Keeping up with the power users

For a while, the whole point of signing up for a social media platform such as Instagram, Facebook or Twitter was to connect with people who interest you. At first, those might have been your friends, your family and your professional networks (*waves to journalism Twitter*), but it wasn't long before that list began to include celebrities and other content creators.

That era of social media was a win-win: The rich and famous got to control their own message and manage contact with fans and audiences, becoming even bigger names (and making more money) in the process. Fans got a chance to feel a deeper parasocial connection to the objects of their affection. And the networks got to bask in the cool factor: If my friends from college AND this person from that show I like are both here, well, I'm going to create an account too.

That arrangement more or less worked for all parties for a while, but cracks began to emerge by 2016; in 2022, they’re becoming frightening maws.

When a social network’s power users get too big, it loses the ability to set its own terms. The power users' preferences instead become de facto rules of engagement.

• Twitter chose not to enforce its own rules against a one-time New York real estate investor and reality TV character until after he became the world’s most famous insurrection cheerleader, paving the path for others to echo his words.
• Facebook likewise let nearly 6 million of its high-profile users get whitelisted to break many of its rules with impunity, the Facebook Files revealed in 2021.
• And Twitter now has a problem with a high-profile automotive and aerospace entrepreneur turned provocateur who used his tweets to back the company and himself into a $44 billion corner he now wants to squirm out of.

And plenty of non-politician, non-CEO celebs also wield enormous power online. As we’ve been reminded just this week, the whims and preferences of power users can make or break a feature rollout.

• Just ask the Kardashians! Kylie Jenner, Kim Kardashian and Khloe Kardashian are all among the top 10 most-followed accounts on Instagram (siblings Kendall Jenner and Kourtney Kardashian also round out the top 20).
• Instagram last week announced a set of video-forward changes some of the Kardashians didn’t like, and they publicly pushed back, as did many other Instagram users.
• Instagram head Adam Mosseri tried to justify the changes, but the Kardashians won for now: Mosseri on Thursday told reporter Casey Newton Instagram was walking back the features. “I care a lot about large creators; I would like to do better than we have historically by smaller creators,” Mosseri said. “I think we've done pretty well by large creators overall — I'm sure some people will disagree, but in general, that's what the data suggests.”
• It’s not the first time the Kardashians have forced a social platform to change: Snap’s stock dropped in 2018 after Kylie Jenner complained publicly about changes to the app, and it altered those planned design changes.

Every day, those power hierarchies become ever more clear. With TikTok dominating the download charts, it’s obvious who needs whom the most. Meta can bail on a partnership with news publishers because Facebook and Instagram don’t need the New York Times to survive — but they can’t get by without giving fans a place to keep up with the Kardashians (or a host of other athletes, musicians and TV personalities). And that, in turn, means billions of the rest of us regular schlubs are living in whatever social media world those power users — presidents, CEOs and reality TV stars — like best.

In Washington

Chips-Plus passed — now what? Protocol has Max Cherney on the case to figure out how the $280 billion legislative package will be distributed, and what impact it could have.

• The Commerce Department is in charge of allocating the funds. In a recent interview, Undersecretary of Commerce for Standards and Technology Laurie Locascio said the agency had been working for over a year to build up staff and infrastructure for the subsidy distribution process.
• “Nearly $40 billion of the total $52 billionis marked for chip manufacturing incentives that will almost certainly benefit the likes of Intel, GlobalFoundries, Samsung and TSMC,” Max noted. He added that $2 billion in cash would be set aside for the manufacturing of older chips critical to automotive and military applications, while $24 billion in tax breaks would go toward factory construction.
• But not everyone is convinced it will have a big impact. Bernstein chip analyst Stacy Rasgon said of the bill: “The kind of numbers that they are talking about for the Chips Act [is] $52 billion over five years. For the entire U.S. semiconductor industry this is a rounding error. Who cares?”
• That sentiment won’t play well with progressives who opposed the bill. In a July letter, Sen. Bernie Sanders noted that the five biggest semiconductor companies made $70 billion in profit last year. “Does it sound like these companies really need corporate welfare?” Sanders asked.

Build Back Better is back on the table for the third time. Sen. Joe Manchin and Senate Majority Leader Chuck Schumer said they agreed to a deal, the Inflation Reduction Act of 2022, that would allocate $369 billion for climate and clean energy funding. Protocol’s Brian Kahn broke down some of the key takeaways:

• It includes individual tax credits. Those would go toward the purchase of heat pumps, solar panels and new and used EVs.
• Tech companies stand to benefit, and not just those operating in the clean energy sector. Brian notes the bill would make it easier for tech companies to deliver on their ambitious climate plans: “More renewables on the grid will make it easier for companies to power their operations without damaging the climate. More importantly, it will help companies get a handle on Scope 3 emissions — that is, emissions tied to the use of their products.”
• But there are caveats. There’s a lot we don’t know about the bill, including whether it would realistically get us to promised 40% emissions reduction (which, by the way, is still below the minimum 50% threshold within the Paris Agreement).
• “That means the Inflation Reduction Act of 2022 is by no means a pure climate bill that's all in on clean tech,” Brian wrote. “But it's better than what was on the table at this time yesterday.”

A MESSAGE FROM CCIA

S. 2992 could break digital services like Google Search, Amazon Prime, and your phone's security. Americans are feeling the squeeze of record inflation; why do some members of Congress want to set the economy back by an estimated $319 billion?

Learn more

In the courts

Federal Trade Commission staff didn’t want to block Meta’s acquisition of VR game developer Within. Commission Chair Lina Khan overruled the recommendation of staff lawyers and economists, breaking the commissioner split, leading to the lawsuit filed earlier this week to block the acquisition.

Twitter’s courtroom showdown with Elon Musk has an official date. The company and its no-longer-wannabe new CEO will square off in the Delaware Court of Chancery Oct. 17-21.

Around the world

Jack Ma is touring Europe, a sign of easing regulatory scrutiny from China’s government. Earlier in the week, The Wall Street Journal reported that Ma agreed to give up his majority stake in Ant following a prolonged period of regulatory scrutiny that stemmed from the planned November 2020 IPO. Ma had previously been warned not to leave China.

Research firm Reset says Russian “cyber soldiers” have taken to Telegram to disseminate pro-Russia talking points. Protocol’s Ben Brody reports the group used Telegram as a means of getting around more proactive monitoring on larger services such as Instagram, YouTube and Facebook

A MESSAGE FROM CCIA

Some policymakers are intent on passing S. 2992—flawed legislation that could undermine free and reliable digital services that families use daily. Without Amazon's guaranteed 2-day shipping, Google search, or phone security, consumers' finances will be squeezed even further.

Learn more

In data

0.9%: That’s how much the U.S. economy shrank year-over-year in the second quarter, the Commerce Department said Thursday. It wasn’t as bad as the 1.6% contraction in the first quarter of 2022, but in either case, it doesn’t bode well. Still, the Biden administration has been very hesitant to say we’re in a recession — even as ominous warnings from business leaders suggest otherwise.

WFP (Work From Pool)

Is it ok to work from a bathtub? A pool? Surely a hot tub might impact productivity, with the lightheadedness and all … but some HR leaders told Protocol’s Sarah Roach that it shouldn’t matter where we work, as long as work is getting done. They cautioned — with a little bit of a buzzkill — that it requires some common sense, too. I definitely recommend reading the full article, with reflections on work life from a watermelon floatie.