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Will regulators clamp down on Silicon Valley?

Russia Facebook ads
Troll farm bought $100K in Facebook ads 06:32

Silicon Valley has been able to escape the heavy wave of federal regulations that other industries have faced, but that now could change as lawmakers question tech companies' practices in the 2016 election and their recent efforts to silence certain groups.

Facebook has revealed that it sold $100,000 in ad spending between June 2015 and May of this year that was connected to "inauthentic" accounts that analysts concluded were operated out of Russia. This revelation could spur some change -- or at least a debate -- about how Washington oversees social media companies, especially in light of the role they now play in politics.

"I think this is a debate," said Sen. Mark Warner, D-Virginia, the top Democrat on the Senate Intelligence Committee, which is conducting its own investigation of Russian interference in the 2016 election. "This has been [the] Wild Wild West. I'm disappointed that Facebook didn't come forward with this information about the Russians pushing people to anti-immigration rallies."

Warner wondered how social media companies "can, in effect, 'hide' their content." And then, referring to the Supreme Court decision that enabled unlimited corporate contributions to outside political groups, he continued, "As much as I dislike Citizens United, at least someone can go down and look at the TV ads and know it's for or against somebody. Why don't those rules apply to social media companies?"

Facebook faces new scrutiny amid Russia probe 01:37

As a result of Facebook's disclosure, the intelligence panel might ask representatives for Facebook and Twitter to testify in public about foreign interference in U.S. elections.

Jeffrey Chester, executive director of the Center for Digital Democracy, told CBS News that so far, digital giants like Amazon, Facebook and Google have used their political clout to ensure they aren't subject to government or public oversight.

"These are unregulated," he said. "We've given Google and Facebook a free ride to do whatever it really wants to do with our information and its business practices and only now are we considering the consequences."

Facebook is already taking action to try to prevent a repeat of the Russian political ad buying in the future. Carolyn Everson, vice president of global marketing solutions, rolled out a series of new guidelines the company will follow to ensure there's a tougher process to determine who can advertise on its network.

"We know we have to stay vigilant to keep ahead of people who try to misuse our platform. We believe in protecting the integrity of civic discourse, and require advertisers on our platform to follow both our policies and all applicable laws," said Facebook's chief security officer, Alex Stamos.

Rep. Ro Khanna, D-California, whose district is in the heart of Silicon Valley, told CBS News that legislation that would require disclosure and intelligence-sharing could help improve transparency.

"I do think there has to be some legislation on disclosure requirements. If disclosure is not required, it's hard for tech companies to do what the U.S. law and election law is requiring. I think this is a loophole in our election system," Khanna said. "Congress should also take legislative action in helping create platforms of intelligence-sharing where our intelligence agencies are working with tech leaders to help identify foreign bank accounts and to identify and trace spending."

Still, Khanna may be one of the few lawmakers thinking about these issues.

"It is likely that there will be pressure from Congress for companies like Google and Facebook to be much more transparent and accountable regarding their ad platform and advertising and marketing used in elections," Chester said. "Whether or not there's going to be actual legislation requiring the companies to disclose, I think that's doubtful in the short-term." 

The tech industry, he predicted, will try to blunt most of the pressure by adopting self-regulatory approaches, as Facebook is already attempting.

Last week, ProPublica reported that Facebook had enabled advertisers to target "Jew haters" through self-targeting fields in user profiles. Facebook described how this had occurred in a post a day after the report. 

"As people fill in their education or employer on their profile, we have found a small percentage of people who have entered offensive responses, in violation of our policies," the post read, "ProPublica surfaced that these offensive education and employer fields were showing up in our ads interface as targetable audiences for campaigns."

Facebook removed them immediately and assured users that "the number of people in these segments was incredibly low," and "an extremely small number of people were targeted in these campaigns." The the social media platform in the same post announced updates to its ad targeting.

"Keeping our community safe is critical to our mission," the post said. "And to help ensure that targeting is not used for discriminatory purposes, we are removing these self-reported targeting fields until we have the right processes in place to help prevent this issue."

While Democrats are scrutinizing these tech companies, so are people on the other end of the political spectrum. After the events in Charlottesville, many firms shut down service to right-wing websites and accounts. Some conservatives, including white nationalist Richard Spencer, don't like the idea that the companies are censoring free speech. Conservatives also expressed outrage when Google fired an engineer last month who had written an internal memo about gender differences in the tech industry.

Other countries, especially in Europe, are much more stringent about their policies regarding social media. Germany, for example, passed a law earlier this year in which social media companies could face fines of nearly $60 million if they don't remove content that's considered hate speech. The United Kingdom is investigating the role Google and Facebook played in the Brexit campaign.

Steve Bannon, toward the end of his tenure as the White House chief strategist, reportedly discussed the idea of having companies like Google and Facebook regulated like utilities because they've basically become monopolies, The Intercept reported in July.

"You can't regulate speech in the same way you would regulate a power company," Rep. Zoe Lofgren, D-California, another lawmaker whose district is based in Silicon Valley, told CBS News. "How would you do that, consistent with the First Amendment? You couldn't."

It's more likely that lawmakers will give additional rights to consumers to "correct some overstepping," rather than create a big regulatory network, Lofgren said.

"The idea that you'd have like a public utilities commission is stupid. But I think you can do some things that would give greater companies to monitor their networks but also give greater power in the hands of the consumers," she said.

The debate over tougher rules on the tech industry only seems to be in the initial stages. No major legislative proposals related to these issues have been introduced.

Plus, Washington may be wary of alienating the companies that could work with the federal government in a variety of areas, including counterterrorism efforts to weed out terrorist recruitment and propaganda online as well as efforts to rebuild the nation's infrastructure system.

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