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Big tech hearing: 'I don't see a real likelihood that the laws will be changed': John Yun

Yahoo Finance’s Julie Hyman, Brian Sozzi, Myles Udland, and Dan Howley speak with John Yun of the George Mason Global Antitrust Institute about antitrust in regards to the Twitter and Facebook Senate hearing.

Video Transcript

JULIE HYMAN: As we have been discussing, we are awaiting the beginning of a hearing by the Senate Judiciary Committee examining Section 230 of the Communications Act that affects many social media companies. Twitter CEO Jack Dorsey and Facebook CEO Zuckerberg will be testifying at that hearing.

Let's bring in someone to talk more about this. That is Professor John Yun. He is a professor at the George Mason University's Antonin Scalia School of Law. Professor, thank you for being here. It's so fascinating, because these companies are being scrutinized and criticized from all different angles, most issues coming back to antitrust, an area in which you are an expert. What do you think is the biggest challenge for these companies from a legal perspective? Which of all of these criticisms do you think is the most valid, or are all of them?

JOHN YUN: Well, thank you, Julie, for having me on again. It's always a pleasure.

I think the biggest challenge that they face is not likely antitrust, to be honest. Even though there's a lot of scrutiny, I think the precedents and the laws are largely in their favor. I think the larger problem is probably this Section 230 and changes to it and potential allegations of discriminatory moderation of their platform. I think there, where consumers can quickly switch to other platforms-- that's probably, to me, their larger threat.

DAN HOWLEY: Professor Yun, this is Dan Howley, the tech editor at Yahoo Finance. I follow a lot of this stuff pretty closely. And I've got to ask, when you look at what different lawmakers want, we have some saying they want these kinds of protections in Section 230 [? offers ?] stripped completely. They want them scaled back. It's not a red-and-blue kind of issue. It's bipartisan. It just depends on the different reasonings from each party. Joe Biden himself has said that he doesn't like 230, and he thinks Facebook doesn't deserve that kind of protection.

Do you see any real change coming, though? Do you think that this is something that we'll actually see evolve through the Biden administration? Or do you think that this is something more of just political showmanship, where these different senators and Congress members are coming up and saying, we don't like Big Tech, and just trying to get their names out there for that reason?

JOHN YUN: Thank you, Daniel. I think it is the latter. I think we're all a little exhausted with dragging them in front of Congress and raking them over the coals and then doing this every six months. I think if there really is a problem, there should be evidence of that. And I think maybe the company should be asked to provide evidence, or the data. Maybe researchers can look at that, whether they're really engaging in bias or not. And if they're not, then I think that should be readily transparent.

I think this show of bringing them up and not really doing anything is really troublesome. And I would argue they should just drop the arguments that they're going to do something. Either they do it, or they don't. And I think that's the frustration I think most people are having right now.

BRIAN SOZZI: John, if this does go against Big Tech, I think a lot of investors are trying to figure out, how much does it open them up to potential fines? Are we talking billions here? And if that's the case, does that choke off innovation at these tech companies and really send them down a dark path?

JOHN YUN: I think it can. I mean, obviously it will depend on the level of the fine. They've been fined heavily in Europe. They have yet to pay them, really, and they have ongoing litigation.

But to the extent that it really does impact their revenue and their research and development, yeah, I mean, innovation is very, very important to this economy. It largely explains almost every economic growth. It's not labor productivity. It's not capital growth. It really is technological growth.

And to the extent that you are hampering the top five firms largely, these platform firms and their rate of innovation, that can have a material impact on the GDP of the US. And so I think one has to be really careful of the incentive effects that these antitrust policies can have on these Big Tech platforms.

MYLES UDLAND: John, you mentioned that this is, I think, what, the third time this year that we've had tech executives brought up before lawmakers. It's certainly been a more regular occurrence. And if we go back in time, there was a lot of excitement, I think, from folks who want to see these businesses broken up around some of the things that, particularly, Jeff Bezos said around how they use their private-label business, using that sort of data.

But today's hearing is focused on censorship on the platforms. I guess, as you see these proceedings, does this make the entire effort somewhat-- I don't want to say less serious, but it is tangential really, to the Section 230 concerns that originally began this regular schedule for these folks.

JOHN YUN: To me, it's all of one piece. And there's to the American public, they're not really making a difference between Section 230 and their censorship and their various policies.

I think Section 230 is sort of abused in the public discussion. I think, Alexis gave a really good background on what it is and isn't. What it is not is, it doesn't give them blanket immunity. In fact, if Twitter, let's say, goes on and makes representations about a tweet or certain fact patterns, that themselves-- that's outside of Section 230. It's about what the users say in their moderation policies. That's what Section 230 covers.

And so to the extent these platforms are actually misrepresenting how they moderate their platform, that's outside of Section 230. So if they're saying they're unbiased, they do it on an even hand, I think they should show that. And I think Congress rightly should be able to demand that type of evidence. But as you mentioned, them coming up again and defending a policy and going back and forth really isn't accomplishing anything. And I think it's just really, largely, a waste of time.

