Regulating Platforms - Terry Flew

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Schumpeter was highly influential in this respect, as it identified capitalism as a complex evolutionary system, characterized by conflict and contradiction and by ‘gales of creative destruction’ (McCraw, 2007). Schumpeter himself was described as a ‘bourgeois Marxist’ (Catephores, 1994) and his account of the long waves of capitalist development was influential, as it placed innovation and entrepreneurship at the dynamic centre of capitalist economies and focused upon the entrepreneur as disruptor of the established institutional order.

      But the influence of the ideas described above was never simply ideological. They were articulated to an emergent set of economic interests, notably those of the digital technology corporations that would come to be the dominant players – first in US capitalism, then globally. This was not necessarily apparent in the early years of the internet. Academics and activists argued that the tendency of digitally networked technologies was to make access to content free, open, non-proprietorial, and shareable (Barlow, 1996b). There was the opportunity, as John Perry Barlow put it, to free ‘the economy of mind’ not only from the distributional constraints of physical form, but from the sociolegal constraints of property.

      Ideas associated with what I have labelled ‘the libertarian internet’ also came to have a strong influence upon the institutions of government. This was most apparent with the passing, in the 1990s and the decade 2000–10, of communications legislation that identified digital platforms as communications intermediaries rather than as companies that provided advertiser-supported digital content, and gave them legal protections from content hosted on their sites that differentiated them from publishers and media companies. This focus upon speech rather than media would strongly shape the evolution of digital platforms, as it made a strong case for nation states to remain ‘hands off’ where the governance of digital platforms was concerned. This continued to be the case even when issues surrounding the power of platform companies and the wilful misuse of the platforms became increasingly apparent.

      There was a strong consensus in the early years of the internet that its development should be driven by a market-led model and that the role of the government should be minimized. The digital revolution, with its ‘crucial left-right fusion of free minds and free markets’, as Louis Rossetto (1966), the founding editor of WIRED magazine, described it, was a critical driver of thought and policy. This was so in spite of the fact that vital parts of the internet’s infrastructure – such as ARPANET – were largely funded by the US government, or that the World Wide Web was first developed by computer scientists at the government-funded Conseil Européen pour la Recherche Nucléaire (European Organization for Nuclear Research) (Castells, 2001; Mazzucato, 2015).

      Extending these pro-competitive, deregulatory principles internationally, in 1998 the US government’s White Paper on internet governance proposed the creation of a new entity, whose function would be to manage internet domain name allocation: the Internet Corporation for Assigned Names and Numbers (ICANN). Observing that ‘the Internet succeeds in great measure because it is a decentralized system that encourages innovation and maximizes individual freedom’, the White Paper proposed that, ‘where possible, market mechanisms that support competition and consumer choice should drive the management of the Internet because they will lower costs, promote innovation, encourage diversity, and enhance user choice and satisfaction’ (1998 White Paper, quoted in Mathiason, 2009, p. 56).

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