Sen. Lindsey Graham, a Republican from South Carolina, had a simple question. “Who is your biggest competitor?” he asked Facebook CEO Mark Zuckerberg at his congressional testimony on Tuesday.
Zuckerberg’s first stab at an answer was to list categories of competition, without giving a specific name of a direct rival. He then retreated to a talking point his minders equipped him with, noting that the average American uses eight different apps — including email — to communicate with people, skipping over the detail that Facebook Inc. has, so far, bought two of the biggest, Instagram and WhatsApp; copied the work of another, Snapchat; and actively seeks to buy out whatever upstart threatens its position.
Zuckerberg’s invocation of email as a possible competitor to Facebook did not satisfy Graham, so he clarified the question.
“If I buy a Ford, and it doesn’t work well and I don’t like it, I can buy a Chevy,” Graham continued. “If I’m upset with Facebook, what’s the equivalent product I can go sign up for?”
By this point, it was a rhetorical question. “You don’t feel like you have a monopoly?” Graham wondered.
“It certainly doesn’t feel that way to me,” Zuckerberg said. Spectators in the Senate Judiciary Committee hearing room broke into laughter. It was a moment in which the emperor stood naked and exposed.
Graham almost certainly shares with most of his fellow senators a certain lack of facility with the intricacies of Facebook’s technical processes. During Zuckerberg’s first-ever congressional testimony, tech reporters on Twitter mercilessly mocked Senate questioners, lamenting that no politician can possibly respond properly to the rampant data privacy, discrimination, and election violations on the Facebook platform if they don’t know how the internet works.
These reporters are wrong. Graham — who, until recently, famously communicated almost exclusively by text on a flip phone — might only know Facebook from when his staff takes a picture of him and posts it. But he knew enough to discern the core problem with Facebook — or, if you’re Facebook, the core advantage: The social media giant has no competition, is too big to manage, and traps users in a devil’s bargain of being subjected to surveillance if they want to connect with friends and relatives online. And moreover, he understood the relationship between a private company and the federal government in a way his colleagues, and even those tech reporters, didn’t.
“I think we’re going to have to lead here,” Graham told reporters afterward. “If we are counting on Facebook regulating itself, we’re going to fail. … I am a Republican. I don’t like regulating things unless you have to, but to me, you’ve got a very large organization without any real competition.”
Here's the Graham-Zuckerberg monopoly exchange https://t.co/JlpNeGMILc
— Brian Ries (@moneyries) April 10, 2018
This willingness, against interest and impulse, to do the job of a policymaker was sorely absent throughout Tuesday’s testimony, which involved both the judiciary and commerce committees, as well as nearly half the members of the Senate. Far too many senators framed the problems with Facebook — almost unilaterally agreed, on both sides of the aisle, to be pernicious and requiring some action — as something for Zuckerberg to fix, and then tell Congress about later.
Could Congress have a better understanding of technology issues? Sure, and if former Rep. Newt Gingrich didn’t eliminate the Office of Technology Assessment in 1995, things would be different. But we don’t need senators who are computer scientists.
The Senate didn’t have a granular knowledge of the banking system when it passed the Securities and Exchange Act, and it didn’t fully recognize every facet of the health care provider and insurance system when it established Medicare and Medicaid. We need senators who are interested in governing. Because if they’re not, we end up with a private government ruled by a boy king making consequential decisions that affect billions of people around the world — and then ritually apologizing each time he screws up.
Let’s dispense with the absurdity that Zuckerberg “did well” at this hearing. He was evasive and noncommittal, as Sen. Kamala Harris, D-Calif., was finally compelled to point out. In addition to failing to name Facebook’s competitors — a forgivable omission, given that there are none — Zuckerberg refused to say whether Facebook tracks browser activity and activity across different devices, even when the user has logged off the site. (It does.)
He couldn’t say why Facebook decided not to notify users affected by the Cambridge Analytica data harvesting in 2015, only waiting until Tuesday to do so. He couldn’t answer if there had ever been a hack of Facebook systems. He wouldn’t commit to whether Facebook supported an “opt-in” for data collection from users, as is being readied in Europe under its General Data Protection Regulation, saying that users in the United States have “different sensibilities.”
Zuckerberg said that Facebook doesn’t allow fake profiles, contradicted by Sen. Chris Coons, D-Del., who literally found two fake profiles of himself the day of the hearing. Zuckerberg alleged that users prefer “relevant” ads — by which he means ads targeting users based on Facebook’s surveillance — impossibly speaking on behalf of hundreds of millions of people (and ignoring the millions of people who feel creeped out by ads that are too on-the-nose). He wrongly stated that Cambridge Analytica was banned from Facebook after the company became aware of the data harvesting; it turns out the firm popped up as an advertiser months later. He claimed users can port their data to other social networks, which is not really true since they wouldn’t be able to contact their friends, the whole point of interoperability. He was super-proud of stating that Facebook doesn’t “sell” its data to third parties — it allows third parties to use any slice of it for a price, making whether the data is “sold” a distinction without a difference.
