Antitrust 01/13/2021

AWS & Parler’s Break-up Increases Competition in Both Social Media and Web Services: A Win for Users

Chris Marchese
Chris Marchese Counsel

While it wasn’t a household name before 2021, Parler is now one of the fastest-growing social media platforms in America. In mere months, Parler has amassed millions of users, particularly conservatives who are drawn to the website’s hands-off approach to content moderation. 

Like the rapid rise of other social media platforms, Parler shows that no one company monopolizes social media. In fact, Parler filled a market void created by Facebook and Twitter by being a space for largely unmoderated content sharing. And that gave users choice.

But last week, following Parler’s role in the Wednesday attacks on the US Capitol as well as repeated contract violations with its website host Amazon Web Services (AWS), AWS terminated their business relationship leaving Parler without a provider to host its website. This decision by AWS could not have surprised Parler’s owners as Parler failed to act on multiple requests by AWS to remove dangerous and violent content — all of which violated Parler’s contract with AWS. 

When this happened, right-wing pundits cried that tech companies had “silenced them” and were “gatekeepers” of speech. For conservatives, this was cause for antitrust action if tech is powerful enough to “annihilate” a site like Parler. But these points proved moot as the evicted Parler quickly found a new residence at Epik. And unlike AWS, which requires its business partners to keep their websites reasonably safe from violent and extremist content, Epik aligns with Parler and takes a more hands-off approach.

In other words, AWS and tech companies like it proved to not be “gatekeepers” of speech but instead were highlighted to be part of a greater competitive landscape online. AWS and Epik remain part of the thriving competition in cloud computing while Parler and Twitter are free to compete another day. 

Still, Parler filed a rushed and meritless lawsuit against Amazon alleging that Amazon colluded with Twitter to block Parler online. With no sufficient evidence, the suit is likely to be dismissed. 

This rush to use antitrust law to force private businesses to do what’s best for other businesses is not what’s best for consumers. The government is guilty of this tactic too, with the FTC, DOJ, and state AGs all competing to use antitrust as a bludgeon to force businesses to do their bidding. 

We must resist that urge–not only is it a threat to innovation and consumers, but also is it a threat to competition itself. 

Case Study: AWS, Google, & Apple

Parler’s free-for-all approach to content moderation created both their rise and potential fall. Parler’s approach attracted conservatives, but ultimately repelled AWS, Google, and Apple–all of whom ended their partnerships with Parler. 

The First Amendment generally protects a business’s decision to partner with or not partner with another business or person. In fact, for over a century, the Supreme Court has recognized that when private businesses are free to contract or not with other businesses, that encourages innovation.

Decisions like those made by AWS, Google, and Apple create market opportunities, as shown by Parler’s rise and Epik’s swooping in to partner with Parler. If AWS had to do business with Parler regardless of its own values, there would be little incentive for web services like Epik to compete.

Even worse, forcing two businesses to contract with each other threatens innovation in business models. 

Consider that AWS requires its business partners to moderate certain content. Parler doesn’t have a dedicated moderation team, nor does it want to moderate all that heavily. To keep working with AWS, however, Parler would need to change its business model. In fact, Parler promises not to moderate in its own terms of service. 

These business models, which attract different customers, aren’t easily reconciled. And because neither is willing to upend its approach–and neither should–Amazon dropped Parler. 

And both of them and their consumers are better off for it.

Content Moderation

Tech’s decision to drop Parler does not threaten speech. Like other industries, tech companies were shaken by last week’s violent insurrection at the US Capitol. And like a variety of other industries, tech took a fresh look at its business partnerships to make sure they reflected its values.

In AWS’s case, it found nearly a hundred examples of violent or extremist content on Parler’s website. That content not only violated AWS’s contract with Parler, but also violated AWS’s values. Although AWS tried to work with Parler to remedy the situation, Parler was either unwilling or unable to remove the content.

And despite promises to moderate more carefully, Parler did not promise to implement greater controls to moderate such content. So AWS dropped Parler.

By contrast, Parler’s new ally Epik seemingly doesn’t mind and is willing to work with Parler regardless. That new business relationship serves only to increase competition in the web services market, especially as Epik refines its brand as a business willing to host platforms with little moderation. (Epik also hosts Gab, which is known for its hands-off approach.)

And for those saying AWS overreacted, consider the examples it flagged. Although people may disagree about the severity, there’s no denying that this content is objectively different from other forms of controversial content. 

Private businesses should be allowed to make their own decisions. This not only benefits users but also increases marketplace competition, which benefits users even more.

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