Bad mistakes, Europe has made a few

Issue 45/2019

More specifically, the regulatory behemoth that is the European Union:

"Regulators in Brussels have been heralded as the world’s leading tech industry watchdogs. But Mr. Stables and other veterans of the Continent’s antitrust battles are telling American authorities, who are investigating Google, Amazon, Apple and Facebook, something else: There is a lot to learn from Europe’s mistakes."

The NYT article the quote above was pulled from notes that while the European Commission has taken plenty of action against the likes of Google, Amazon, Apple and Facebook (fining them billions of dollars), it hasn't achieved the desired outcomes.

In typical NYT fashion, those outcomes aren't specified, with the article just trotting out the usual anecdotes from failed businesses along the lines of "Google stopped sending free traffic to my site". It also fell back on the ultimate rent seekers in this space, antitrust lawyers, who want - you guessed it - "tougher rules, including expanding the scope of antitrust enforcement into new areas of the digital economy".

Europe's approach to big tech is a dangerous one, but not in the way the NYT claims. Antitrust regulation is not simple and it's not obvious that big tech companies in their current forms should be subject to it. Yes, they have the advantage of network effects, but that certainly didn't help MySpace, Friendster, Bebo, OpenSocial, ConnectU, or Vine - and those are just some of the competitors that Facebook has seen off. These big tech companies operate in highly contestable markets and keep prices low (or don't charge anything!). Sure, they have advertising platforms but they face fierce competition on that front too, not just from each other but from traditional media such as television.

Worryingly, it could be much worse. The US has so far taken a mostly hand-off approach, although that might change regardless of who wins the Presidency given the attitude of Trump's Attorney General William Barr.

But the proposals offered by some of the Democratic Presidential candidates are particularly disturbing. While their ability to execute and enforce those proposals is a separate issue, the ideas themselves are straight out of Margrethe Vestager's play-book, the nutter at the helm of the European Commission for Competition.

I've already covered a few of Warren's, so here are some of the 'tech guy' Andrew Yang's worst, who has promised that as President he would:

  • Work with companies to create algorithms that minimize the spread of mis/disinformation, and information that’s specifically designed to polarize or incite individuals.
  • Require algorithms on platforms that allow political advertisements or the sharing of news stories to be open source, or confidentially disclosed to the Department of the Attention Economy.
  • Set new standards and metrics for antitrust, including size of data assets and lack of business formation.

You read that right, a "Department of the Attention Economy". Yang wants to create a big new tech bureaucracy that will regulate everything from political advertisements to social media and even video game prizes, such as loot boxes. All in the name of protecting the children, of course. What could possibly go wrong?

Enjoy the rest of this week's issue. Cheers,

— Justin


The bits


Meet Google, the evil company

Remember when I said Google wasn't so bad? It's bad all right, just less bad than certain ISPs. Now the evil company wants to enter the banking world, although much like the Apple card it will be a half-hearted, mainstream offering with Citigroup running the back-end. Presumably Google will provide a nice app and zero/low fees, a loss leader enabling it to gather financial data about its users which it can sell to advertisers.

Learn more:


Corbyn's "crazed communist scheme"

Trust me Jeremy, you don't want to go down this road:

"The plan would involve nationalising elements of BT connected to broadband provision, forming a new company called British Broadband. Labour says it would cost about £20bn to roll out universal full-fibre broadband by 2030."

Corbyn won't win the election but it's still a horrible idea. Nationalising broadband will stifle future technology (can't have anyone competing with the government) and increase the risk of what's happening in Iran, where access to its equivalent of "British Broadband" was just cut off.

But really all Corbyn needs to do is have a look at Australia where the quality of broadband has deteriorated following the hundred-billion dollar boondoggle known as the National Broadband Network. Who would have thought that establishing a large, government-run monopoly to provide outdated, cross-subsidised technology might be a bad idea... 5G can't come soon enough.

Learn more:


So much for Libra

Facebook was in the news again for mostly the wrong reasons. Basically, its Portal TV is a mediocre TV that will spy on you; the Zuck says he believes in democracy but only because he didn't get his way; Facebook's app was (is) literally spying on you via the camera app; and Facebook Pay almost certainly spells the end of Libra (to be clear, Libra will eventually emerge but only as a figment of its former, white-paper self).

Learn more:



Image of the week

View source

Machine learning

Every traffic light captcha you click is training some self-driving algorithm, probably Google's via Waymo, how to detect traffic lights.


This week's data breaches



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Issue 45/2019: Bad mistakes, Europe has made a few was compiled by Dr Justin Pyvis and delivered on 19 November, 2019. Feel free to send feedback, suggestions for future issues, ideas, insults, or pretty much anything that crosses your mind to his Keybase or Twitter account.