He claimed that Palantir Technologies, the surveillance company chaired by Facebook board member Peter Thiel, didn’t have access to Facebook data; a former Palantir employee said the company did. He waved away suggestions that Facebook couldn’t manage the millions of examples of discriminatory advertising tactics and hate speech and deceptions that happen on the site daily, saying that unspecified “AI tools” would fix things later. When asked questions to which he said he didn’t know the answer, Zuckerberg habitually said he would get senators the information later.
Under any normal circumstances, this would have been seen as a disaster for Zuckerberg and Facebook. But Facebook stock jumped nearly 5 percent on the day of the hearing, including while he was in the not-so-hot booster seat. And that’s because the Senate made it very clear that Facebook would be given every opportunity to continue governing itself, with barely any recognition that its power in the marketplace and business model of mass surveillance means that any serious fix changes the fundamental nature of what makes Facebook the profit center it is now.
The trend of senators disclaiming their power began in the opening statements. Sen. Bill Nelson, D-Fla., told Zuckerberg, “If you and other social media companies do not get your act in order, none of us are going to have any privacy anymore.” This is a ridiculous sentence for a government official to utter. It’s not up to a social media company to govern privacy. It’s up to Congress. Nelson added, “If Facebook cannot fix the privacy violations, we are going to have to.” In Congress-speak that means, “We don’t want to legislate anything here, so help us out and clean this up so we don’t have constituents yelling at us.”
In other words, Nelson stood the entire relationship between the government and the governed on its head. This is not unusual; it in fact defines the past 40 years of U.S. politics. But it’s somewhat rare to see it so overtly on display.
It only grew worse. Sen. Chuck Grassley, R-Iowa, asked who else might be harvesting data from Facebook users. Zuckerberg said his team is investigating and it would let Congress know. That Zuckerberg would deliver his “don’t call us, we’ll call you” routine to Grassley, known as the Senate’s most dogged investigator, is a glimpse into the true power dynamic at work.
Sen. Orrin Hatch, R-Utah, openly asked for Zuckerberg’s assistance in writing regulations on tech platforms. Neither the chair, Sen. Mike Lee, R-Utah, nor the ranking member, Sen. Amy Klobuchar, D-Minn., of the antitrust subcommittee in the Senate asked about Facebook’s monopoly or market power.
A couple of senators did make Zuckerberg at least uncomfortable. Sen. Dick Durbin, D-Ill., opened by asking Zuckerberg what hotel he stayed in the night before. When Zuckerberg balked at answering, Durbin pointed out that this was the crux of the problem.
Sen. Maria Cantwell, D-Wash., a former vice president of the long-departed web video company RealNetworks, caused Zuckerberg to squirm with questions about Palantir, in a clear attempt to reference Facebook board member Thiel. Sen. Richard Blumenthal, D-Conn., heard enough to state plainly that Facebook violated its 2011 consent decree with the Federal Trade Commission around data privacy.
But the senator most emblematic of the framing of the hearing was Dan Sullivan, a Republican from Alaska. He started by correctly noting how much power Facebook has, sharing with Google almost 70 percent of digital advertising, earning $40 billion in revenue. “When companies become big and powerful … what typically happens from this body is there’s an instinct to either regulate or break up,” Sullivan said.
Zuckerberg actually had a ready answer for that line of questioning: His cheat sheet, leaked after the hearing, stated that he would have talked about how U.S. tech companies were a key asset to prevent Chinese dominance, and that “consumers have lots of choices over how they spend their time” — in other words, positioning Facebook as not a monopoly because you can also eat and shower and play softball. But Zuckerberg didn’t need to go there, because Sullivan suddenly became a political commentator rather than someone with lawmaking authority:
One of my worries on regulation, again, with a company of your size. You’re saying, hey, we might be interested in being regulated, but regulations can also cement the dominant power. You have a lot of lobbyists. Every lobbyist in town is involved in some way or the other. … Do you think that that’s a risk, given your influence, that if we regulate, we’re going to regulate you into a position of cemented authority. … Isn’t that the normal inclination of a company: I’m going to hire the best guys in town. You wouldn’t do that?
This is a viable statement for an observer of politics to make, but not really for someone who has the ability to write legislation and ignore lobbyists’ wishes. Yet Sullivan cannot imagine that world. Nor could most of his colleagues. And after senators on the two committees questioning Zuckerberg received $604,000 in campaign contributions from Facebook over the past decade, it makes sense that they tend to ignore their own power.
Behind the scenes, there are baby steps toward some actual regulatory regime for Facebook. But unless politicians realize they are allowed to make laws rather than be the kind of passive mall cops who’ve ushered us into this age of monopoly, we’ll still be in the same place years from now.