How to regulate Facebook and Google – Hint: NOT as platforms

The common narrative today – and also in a lot of my work, including Platform Revolution – frames Facebook, Google, and Twitter as multi-sided platforms.

Are Facebook, Google, and Twitter multi-sided?

Absolutely.

But viewing them solely with that lens has limitations, which interferes with our efforts to design regulation.

In fact, Facebook and Google realise this all too well and plow the ‘we-are-a-neutral-platform’ line to skirt regulation.

What if we viewed Facebook and Google as pipelines, instead of platforms? Surprisingly, that gives us a rather compelling framework for regulating them.

The ideas in this post were first published as a Twitter tweetstorm.

Let’s dig in!

But first…

Regulation is one of the key themes in the State of the Platform Revolution 2021 report. Get your copy of the report.

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A counterintuitive view for regulators

During the course of my work advising regulators on platforms, one of the most interesting projects I’ve worked on involved applying a variety of non-platform lenses to these companies. Essentially, now that the dominant view of Facebook and Google as platforms is widely accepted, what counter-intuitive non-platform lenses could we apply to analyse these companies.

This article sets up one such lens.

Facebook and Google are really pipelines, masquerading as platforms

A lot of my work talks about the distinction between pipelines and platforms. To really determine whether a business is a pipeline or a platform, we need to start with the core value unit – the minimum unit of value created in the business.

So what really matters is the unit of analysis. What’s the minimum unit of value created on Facebook.

From a ‘product management’ perspective, if you claim you’re ‘building for users’, the core value unit is content.

But from a ‘business model’ perspective (unit of value, a portion of which is captured), the core value unit is attention.

If the core value unit is attention, these companies are very much traditional pipeline businesses harvesting attention, packaging them into data and targeting products, and selling them – literally – to the highest bidder.