Regulating Silicon Valley: The view from 10,000 feet

“We are probably about to get into another big argument about how Apple controls what you do on an iPhone” — Benedict Evans, late of Andreessen Horowitz, now at Mosaic Ventures

From Evans’ “Regulating technology” posted Thursday on ben-evans.com

Technology was a small industry until very recently. It was exciting and interesting, and it was on lots of magazine covers, but it wasn‘t actually an important part of most people’s lives… Today 4 billion people have a smartphone—       three quarters of all the adults on earth. In most developed countries, 90% of the adult population is online.

When something is systemically important to society and has systemically important problems, this brings attention from governments and regulators. At a very high level, one could say that all industries are subject to general legislation, and some also have industry-specific legislation. All companies have to follow employment law, and accounting law, and workplace safety law, and indeed criminal law. But some also have their own laws as well, because they have some very specific and important questions that need them. This chart is an attempt to capture some of this industry-specific law. Banks, airlines and oil refineries are regulated industries, and technology is going to become a regulated industry as well.

apple benedict evans regulation

Part of the point of this chart is that regulation isn’t simple, and that it can’t be. Each of these industries has lots of different issues, in different places, with different people in positions to do something and different kinds of solution…

We are probably about to get into another big argument about how Apple controls what you do on an iPhone, and there’s a Venn Digram to be drawn here: there are Apple policies that protect the user’s privacy and security, policies that protect Apple’s competitive position (or just make it money), policies that do both, and policies that really just reflect Apple’s preferences for the kind of apps it would like to see. How exactly do these intersect? You might not want to let privacy regulators or competition regulators have the only word on this.

Of course, this is how policy works – you have to pick tradeoffs. You can have cheaper food or more sustainable food supply chains; you can make home-owning a wealth-building asset class or you can have cheaper housing. As voters, of course, we want both – I want my parents’ home to appreciate and the home I plan to buy to get cheaper. A UK minister recently told me that his constituents complain about two aspects of government data collection: the government knows too much about them, and also they have to enter the same information into too many different government websites.

My take: A good counterpoint to Scott Galloway. Bottom line: It’s complicated. Thanks to friend-of-the-blog Thomas Nash for the pointer.

2 Comments

  1. Fred Stein said:
    Thanks. Benedict adds a useful perspective. We need the discussion and regulation.

    He makes a interesting point, towards the end of his article. The cost of regulatory compliance for the smallest banks is about 8% and for the largest, about 3%.

    We can expect a similar phenomena with tech regulation.

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    July 26, 2020
  2. David Drinkwater said:
    Fishing has more regulation that Pharma?!? That’s phucked!

    0
    July 26, 2020

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