Andrew Ross Sorkin, Bernhard Warner, Sarah Kessler, Michael J. de la Merced, Niko Gallogly,Brian O’Keefe and Ian Mount, The New York Times; Is Big Tech Facing a Big Tobacco Moment?
Back-to-back courtroom losses have put technology giants, including Meta and Google, in uncertain territory as they face lawsuits and bans on teen users.
"Andrew here. Back in 2018, I moderated a panel at the World Economic Forum that included Marc Benioff of Salesforce. It was then that he essentially declared that Facebook was the modern-day equivalent of cigarettes, and that it and other social media companies should be regulated as such.
Well, Meta’s loss in court on Wednesday, in a case about whether its platforms were designed to be addictive to adolescents, may be a watershed. Investors don’t seem to be fazed — the company’s shares hardly moved after the verdict came out — but the decision could change the conversation around the company yet again. More below...
Some legal experts wonder if Big Tech is staring at a Big Tobacco moment, a reference to how cigarette makers had to overhaul their businesses — at a huge expense — after courts ruled that some of their products were addictive and harmful.
“We’re in a new era, a digital era, where we have to rethink definitions for products based on which entities might have superior information to prevent these injuries and accidents,” Catherine Sharkey, a professor of law at N.Y.U., told The Times. She added that the “implications” of those verdicts were “very, very big.”
“This has potentially large impacts on other areas in tech, A.I. and beyond that,” Jessica Nall, a San Francisco lawyer who represents tech companies and executives, told The Wall Street Journal. “The floodgates are already open.”
Meta and Google plan to appeal. The companies have signaled that they will fight efforts to make them drastically redesign their products and algorithms."
