Most of us worry about monopolies. The thing we forget is that outside of a government-granted monopoly, a business can’t accomplish it. They might want to, but it can’t be done in a capitalist society. Huge businesses love government intrusion. They know that they can afford the costs and that it will run off small competitors.
There was a shocking moment in this week’s Senate Commerce Committee hearing on the Stop Enabling Sex Traffickers Act (SESTA). Prof. Eric Goldman had just pointed out that members of Congress should consider how the bill might affect hundreds of small Internet startups, not just giant companies like Google and Facebook. Will every startup have the resources to police its users’ activity with the level of scrutiny that the new law would demand of them? “There is a large number of smaller players who don’t have the same kind of infrastructure. And for them, they have to make the choice: can I afford to do the work that you’re hoping they will do?”
Goldman was right: the greatest innovations in Internet services don’t come from Google and Facebook; they come from small, fast-moving startups. SESTA would necessitate a huge investment in staff to filter users’ activity as a company’s user base grows, something that most startups in their early stages simply can’t afford. That would severely hamper anyone’s ability to launch a competitor to the big Internet players—giving users a lot less choice. Read more here.