posts up.” The anger from conservatives at technology companies is understandable. But calls for more regulation are not. The elimination of Section 230 protections will have unintended effects. The best way to curtail the power of social media is in the free market.

Alfredo Ortiz is president and chief executive of the Job Creators Network.