Big Tech Regulation Bill Shut Down, But the Fight Still Looms

Regulators have taken a lot of interest in the tech industry lately. Bills and proposals have popped across all levels of government aiming to put various limits on Big Tech over the past year. While most of these regulations have failed to go into effect, changes could loom on the horizon.

The rush to regulate Big Tech is understandable. Life today is inseparable from technology, especially from giants like Google, Amazon and Meta, whose size and power keep growing as tech adoption surges. With these companies holding so much influence over daily life, legal challenges are inevitable.

Proponents of regulation believe restricting Big Tech will protect consumers, while the opposition argues that it could have the opposite effect and hinder innovation. With much tech legislation still in limbo, how these laws could play out is still uncertain.

State Regulations Blocked

Many state bills regulating Big Tech companies have passed only for courts to block them. Most notably, the Supreme Court blocked a Texas law, HB20, over content moderation on social media. The law prohibited social media platforms from restricting content based on viewpoint, something that’s become a hot button issue lately.

HB20’s supporters argue that sites like Twitter and Facebook violate the first amendment by blocking speech they don’t agree with. However, the Big Tech groups lobbying against the bill point out that it could stop them from removing content from hate groups like Neo-Nazis and the KKK. Concerns about misinformation over the war in Ukraine add fuel to this argument.

The Supreme Court’s block on HB20 is temporary, but it’s not the first of its kind. In 2021, a federal judge blocked a Florida law stoppingsocial media from restricting politicians’ content. Since this older block has remained in place, HB20 will likely follow its precedent and stay blocked.

Despite courts blocking these bills, states keep considering similar legislation. At least 18 states have proposed penalties for social media companies that restrict content for its viewpoint. While none of these have been able to pass without blocking yet, they represent a growing trend.

The American Innovation and Choice Online Act

Federal lawmakers have also moved to regulate Big Tech. Perhaps the most notable example is the American Innovation and Choice Online Act. If passed, the law would prevent tech companies from giving preferential treatment to their own services on their platforms. For example, Amazon couldn’t rank its own products above competitors’ just because they make them.

The House introduced a similar version of the bill in June 2021 but made little progress. The last action on the legislation wasan order to amend it a couple of weeks after its introduction. Since that version effectively died in the House and state regulations have failed to pass, a similar fate could await the Senate version.

Despite that history, the American Innovation and Choice Online Act’s chances of passing look stronger than its predecessors. The bill __advanced out of the Judiciary Committee__with little challenge, and politicians supporting it seem optimistic about its future.

Lawmakers will try to vote on the bill in early summer, before the midterm elections. Its chances of passing will likely drop if it delays beyond midterms, but right now, signs suggest that it could pass. At the very least, it has better chances than previous legislation.

Cultural Changes Building Despite Lack of Legal Action

While the American Innovation and Choice Online Act could pass, Big Tech remains largely unregulated today. However, even if the bill doesn’t pass, the industry may change on its own to address some of the issues that inspired this legislation.

Microsoft recently announced it will stop putting non-competition clauses incontracts outside of senior executive positions. The company also said it will start listing salary ranges in job descriptions in an effort to promote transparency within the industry.

Non-competition clauses stop employees from working for direct competitors once they leave a company, usually for three to five years, to protect trade secrets. Critics argue that, in reality, these clauses only restrict employment opportunities for qualified job-seekers, and allowing people to switch companies won’t significantly impact a business’s success.

Microsoft’s announcement reflects a growing shift in the industry that could have legal backing soon. President Biden issued an executive order earlier in the year asking the Federal Trade Commission (FTC) to restrict non-competition clauses. Even if legislation doesn’t change much, the conversations around it seem to be spurring tech companies to rethink some practices.

What Does This Mean for the Future of Big Tech?

These changes reflect a growing awareness of how the tech industry affects everyday life. If the American Innovation and Choice Online Act passes, it could set a precedent for further regulations for Big Tech.

How these regulations could impact tech and the aspects of life they influence remains uncertain. If some bills passing leads to a trend of increasing restrictions, it may limit innovation as businesses face increasing obstacles to pursuing new, disruptive solutions. Alternatively, if a few regulations pass, but people remain critical of others, they could help make the sector a fairer, more competitive place.

Interestingly, while regulatory talk around Big Tech has increased, public opinion seems to be going in a different direction. In 2022, 44% of American adults believe the government should regulate tech companies more tightly, down from 56% in 2021. Similarly, the share of people who think tech companies should face fewer regulations rose from 9% to 20%.

This trend in public opinion could tame the recent legislative activity. As a result, the American Innovation and Choice Online Act may not spur further regulation after all.

As Tech Grows, So Will Legal Action

Any organization as large and influential as Big Tech companies will naturally draw attention and create controversy. As tech plays an increasingly central role in everyday life, talks about regulating it will also grow, regardless of what laws actually pass.

While Big Tech’s regulatory future is uncertain, change is likely. Whether or not they face increasing restrictions, tech companies will likely shift their practices to appease the public and protect the industry.