Predistribution vs redistribution (Big Tech edition)
I'm coming to COLORADO! Catch me in DENVER on Jan 22 at The Tattered Cover<, and in COLORADO SPRINGS from Jan 23–25 where I'm the Guest of Honor at COSine. Then I'll be in OTTAWA on Jan 28 at Perfect Books and in TORONTO with Tim Wu on Jan 30.
All over the world, for all of this decade, governments have been trying to figure out how to rein in America's tech companies. During the Biden years, this seemed like a winner – after all, America was trying to tame its tech companies, too, with brave trustbusters like Lina Khan, Jonathan Kanter, Rohit Chopra and Tim Wu doing more work in four years than their predecessors had done in forty.
But under Trump, the US government has thrown its full weight into defending its tech companies' right to spy on and rip off everyone in the world (including Americans, of course). It's not hard to understand how Big Tech earned Trump's loyalty: from the tech CEOs who personally paid a million dollars each to sit behind Trump on the inauguration dais; to Apple CEO Tim Cook hand-assembling a gold participation trophy for Trump on camera; to Zuckerberg firing all his fact-checkers; to the seven-figure contributions that tech companies made to Trump's Epstein Memorial Ballroom at the White House. Trump is defending America's tech companies because they've bribed him, personally, to do so.
Given that these companies are so much larger than most world governments, this poses a serious barrier to the kind of enforcement that world governments have tried. What's the point of fining Apple billions of Euros if they refuse to pay? What's the point of ordering Apple to open up its App Store if it just refuses?
But here's the thing: most of these enforcement actions have been redistributive. In effect, lawmakers and regulators are saying to America's tech giants, We know you've stolen a bunch of money and data from our people, and now we want you to give some of it back. There's nothing inherently wrong with redistribution, but redistribution will never be as powerful or effective as predistribution – that is, preventing tech companies from stealing data and money in the first place.
Take Big Tech's relationship to the world's news media. All over the world, media companies have been skeletonized by collapsing ad revenues and even where they can get paid subscribers, tech giants rake off huge junk fees from every subscriber payment. Reaching new or existing subscribers is also increasingly expensive, as tech platforms algorithmically suppress the reach of media companies' posts, even for subscribers who've asked to see their feeds, and which lets the platforms charge more junk fees to "boost" content.
Countries all over the world – Australia, Germany, Spain, France, Canada – have arrived at the same solution to this problem: imposing "link taxes" that require tech companies to pay for the privilege of linking to the news or allowing their users to discuss the news. This is pure redistribution: tech stole money from the media companies, so governments are making them give some of that money back.
It hasn't worked. First of all, the thing tech steals from the news isn't the news, it's money. Helping people find and discuss the news isn't theft. News you're not allowed to find or discuss isn't news at all – that's a secret.
Meanwhile, tech companies have an easy way to escape the link tax: they can just ban links to the news on their platform. That's what Meta did in Canada, which means that Canadians on Instagram and Facebook no longer see the actual news, just far-right "influencer" content. Even when tech companies do pay the link tax, the results are far from ideal: in Canada, Google has become a partner of news outlets, which compromises their ability to report on Google's activities. Shortly after Google promised millions to the Toronto Star, the paper dropped its award-winning, hard-hitting "Defanging Big Tech" investigative series. Given that Google came within centimeters of stealing most of downtown Toronto just a few years ago, we can hardly afford to have the city's largest newspaper climb into bed with the company:
Worse still: any effort to make Big Tech poorer – by curbing its predatory acquisition of our data and money – reduces its ability to pay the link tax, which means that, under a link tax, the media's future depends on Big Tech being able to go on ripping us off.
All of which is not to say that Big Tech should be allowed to go on ripping off the media. Rather, it's to argue that we should stop tech from ripping off Canadians in the first place, as a superior alternative to asking Big Tech to remit a small share of the booty to a few lucky victims.
Together, Meta and Google take 51 cents out of every advertising dollar. This is a huge share. Before the rise of surveillance advertising, the ad industry's share of advertising dollars amounted to about 15%. The Meta/Google ad-tech duopoly has cornered the ad market, and they illegally colluded to rig it, which allows them to steal billions from media outlets, all around the world:
https://en.wikipedia.org/wiki/Jedi_Blue
What would a predistribution approach to ad-tech look like? Canada could ban the collection and sale of consumer data outright, and punish any domestic firm that collects consumer data, which would choke off much of the supply of data that feeds the ad-tech market.
