Startup News Digest 05/12/23

The Big Story: The difficulties of content moderation and the chance to try it yourself

Critics of the Internet industry, including policymakers, frequently complain about content moderation decisions and propose legislative changes that would make it harder for Internet companies to host, remove, demote, amplify, and curate user content. To help inform those conversations, Engine worked with Copia and Leveraged Play to develop a new video game this week—Moderator Mayhem—with the goal of highlighting the difficulties and the inherent tradeoffs Internet companies, especially startups, face while navigating moderating their users’ content. 

Every creator or consumer of content online has encountered content moderation. From having your own innocuous photo inaccurately labeled or removed to seeing a piece of policy-violating content remain accessible, most people have experienced frustration around how a platform moderates its user content. In recent years, that frustration has fueled policy conversations about intermediary liability frameworks like Section 230 that don’t always recognize that content moderation is a delicate balancing act, and no amount of money, people, and technology can ensure that only the “good,” productive content stays online and the “bad,” harmful content gets taken down. 

Startups invest a disproportionately large amount of their limited time and resources in content moderation to keep their corners of the Internet safe, healthy, and relevant for their users. And startups of all sizes, catering to all kinds of communities of users, and hosting all types of content (from photos and videos, to reviews, to messages, and more) need to be able to moderate their users’ content to grow and compete in the Internet industry. Startups would also be the most at risk if intermediary liability frameworks changed and they were at risk of ruinous litigation costs any time one person wanted to sue over another person’s content.

If you’re interested in taking on the challenge of content moderation, you can play the game here

Join us at noon today and put yourself in the shoes of a startup content moderator. Join Engine, startup founders, and Internet policy experts for a lunch panel discussion of how content moderation works across the Internet. As part of the discussion, the panel and the audience will play a sample of Moderator Mayhem. Register here.

Policy Roundup: 

Startup founders travel to Capitol Hill to talk data privacy. This week, the founders of eight startups from across the country traveled to Washington, D.C. to explain how the current patchwork of state privacy laws impacts them. They asked Congress to pass a federal privacy framework that creates uniformity, promotes clarity, limits bad-faith litigation, accounts for the resources of startups, and recognizes the interconnectedness of the startup ecosystem. Read more about the startups and how data privacy issues impact them here.

Border drama, Florida law highlight need for immigration fixes. With both Title 42 ending this week and a draconian immigration bill imminently expected to be signed by Florida’s governor, policymakers in Washington are again turning their attention to immigration policy. House Republicans passed a sweeping bill that will not be taken up by the Senate, meaning bipartisan immigration reform still remains out of reach. Immigrants are overwhelmingly entrepreneurial, and solutions to allow more people to start businesses in the U.S. are needed as part of any immigration package.   

European Parliament votes against data transfer pact. In a non-binding vote this week the European Parliament urged the European Commission to reject the new transatlantic Data Privacy Framework and reopen negotiations with the U.S. EU-U.S. data flows have been on ice since an earlier transatlantic data transfer agreement was invalidated in 2020. Cross-border data flows are critical for U.S. startups to serve their EU users on a level playing field, and the EU must move forward with the replacement pact. 

Maryland Supreme Court vacates earlier digital tax ruling on procedural grounds. The Supreme Court of Maryland this week reversed and dismissed a challenge to the state’s digital advertising tax, saying the challengers failed to exhaust their administrative remedies. A lower court had earlier found the state’s digital advertising tax law unconstitutional and in violation of the Internet Tax Freedom Act. The tax is intended to target large tech companies, but an agreement with the state enables the tax to be passed through to their customers—often startups and other small businesses who utilize low-cost advertising and other services to reach potential customers.

Engine joins coalition urging Congress to raise debt limit. Engine this week joined 19 organizations telling Congress to “fulfill its bipartisan responsibility of raising the debt ceiling as soon as possible.” The U.S. surpassed the borrowing limit in January and is expected to exhaust ‘extraordinary measures’ in June leading to a default on the nation’s debt. Failing to raise the debt limit would hurt our economy, weaken our global competitiveness, and directly impact the startup ecosystem.


Startup Roundup:

#StartupsEverywhere: San Francisco, California. Fabio Caironi is the Founder & CEO of ByteNite, a company that specializes in making computing more affordable and powerful by distributing the task of data encoding. ByteNite enables users to join their distributed network of personal computing devices to earn rewards for the use of their computing power to process and store data. In addition to learning about how he thinks about issues of data privacy, we spoke with Fabio more about the company he’s building and his firsthand experience navigating the complex U.S. immigration system.