MYLES UDLAND: And then, again, going back in time a bit, there was also conversation around Sherman Anti-Trust and the way that's been applied or not applied to these businesses. And it's not exactly related to Section 230 but we're really saying, can laws be rewritten? Will laws be rewritten?

And certainly, I don't think there's a ton of bullishness around Congress changing laws, putting in new statutes. But have you had any conversations with lawmakers or groups influencing them that seem more serious around rewriting these laws, such that they would be applied in a more 2020-type fashion?

JOHN YUN: So Myles, you're right. I haven't personally been in any conversation-- well, intimate conversations about changing the laws. And I think that is the right path, though. I'm not saying that that is something we should do. But if we do feel like there's a systematic problem with Big Tech, and they're really imposing loss on consumers, really harming innovation and rivals in these spaces, then I think changing the laws is really the right approach. And that needs to be amended, or they have certain provisions, that certain type of firms have to behave in certain ways.

I think trying to change antitrust within the current structure-- that's the problem people are having, because antitrust is a very disciplined area of the law, and there's a lot of strong precedents that protect companies from whimsical challenges to their business practices that aren't largely based on the consumer, but more on protecting their competitors. And I think that's the right approach. So that being said, I don't see a real likelihood that the laws will be changed. But if we do think there's a problem, I think that's the right avenue.

DAN HOWLEY: Professor Yun, I want to ask what happens if we do see something like Section 230 go away completely. It doesn't seem as though that's going to happen. It seems that it's unlikely we'll see anything done substantively. But it also doesn't seem as though, when the lawmakers speak, they understand the full ramifications of what they're offering. So I guess, could you give us an idea of what it would look like if Section 230 just disappeared overnight? What would happen to these companies, and I guess the internet in general?

JOHN YUN: That's a great question. I mean, in law school, that's what we always do, is these counterfactuals and hypotheticals. And they're really important. And the one that you pose is really key.

I think if they got rid of Section 230, it would actually help the incumbents and hurt the smaller firms, because regulatory intervention almost always, always helps the larger firms. They'll be able to navigate Section 230 without it being there. They'll be able to prevent liability I think it will be the startups and the smaller platforms that will have hindrances in moderating their user content in a way that doesn't trigger liability.

So I think it would actually be a bigger problem for the smaller firms if they repealed the law, because anytime you have any type of policy that makes it difficult due to liability and exposing firms to liability, you're going to have a disproportionate impact depending on your ability to handle those lawsuits.

And I think these larger firms are very sophisticated. They're going to survive quite well with or without Section 230. They're going to thrive. The question is, what will help the entrants, the startups, the more innovative firms that aren't these big guys? And I think having Section 230 actually does help them, rather than harm them.

JULIE HYMAN: John, just to offer a little bit of clarification on something that you mentioned, which is that these companies should show data that shows they are not showing bias in their moderation-- just to put a fine point on it, why do they have to do that? Why can't they be biased in their moderation as private companies? Is it because of Section 230?

JOHN YUN: No, they can be. So that's a really great clarification. Absolutely, Julie. They can be biased. The question is, how do they represent their platform to users?

I think there's a big problem about a bait-and-switch type of strategy. And I'm not suggesting they've engaged in it, but if you grow your platform based on this evenhanded moderation policy, and people rely on that, they help you build your platform, they use it, they attract users who want to follow these certain influencers, and then later you suppress what they can or can't say.

I think all of it is fine, as long as it's very upfront. And even saying, hey, we're biased, we don't like these type of statements about COVID, or we don't like these type of political statements about the election-- I think most people would view that as fair. And I don't think there's any obligation these private companies have to have a certain type of policy.

What I am concerned with is representations about what their moderation policy is and isn't. And I think they've made very strong representations that they're evenhanded. And that sounds really good, and that's attractive to consumers. And I think they should, at this point, be-- not required, but I think it would be certainly nice if they could support that with some type of evidence or data saying, look, everyone talks about the conservatives, but we moderate our policies, and these type of viewpoints were also moderated as well. And I think that type of evidence, fair-minded people will really welcome that type of data.

JULIE HYMAN: What I do wonder, though is-- and I know this isn't a legal question. It's more of a political and cultural one. What happens when the social media platforms are just as politically siloed as everywhere else, as other public spheres? In other words, what if people decide that Facebook or Twitter or whatever is biased, and they migrate to other platforms, and then everyone just kind of goes into their own groups even more than they have already?

JOHN YUN: That's fair. And one virtue of Twitter-- it feels like a public forum where we can all go on there and hear each other. And sometimes it's unpleasant. Sometimes it is pleasant. And sometimes there is common ground. And I think we lose that when we go into our respective political silos.

That being said, consumers vote with their feet. And if they really do value that, as much as we think as it's a public good for us to get together, I think more realistically, consumers should be free to go to where they get the most value with their time. And if that's going on Parler, if that's staying on Twitter, going on YouTube or Rumble, I think what's really good for consumers is choice. And I think that's--

- [INAUDIBLE]

JOHN YUN: --what we're seeing.