|Bid||2,881.19 x 1200|
|Ask||2,886.00 x 1000|
|Day's range||2,871.50 - 2,955.56|
|52-week range||1,626.03 - 2,955.56|
|Beta (5Y monthly)||1.32|
|PE ratio (TTM)||138.05|
|Earnings date||23 Jul 2020 - 27 Jul 2020|
|Forward dividend & yield||N/A (N/A)|
|1y target est||2,814.43|
Here's why Tesla's stock continues to be on fire.
Founder and CEO Jeff Bezos continues to run the company with the mindset that it is always Day 1. In his 2016 letter to shareholders, Bezos gave investors a glimpse into what Day 2 is -- stasis, followed by irrelevance, decline, and, ultimately, death.
The coronavirus outbreak drove the remote-working trend, forcing businesses to reset priorities and in turn boosting cloud stocks.
(Bloomberg Opinion) -- The internet, once a freewheeling global network, is becoming balkanized into national spheres of influence. This could be bad for both cross-cultural communication and U.S. tech companies.China has long protected its local internet, censoring speech behind what has become known as the Great Firewall. The government blocks U.S.-based services such as Google, Facebook and Twitter, and closely monitors the local Chinese versions. Other authoritarian and quasi-authoritarian countries -- Iran, Turkey, Pakistan, Vietnam, Ethiopia – do the same. And Russia recently passed a so-called sovereign internet law that makes it much easier for the government to monitor and control online content.Now democracies may be joining in. India just banned 59 of China’s largest internet apps, including social video sharing service TikTok, reflecting rising tensions between the two giant Asian countries. It has also shut off internet to regions experiencing government crackdowns or unrest, such as Jammu and Kashmir in 2019. In Europe, major rules such as the General Data Protection Regulation are forcing internet companies to operate differently in different regions. Though this doesn’t officially ban or censor U.S.-based sites like Facebook, it does present an obstacle that could end up inhibiting the flow of information.This was probably inevitable. Different cultures perceive concepts such as privacy differently. And as U.S. global hegemony gives way to a more multipolar world, countries are going to assert their sovereignty by refusing to play by U.S. rules. Further unrest, like the protests that rocked the world in 2019 or tensions between countries such as China and India, are likely to accelerate the trend towards digital division.This could be tough on U.S. tech companies. Facebook, Twitter, Instagram and YouTube don’t owe their profitability to superior technology, other than some techniques for managing large amounts of user data. They make money because they have a lot of eyeballs to which they can deliver advertisements.And they have those eyeballs because of network effects. It’s easy to make a Twitter clone -- Gab tried it a while ago, and a new entrant called Parler is trying it now. But it’s incredibly hard to get people to switch, because the first people who make the jump will find themselves mostly alone, with everyone they know and want to read still back on Twitter. Similarly, people use Facebook, Instagram, Snapchat, and other social media services because everyone else does.Captive advertising targets translate into enormous profits. Facebook, Inc., which dominates the social media landscape, has a profit margin that typically ranges between 20% and 40%. Its market cap as of early July was about $647 billion, or 2.6% of the entire S&P 500.Regional balkanization, though, slices through network effects. If services like Facebook are banned in some countries and heavily restricted in others, users will have less company. Most people’s contacts and friends will tend to be in the same country, but not all. And outright bans will cut some services off entirely from huge markets like China, while restrictions like GDPR will force them to invest in expensive localization.This is an unfortunate side effect of nationalism and unrest. But it’s also reason to worry about a technology industry whose profitability stems mostly from network effects, not know-how. Actual innovations, like Intel Corporation’s semiconductor manufacturing processes, Amazon.com, Inc.’s cloud computing systems, or Google LLC’s machine learning algorithms give these companies some clout: if a country decides it doesn’t want to buy Intel’s chips, it will suffer a real economic penalty. But if a country decides to create its own Facebook clone, it will lose little, while Facebook’s American owners and workers will lose a lot.A free and open global internet may one day reemerge. In the meantime, U.S. companies and policy makers should think about how to invest in products whose value isn’t so subject to the whims of foreign authorities.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Noah Smith is a Bloomberg Opinion columnist. He was an assistant professor of finance at Stony Brook University, and he blogs at Noahpinion.