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Will America’s internet giants prove to be toothless?

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NEW YORK – For several years, the stocks of America’s Internet giants — Facebook, Apple, Amazon, Google — have been the way to make money. And yet, for all their past prowess, these four companies all have major weaknesses in their business models that are becoming increasingly apparent.

They could thus be destined for a replay of the 1999 dot-coms, the 1972 Nifty Fifty, the 1929 Investment Trusts or the 1720 South Sea Company.


To begin with Facebook, we learned that Facebook intends to set up its own “Supreme Court” to police “hate speech” on its service. This may suit Mark Zuckerberg’s dreams of world domination, but it in no way represents what a private corporation ought to be doing.

At the core of the problem is Facebook’s ability to scoop up private information on people and sell it to third parties, or indeed use it itself in pursuit of some nefarious non-economic goal.

When Facebook started, it appeared to be largely a means for teenagers to communicate, which could be monetized through advertising, but as it has grown its sinister potential has more clearly appeared.

There simply is no solution to Facebook’s censorship problem. In a traditional media environment, a wide variety of media outlets use the skilled judgment of journalists with decades of experience to decide what to print. If they got it wrong, their publication lost subscribers and money.

Not so with Facebook. It is effectively a monopoly. There is no way it can censor the news without becoming Pravda. Unfortunately, for all of Zuckerberg’s soothsaying, under his leadership, becoming Pravda appears to be Facebook’s ambition rather than its fear.

The only solution would be to break up Facebook into half a dozen competing outlets, each with a different political outlook, thereby reproducing a healthy newspaper........

© The Japan Times