The Regulator's Reflex

Why the State's worldwide hunger to govern internet platforms should worry us more than the platforms themselves

There is a revealing little scene in this week’s New Zealand political news. The Media Minister, Paul Goldsmith, told a select committee that he goes on phoning the chairs of the public broadcasters at “random times” to see what is going on, keeps no notes, makes no recording, carries — in his own phrase — no “little notebook,” and assumes the chairs keep no record either.

This is the same minister whose private call from the TVNZ chair, who tried to raise a news story the Government disliked, set off a firestorm two months earlier. Ministers are barred by law from directing the public broadcasters on editorial matters. The minister’s defence was essentially that the alternative — never talking to the people he appoints — would be worse.

Set beside that, a second story from the same week: the head of Screen Producers New Zealand calling it “extremely urgent” that the country follow Australia and impose a levy on international streaming services, with the Government already floating a levy, a local-content quota, or forced investment, and meanwhile asking the streamers to “voluntarily” hand over their New Zealand revenue and subscriber data so officials can build the evidence base for “potential future interventions.”

Put the two together and you have, in miniature, the governing instinct of our age: the conviction that the flow of information and entertainment is a thing the State ought to be managing — by a quiet word here, a levy there, a quota, a ban, a new framework.

The platforms that now carry most of what people read, watch and say are the great prize of that instinct, and the reasons given for reaching for them deserve far more scepticism than they usually get.

An alternative the State cannot control

Begin with the part that is rarely said aloud. The large internet platforms are the first mass-communication infrastructure in modern history that no government built, licenses, or can easily switch off.

For most of the twentieth century, the State sat close to the chokepoints: it issued broadcast licences, owned the public broadcasters, and could lean on a handful of editors.

The Goldsmith episode is a fossil of that world — a minister who still thinks the natural thing to do is ring the chair and ask what is going on. The platforms broke that arrangement. They represent an alternative means of messaging the State did not authorise and cannot conduct off-record phone calls to manage.

It should not surprise us, then, that the most aggressive platform regulation now arrives dressed as something else.

The European Union’s Digital Services Act is the clearest case. It is sold as a shield for democracy against “disinformation,” “hate speech” and “systemic risk” — but those terms are notoriously elastic, and the enforcement mechanism is a fine of up to six per cent of a company’s global turnover. Faced with that, the rational move for any platform is to remove more than the law strictly requires, a tendency critics call collateral censorship.

More than a hundred free-speech advocates and over fifty European civil-society groups have warned the Commission about exactly this; a U.S. congressional committee, having obtained internal documents, accused Brussels of pressing platforms to change their worldwide moderation rules. One need not endorse every word of those critiques — many come from interested parties — to notice the shape of the thing.

A government that finds a vague offence (”harmful content”), attaches a ruinous penalty, and then leaves the platform to work out where the line is, has built a censorship machine it never has to admit operating. The platform does the silencing; the State keeps its hands clean.

“Big tech should pay us”: the incumbents’ grievance

The second strand is subtler because it wears the costume of fairness. Newspapers, radio and television — themselves enthusiastic adopters of every new technology, with their apps, podcasts and streaming feeds — have decided that the platforms which send them audiences should also pay them for the privilege.

Australia’s bargaining code, Canada’s Online News Act, and New Zealand’s now-stalled Fair Digital News Bargaining Bill all rest on the same premise: that Google and Meta capture value from news and must be made to share it.

The trouble is that the premise is contestable and the experiment has already been run.

When Canada passed its law in 2023, Meta did not pay; it simply removed news from Facebook and Instagram for Canadian users, turning the country’s biggest social network into what one law professor called a news desert. Researchers found Canadian outlets lost the overwhelming bulk of their engagement on those platforms, and the smallest, most local publishers — the ones the law was meant to protect — were hit hardest.

Google paid only after negotiating its way to a single national fund.

The lesson is awkward for the levy enthusiasts: you cannot compel a company to value your content at the price you have set, and when you try, it may decide your content is not worth carrying at all.

New Zealand’s own minister, asked how much longer he would “watch Australia closely,” conceded the bargaining bill is on the books but not being progressed — which is either prudence or paralysis, depending on whether you think the idea was ever sound.

There is a deeper objection. A press that depends on the State to extract its revenue from a third party is a press that has acquired a powerful new reason to stay on good terms with the State.

The same week’s news — a minister phoning broadcast chairs, a budget trimming RNZ’s funding, a governing-party MP chairing the very committee while pursuing an apology from a hostile talkback host — is a useful reminder of how many levers government already holds over the outlets that scrutinise it.

Adding “we decide whether big tech has to fund you” to that list is not obviously a gift to press freedom.

After all one wonders whether or not there should be an element of economic Darwinism at work. If existing media cannot adapt and survive in the Digital Paradigm, do they have a “right” to be there at all.

The soft target: banning the children

The third strand is the cleverest, because it is almost impossible to oppose without sounding like you are against children. Australia has banned under-16s from social media, with platforms facing fines of up to A$49.5 million; Britain, France and others are circling the same idea.

The public loves it — polling has run around seventy per cent in favour. It is the perfect regulation: emotionally unanswerable, broadly popular, and aimed at companies nobody feels sorry for.

And then reality arrives. Australia’s own e-Safety Commissioner reported that platforms took only “some steps”; that children sailed through age checks using masks, older siblings, or a parent sitting in front of the camera; that some systems guessed a child’s age from the accounts they followed and waved through anyone who had liked grown-up content; and that the major platforms were promptly placed under investigation for non-compliance.

Teenagers interviewed by the press were largely unconvinced, and even before launch the workarounds were public knowledge.

The hard question — how, exactly, do you verify everyone’s age without building an apparatus that checks the identity of every adult too? — was never satisfactorily answered, because there is no comfortable answer. Either the ban is porous, in which case it is theatre, or it is effective, in which case the price is an age-and-identity verification layer over the entire internet, available to whoever controls it next.

A measure framed as protecting children quietly normalises the idea that you must prove who you are to speak online at all. I wrote about this in my series “The Unanswered Question” the most recent episode of which is here.

The honest case on the other side

None of this means the concerns are imaginary. Social media genuinely can harm vulnerable teenagers; the parents campaigning for the Australian ban are not cynics. Local screen industries genuinely struggle against globally-scaled competitors who carry no obligation to the cultures they sell into, and small countries do lose something real when their stories go unmade. And the platforms are not gallant defenders of the public square — they are enormous commercial actors optimising for engagement, and “trust us, we’ll self-regulate” has a poor track record.

A reasonable person can look at all this and conclude that some rules are warranted. The fair version of the levy argument is that a modest, predictable contribution to local production is a price of market access, much as broadcasters have long accepted content obligations. The fair version of the age-limit argument is that we already restrict alcohol, gambling and driving by age and survive the imperfections.

The point is not that the State should never act. It is that we should be honest about what is driving it. Each of these measures is presented as a narrow, technical fix for a discrete harm, and each turns out to hand government and the legacy incumbents more leverage over the one communications system they do not yet command.

Goldsmith’s instinct to ring the chair without a notebook is not an aberration; it is the whole mentality in distilled form — the assumption that information is something the powerful are entitled to manage quietly, off the record, for our own good.

The platforms are imperfect, often maddening, sometimes genuinely harmful. But before we let the State take them in hand, it is worth remembering that the minister’s own last word on what to do about media you dislike was the least regulatory thing he said all week: maybe the best solution is simply to turn them off — a choice that belongs, by right, to the citizen and not to the State.

And for this Goldsmith deserves a resounding cheer for his articulation of the principle of individual choice and autonomy.