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Zoom, one of the few success stories of the Covid-19 pandemic, now faces a new competitor in an app backed by Asia’s wealthiest person Mukesh Ambani.Ambani’s Reliance Industries Ltd., which has scored billions of dollars of investments from Facebook Inc. to Intel Corp. for its digital businesses, has launched the JioMeet video conferencing app after beta testing. The app has already garnered more than 100,000 downloads on the Google Play Store after becoming available Thursday evening.Like Google Meet, Microsoft Teams and other services, JioMeet offers unlimited high-definition calls -- but unlike Zoom, it doesn’t impose a 40-minute time limit. Calls can go on as long as 24 hours, and all meetings are encrypted and password-protected, the company said on the JioMeet website.The launch coincided with a nationwide ban on dozens of popular apps from Chinese technology giants including ByteDance Ltd.’s TikTok and Alibaba Group Holding Ltd.’s UC Web, on grounds they threatened security and data privacy. JioMeet went viral Friday on social media alongside the hashtag MadeinIndia.The app is one facet of Ambani’s rapidly expanding digital empire, which includes India’s largest telecom operator with nearly 400 million users. On Friday, Reliance announced Intel Capital has invested $253 million into Jio Platforms Ltd., a unit of Ambani’s oil-to-retail conglomerate. The U.S. chipmaker’s arm is the 11th investor in about as many weeks to announce its backing for the digital services platform, which has now raised about 1.2 trillion rupees ($15.7 billion).“JioMeet will be a very credible disruptor in the space,” said Utkarsh Sinha, managing director of boutique consultancy Bexley Advisors. “Just the fact that it has no time limits on calls makes it a serious challenger to Zoom, despite its entrenchment.”Jio Platforms is amassing a wide range of services from music streaming to online retail and payments, fast turning into an ecommerce juggernaut that can take on Alphabet Inc.’s Google and Amazon.com Inc on its own home turf. Like elsewhere, video conferencing apps have become lifelines for millions of Indians working in cramped homes during Covid-19 lockdowns.JioMeet is also debuting at a time Zoom users have accused the service of security flaws. It’s been accused of siding with China after deactivating accounts of pro-democracy activists in the U.S and Hong Kong, which it said was intended to comply with Chinese law.(Adds total investment in Jio in fifth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- Back when Tesla Inc. delivered 95,000 cars to customers during the spring quarter of 2019, the stock price was languishing at about $235 and Elon Musk’s electric car company was valued at “only” $40 billion. Fast forward a year and the shares are now priced at more than $1,200. With a market capitalization of $224 billion, Tesla has surpassed Toyota Motor Corp. as the world’s most valuable automaker.Yet in the second quarter of 2020, Tesla delivered 91,000 vehicles — about 5% fewer than the same period last year. That’s pretty underwhelming for a company whose fans view it as a fast-growing technology company in the mold of Amazon.com Inc., rather than a sluggish metal-bashing carmaker. So how is the massive recent jump in its market value justified?In fairness, it shows resilience to sell this many cars when the company’s main California plant was shut by the pandemic for much of the spring period. Doubtless, Tesla’s new Shanghai plant picked up the production slack, which suggests the expense and effort of getting that China factory up and running was worth it. The launch of Tesla’s new Model Y crossover vehicle will have helped. Ford Motor Co. and General Motors Co. both saw their U.S. deliveries decline by a third in the same quarter. Nevertheless, Tesla’s stock market acolytes pushed the shares up another 8% on Thursday, adding $16.5 billion to the market value. Such exuberance is hard to understand. Musk’s company sold 7,650 more vehicles than analysts expected during the second quarter, and the stock price jump equates to about $2 million of added shareholder value for each of those additional sales. This seems a little excessive given that a Tesla Model 3 sells for less than $40,000, and the profit margin on those cars is pretty slim. The shareholder reaction makes even less sense when you consider that Tesla investors aren’t really meant to buying the stock because of the company’s current sales, which are less than 4% of Volkswagen AG’s. Rather, the investment case is a long-term one: that it will come to occupy a dominant position in clean transport and energy in the years ahead. That explains why the shares trade at 320 times its analyst-estimated earnings this year. Viewed through this lens, Tesla’s ability to shift a few thousand extra cars in recent weeks shouldn’t matter so much for the valuation. Investors’ tendency to overreact to Tesla news made more sense when its survival was open to doubt. A year ago it was laying off workers, U.S. sales were slowing and its retail strategy was confused. Senior staff kept heading for the exit. The company was burning through cash and ran pretty low on financial fuel. It had just $2.2 billion of cash in March 2019, compared with more than $8 billion now.But subsequent evidence that Tesla can sell cars for more than it costs to produce them has transformed the mood — and with it Tesla’s stock price.Instead of “killing” off Tesla, the tepid electric offerings of established carmakers such as Audi and Mercedes have only underscored the quality of their rival’s battery and powertrain technology (the same can’t be said of Tesla’s build quality). Volkswagen’s software problems with its forthcoming ID.3 electric vehicle suggest catching Tesla won’t be straightforward, even with the Germans’ vast resources.Tesla’s stratospheric valuation appears to have become self-reinforcing. Should