over 3 years ago • 2 mins
The US government revealed plans this week that might eliminate measures currently protecting some of the biggest internet companies from serious lawsuits – and concerned investors just want to know where they stand, y’know? 🤨
As it is, America’s online platforms – including social media sites – are protected from liability for user-posted content under federal law. And that’s probably a big relief to them given the sheer number of cases of harassment and libel in recent years.
But the US government now seems to be arguing that since the Twitters of the world have taken to editing their users’ posts – by, say, fact-checking certain high-profile users – they might now forfeit those protections. And if that is what the review concludes, social media giants could be responsible for what their users post and open to legal action if it falls foul of the laws of the land 🇺🇸
At-risk companies saw their share prices fall on Thursday – including Facebook’s by 2% and Twitter’s by 4% – possibly because they could face the “negative jaws” of falling revenue and rising costs 🦈 The potential for increased legal fees, settlements, and damages, after all, would leave them less cash to reinvest in future growth or to return to investors. Taking steps to more proactively police users’ posts would increase costs too – and it may even put some users off, reducing activity and lowering the ad revenue the social giants are able to generate.
When Twitter announced it’d ban political ads on its platform last year, Facebook made no such promise 🤷♀️ And it’s taken the other side of this debate too: Facebook’s CEO said on Thursday that he doesn’t think it’s social networks’ responsibility to fact-check politicians. Those diverging ideologies may foreshadow a split in their user bases, and could ultimately result in each having a smaller, if more engaged, audience.
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