Canada could also repeal its wildly unpopular "anticircumvention" law, The Copyright Modernisation Act of 2012 (Bill C-11), which was passed despite the public's overwhelming negative response to a consultation on the bill:
Under this law, it's illegal for Canadian companies to reverse engineer and modify America's tech exports. This means that Canadian companies can't go into business selling an alternative Facebook client that blocks all the surveillance advertising and restores access to the news, and offers non-surveillant, content-based ways for other Canadian businesses to advertise:
Repealing Bill C-11 would also allow Canadian companies to offer alternative app stores for phones and consoles. Google and Apple have a duopoly on mobile apps, and the two companies have rigged the market to take 30% of every in-app payment. The actual cost of processing a payment is less than 1%. This means that 30 cents out of every in-app subscriber dollar sent to a Canadian news outlet is shipped south to Cupertino or Mountain View. Legalizing made-in-Canada app stores, installed without permission from Apple or Google, would stop those dollars from being extracted in the first place. And not just media companies, of course – the app tax is paid by performers, software authors, and manufacturers. Extend the program to include games consoles and Canada's game companies would be rescued from Microsoft and Nintendo's own app tax, which also runs to 30%.
But a C-11 repeal wouldn't merely safeguard Canadian dollars – it would also safeguard Canadian data. Our mobile phones collect and transmit mountains of data about us and our activities. Yes, even Apple's products – despite the company's high-flying rhetoric about its respect for your privacy, the company spies on everything you do with your phone and sells access to that data to advertisers. Apple doesn't offer any way to opt out of this, and lied about it when they were caught doing it:
These companies will not voluntarily stop stealing our data. That's the lesson of nine years under the EU's GDPR, a landmark, strong privacy law that US tech companies simply refuse to obey. And because they claim to be headquartered in Ireland (because Ireland lets them cheat on their taxes) and because they have captured the Irish state, they are able to simply flout the law:
Telling Big Tech not to gather our data is redistribution. So is dictating how they can use it after they collect it. The predistribution version of this is modifying our devices so that they don't gather or leak our data in the first place.
Big Tech is able to suck up so much of our data because anticircumvention law – like Canada's Bill C-11, or Article 6 of the EU Copyright Directive – makes it illegal to modify your phone so that it blocks digital spying, preventing the collection and transmission of your data.
Repeal anticircumvention law and businesses could offer Canadians (or Europeans) (or anyone in the world with a credit card and an internet connection) a product that blocks surveillance on their devices. More than half of all web users have installed an ad-blocker for their browser (which offers significant surveillance protection), but no one can install anything like this on their phones (or smart TVs, or smart doorbells, or other gadgets) because anticircumvention law criminalizes this act.
Big Tech are notorious tax cheats, colluding with captured governments like the Irish state to avoid taxes worldwide. Canada tried to pass a "digital service tax" that would make the US pay a small share of the tax it evades in Canada. Trump went bananas and threatened to hit the country with (more) tariffs, and Canada folded.
Tax is redistributive and getting money back from American companies after they steal it from Canadians is much harder than simply arranging the system so it's much harder for American companies to steal from Canadians in the first place. Blocking spying, clawing back the app tax, unrigging the ad market – these are all predistributive rather than redistributive.
So is selling alternative clients for legacy social media products like Facebook and Twitter – clients that unrig their algorithms and let Canadians see the news they've subscribed to, so they can't be used as hostages to extract "boosting" fees from media outlets who want to reach their own subscribers.
Canada's redistribution efforts have been a consistent failure. Canada keeps trying to get streaming companies like Netflix to include more Canadian content in their offerings and search results. Legalize jailbreaking and a Canadian company could start selling an alternative client that lets you search all your streaming services at once, mixing in results from Canadian media companies and archives like the National Film Board – all while blocking surveillance by the tech giants. This client could also incorporate a PVR, so you could record shows to watch later, without worrying about the tech giants making your favorite program vanish. Remember, if it's legal to record a show from broadcast or cable with a VCR or a Tivo, it's legal to record it from a streaming service with an app.
These predistribution tactics don't rely on US tech companies obeying Canada's orders. Instead, they take away American companies' ability to use Canada's courts and law enforcement apparatus to shut down Canadian competitors who disenshittify America's spying, stealing tech exports. Canada may not be able to push Google or Apple or Facebook around, but Canada can always decide whether Google or Apple or Facebook can use its courts to push Canadian competitors around.
Back in December, when Trump started threatening (again) to invade Canada and take over the country, Prime Minister Mark Carney broke off trade talks. Those talks are slated to begin again in a matter of days:
Getting Trump to deal fairly with Canada is just as unlikely as getting Trump's tech companies to give Canadians a fair shake. Canada isn't going to win the trade war with an agreement. Canada will win the trade war by winning: with Made-in-Canada tech products that turn America's stolen trillions into Canadian billions, to be divided up among Canadian tech businesses (who will reap profits) and the Canadian public (who will reap savings).
If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:
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