it require more money to fund its roughly $9 billion of capital expenditure over the next three years, it can raise it from shareholders without worrying about diluting them too much.Similarly, holders of more than $4 billion of convertible bonds that Tesla issued to fund its expansion should be happy to convert them into stock, rather than demand cash repayment, taking some of the pressure off the company and its balance sheet. Still, Tesla’s valuation remains impossible to justify by any standard metrics. Analysts’ average price target is more than 40% below the current level. Even Musk has suggested that the share price, which has almost trebled since the start of 2020, is too high — although, as with his taunting of the U.S. Securities and Exchange Commission and his comments about “fascist” lockdowns, it’s usually better to tune out what Musk says and focus on his actions instead. The skeptics might have more faith in Tesla’s new position as the leader of the automaker pack when Musk stops his provocations and his shareholders stop getting giddy over modest good news.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Bryant is a Bloomberg Opinion columnist covering industrial companies. He previously worked for the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Chinese flexible display maker Royole Corp. is weighing an initial public offering in China while its planned U.S. listing is put on hold, according to people familiar with the matter.Royole had filed confidentially for a U.S. IPO that could raise about $1 billion, Bloomberg News reported earlier this year. However, the startup is now considering a listing in China, the people said, asking not to be identified as the information is private.Considerations are at an early stage and no final decisions have been made, the people said. A representative for Royole declined to comment on the matter.Royole, known for manufacturing the world’s first commercial foldable phone, had originally planned to raise funds via a private financing round at a valuation of about $8 billion, people familiar with that deal said last year. But the Chinese company turned to the U.S. markets after liquidity tightened during a downturn in China’s venture capital sector, the people said.Since January relations between the U.S. and China have deteriorated sharply, with tensions spanning trade, technology and Hong Kong. Many U.S.-listed Chinese companies are considering second listings closer to home in Hong Kong, while China has been actively seeking to lure innovative technology companies to list in Shanghai and Shenzhen.Royole competes with Samsung Electronics Co. and BOE Technology Group Co. to produce bendable screens using cutting-edge organic light-emitting diode technology. The company, which gave away wraparound-screen hats at the 2018 World Cup in Russia, in January unveiled a smart speaker that packs a bendable display around a cylinder.Its full line of products encompasses head-mounted displays intended for use as so-called mobile theaters and other wearable flexible displays. The company even has a smart writing pad that it sells on Amazon.com, JD.com and in stores globally.Royole’s earlier investors include Knight Capital, IDG Capital, Poly Capital Management, AMTD Group, the funds of Chinese tycoon Xie Zhikun and the venture capital arm of the Shenzhen city government.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Google and Temasek Holdings Pte are in negotiations to join a funding round of between $500 million and $1 billion for Indonesian e-commerce giant PT Tokopedia, according to people familiar with the matter.Tokopedia, the online marketplace backed by SoftBank Group Corp.’s Vision Fund, has held talks with U.S. internet giants including Facebook Inc., Microsoft Corp. and Amazon.com Inc., the people said. But Google and Temasek have been more active in their negotiations and those talks may conclude in coming weeks, they said, asking not to be identified because the discussions are private.America’s largest internet corporations have looked increasingly toward Asia as growth in the U.S. and Europe slows, seeking to tap the region’s rapidly growing smartphone-savvy population. Facebook is buying a stake in India’s Jio Platforms, while its WhatsApp unit struck a deal last month to invest in ride-hailing and food delivery giant Gojek. Representatives for Tokopedia and Temasek declined to comment. Google didn’t respond to an email seeking comment.The backing of Alphabet Inc.’s Google and Singaporean state investment firm Temasek would mark a major boost for one of Southeast Asia’s biggest e-commerce operators. Tokopedia co-founder and Chief Executive Officer William Tanuwijaya built the country’s most valuable startup after Gojek after scoring early backing from SoftBank founder Masayoshi Son and Alibaba Group Holding Ltd. co-founder Jack Ma. It now plans to list shares at home as well as in another as-yet-undecided location, Tanuwijaya told Bloomberg News in October.Read more: SoftBank’s Bet on Sharing Economy Backfires With CoronavirusTokopedia came close to finalizing its latest financing this year before news emerged of a recent data theft attempt that may have affected 15 million of its users, one of the people said. It was also held back by the Covid-19 pandemic, which is rapidly changing the online shopping landscape in the world’s fourth most populous nation.E-commerce platforms are now moving quickly to serve the millions of people forced to make their first online purchases during widespread lockdowns. Singapore-based rival Shopee -- a unit of Sea Ltd. -- is catching up, while Alibaba last month appointed a longtime veteran to head up Lazada and “fight harder” as competition heats up.Indonesia has become a key battleground between the regional rivals: The country’s e-commerce market is projected to expand from $21 billion in 2019 to $82 billion by 2025, according to a recent study by Google, Temasek and Bain & Co.