Platform Economy InsightsTop 10 Issues of 2021
1) Social Media Content Moderation & Facebook’s Whistleblower
The “Facebook Whistleblower” blew up into a global media sensation but major regulation was already fully on track with the EU Digital Services Act and UK Online Safety Bill well before she arrived. Governments in Central Asia, Russia, Turkey, India, China, and Africa are also blaming social media for online troubles and mandating similar censorship interventions.
2) The Epic App Developer Battle Against Apple and Google
Epic Games’ federal antitrust lawsuit against Apple filled the news, with Judge Yvonne Gonzalez Rogers rejecting Epic’s charge that Apple was an illegal monopolist. South Korea legislated that app developers could choose alternative payments but Google said they would still collect their fees. The app developers cried foul. Watch for big developers to push for rate regulation in 2022.
3) Republicans Complain of Social Media Censorship
Nearly all Republicans suspect anti-conservative censorship by social media giants. Congress is stymied but GOP legislators in Florida and Texas waved off constitutional concerns and enacted state laws. Both bills were blocked by federal judges on First Amendment grounds. Former President Trump filed federal lawsuits against three platforms for banning him, but they appear on a similar track.
4) Big Tech Antitrust Regulation (The DMA) is Coming
Competition-inspired regulatory regimes intended to bypass the time and hassle of traditional competition enforcement were on the march, led by the EU’s Digital Market Act with unprecedented mandates on “digital gatekeepers”. Expect it to cover 20-to-30 digital businesses to start. While Big Tech regulation in the US Congress is stalled, Germany and Japan each enacted a Big Tech regulatory regime.
5) Gig Work Platforms and Change in Europe
Europe was the center of Gig work news in 2021. The UK High Court ordered Uber to reclassify drivers as workers, Spain and Portugal legislated that ridesharing and delivery drivers be treated as employees, and courts in the Netherlands and Italy made similar rulings. The biggest long-term impact may be from the European Commission’s draft legislation to update labor regulations for “Digital Labor Platforms”.
6) Biden’s Global Corporate Tax Reform and Digital Taxes
The Biden Administration completely changed the global standoff on digital taxes by refocusing US attention on tax havens. The result was a massive two-part deal negotiated at the OECD. It reworked a digital-only tax to cover around 100 giant consumer-facing companies and set a minimum tax of 15% on multinationals. Maryland also enacted a state digital advertising tax being challenged in federal court.
7) Google and Facebook Forced to Pay Media Companies
France and Australia have carried the media industry’s water to squeeze payments out of Google and Facebook. Australia proposed legislation that led both to threaten to stop key services, something Facebook actually did for a few days. A compromise was reached and payments talks ensued. France was focused on Google, slapping a 500 million euro fine on the giant for not paying up fast enough.
8) Shifting Standards for Big Tech Acquisition Reviews
Two Facebook acquisitions, GIF platform Giphy and CRM software platform Customer, highlighted the shifting standards for Big Tech acquisitions. Both are small, not profitable, US-based startups without operations in Europe. The EU signed off on Giphy, but not Customer. The UK CMA did the opposite, ordering the Giphy deal unwound. Look forward to multi-jurisdiction Good Cop – Bad Cop scenarios.
9) Amazon Battles Reliance in India
The battle between Amazon and Reliance Industries over Indian e-commerce supremacy filled 2021. While Amazon blocked Reliance’s purchase of Future Retail in court, India’s competition regulator may undo that result. Amazon’s issues are grounded in the country’s unique Foreign Direct Investment laws with accusations that the eCommerce giant routinely violates the law by engaging in retail activities.
10) TikTok, WeChat, Data Security and China “Decoupling”
The Biden Administration ended the Trump Administration’s legal battles over TikTok and WeChat and embarked on an effort to create a new system to judge the security implications of Chinese-owned apps and digital equipment. Outside the US, the data security implications of digital businesses sharing data with businesses inside China were a growing issue, especially in Japan.
