Perhaps social media was a big mistake

Twitter CEO Jack Dorsey in Melbourne. Stuart McEvoy/The Australian

Over the weekend The New Yorker magazine published a long article about the founder and CEO of Twitter, Jack Dorsey, which contained the following eye-catching sentence:

“Since the 2016 election, it has grown increasingly clear that allowing young, mostly male technologists to build largely unregulated, proprietary, international networks, might have been a large-scale, high-stakes error in judgment.”

The writer, Anna Weiner, didn’t really develop that thought, and she was mainly on about Twitter and the fact that it’s more or less out of control now, but she was also obviously referring to Facebook, YouTube and Instagram as well. There are a few other wannabe social media platforms but they’re the ones that matter.

Of course, the idea that “allowing” them to be built might have been an error of judgment implies that they could have been stopped at some point, and while that’s theoretically possible, in reality it wasn’t. Those creepers have grown so fast they’ve covered the house before we had time to get the clippers out of the shed.

Dorsey created Twitter in 2006 as an undergraduate student at New York University. The idea was simply to use an SMS service as a way of sharing short messages with a small group of people, but a year later it took off and, by 2008, millions of tweets were being sent.

Facebook was started by a Harvard student named Mark Zuckerberg in 2003 and it opened to the public in 2006. By July 2010 it had 500 million users.

The founders of Instagram (now owned by Facebook), Kevin Systrom and Mike Krieger, were not students but software engineers and entrepreneurs but in 2010 when they started their photo-sharing platform they were both in their mid-20s, so near enough to students.

YouTube, now owned by Google, was started by three young employees of PayPal, Chad Hurley, Steve Chen and Jawed Karim, who raised some money from Sequoia Capital in 2005 because they had had trouble sharing a video of a dinner party at Chen’s place. The first YouTube video was Jawed Karim at the San Diego Zoo on April 23, 2005.

Now each of these things is a global monster. Facebook has 2.3 billion users and Twitter 330 million. There are 400 hours of video uploaded to YouTube every minute; Taylor Swift’s Me! video got 65.2 million YouTube views within 24 hours last week, breaking the record and demonstrating YouTube’s power. Instagram is receiving close to a 100 million posts a day and there are well over 40 billion photos on the site.

Is the fact that they were started by young men relevant, as Anna Weiner suggests? Well, I was one of them once, and I can confirm that young men have a talent for blind ambition, which can be both an admirable and a bit dangerous.

The problem is the colossal scale that has happened so quickly, for several reasons.

Publishing used to be an activity in which a publisher’s staff checked the material before sending it out.

That still goes on, expensively, and a lot less profitably than before, but it’s now being swamped by the new “platform” publishers — Facebook, Twitter, YouTube and Instagram — providing their technology for everyone to use, for free, with no friction.

The lack of friction creates the scale, and thus the sheer impossibility of checking everything before it goes out. Each of them has a mechanism for dealing with content that is flagged or otherwise complained about, but checking material before it’s seen or read is simply out of the question, and becoming less so as time goes on.

As a programmer who was quoted by Anne Weiner in the New Yorker piece said of Jack Dorsey: “He’s dealing with a scale of a problem that doesn’t have a lot of precedent in human history.”

And Dorsey’s is the smallest of the four big platforms. Ben Thompson of Stratechery calculated a while ago that watching all the YouTube videos before they went out would require 100,000 people watching full-time (without any breaks for reporting) — and the total has only increased since then.

I recently listened to a gripping podcast on Radiolab about Facebook’s monitoring process. There are thousands of people in airless rooms in low-wage countries looking at flagged content; they each have about 4-5 seconds to decide whether to chop a piece of flagged content. A lot of it is horrific, all of it disturbing; many of them suffer from PTSD and burn out quickly. But this is just the stuff that is complained about after it’s been published: as we learned from Christchurch, bad content can be up for a long time before it’s discovered

The sudden scale of these platforms is not just challenging in itself — it’s also because they are global. Each country is trying to regulate them separately and while that’s a bit of nightmare for the companies’ public affairs departments, there’s also an element of divide and conquer. Regulation is a slow, uncoordinated mess.

And because they are global, they can easily shift their profits around, and as result they can and do avoid tax on an unprecedented scale.

Bloomberg had a story on Friday that said multinationals, as a group, now pay 9 per cent less tax than they did before the GFC; I doubt that it’s a coincidence that this is the same period that the social media goliaths have appeared and grown. Eight per cent of the world’s financial wealth now sits in tax havens, according to Bloomberg, which is equivalent to $US200 billion in lost revenue each year.

That’s not all Facebook, Google and Twitter of course, but the globalising of commerce that they are leading is the reason national governments are losing more and more revenue to tax havens.

We are only 15 years into this new world of virtually unregulated, uncontrollable, optional taxpaying global publishing platforms. The scale of it already has no precedent in human history, and they have only just started.

Alan Kohler is Editor in Chief of InvestSMART