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- With the U.S. Justice Department nearing a lawsuit against Alphabet Inc.’s Google for antitrust violations, a coalition of states that are conducting a parallel investigation are divided over the best strategy for taking on the internet giant, according to people familiar with the matter.While the multistate investigation into Google’s dominance of the digital advertising market is in its final stages, some state attorneys general are advocating to take more time to investigate Google’s conduct in other markets and potentially bring a broader case against the company, said the people, who asked not to be named discussing a confidential matter.The disagreement could affect whether states join a Justice Department complaint about Google. Like the states, federal antitrust enforcers have been investigating whether Google is thwarting competition in the digital advertising market, where it holds a commanding position.The Justice Department, which is coordinating with the states, wants to move quickly, two of the people said, and is on track to file a complaint this summer, another person said, though it wasn’t clear what conduct the complaint will ultimately target. The department declined to comment.“While we continue to engage with ongoing investigations, our focus is on creating free products that lower costs for small businesses and help Americans every day,” Google said in a statement.State attorneys general can play a pivotal role in enforcement cases against companies when they band together in group investigations. They joined the Justice Department in suing Microsoft Corp. in 1998 for antitrust violations. The case nearly led to the break-up of the company when a judge sided with the government. After an appeals court reversed the ruling, the Justice Department under the George W. Bush administration settled the case.Two people familiar with the states’ investigation said the split among the states reflects normal tension about the best litigation strategy. A broad complaint would cover more conduct but would take more time to complete.Texas Attorney General Ken Paxton is leading the investigation into Google’s conduct in the digital advertising market, which was announced in September on the steps of the Supreme Court. Other states, including Utah and Iowa, are focusing on internet search. Google dominates web search in the U.S., and rivals have complained that the company has prioritized its own services, such as travel and restaurant reviews, in results.Texas declined to comment. Representatives from Utah and Iowa didn’t immediately respond to requests for comment.The digital advertising part of the probe focuses on Google’s control of the tools that deliver display ads across the web. Google owns much of the technology used by publishers and advertisers to buy and sell advertising space. Google has been accused of using its dominance to siphon advertising dollars from publishers.Earlier: Google Antitrust Road Map Goes to DOJ With U.S. Suit LoomingTexas is in the later stages of its probe in advertising and could join the Justice Department’s case with some states, said two of the people. States are still waiting to get a full look into the federal complaint, one of the people said.The investigations are so complex that few among the enforcers have a sense of what the Justice Department and all the states are doing, two of the people said.The investigation into online search is not advanced as far as Texas’s probe into the digital ad market, and some states are pushing for more time to investigate, said the people. At one point, states were also looking the company’s mobile operating system, Bloomberg reported last year, though it wasn’t clear whether that is an active part of the investigation.The chief executive officer of Google search rival DuckDuckGo Inc. said last month that state and federal enforcers have asked detailed questions about how to limit Google’s power in the search market as recently as the spring.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Amazon.com (NASDAQ: AMZN) shares rose 13% in June, according to data provided by S&P Global Market Intelligence. Amazon stood out early in the crisis as a stock to buy as consumers stockpiled their pantries with essentials and opted for online shopping. At the same time, Amazon Web Services (AWS), the company's cloud-computing business, saw demand linked to the outbreak as well.
Amazon (NASDAQ: AMZN) has been stealing away Google's most valuable searches over the last several years. More product searches begin on Amazon.com than the search engine owned by Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL). In order to combat the growing popularity of product searches on Amazon, Google's offering brands and retailers free listings on its main search results.
Does Amazon (AMZN) have what it takes to be a top stock pick for momentum investors? Let's find out.
