Over the past year since GDPR (opens in new tab) came into play, there have been a number of high-profile fines for the big tech giants like Facebook, and a growing appetite for regulation of this industry.
These big tech businesses continue to grow more or less exponentially and have a huge amount of influence in all areas of our lives, from politics to news and education to business, and yet we continue to trust them with our data. Even Facebook, which was at the centre of one of the biggest advertising scandals in history, has continued without regulation on its powers but it has a duty of care for its users.
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More regulations please! But why?
I want to highlight why tech regulation is needed for the industry. Should these businesses be able to continue to have such a significant impact on every area of our lives, with little to no punishment for breaches of our trust? Alternatively, do we need to find a new way to regulate the tech sector, to avoid fines that are insignificant in proportion to their revenue?
One of the main challenges is that businesses such as Facebook span multiple regions, making regulation difficult. It requires multiple nations agreeing on the same guidelines and the best way to implement them.
The French tech tax that has recently been proposed is one example of a nation trying to ensure that these businesses pay their fair share of tax, irrespective of which countries they have a physical presence in. Other countries are now expected to follow, but this only addresses one small area of regulating these businesses.
At the end of last year, the UK government also proposed the implementation of a digital services tax, requiring all technology giants like Facebook to pay tax on the sales that they generate in the UK. The government has also proposed to launch a market study into the advertising models of the big tech giants, and how this is having a negative impact on publishers.
This thinking is a step in the right direction for the government, who should aim to reshape the rules that ensure major tech businesses are operating ethically and are responsible for their actions in every region. Enormous fees and fines alone can often be insignificant to such heavyweights, and don’t always reflect the severity of actions.
Here is what I propose
Instead, we should introduce a regulatory watchdog. Most industries have some form of regulatory body that protects consumers and assists with complaints. These ombudsmen cover everything from telcos, to banking and even the NHS, with an independent team assisting in processing consumer queries. So why shouldn’t we have a similar process with tech businesses?
A watchdog would serve to scrutinise the powers of the big tech giants, adjust market power to allow competition to thrive, and demand greater transparency to build trust, resulting in a more positive online environment for all. We’ve seen that self-regulation hasn’t worked. A governing body that is able to implement suitable regulations that are sensible and fair would be the only solution to keep unfair practices in check.
The arguably more essential laws concern protecting individuals; it’s important to ensure that these businesses are not leveraging their size, scale, and influence to take advantage of consumers. GDPR was a small step forward here - and other countries are now also implementing similar guidelines - but there is still a lot of confusion around how this will be regulated in the long term.
To protect users, I believe we should introduce an independent regulatory body like the ombudsman that already assist consumers in the UK. However, we would need buy-in from the tech companies to ensure this is achievable. Telcos are one area where this already works. For example, Vodafone arranged for the services and communication ombudsman to help with a huge number of complaints it was receiving, meaning issues could be resolved quicker than before, and consumers felt more confident and in control of their experience.
Taking on such large and powerful businesses like the Big Tech giants is incredibly daunting and we still have a long way to go to ensure that the rules around tech regulation consider the fast and growing pace of these businesses. It’s also important to ensure that the rules we do implement are able to adapt to any new technology that is constantly being introduced, whilst being watchful that they don’t become irrelevant before they even come into play. We aren’t ever going to make changes that resolve all of these issues overnight, but small steps in the right direction will make a long-term difference, and we should start now.
- Ruth Manielevitch is VP Global Business Development at Taptica (opens in new tab), a publicly traded, global end-to-end mobile advertising platform that helps the world's top brands reach their most valuable users.