Technology Social networks risk quitting Britain under online safety laws,...

Social networks risk quitting Britain under online safety laws, Reddit claims

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Reddit has claimed that incoming online safety laws could force social networks to quit Britain because of the burden of complying with the new rules.

The US company, which recently pulled off a $6.4bn (£5.1bn) Wall Street listing, has told Ofcom that holding less well-resourced companies to the same standards as giants such as Facebook and Google could lead them to pull out of the market altogether.

Reddit said: “If smaller companies are held to the same compliance standards as the largest players, their competitiveness may be diminished, they may opt to withdraw from the market, and newer entrants may be discouraged.”

Ofcom is consulting on how to apply the Online Safety Act, which is designed to protect children online and crack down on illegal activity.

It will apply stricter conditions to major social networks, such as requiring them to offer verification and protect news content, but is considering where to set the bar.

In response to Ofcom’s consultation, Reddit claimed that it would be unfair to require it to stick to the same standards as bigger rivals.

“It would… be fundamentally disproportionate and harmful to sectoral competition to hold a company of this size and corporate profile to the same regulatory standards as its competitors, some of whom are amongst the largest and most resourced companies in the world,” it said.

Meta, which owns both Facebook and Instagram, is worth $1.24 trillion. Alphabet, the parent company of Google, which is also subject to the Online Safety Act, is worth $1.88 trillion.

Reddit said in its submission: “If thresholds are premised on certain characteristics and functionalities alone, small-to-medium sized platforms will bear disproportionate economic, operational, and competitive disadvantages when placed in the same category as much larger companies.

“A company’s capacity to shoulder the compliance requirements of demanding categories should be included in threshold criteria to protect competition and innovation.”

The submission was written in September last year, but published recently.

Reddit has slightly more than 2,000 employees and relies heavily on volunteers to moderate parts of its social network.

Ofcom last week indicated it expected sites such as Reddit to fall under the strictest parts of the Online Safety Act.

The regulator set out criteria for a so-called “Category 1” service, saying sites that are used by more than 10pc of the UK population, and use social features such as content recommendation algorithms and re-sharing options would fall under the strictest rules.

Reddit is used by 37pc of the population, according to research commissioned by Ofcom.

The company’s shares have climbed by around 50pc since its initial public offering, one of the year’s biggest, last month.

A spokesman for the company said Reddit did not wish to comment beyond the filing.

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