Business Scholarship Podcast
Abby Lemert on Facebook's Corporate-Law Paradox
Tue Jun 06 2023FacebookSocial MediaContent ModerationRegulationMental Health
Description
The episode covers Facebook's unique position as a speech distribution platform, its manipulation of users, ethical challenges faced by the company, difficulties in reforming content moderation, regulating Facebook's behavior and business models, and the growing recognition of mental health harms caused by social media platforms.
Insights
Facebook's Manipulation Tactics
Facebook camouflages its transaction with users and manipulates their beliefs about engagement, leading to increased risk of manipulation.
Ethical Challenges in Delaware Corporate Law
Accusations against Facebook are ethical problems rather than legal problems due to obligations to maximize profits under Delaware corporate law.
Challenges in Reforming Content Moderation
Reforming content moderation on platforms like Facebook is difficult under Delaware corporate law, making proposed solutions challenging to implement.
Regulating Facebook's Behavior and Business Models
Antitrust lawsuits and proposed legislation could regulate Facebook's behavior and business models, potentially introducing healthier alternatives.
Growing Recognition of Mental Health Harms
Similar to the recognition of health effects from cigarettes, there is a growing recognition of the potential mental health harms of social media platforms.
Chapters
- Facebook's Unique Position and Manipulation of Users
- Ethical Challenges Faced by Facebook
- Challenges in Reforming Content Moderation
- Regulating Facebook's Behavior and Business Models
- Growing Recognition of Mental Health Harms
Summary
Transcript
Facebook's Unique Position and Manipulation of Users
00:06 - 07:01
- Facebook is a dominant speech distribution platform that shapes public opinion and the news cycle.
- Users are often unaware of the transaction they engage in with Facebook, which involves selling advertising opportunities rather than personal data.
- Facebook camouflages this transaction and manipulates user beliefs about their engagement with the platform.
- Lack of awareness about the transaction exposes users to increased risk of manipulation.
- Facebook's addictive product leads users to overconsume, even when it causes harm.
- Controversies surrounding Facebook include prioritizing profits over social harms, as revealed by the Facebook files.
- The impact on teen girls' mental health and disordered eating caused by Instagram was one notable revelation from the Facebook files.
- Facebook's moderation practices in violent countries and its knowledge of human trafficking have also raised concerns.
Ethical Challenges Faced by Facebook
06:37 - 13:53
- Public outrage and criticism have been directed at Facebook for social harms caused by its platforms and content moderation failures.
- Accusations against Facebook are ethical problems rather than legal problems, as Delaware corporate law obligates maximizing profits for shareholders.
- Maximizing user engagement, which drives profitability, may not be beneficial for society or democracy.
- Proposed solutions to social harms on platforms like Facebook are difficult to undertake lawfully under Delaware corporate law.
Challenges in Reforming Content Moderation
13:38 - 20:52
- Reforming content moderation on platforms like Facebook is challenging due to Delaware corporate law.
- Proposed reforms include hiring more human content moderators, creating institutional separation between business teams and trust and safety teams, reducing platform addictiveness, and cutting back on sensationalist content.
- Increasing the number of human content moderators would be expensive and drive up costs.
- Institutional separation is barred under Delaware corporate law as important decisions impacting profitability cannot be delegated to outsiders.
- Reducing addictiveness or sensationalist content would reduce user engagement and is difficult to justify under existing business models.
- Aligning profit maximization with pro-social approaches could be possible if there were a threat of external regulation that justifies costly investments in content moderation.
- User exit has not been effective in response to public relations crises faced by Facebook.
- The threat of government regulation in the United States has not led to meaningful steps towards digital platform regulation.
- Suggestions for change include antitrust enforcement actions, digital competition legislation, and mandating interoperability between platforms.
Regulating Facebook's Behavior and Business Models
20:25 - 27:41
- Antitrust and competition lawsuits, as well as proposed legislation, could regulate Facebook's behavior and lower barriers to entry for new social media platforms.
- Forcing platforms to compete on quality with a wider assortment of new entrants may introduce healthier alternative apps and platforms into the market.
- The Supreme Court case Gonzalez vs. Google could impact Section 230 of the Communications Decency Act, which currently grants immunity to digital platforms from civil liability.
- Expensive litigation might push Facebook and other platforms to invest more in content moderation and drive fundamental changes to their ad-based business models.
- Taxing Facebook for the social costs of connection, similar to the social cost of carbon in environmental regulation, could incentivize platforms to reevaluate their investment decisions and change their business models.
- Facebook, Instagram, and TikTok are primarily digital advertising companies that capture our time and attention in exchange for access to the platform and advertisements.
- Recognizing the true nature of these companies is important when forming opinions about them and participating in regulatory conversations.
- Society is beginning to reckon with the long-term health effects of social media platforms, similar to how it addressed the health effects of cigarettes.
Growing Recognition of Mental Health Harms
27:14 - 29:30
- Similar to society's recognition of the health effects of cigarettes, there is a growing recognition of the potential mental health harms of social media platforms.
- The literature on the long-term health effects of these platforms is just beginning to emerge.
- A societal reckoning with the mental health impacts of social media is likely in the future.
- Keep an eye on Gonzalez versus Google and consider its economic implications.
- Gratitude is expressed towards scholars who have contributed to developing a critical perspective on technology companies.
- Abby Limurt, a third-year student at Yale Law School, discusses her article 'Facebook's Corporate Law Paradox' published in the Virginia Law Business Review.