Public Knowledge and Roosevelt Institute Launch Guidebook to Regulating Digital PlatformsMay 8, 2019
Today, Public Knowledge and the Roosevelt Institute launched “The Case for the Digital Platform Act,” a new e-book by Public Knowledge Senior Vice President Harold Feld with a foreword by former Federal Communications Commission Chairman Tom Wheeler. The e-book operates as a guide for addressing the challenges posed by the power of digital platforms.
Many Americans now wonder how they can reassert control over their lives after ceding so many decisions about our economy and our public discourse to private actors. These individuals manage digital platforms that now permeate every aspect of our lives. In this e-book, Feld explains both how we got here and what we can do about it. He evaluates a wide variety of policy solutions and provides a road map to regulating digital platforms inspired by economics, social policy, the history of communications regulation, and antitrust law. His e-book aims to show policymakers how they can both preserve competition and empower individual platform users in the huge swath of our economy now referred to as “Big Tech.”
In the e-book, Feld defines digital platforms as a service that:
- Is accessed via the internet;
- Is at the center of a two-sided or multi-sided market where at least one side is open to the general public and allows the public to play multiple roles;
- Enjoys specific types of powerful network effects.
He explains the need for a “Digital Platform Act” and for an agency specifically charged to regulate digital platforms on an ongoing basis. He proposes a new method of assessing a platform’s dominance for purposes of new regulation. He also addresses questions around content moderation rights and responsibilities for companies that have found themselves policing the new public square, all while preserving the best things about digital platforms for their users.
An expert agency over digital platforms can analyze and study the market to determine when regulation or enforcements are needed, including if:
- Dominant digital platforms should be required to offer interconnection to competitors through open APIs to break down network effects that lock in users.
- Dominant digital platforms should be prohibited from self-preferencing and some types of discrimination. An agency can monitor and enforce this through “black-box testing,” protecting details of proprietary algorithms.
- There should be restrictions on acquisitions by dominant digital platforms, including non-horizontal acquisitions usually less scrutinized by antitrust agencies.
- Certain platforms that collect data from competitors (or potential competitors defined broadly) should be limited in how they can use their competitor’s data.
The e-book will be available free under a Creative Commons license and may be accessed here.
“It is time for the government to step in and defend our fundamental values so that digital platforms continue to benefit the public,” Feld explains, “although antitrust law seeks to protect competition, antitrust alone is not enough — what we really need is a regulator properly equipped to go further by affirmatively promoting competition through policymaking.” The e-book argues that a “Digital Platform Act” establishing a new federal agency to regulate digital platforms is the best next step and provides a framework for getting there.
The following can be attributed to Harold Feld, Senior Vice President at Public Knowledge:
“In a world where tech companies remain extremely popular but are also in the news daily due to concerns about their impact on our society, I wrote this book to offer a way forward. In the book, I provide a comprehensive framework that places our enduring values and consumers at the center of decision making — not corporate profits or economic ‘efficiencies.’ We are still years away from passing comprehensive legislation. This book is not the text of a needed law, but the way to get to the laws we need.
“To get to the laws that both protect society and continue to allow innovation, we must have a public policy conversation that accomplishes two contradictory things. On the one hand, we must find ways to constrain the power of Silicon Valley giants to make fundamental decisions on how our economy works and how our democracy works, rebalancing it toward empowering and protecting average users. At the same time, we cannot act in blind panic of policymaking that threatens to undermine the benefits digital platforms provide or does ourselves and our economy even greater harm than living with the status quo.”
The following can be attributed to Marshall Steinbaum, Fellow at the Roosevelt Institute:
“The assumption that an unregulated digital marketplace both protects users from exploitation and fosters competition has been disproved by decades of experience with telecommunications deregulation and lax antitrust policy. The tech sector shows us the result of that policy choice: unaccountable middlemen make a killing because they don’t have to follow the rules that govern everyone else in the economy.
“Feld’s book offers a way forward to re-assert the importance of public power as a counterweight to corporate power: regulation in the public interest, restructuring where existing business models are inimical to it. This publication offers a comprehensive guide to policymakers who recognize that something is wrong with the way tech currently works and are searching out policy options for what to do about it.”