The Missing Stakeholders

The coming wave of digital regulation may claim to target “Big Tech” but will inevitably end up harming citizen-innovators most because regulators have forgotten to include them in their process.

Tracks in the snow suggest a bird being captured by a cat.
Stakeholder-Citizen Interaction

Here come the regulators. “Big Tech” companies like Facebook and Google definitely deserve some guide-rails, as well as some consequences for the unwanted impacts they have foisted on society along with the desirable ones. Facebook in particular has some deep, serious consequences of its amorality due soon. But so far, pretty much every regulation relating to the digital realm is defective.

For example the GDPR takes the best of intentions around citizen privacy and ends up causing unintended harm by layering ambiguous and extensive responsibilities and liabilities on small businesses and individuals with web presence. They either comply at great cost (relative to their turnover) or ignore it all, intentionally or out of bewilderment.

Meanwhile, well-resourced transnational corporations use their existing staffs to comply at a cost that’s effectively small change to them. The result is the local companies suffer higher costs and risk while the behemoths treat it as just another minor global cost. This “friendly fire effect” is evident throughout the regulatory landscape – see the EU Terrorism Regulation for example, or the accidental hit on non-content industries like software when the European Copyright Directive draft was released (fortunately patched up in the final text).

While the targets of much of this bad legislation are indeed those US new-wave corporations, the actual victims are repeatedly the Europeans who are our best hope of countering this US corporate power; citizen-innovators. Far from gutting Google’s guns and foiling Facebook’s finagling, the new rules give them and their peers unintended power over European innovators.

Hammers To Crack Nuts

A root cause of many of the problems with British and European legislation regarding the Internet is a failure to recognise that, in the meshed society it creates, the citizen can play roles previously reserved for the corporation. I can create published works, I can directly fund new ventures, I can build global-scale applications (or at least be a critical link in their supply chain) and so on. But current political thinking only understands me as either a spending unit or a labour unit.

Believing these and other capabilities to only be within the scope of corporations, legislation frequently fails to observe the impact of regulations on individuals and small businesses. Penalties are disproportionate because they assume corporate resources; recourse is onerous or absent because they assume a legal department is involved; restrictions are asymmetric because they assume targets are a fraction of a giant operation not the entirety of a small one.

Consequently, only well-resourced corporations can hope to fully comply — an exclusionary gift to the large and established players and a further smack in the face of small European innovators. Worse, the Byzantine complexity and special vocabulary of the regulations mean that legal hyenas running trolling operations like they did around copyright regulations are bound to be along Real Soon.

One final wrinkle is the system is well populated with representatives of rights-holder organisations and patent-dependent corporations, who use the opportunity of a policy vacuum to inject restrictions on the pesky “pirates” they blame for their own slow transition to the meshed economy. Consequently what regulations do appear with digital elements are weighed down with “checks and balances” to make sure legacy rights holders can still collect their rents.

Missing So Unrepresented

How did this happen? It’s in no small part because the anachronistic absence of citizen-scale thinking from the legislative process means it consequently has no representation for citizen-innovators. Only organisational “stakeholders” — corporations, trade associations and special-interest groups — are included in the cycle of research, consultation and review through which every new instrument proceeds. Worse, the European native corporate voices who are consulted make things worse by advocating for IPR extremism to prop up their own flagging fortunes. Our current legislative worldview treats citizens only as consumers or workforce, never as stakeholders, so rarely even meaningfully alerts us to proposals let alone considers or consults us.

To make significant progress with any “Digital Charter” of the kind the UK government purports to love or with the expansive digital agenda the European Commission is rushing, we first need to recognise that the Internet has created a meshed society of opportunity for all and not just a new market for the winners of the previous age to re-sell/rent their old goods and methods. Digital sovereignty is an excellent concept and goal, but shouldn’t citizen-innovators also be allowed to aspire? Until the legislators consult open source developers, self-published writers and musicians and other small-but-scaleable innovators, new rules targeting the Internet will only result in reinforced oligarchies.