By John Jannarone goPuff’s delivery volume rose 400% in the first half of 2020, according to sources goPuff now reaches 500 cities through over 200 distribution facilities Raised $1 billion from investors including Accel and SoftBank Vertical integration provides better customer experience and margins goPuff’s rapid expansion gives it head start and wide moat versus […]
Behind every monster stock is almost always a company driving tremendous change to an industry. Experienced investors can remember how Amazon transformed both retail -- and later -- the information technology industry. Buying Amazon or Netflix could still keep one rich.
The Zacks Analyst Blog Highlights: Amazon.com, Snap, Netflix, PayPal and Match Group
With many people stuck at home during the second quarter due to the coronavirus outbreak, engagement on all manner of streaming platforms has soared. That includes popular video-streaming services, as well as Amazon.
Target (NYSE: TGT) is adding groceries to its curbside pickup program, Drive Up. After successful tests in Minneapolis, Target expanded grocery pickup to 400 stores in the Midwest, and it plans to cover all 1,500 stores by the holidays. While all of e-commerce is growing rapidly amid the coronavirus pandemic, online grocery sales have led the way.
The owner of the world's top search engine is also leveraging the world's most-visited video platform.
Shares of Shopify (NYSE: SHOP) gained 25.3% in June, according to data from S&P Global Market Intelligence. Walmart announced on June 15 that it would feature select Shopify stores on its third-party online retail marketplace -- a development that could have big implications for the competitive landscape in the e-commerce space. Walmart is investing to build its online retail business, and bringing products from Shopify stores on to its e-commerce platform could help both companies challenge Amazon.com's dominance in the space.
Amazon may not have delivered the biggest percentage gains since the stock market bottomed out, but its performance in 2020 is pretty impressive, especially when you consider that it's the third-largest publicly traded company on the U.S. exchanges at $1.34 trillion. At no point in 2020 has Amazon's share price been down more than 9% on a year-to-date closing basis. What's more, the company's year-to-date gain (through June 29) of 45% represents a 50-percentage-point outperformance of the benchmark S&P 500.
A handful of corporate behemoths has skyrocketed YTD. Some of these stocks carry a favorable Zacks Rank and have rallied more than 20% YTD.
Amazon (NASDAQ: AMZN) is facing significant disruptions in its business as a result of the COVID-19 pandemic. Meanwhile, Amazon is making adjustments to fulfill the increase in orders while keeping frontline workers safe. Amazon borrows $10 billion to reinforce its balance sheet.
(Bloomberg) -- Sony Corp. is weighing a bid for Leyou Technologies Holdings Ltd., people familiar with the matter said, paving the way for an intensified bidding war for the Hong Kong-listed gaming firm.The Japanese tech giant is working with a financial adviser on the potential offer for Leyou, said the people, asking not to be identified because the matter is private. In May, the Chinese gaming firm confirmed it had received a non-binding takeover offer from Shenzhen-listed rival Zhejiang Century Huatong Group Co., after months of buyout talks with other bidders including iDreamSky Technology Holdings Ltd.Shares of Leyou extended their gains to as much as 9.8% after the Bloomberg News report. The stock has risen about 20% this year, giving the company a market value of about $1.1 billion.Leyou’s controlling shareholder Charles Yuk had been in talks with iDreamSky for a majority stake sale since late last year. iDreamSky, which counts Tencent Holdings Ltd. among its investors, had been in discussions with CVC Capital Partners for a joint offer valuing Leyou at about $1.23 billion but the Covid-19 pandemic brought their talks to a stalemate, Bloomberg News reported in April.Sony is hoping that it can edge out other bidders with greater certainty of financing, the people said. Leyou’s Yuk aims to choose a buyer and sign an agreement as soon as this month, the people said.Talks are still ongoing and no final decision has been made, the people said. Other bidders could still emerge, they said. Representatives for Leyou and Sony declined to comment.Leyou was listed in Hong Kong in 2011 and counts among its titles the free shooting games Warframe and Dirty Bomb. It’s also working with Amazon.com Inc. to co-produce a video game based on the popular fantasy series “The Lord of the Rings,” according to its website.Sony has recently been aiming to beef up its content arsenal as the tech giant’s chief executive officer Kenichiro Yoshida believes that would in turn strengthen the value of its branded consumer electronics hardware. That includes PlayStation 5, the new video game console that the company plans to launch at the end of this year.Leyou’s Warframe is already available on PlayStation 4 and the company has said in its latest earnings report that it plans to expand the game to more platforms including the next-generation consoles.