Time for a new digital regulatory authority

For platform companies, endorsing the concept of a new digital regulatory authority should be an act of enlightened self-interest. The idea that a handful of platforms can continue to make their own behavioral rules even when those decisions harm the public interest is no longer sustainable. The absence of a uniform federal policy is not only not in the interest of the public, but also it is creating problems for these companies. The ultimate uncertainty is a set of unknown decisions from multiple regulators. The benefits of the interconnected digital marketplace are threatened if state and/or national governments chop the previously uniform marketplace into smaller, less efficient pieces. Industrial era policies must be updated to reflect digital era realities. It is necessary to leave behind the kind of rigid micromanagement that characterized industrial regulation in favor of agile risk management that protects consumers and competition while encouraging innovation and investment. It is in this regard that the United States has the opportunity to reassert international policy leadership by advocating a new regulatory paradigm. While the EU and UK have pioneered the need for oversight of the digital platforms, the United States can get back to the international policy table with a new agile regulatory process that will make those efforts more effective in protecting consumers and competition while meaningfully addressing some of the regulatory issues the companies fear.

[Tom Wheeler is Visiting Fellow - Governance Studies, Center for Technology Innovation at Brookings.]