Apple Boss Says Tech Industry Regulation ‘Inevitable’

* Free market not working in protecting privacy, concedes
Tim Cook

Apple’s chief executive Tim Cook said new regulations for the
tech industry are “inevitable” in the wake of a series of scandals,
rejoining a debate that is intensifying along with political
pressure on the company’s rival, Facebook. 

In an interview to be aired on Sunday, Mr Cook said “the free
market is not working” and politicians will step in.

His comments come amid simmering tension between Apple and
Facebook. Earlier this week, Facebook was accused of using
underhand tactics as it struggled to contain the fallout from
Russian interference on the social network and controversy over the
leak of user data to Cambridge Analytica, the research firm.

Facebook’s actions, reported by the New York Times, included
contracting with Definers, a Republican-leaning consultancy, which
attempted to smear competitors and opponents on its behalf.

In an interview with the Axios website taped before those
revelations which will be broadcast on HBO on Sunday night, Mr Cook
said the tech industry should embrace regulation.

This is not a matter of privacy versus profits, or
privacy versus technical innovation. That’s a false
choice

Tim Cook

“Generally speaking, I am not a big fan of regulation,” he said.
“I’m a big believer in the free market. But we have to admit when
the free market is not working. And it hasn’t worked here. I think
it’s inevitable that there will be some level of regulation . . . I
think Congress and the administration at some point will pass
something.”

A Definers’ affiliate called NTK Network posted dozens of
articles blasting Apple and Google for “unsavoury business
practices”, including calling Mr Cook hypocritical for criticising
Facebook over privacy, it was reported.

Definers told the NYT that their work on Apple was funded by a
different technology company. Facebook has denied it paid
Definers to smear anyone and cancelled its contract with the
company.

Facebook was also reported to have told employees to ditch their
iPhones for Android alternatives. Facebook said this was because
Android is the largest global operating system.

Mr Cook has tried to put clear water between Apple, which makes
most of its money from selling hardware, and advertising-based tech
platforms, particularly Facebook, on the issue of privacy.

“This is not a matter of privacy versus profits, or privacy
versus technical innovation. That’s a false choice,” he told
Axios.

US politicians have been discussing how to regulate tech
companies for the last two years on issues that vary widely,
including privacy, political advertising and competition
concerns.

Tech companies have been gradually getting behind broad federal
privacy legislation, in part as an effort to undermine more
stringent rules passed in California. Some, including Facebook,
have also put their weight behind the Honest Ads Act, which extends
the regulation that currently covers political ads on television to
also cover social media.

But the companies are eager to head off concern that recent
scandals are the result of their dominance of the industry,
something that could open the door to action on competition
grounds.

After the NYT investigation was published, David Cicilline, the
Democratic congressman who will soon be chair of the House of
Representatives’ antitrust subcommittee, said Congress should enact
new laws “to hold concentrated economic power” to account.

Mr Cook previously made pointed criticism of Facebook after the
revelations of the massive Facebook data leak to Cambridge
Analytica, the data analytics firm that worked for the Trump
campaign. “The truth is, we could make a ton of money if we
monetised our customer — if our customer was our product. We’ve
elected not to do that, he said in March.

Facebook did not respond to a request for comment on the new
interview. The social network said on Thursday that Mr Cook
has “constantly criticised our business model” and that Mark
Zuckerberg, Facebook chief executive, has been “equally clear he
disagrees”.

Democratic senators said on Friday that they were “gravely
concerned” about the latest allegations against Facebook.

“Both elected officials and the general public have rightfully
questioned whether Facebook is capable of regulating its own
conduct,” senators Amy Klobuchar, Mark Warner, Chris Coons and
Richard Blumenthal said in a statement.

Related