User Data as Public Resource: Implications for Social Media Regulation

Revelations about the misuse and insecurity of user data gathered by social media platforms have renewed discussions about how best to characterize property rights in user data. At the same time, revelations about the use of social media platforms to disseminate disinformation and hate speech have prompted debates over the need for government regulation to assure that these platforms serve the public interest. These debates often hinge on whether any of the established rationales for media regulation apply to social media. This paper argues that the public resource rationale that has been utilized in traditional media regulation in the U.S. applies to social media. The public resource rationale contends that, when a media outlet utilizes a public resource – such as the broadcast spectrum, or public rights of way – the outlet must abide by certain public interest obligations that may infringe upon its First Amendment rights. This paper argues that aggregate user data can be conceptualized as a public resource that triggers the application of a public interest regulatory framework to social media sites and other digital platforms that derive their revenue from the gathering, sharing, and monetization of massive aggregations of user data.

Private Regulation of Speech

Governments around the world are increasingly turning to private internet platforms as de facto regulators of internet users’ speech. In the United States, newly enacted legislation has expanded internet intermediaries’ liability for users’ communications for the first time in two decades. In the European Union, the Commission has proposed making social media companies proactively monitor and remove user communications relating to terrorism. Pressure to combat violent extremism has already led to troubling errors – including platforms removing political speech, videos posted by human rights organizations, and users’ discussions of Islamic religious topics.

See Private Speech Regulation

Politico: Facebook’s digital currency could trigger new D.C. battles




But with this big step into the tightly regulated world of finance, the company will expose itself to a type of regulatory intrusion that is not common in its traditional realm of online media. Chief among the concerns, according to experts, are the possibilities that Facebook’s global coin could be exposed to money laundering using the company’s main website and its sister platforms WhatsApp and Instagram.

“Facebook coin will do for money laundering what Facebook did for fake news — likely lead to an explosion in terrorist financing,” said Charlie Delingpole, CEO of Comply Advantage, an anti-money laundering consultancy.

SEC: Updated Investor Alert: Social Media and Investing – Avoiding Fraud

Editor’s Note:  Five years ago the SEC alerted the public to the damage that could result from the unethical use of social media.

The SEC’s Office of Investor Education and Advocacy is issuing this Investor Alert to help investors be better aware of fraudulent investment schemes that may involve social media. U.S. retail investors are increasingly turning to social media, including Facebook, YouTube, Twitter, LinkedIn and other online networks for information about investing. Whether it be for research on particular stocks, background information on a broker-dealer or investment adviser, guidance on an overall investing strategy, up-to-date news, or to simply discuss the markets with others, social media has become a key tool for U.S. investors.

SEC: High-Yield Investment Programs (HYIP)

Fraudsters may use social media to promote a HYIP website or may encourage investors to use social media to share information about a HYIP website with others.

High-Yield Investment Programs

The Internet is awash in so-called “high-yield investment programs” or “HYIPs.” These are unregistered investments typically run by unlicensed individuals – and they are often frauds. The hallmark of an HYIP scam is the promise of incredible returns at little or no risk to the investor. A HYIP website might promise annual (or even monthly, weekly, or daily) returns of 30 or 40 percent – or more. Some of these scams may use the term “prime bank” program. If you are approached online to invest in one of these, you should exercise extreme caution – they are likely frauds.

Circle ID: A Case for Regulating Social Media Platforms

There are some who see the regulation of social media platforms as an attack on the open internet and free speech and argue that the way to protect that is to let those platforms continue to self-regulate. While it is true that the open internet is the product of the same freedom to innovate that the platforms have sprung from, it is equally the product of the cooperative, multi-stakeholder organisations where common policy and norms are agreed.

Read article.

Republique Francaise: A Framework to Make Social Media Platforms More Accountable

The French government is among the long list of countries who are implementing a program to address issues associated with social media.

The second pillar of their program is a:

A prescriptive regulation focusing on the accountability of social networks, implemented by an independent administrative authority and based on three obligations for the platforms:
· Obligation of transparency of the function of ordering content,
· Obligation of transparency of the function which implements the Terms of Service and the moderation of content,
· Obligation to defend the integrity of its users.

Read French Framework for Social Media Platforms

The Editor: Will Regulation of the Social Media Maim the US High Tech Industry?

In the very short period of time that CRE has established an interactive public docket which addresses possible US regulation of the social media two dominant concerns have been raised both in the literature and on the basis of first-hand discussions with stakeholders:

(1) how do you address First Amendment Issues, and

(2)  will mission creep maim the US high tech industry?

Question (1) is self-explanatory.

Question (2) is raised in terms of mission creep; the ability of regulators to continually expand upon their initial mandate.  Mission creep not only results from the promulgation of regulations but in a myriad of guidance documents.

The Editor: CRE Letter to NTIA

CRE routinely works with federal agencies regarding the improvement of their regulatory programs. In this memorandum to NTIA we have asked  them to become involved in the potential regulation of the social media.

The Editor: What is the operational sequence for examining the possible regulation of social media?

Any number of tasks could be initiated including, technical viability, First Amendment issues, digital impersonation and content control. In any event the National Institute of Standards and Technology should be tasked immediately to assess the technical viability of regulating social media.

National Institute of Standards and Technology