Should the FCC Block Elon Musk from Buying Twitter?

Last week, the Open Markets Institute called on the FCC, the FTC, and the DOJ to block Musk from buying Twitter:

Yesterday Twitter’s board agreed to sell the corporation to Elon Musk, the owner of Tesla and SpaceX. The Open Markets Institute believes the deal poses a number of immediate and direct threats to American democracy and free speech. Open Markets also believes the deal violates existing law, and that the Federal Communications Commission (FCC), the Department of Justice (DOJ), and the Federal Trade Commission (FTC) have ample authority to block it.

The most obvious problem is that the deal would give to a single man – one who already wields massive political and economic power – direct control over one of the world’s most important platforms for public communications and debate. As has been true from the Founding, the American people have an absolute right to ensure the full openness and neutrality of all essential public infrastructure. Specific to communications, we see this in Article I, Section 8 of the Constitution, in the Telegraph acts of 1860 and 1866, the Mann-Elkins Act of 1910, the Communications Act of 1934, and many other federal and state laws. Americans have also repeatedly used our antitrust laws to prevent concentrations of power over communications, speech, debate, and news.

Yesterday’s deal also violates the law at a more technical level. Mr. Musk already controls one of the most important internet platforms in the world – in the form of the satellite communications system Starlink. Since the late 19thCentury, the US government has routinely acted to prevent mergers between existing essential platforms. Most recently, the DOJ in 2017 attempted to block AT&T’s takeover of Time-Warner (an effort which failed because the DOJ filed a poor case, as OMI made clear at the time). This means that just as we would now expect the US government to block a takeover of Twitter by Google, Facebook, Comcast, or Verizon, the same rules apply to the owners of Starlink.

Let’s be clear. Elon Musk’s effort to buy Twitter is not the only threat to free communications and debate in the United States. The size, scope, and business models of Facebook, Google, and Amazon also pose a wide variety of often extreme threats to the American democracy and the basic rights of citizens. That’s why law enforcers and Congress should view this deal as an opportunity to firmly reestablish clear bans on any manipulation of communications by essential platforms, and to eliminate all business models that rely on such manipulation.

Finally, as Open Markets made clear in this article In the Washington Monthly, it’s past time for the FCC to get serious about regulating Starlink to ensure that this vital and important Internet platform serves the public interest only.

The following day, FCC Commissioner Brendan Carr responded,

The FCC has no authority to block Elon Musk’s purchase of Twitter, and to suggest otherwise is absurd. I would welcome the full FCC making it clear that we will not entertain these types of frivolous arguments.

And Monday, Commissioner Nathan Simington added,

Some have recently called on the FCC to stop Elon Musk from acquiring Twitter. But nothing in the United States Code or our regulations gives us the right to interfere with this transaction. Our competition review authority does not and has never extended to internet platforms like Twitter.

But even if this deal were within our purview, it would be inappropriate and contrary to the public interest to block it. Mr. Musk’s acquisition does not raise any concerns about vertical or horizontal concentration in the social media market, and there is no reason to think it would otherwise limit competition or harm consumer welfare.

In fact, antitrust regulators should welcome this purchase. In recent years, consumer choice and freedom have suffered due to the restrictive, and often politically motivated, content moderation practices adopted across all major social media platforms. If Mr. Musk follows through on his stated intention to ease Twitter’s restrictions on speech, he would almost certainly enhance competition and better serve those Americans, the majority, who value free speech.

Also unpersuasive are selective concerns about concentration of ownership. Nothing about Mr. Musk becoming the sole owner of Twitter would be out of step with the ownership structures of other social media platforms or, for that matter, media companies generally. Google, YouTube, Facebook, the Washington Post, and the New York Times are each owned or controlled by one or two people or a single family. Vertical integration is also widespread, and there are numerous examples of common ownership and control of broadband internet access service and online services like search engines, streaming platforms, and news websites. Concerns about Mr. Musk controlling both Twitter and Starlink—a broadband provider currently serving less than one percent of Americans—cannot be taken seriously.

The FCC cannot, and should not, block this sale. We should instead applaud Mr. Musk for doing something about a serious problem that government has so far failed to address. I encourage my colleagues across the government to investigate the market failures and perverse incentives that caused big tech companies to standardize around censorious and slanted content policies in the first place. If this acquisition leads to corporate success by bucking the trend toward curated and managed speech informed by the sensibilities of a narrow and unrepresentative class of insiders, it will bring greater diversity to the social media experience. And, as this experiment is clearly lawful, I for one look forward to seeing what comes of it.

Finally, I am particularly troubled by arguments that the federal government must act with the purpose of stopping Mr. Musk from enshrining free expression on Twitter. The only merit in such proposals is their candor in proposing something so blatantly illegal. The law in this country does not recognize a government interest in restricting the open exchange of ideas. Labeling content as “fake news” or “disinformation” does not change that. It would be not only unconstitutional, but plainly un-American, for any arm of the government to act against Twitter or Mr. Musk for such a purpose.

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