Time to call it - the social utility has arrived. That has important consequences

Denis Pombriant Profile picture for user denis_pombriant March 14, 2018
If we view social media as a maturing social utility, then economic theory suggests the time has come to regulate.

social utility
Social technology has reached a point where it can be argued as representing a utility service. In this worldview, a case for regulation makes sense. Here's why. And - before we go further, I will stipulate the case I'm going to make applies to the U.S. but may well have application in markets that display similar characteristics to the one operated in the U.S.

The case for calling social utility

Economic cycles provide a useful way to observe the evolution of a disruptive technology throughout its lifecycle from a specific product to a competitive industry. The last phase in the evolutionary chain is the formation of a utility. For example, over a couple of centuries, we’ve seen the evolution of electricity from a curiosity to a business, to a group of public companies. Along the way there are the inevitable mergers and acquisitions to enable a winnowing field of competitors to achieve the scale needed to compete in very large markets.

Conventional wisdom says that when your business becomes so big that it affects large segments of society it can’t be allowed to fail lest it craters the economy or causes massive disruption injuring many people. At that point, the government has a compelling interest in preventing failure and along with that, an interest in regulating the riskiest corporate behaviors.

The latest example to hit the radar might be social media which has completed many steps of the lifecycle with blistering speed in just over a decade. This speed notwithstanding, we are now at a point where what happens in social media affects all of us.

The recent interference in the US election, which all the American intelligence agencies have confirmed, is a proof point that social media is now a utility and needs some form of regulation. Regulation is a thorny issue wrapped in individual freedom. But it is also a logical way out of an impasse.

In a recent Wired article titled Bad Actors are Using Social Media Exactly As Designed, writer Joshua Geltzer makes the point that popular social sites including Facebook, Twitter, and Airbnb, all provide tools that enable users to find and segment groups that are best subjected to targeted messaging. His point is simple, the bad actors didn’t pervert social media or hack its code. They simply use the tools provided to mount a campaign to upend a US election. There’s evidence of similar activity elsewhere.

By this measure, some elements of social media are now "too big to fail"; it is regarded as too essential to a large segment of society and its potential excesses must be managed so that it does not consume the society and the users who depend on it. Geltzer’s article clearly, but inadvertently, makes the case that social media is now a utility in need of regulation,

When Russia manipulates elections via Facebook, or ISIS recruits followers on Twitter, or racist landlords deny rentals to blacks and then offer them to whites through Airbnb, commentators and companies describe these activities as “manipulation” or “abuse” of today’s ubiquitous websites and apps. The impulse is to portray this odious behavior as a strange, unpredictable, and peripheral contortion of the platforms. But it’s not. It’s simply using those platforms as designed.

So, what would a social media utility look like and how would it be different from what we see today?

The shape of 'common good' regulation

Regulation should be done with as light a touch as possible. Grandmothers sharing baby pictures shouldn’t have to change their use habits, for example. Second, to achieve positive ends, regulation should be implemented at two distinct levels, the source, and the periphery.

At the source, regulation comes down to access for any person or entity with a beneficial and productive need for the utility’s services. In the electricity markets, this means stable pricing for all and a commitment to serve as a common carrier.

Common carrier law began in railroads and shipping. In return for its use of public lands and roads, the carrier commits to serve all parties equally. In broadcast industries (radio and TV), slices of electromagnetic spectrum play the role of roads that the broadcasters use as grants (licenses) from the people. In transport, the waterways are also owned by the people, so are the roads, and railroads have historically received government help because they provide a useful service to society.

It goes on, but you can see that source regulation amounts to giving all participants a fair shot at using the public’s assets. Regulation at the periphery takes on a different cast, notably in America where so much of modern utility regulation evolved. A great deal of peripheral regulation occurs through certification and licensure. People interested in careers involving one of the utilities often serve apprenticeships, learning from a master before earning journeyman’s status. They must also pass tests to prove their knowledge and skill.

Barbers, beauticians, and other personal services professionals go to school and sit for certifying exams. Other professions are similar. Doctors, dentists, lawyers, and many others must take many years of education, pass tests, and serve different forms of internships before practicing on their own.

The point here is that we already regulate the day to day best practices of many industries for the sake of the common good, albeit within the context of an ultra-capitalist model.

My take

Perhaps the time has come to consider lightly regulating parts of the tech industry, something we have never done. But the age of information and telecommunication, a 50-year economic cycle called a K-wave, is reaching its natural endpoint and that’s often when regulation has come to the forefront in prior cycles.

Elevating social media use to professional status seems a logical thing to do. Establishing a certification or licensing process plus capturing a user’s license number when accessing some of social media’s higher functions would give an uncomplicated way of keeping bad actors out of the networks or at least making them traceable. In case you are wondering this is the basic process of getting a building permit.

This approach need not apply to lower level personal use. But trying to reach millions of people on a social network is functionally like climbing a utility pole and messing with the wires. For this one should need certification.

Part of certification in any industry is training in the ethical use of the tools and techniques of that industry. As a society, we have not engaged in such a dialog yet, but one is overdue.

I accept that regardless of any certification, there are enormouse hurdles to overcome but without that debate, it is likely that U.S. administrators will come forward with a solution that satisfies no-one.

Endnote: It should be noted that there are unofficial - in the sense they are not mandated - certification programs for social media in some U.S. colleges. In that sense, a good part of the framework already exists. Is it too much of a stretch to move this forward to a mandated situation?

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