On Mar. 13, the U.S. House of Representatives passed a bill looking to remove TikTok from app stores nationwide unless it severs ties with its Chinese parent company, Bytedance. While it remains the only firm whose alleged links to the Chinese government are being scrutinized, TikTok isn’t alone in facing international censure. Over the past twelve months, Amazon, Meta, Apple, and X have all found themselves confronting lawsuits over content moderation and data privacy on both sides of the Atlantic. Make no mistake: We are witnessing the birth of a new Western regulatory consensus and this time, it has teeth.
In February, the EU launched an investigation into TikTok’s alleged failings to protect minors on their platform, having already fined the social media platform $372 million just six months prior on similar grounds. Under the new Digital Services Act, they could now be facing a penalty of up to $800 million–or 6% of their global turnover.
With major elections looming in both Europe and the United States later this year, consumers are about to start seeing significant changes to their online content. Is this the end of social media as we know it?
A renewed onus on tech companies
Even if the TikTok ban clears the U.S. Senate, it still gives Bytedance five months to sell TikTok’s U.S. Operations before its more draconian measures come into effect, opening the decision to a host of legal challenges. Montana attempted to enact a statewide ban on TikTok last year only to find the state mired in lawsuits around First Amendment rights. The same fate may yet await the current piece of legislation.
Indeed, the long-running legislative soap opera around Big Tech used to be all about preserving freedom of speech. But now it seems we are reading from a different script– it’s about user protection and it’s being syndicated internationally.
The EU’s Digital Services Act is the latest in a string of global regulations that attempt to tackle online safety. Shifting the burden of responsibility onto platforms, this recent trend is a sharp departure from the previous era of internet legislation.
Back in the 1990s, the first set of rules guiding online service providers was shaped in large part by U.S. Lawmakers and their focus on extending the First Amendment online. In 1996, this legislative push culminated with the notorious Section 230, which exempted internet intermediaries from liability around hosted content. When the Digital Millennium Copyrights Act came out two years later, it doubled down on this approach by granting platforms similar protections.
After nearly two decades, the winds finally seem to be blowing in the opposite direction. Watershed moments such as the Molly Russel inquest and the U.S. Senate hearing on online child exploitation have inspired a large amount of public rancor, and regulators have responded by placing more emphasis on online safety and transparency. The emerging bottom line is that users pay too steep a price when platforms prioritize user acquisition instead.
Following the DSA, the UK Online Safety Act came into effect in 2023 alongside a broader international push for online safety and data privacy. This wasn’t just from the EU–the U.S., Australia, Singapore, South Korea, and a few Latin American countries have all rolled out their own legislation in the past two years. For the first time, we are witnessing a global consensus form around stronger regulatory frameworks designed to protect internet users.
In 2021 alone, Google, Amazon, Meta, Apple, and Microsoft generated a combined $1.4 trillion in value. For a long time, many governments looked to harness Big Tech’s growth potential for their local economies, welcoming them with open arms, and allowing the tech-related ecosystem room to grow exponentially, despite well-documented safety risks to consumers.
Regulators are now stepping up. Apple was just fined €1.8 billion under the EU’s Antitrust laws, GDPR continues to levy heavy fines, and the DSA looks set to raise these stakes even further.
European users exist in the most heavily regulated global market but they are too valuable to ignore, making up 15% of TikTok’s total monthly active users (MAU) and 13% of Meta’s. This roughly correlates to how much the region contributes to their respective advertising revenue, a model upon which the majority of social media platforms still rely for continued growth.
What does this mean for you?
There is little doubt that regulators want to reign in Big Tech but whether that will be accomplished through unilateral bans is unclear. The relationship between both parties continues to be one of complex symbiosis, despite noises to the contrary.
In Oct. 2023, reports that Elon Musk was considering removing X from Europe due to a DSA-related investigation. This has yet to transpire. As Mark Zuckerberg has suggested, Big Tech needs regulatory constraints just as much as regulators need Big Tech for their economies.
Even as Biden talks of TikTok’s dangers, his presidential campaign uses the platform for its messaging. Meanwhile, Trump has backpedaled on earlier calls for a ban, citing Facebook as a far “greater enemy of the people.”
For now, users across the board will see some of their features restricted or modified. In cases like Meta’s ad-free subscription model, we may even see a transition towards a pay-to-play model as companies look to offset the costs of compliance. These kinds of agreements are good news for the average consumer, bolstering digital literacy around the use of personal data, which has long been commodified for free by ad-dependent companies.
In a pivotal year both for technology and democracy, we are bound to see more highly publicized theatrics in the tussle between regulators and online platforms. Hopefully, the result will be greater legislative clarity and a safer online experience for everyone.
Olia Valigourskaia is the founder and CEO of WebKyte.
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