years, tech giants and their CEOs could count on glowing praise and
friendly media coverage that hyped up just how much their products
would change the world.
changes are now the subject of growing skepticism from politicians,
academics and that same media. Election meddling, concerns about
privacy and questions about technology's role in our daily lives
have muddied the waters for the Silicon Valley giants, which now
face tough questions and scrutiny like they've never seen before.
technology industry could be in the midst of the biggest corporate
backlash in decades. While big banks were the targets of scorn after
the financial crisis, public contempt is now focused squarely on
Silicon Valley and big tech.
of this combined to be a perfect storm," said Jonathan
Taplin, director emeritus at the Annenberg Innovation Lab and
author of "Move Fast and Break Things: How Facebook, Google and
Amazon Cornered Culture and Undermined Democracy."
some high-profile voices in Silicon Valley, who started their own
companies or were early employees at Facebook and Google, agree —
and are doing so vocally. A number of early
employees from Facebook and Google launched the Center for Humane
Technologyearlier this month, with the goal of "reversing the
digital attention crisis and realigning technology with humanity's
CEO Marc Benioff, an influential figure in the tech community,
likened Facebook last month to Big Tobacco and said there's a need
the same as any other industry," Benioff told CNBC.
"Financial services, consumer product goods, food — in technology,
the government's going to have to be involved. There is some
regulation but there probably will have to be more."
appears to already be trying to get in front of any potential
regulation in the United States. CEO Mark Zuckerberg has pledged to
"fix" Facebook this year to focus on "time well spent." Facebook
said time spent by its users on the platform dropped 50 million
hours per day after the company retooled its algorithm to focus more
on friends and family, less on publishers and brands.
tech may already simply be, well, too big, according to Taplin.
and Google combined to grab 88 percent of all new online advertising
revenue last year, he said, and that may be a problem.
original idea of the internet was a very decentralized system and a
democratic space where everyone could have a place to talk," said
Taplin. "The big three online: Google, Facebook and Amazon, are more
and more becoming monopolies, so it is a winner takes all business."
America is also getting in on the tech backlash. Unilever, the
multi-billion dollar consumer goods company that makes everything
from food to cleaning and hygiene products, warned tech giants that
it was willing to use its $9 billion advertising budget, much of it
spent on Facebook and Google, as leverage
to get the tech giants to clean up their acts. Last year, several
consumer brands pulled their ads from Youtube after
an investigation by the Times of London found their ads were running
next to videos of scantily clad children. YouTube vowed to urgently
fix the issue.
executives have said they're already taking steps to address the
same concerns Unilever's chief marketing officer raised at the Interactive
Advertising Bureau's annual leadership meeting.
when Congress called on Twitter, Facebook and Google to testify on
Oct. 31 and Nov. 1 of 2017, their CEOs were nowhere to be seen.
Instead, each company sent their general counsel to be hammered with
questions that were met with little substantive answers.
big tobacco was called to testify in 1994, the companies sent their
big tech was called to testify in 2017, none of the CEOs showed
technology companies have largely avoided regulation in the United
States, they're already in the crosshairs of European regulators.
was hit with a $2.7 billion fine last year
over charges the company unfairly favored its Google shopping
business over competitors. Another EU ruling last year called on Apple
to repay the Irish government $15.4 billion
in back taxes, over charges the company benefited from unfair tax
loopholes — even though the Irish government doesn't want the money.
EU is also about to establish a new rule in May called General Data
Protection Regulation, or GDPR for short. The GDPR covers how
companies store your data, and requires them to alert authorities
within 72 hours of a data breach.
without regulation being passed in the United States, the
new rule is expected to have serious impact on American companies,which
could be fined 4 percent of their global revenue or 20 million Euros
— whichever number is higher — if they don't comply.
interesting thing is, as the Europeans regulate these platforms,
much of that regulation applies to the platforms globally," said
Taplin. "The effect of European regulation will be felt here in the
first big attempt at regulation, the Honest
Ads Act, was introduced last year. The bill would require
technology companies to be more transparent about who is paying for
an online ad. It is currently in the Senate and could change the way
tech companies, which rely heavily on advertising, conduct business.
However, four months after it was introduced, it's still lingering
in the Senate.
but surely, they [the big tech companies] are coming around to
accept responsibility," said Taplin. "But they are also trying to
avoid having any regulations passed."
THE ROLE OF TECHNOLOGY IN OUR LIVES
tech's business practices are being put under the microscope, but so
is the presence of technology in our daily lives — particularly with
the emergence of smartphones.
month, active investor JANA Partners and the California State
Teacher's Retirement System sent
Apple's board of directors a letterasking them to "think
differently" when it comes to kids.
letter pointed to a number of studies purporting to show the effects
technology has on children and teenagers.
is also a growing societal unease about whether at least some people
are getting too much of a good thing when it comes to technology,
which at some point is likely to impact even Apple given the issues
described above," said the letter.
groups said there is "no good reason why you should not address this
issue proactively" and noted the notoriously secretive company could
perhaps already be working on the issue.
has had parental controls available in iOS, the operating system
used on the iPhone, for the past decade. A statement issued by Apple
last month, in response to the letter, said the company has "always
looked out for kids ... while also helping parents protect them
addition, Apple's statement said there are "new features and
enhancements planned for the future, to add functionality and make
these tools even more robust."
former Facebook and Google employees who mobilized to start the
Center for Humane Technology are working alongside Common Sense, an
advocacy group focusing on children and technology.
addressing those concerns could mean rethinking what has made tech
companies so successful. Tech business models "often encourage them
to do whatever they can to grab attention and data and then to worry
about the consequences later, even though those very same
consequences may at times hurt the social, emotional, and cognitive
development of kids," James Steyer, CEO and founder of Common Sense,
said earlier this month. He called on the industry to "change its
ways and improve certain practices."
if ever there was an inflection point, and a critical and necessary
place to do it, that time is 2018, according to experts. How tech
companies handle this year could potentially be do or die.
reaction from the platforms was, 'We have nothing to do with this,
or this was just imaginary,'"' said Taplin. "Then slowly but surely,
they are coming around to beginning to accept some responsibility."
they are really trying to do is avoid having any regulations passed
because they have lived in a world without regulation for 25 years —
and they don't want it to start now," he said.