For decades, tech giants grew at breakneck speeds as Congress struggled to keep pace with the consequences of the companies’ rapidly booming businesses. But a new de facto regulatory regime has emerged over the past year as courts clobber the biggest internet companies. And for the first time, their product designs and their advertising models — which critics say treat users like products — are costing the companies serious money. The latest blow came on Wednesday, when a New Mexico judge ordered Meta, which owns Facebook, Instagram and Whats App, to pay a record $25 billion penalty for abusing consumer privacy. In a 20-page ruling, the judge scolded the company for deceiving consumers and allowing their data to be harvested by the political consulting firm Cambridge Analytica.
The decision, and others like it, amount to a comeuppance for tech behemoths, whose fortunes have been built on the business model of winning the attention — and data — of users. Now, trials and court decisions have laid bare many of the allegations over deceptive and harmful business practices that critics have said long propelled the companies’ growth. New consumer guardrails are emerging through the courts’ record financial penalties and order of changes to designs of the companies’ technologies, legal experts said.
“We’re witnessing an inflection point in the regulation of social media,” said Nora Engstrom, a professor of law at Stanford. “Courts, not Congress, are promoting accountability and forcing concrete change.” The changes stem from thousands of lawsuits filed against Meta, Google, Apple, Amazon, Tik Tok and others by individuals, schools, and state and federal officials. Their claims include that the internet giants harmed consumers by creating addictive platforms, abusing their power through their collection of valuable data and deceiving users.
Source: New York Times Top Stories · Summarized by HeadlinesBriefing