(Updates with more background from the seventh paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- A top Democratic lawmaker wants to empower the U.S. Federal Trade Commission to take action against Alphabet Inc.’s Google and Facebook Inc., among other technology platforms, if they fail to remove content that violates their terms of service and community standards.Democratic Representative Jan Schakowsky of Illinois, who chairs a subcommittee on consumer protection, told Bloomberg in an interview that she plans to introduce a bill in the coming days that would clarify that if technology companies fail to fulfill the “assurances” made to users in terms and conditions, community standards, advertising rules and content moderation policies, they could face enforcement from the FTC.The initiative falls into a flurry of measures that aim to limit a much-cherished liability shield for user content under Section 230 of the Communications Decency Act. Many of the initiatives are coming from Republicans, including President Donald Trump, as a way to address their claims that social media sites silence conservative voices.“Irrespective of what Trump is saying, we’re going to move ahead in a bipartisan way to do what we need to do to protect consumers,” Schakowsky said.The FTC already polices businesses under its authority to enforce against “unfair or deceptive acts or practices.” Schakowsky’s bill would clarify that Section 230 can’t be used as a defense in those cases.The idea behind the bill would be to treat Facebook’s failure to block a post advocating, say, white supremacy or Google’s inability to stop an ad for medical masks, both of which are banned, the same way the FTC treats broken promises by companies to deliver cures or cybersecurity protection. The agency can seek injunctions, consent decrees and fines for repeat offenders.Facebook and Google have extensive bans on certain kinds of content, including Covid-19 scams, medical misinformation, posts inciting violence, terrorist content, harassment, hate speech, illegal drug sales and violent and graphic content.Facebook and Instagram have also taken action to ban white-nationalist content on their social-media platforms as well, while Google bans counterfeit goods and dangerous products and says that it protects advertisers “from invalid activity and advertising fraud.”A Google representative declined to comment. Facebook representatives could not be reached for comment after business hours on Wednesday.Schakowsky’s concern, which some of her GOP colleagues share, is that technology companies will try to duck any FTC enforcement of their content-moderation policies by invoking Section 230. The provision exempts them from liability for third-party posts, but has been interpreted by courts to free companies from much scrutiny over what content they leave up or take down.“Bottom line, we want to clarify that there is no doubt that 230 is not going to be the escape hatch,” Schakowsky said.By example, Schakowsky pointed to an effort by Airbnb Inc. to escape local regulation of short-term rental listing by invoking the provision, though a federal court rebuffed the effort.An FTC spokesperson didn’t comment on the bill, but said the agency “is committed to robust enforcement of consumer protection and competition laws, including with respect to social media platforms, and consistent with our jurisdictional authority and constitutional limitations.”While the companies have stepped up enforcement in recent years, Schakowsky said that the bill is necessary because of the spread of election misinformation targeting Black voters, scams involving stimulus checks and other content that proliferates despite being banned.Schakowsky’s effort follows a bill from five Republican senators led by tech critic Josh Hawley of Missouri that would expose the platforms to customer lawsuits if they engage in “intentionally selective enforcement” of their terms and standards.And a sweeping proposal by Trump’s Justice Department would clarify that Section 230 doesn’t stop federal civil enforcement. Trump’s May executive order also aimed to expose companies to FTC enforcement, as well as to user lawsuits if the platforms “use their power over a vital means of communication to engage in deceptive or pretextual actions stifling free and open debate by censoring certain viewpoints.”Schakowsky agreed with criticism of the White House order, which came after Twitter Inc. slapped a fact-check on one of Trump’s tweets, as an assault on the platform’s constitutional right. Her bill would focus more narrowly on FTC enforcement, rather than exposing companies to potentially thousands of user lawsuits.Promises, PromisesWhile many tech critics have urged companies to more strongly enforce their terms of service, ad policies, community standards and other documents, some have suggested that the companies might scale those back to avoid making promises they can’t deliver and that could draw FTC scrutiny.Others suggest that the company statements don’t represent promises at all and are merely rules that users must follow.“Proving deception from community standards language is probably pretty difficult because it’s couched in best efforts rather than a promise,” said Neil Chilson, a former FTC official who defends Section 230.Schakowsky said that FTC officials have told her they welcome her attempt to clarify the agency’s authority in an area that remains little-tested. “We need to empower them,” she said.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Uncle Sam best come through with more stimulus checks, or else investors could be battered.