The Convergence of Content and Conversation: Approaches to Regulating Social Media

Posted: 3 Apr 2017

Date Written: March 31, 2017

Abstract

Internet regulation has focused, in most countries, on those aspects of the Internet associated with packet carriage and provided by ISPs. The debates around network neutrality are the most obvious example of this regulatory focus. However, going forward, we anticipate a shift in attention to the higher application layers, which have their own regulatory history that has to a large extent not been applied to the Internet.

The premise of this paper is that the market structure at these higher layers is highly dynamic, compared to the relatively stable role that a facilities-based access provider plays. Furthermore, the definition and categorization of emerging services at this layer is relatively complex and ambiguous, compared to traditional services like telephony and television. This dynamic and fluid market structure raises serious challenges to any regulatory approach that is based on a particular class of actor.

This paper attempts to build a foundation for studying the regulatory issues and approaches at this layer. It focuses on the convergence of two important classes of applications — those that support content distribution and those that support interpersonal communications — in social media like Facebook, Snapchat, Twitter, and YouTube.

Historically, the telecommunications industry has been bifurcated into content- and connectivity-related applications, with a somewhat clear understanding of what each of those domains comprised. However, the content/connectivity dichotomy represents a forced separation of what is actually a continuum of human practices and modes of communication that range from producer-consumer to peer-to-peer exchanges. Social media platforms defy this content/connectivity dichotomy.

Consequently, social media applications operate increasingly in policy “grey areas.” More specifically, they originated as social utility tools more in line with telephone calls, emails, and texts, but did not carry regulatory burdens like accessibility, lawful intercept, or 911 access. They have now entered the media industry ecosystem without being subject to media regulatory oversight. Many have specifically resisted classification as media companies to avoid the burden and costs of compliance.

This paper provides a framework for understanding the complex and highly nuanced role of social media in the traditional media ecosystem, demonstrating that they do not easily map onto current classification schemes. The framework identifies four dynamics in the ecosystem, and how they drive value creation and capture. The paper then poses some speculations about future trends, which imply a continued high rate of structural evolution and regulatory ambiguity/confusion.

We explore several possible conclusions from this analysis. One is that to the extent that social media platforms behave like media companies, they should be regulated as media companies. A second conclusion is that a new industry classification scheme is required that reflects these evolutionary trends. However, given the tendency for regulatory escape along with continued industry mutation, we argue that any regulatory approach that is based on regulation of a particular class of actor will not be effective. Rather, regulatory objectives (which may take different forms in different countries) must be based on clear articulation of acceptable and unacceptable outcomes or principles, independent of where and how that behavior manifests.

Keywords: Internet policy, social media, content regulation, Internet industry structure

JEL Classification: L50, L82, L86

Suggested Citation

Klym, Natalie, The Convergence of Content and Conversation: Approaches to Regulating Social Media (March 31, 2017). Available at SSRN: https://ssrn.com/abstract=2944317

Natalie Klym (Contact Author)

Independent ( email )

No Address Available

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