Latest / Rick Outzen: (we don’t) color on the dog / Meta's $17 Billion Wake-Up Call
Transcript
- Rick Outzen: Welcome to We Don't Color on the Dog. We've got with us attorney Ned McWilliams, longtime friend. One of the first rising stars, Ned, you Ned: Right. Rick Outzen: know, 20 years ago. It's hard to believe. Big settlement with Meta this week, seven over 17 billion dollars with about, I guess about 47 states and some of the territories. Ned: Yeah. Rick Outzen: talk just a little bit about the impact of this settlement. Ned: I mean, I guess pr the first thing I'll say is it looks big to to lots of people, but this is just a day's pay for Meta. This is nothing. And the purpose of these trials and a a big purpose of these types of actions brought by attorney generals, it's meant to deter future conduct. And I just don't believe this is sufficient to deter any conduct by a company that makes, you know, hundreds of billions of dollars in profit every year. this will work out to over the course of the you know, granted, they get to pay this out over 20 years. yeah, and and so Rick Outzen: gosh. Ned: this this even at the end of the 20 year period, this accounts to less than a fifth of one year's profits. So Rick Outzen: Right. Ned: I'm not as excited about the top line number as a lot of people are. It is a big number. Anything over, you know, you're talking 15, 16, 17 billion, depending on how you slice it. That is a large amount of money, but I don't think it's going to be effective at what it was supposed to do, which is to keep companies like Meta and others others like them to not engage in this type of behavior. this is just the cost of doing business for them, unfortunately. Rick Outzen: Yeah, you're right. I didn't think about it. But you're there I think their annual revenue this is Facebook and Instagram, for Ned: Right. Rick Outzen: our for our viewers. you know, they're making almost one and a half trillion dollars a year. So to pay Ned: You're right. Rick Outzen: this out over twenty years in yeah. Ned: No, I I I did the math. So if you break it down by year, it accounts for one point nine percent of their net annual income. One point nine percent. Like so just ask if pr anybody listening to this or watching this, would you change your behavior if you got fined one point nine percent of what you made? I mean, that's that's not that's not a that's not a major slap on the wrist. Exactly. Right. Rick Outzen: That's a parking ticket for you know. And and you're looking at as far as any of that money coming down to individuals, I think I saw one i it could be less than fifty dollars. it it's just not a lot. Ned: Yeah. But but what I will say though is I mean, so that's everyone all the attention in the media is is about the dollar amount. But what I do think is meaningful and what and what they were successful in getting is getting Meta to potentially agree to change their platform. And I'll explain Rick Outzen: Good point. Right. Ned: how it's potential, but that that's the win here. they're gonna for for the first time ever, they're gonna put in real controls on miners' access to their to their products. They're going to make it where you cannot access their product after midnight until six o'clock the next morning. They're going to make it where kids cannot access it during school days, during school hours. They're going to make it where kids can't get notifications on their phone in the evening. So that is true meaningful changes Rick Outzen: Mm-hmm. Ned: to the product. And because what they what they do I mean, that's how this product was designed. It was designed to you know, this this endorphin you know loop. And they and they know that if by sending you those notifications, if I keep it keeps kids engaged, and that's all these kids get addicted. And so by agreeing to cut that off at the during those time periods is a great first step and a major win for the attorney generals. Rick Outzen: That's a great point, Ned, because it it it we do need to to remind people that there's an addictive nature and it plays into you know minors. Yeah, I d I can see it not in Facebook and Instagram as much as I'm watching my grandsons watch YouTube. And the people Ned: Right. Rick Outzen: on YouTube are saying like and subscribe because if you really want to know the answer or you could save Molly or you could save, you know, JoJo. if you'll do this and and you just suck in to it where it's you're waiting for that next hit, that next like, that next, you know, rush that you've done something. And if you're producing content, it's even more so. Ned: Yeah. And the other thing they agreed to again potentially agree to what is is it is this a two hour cap, two hour cap a day for miners. That is another that's a huge win. and you know what the funny thing is we talked about you know a little bit ago about the dollar amount, how that's not that much. I promise you that two hour cap is gonna hurt Meta more financially than this fine Rick Outzen: Right. Ned: they agreed to pay. Rick Outzen: Good point. Now Florida is not part of this settlement. Is you think that's a good decision on Florida's part? Ned: You know, I I I I tried to find the the a statement from the attorney general quick. I I was quickly getting ready for this. I Rick Outzen: Right. Ned: I couldn't find it. I apologize. I don't know if that's if they think they can get more or if they think we gotta protect business. you know, I could see either extreme here. So I don't I can't talk to you in an educated way. Rick Outzen: Yeah, I I I just I did the same thing before we got on the air. I think it primarily he felt like it was a penance. You know, pentance. It was not enough money. that there's more out there. Ned: Yeah. Well good for him then. Yeah. Rick Outzen: the I think Florida and Texas were two of the states, I don't know who the other the other Ned: Well, Texas got a separate one billion dollar deal. But but that's Rick Outzen: they did? Okay. Ned: but that's could subsumed in that seventeen, eighteen billion dollar number that's been publicized. Rick Outzen: Do you foresee this a ripple effect to go to TikTok and some of the other platforms too, that it will see them impacted? Ned: What's it's funny you asked that yeah, it's because whenever I said that they're gonna make these changes potentially, so that they're agreeing to make these changes to the to Meta's platforms contingent upon their peers, TikTok and Snapchat, doing the same thing. Rick Outzen: Yeah. Ned: Which I actually think is a good thing. I think that they're gonna all end up, you know, coalescing around the these rules. And I I suspect that Snapchat and TikTok will will do that indeed. Rick Outzen: You would think at some point the the public pressure would be such, and to the potential more liability that they're setting themselves out for by not being part of something like this. Ned: Yeah. Meta was just the first trial. There all these companies are being sued out in California. And so it's just a matter of time before they work their way to these others. So I I don't have any inside knowledge, but I would be shocked if there weren't ongoing negotiations right now to to achieve exactly this. Rick Outzen: Okay, great. Ned, thank you so much for coming on. It's good to see you again. Ned: Course, but I think. Rick Outzen: All right, take care.