Privacy, Technology and Perspective
Algorithms, GameStop and Roaring Kitty. Last week, we wrote about dramatic, recent moves by Twitter, permanently suspending former President Trump’s account; Facebook, also suspending it, and referring the request for reinstatement to its Oversight Review Board; and AWS, kicking Parler off of its platform.
This week’s big news isn’t about any of those platforms. This week, it’s about Reddit, Roaring Kitty and GameStop, along our view that platforms, like Reddit and Twitter, are fuel-injecting the recent controversies.
What is Reddit, and how is it different from Twitter?
Reddit is a discussion board, similar in some ways to the old bulletin boards of yesteryear but updated. Discussions are grouped by topic and subtopics, which registered members can create and which allow expansive discussion. Reddit algorithms rank posts or “stories” according to the number of votes they receive within a certain time. For example, within the minutes that a story is posted, the Reddit story algorithm calculates and places a value on the number of upvotes, downvotes and comments it receives, and then allows the amount of “engagement” reflected by the votes to drive the prominence of the story, making it “hot” or not. (In contrast, Twitter has sharp limits on how many characters a message can include, and its algorithms sort content based on relevance, engagement, recency and other factors, including whom people “follow” and what posts they “like.”)
What happened this week?
For a few weeks, a Reddit user, who goes by the name “Roaring Kitty” on some social media accounts, has inspired a swarm of retail investors to drive up the stock price of GameStop. Bolstered by upvotes and comments in the WallStreetBets Reddit forum (https://www.reddit.com/r/wallstreetbets/), and a related Discord hang-out group (https://discord.com/invite/wallstreetbets) (“Discord” is comparable to a live version of Reddit where users can interact on topics of choice in real-time), the sudden price increase put severe pressure on hedge funds shorting the stock.
On Tuesday, as the value of GameStop shares increased, Elon Musk tweeted a link to r/WallStreetBets, along with one word: “Gamestonk!!” (on social media, the term “stonk” is used colloquially to mean “stock”). GameStop’s price then sky-rocketed, and the hedge funds shorting GameStop and other stocks, like AMC, Nokia and Blackberry, lost billions almost overnight. (GameStop started the year at $18.84 per share; at one point it traded at $483, up almost 2,500%.)
You can read the details by clicking on the following links:
What does this mean?
This is January’s second astonishing event driven largely by commentators on social media and powerful algorithms that amplify their messages.
We suggest three topics to consider thoughtfully:
1. Even without resort to electronic trickery, social media is a powerful amplifier, whose automatic tools can be leveraged for a multitude of purposes. Here, as earlier in January, like-minded users leveraged social media to coordinate action.
2. There is an anger “out there” which is searching not only for expression, but for action. The discussion that began on Reddit touched an exposed nerve, reaching through its amplification an audience that was already there, waiting.
3. Social media is amplifying the anger. The large platforms—Reddit, Twitter, Facebook, Parler, or others—have become places which automatically amplify emotional speakers and content, including angry speakers and false content. We are seeing algorithmic amplification result in crowds of people becoming radicalized, often unexpectedly and all-too-often irrationally. However different Capitol insurrectionists may be from GameStop anti-institutionalists and/or speculators, and irrespective of the merits of the messages, in each instance it was the platforms’ algorithms that made those calls to action louder.
We suggest that if anger can find not just expression, but automated amplification on these online platforms because of how they are engineered – and especially if they want to claim a portion of credit for amplifying constructive and beneficial messages – then the platforms must bear at least a portion of responsibility, for the actions of the online “mobs” they thereby help to create.
Hosch & Morris, PLLC is a boutique law firm dedicated to data privacy and protection, cybersecurity, the Internet and technology. Open the Future℠.