No one wins in a lawless land for tech companies

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SvD Näringsliv

This analysis was first published in SvD Näringsliv, in Swedish, on January 15th, 2021.

The uncertainty about what applies when infrastructure giants such as Amazon Web Services shuts down individual companies benefits no one.

In August 2017, after the riots in Charlottesville, USA, Cloudflare decided to shut down the Nazi site The Daily Stormer. Cloudfare is a company that provides cloud services and in a blog post, its CEO, Matthew Prince, explained his actions:

Like a lot of people, we’ve felt angry at these hateful people for a long time but we have followed the law and remained content neutral as a network. We could not remain neutral after these claims of secret support by Cloudflare.

Now, having made that decision, let me explain why it’s so dangerous.

Matthew Prince, CEO of Cloudflare

He then questioned his own decision, asking for guidelines that all companies could follow in similar situations.

Matthew Prince was clearly ahead of his time. But no clear directives or legislation have emerged since his statements.

Last week’s attack on the US Congress – and the actions of the big tech giants – illustrated the consequences of just that. When Twitter and Facebook shut down Donald Trump and also threw out a large number of other users, they did so based on their own policies.

Most recently, it was Amazon Web Services’ AWS turn when they shut down Parler, the right-wing app. The discussion that followed has been about both the tech companies’ role on the internet and about freedom of speech in general – should private companies be able to decide which sites can be hosted on their servers?

This is no small matter. AWS is one of the world’s most important internet companies. You probably use them every day without noticing it. Like Cloudflare, they belong to a category of companies that offer cloud services that enable the world’s largest sites to work.

These companies thus have enormous power. Starting a new website or app and not relying on any third party services is virtually impossible today. Everyone who builds something digitally is to some extent dependent on services similar to AWS.

And when they decide to close a service, the principle of their decision carries a lot of weight.

AWS itself has justified the closure of Parler by referring to its terms where it prohibits “activities that are illegal, that violate the rights of others, or that may be harmful to others”.

The fact that there has been no legislation can be partly explained by the slowness of politics. But regulating these types of services and businesses is anything but easy. The servers are often owned by US companies, but can be located anywhere in the world. Sites can also use cloud servers from many places at once, and have users from all over the world. No matter what one thinks of legislation or regulation, it is not obvious which body would even be appropriate to push through and ensure compliance.

It remains to be seen whether the events of recent weeks will lead to the kind of regulation that Matthew Prince asked for, four years ago. It is clear that the current situation creates an uncertainty that does not benefit any party.

In the near future, consequences in business is more likely. For Amazon, the political risk with AWS may soon become too great. They are already a major powerhouse in e-commerce and probably do not want to attract more attention for it. A possible solution for Amazon would therefore be to spin out AWS as a separate company instead. Last year, AWS had sales of $40 billion so the size alone could justify such a move.

Whatever happens, no one is happy with the current situation. While the world waits for order on these issues, tech leaders continue to question their own actions. As Jack Dorsey, CEO of Twitter, put it:

I do not celebrate or feel pride in our having to ban @realDonaldTrump from Twitter, or how we got here. After a clear warning we’d take this action, we made a decision with the best information we had based on threats to physical safety both on and off Twitter. Was this correct?

Jack Dorsey, CEO of Twitter.

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