Compared to the governance framework of platforms, government regulation of live streaming can better provide protection for users and pursue a fair and effective economic system.
The gradual commercialization of social platforms has led to the emergence of the act of live streaming with goods. Unlike the very beginning of brushing gifts, Self- media workers began to start selling their wares on the air. The rules of social platforms do not apply to commercial live streaming, so it needs to be regulated by the government. Professor Picard and Pickard’s report (2017) expresses seven basic principles of contemporary media and communication:
“1) Meeting fundamental communication and content needs;
2) Providing effective ability for public use of media and communications;
3) Promoting diversity/plurality in ownership of media and content available;
4) Affording protection or users and society;
5) Providing transparency and accountability;
6) Pursuing developmental and economic benefits; and
7) Pursuing equitable and effective policy outcomes.”
The latter four elements are all lacking in social media platforms in the face of market behaviours such as live trading, and thus require government intervention to govern.
- Internet Economics and Politics
In line with the development of the times, the Internet era has entered the web2.0 period, that is, the period of the network platform. Platforms are broadly divided into e-commerce, social media and search engines. Internet platforms for social media were originally created to make money. As a result, most platforms tend not to exert much control over live streaming as a means of generating traffic for the e-platforms. Instead, they will give traffic to attract more users to their platforms. Live streaming as a contemporary Internet product combines all the features of e-commerce and social media. That is, shopping is done while engaging in socializing on an online platform. At the same time, big data pushes from social platforms are pushed more accurately to the target audience. According to Mansell and Steinmueller (2020), making money from information systems is a very important point of data informatization. Facebook, the world’s largest social media company, has an amazing ability to make money using the internet.According to a report released by Statista Research Department(2023), Facebook’s ad revenue will continue to grow in the future.
Unsurprisingly, social media live streaming is not a benefit for consumers, but a further exploitation of benefits. Maximising the benefits of advertising and big data enables users to buy goods on their own platforms instead of going to e-commerce stores.
- Problems arising from live streaming
- tax evasion
Firstly, I showed that the tax evasion thing doesn’t just happen on air, but media influencers also engage in unmonitored tax evasion when they take adverts.As you can usually see, a digital platform is a software and technology technique.Digital platforms exist only as a medium and the content is edited by users.The platform does not produce content, but monetises by distributing users’ content and processing data.Because the platforms give users enough creative freedom and freedom of communication, there is no way to know the details of collaborative transactions between media influencers and businesses. The blogger will leave a contact email or phone number on their homepage and wait for the collaborator to come and talk to them. The process of exchanging these collaborations is separate from the platform itself. As long as the blogger or the merchant does not tell the truth, the digital platform has no way of knowing the exact amount of the partnership.
In 2021 something happened that shocked the whole of China.Viya, China’s top live-streamer evaded 1.341 billion RMB in taxes.Authorities in Hangzhou have accused her of tax evasion of this huge amount during 2019 and 2020. Being a public figure brought about such bad publicity that the Chinese government eventually blocked Viya(BBC,2021).It is ironic that Viya’s tax leakage comes at a time when Covid-19. the global economy is in a bad shape and a tax leakage of 1.341 billion RMB is staggering no matter what country it occurs in. It was difficult for people in poor areas to survive during the Covid-19 period(Baena-Díez et al.2020).Such a significant amount of tax evasion could easily be carried out for years, fortunately Viya was eventually given the legal sanction to make up the fines and blocked by the government.
Viya’s tax evasion sparks heated debate.
ShanghaiEye.(2021).China’s ‘live-streaming queen’ Viya FINED 210 millions USD for tax evasion.[Motion picture].YouTube.
- Incresed pricing
Live streaming can cause goods to be priced higher and higher. Once a live-streamer wants to get customers to their live stream to buy the item they need to go for the lowest price. Sellers have their own fixed margins and if the live-streamer wants to make a profit they need to sell at a markup from the original. At this point, the merchant increases the price even higher on what was originally cheaper, and the increased pricing of the item that the live-streamer is selling becomes the lowest price.Marking up the price of goods makes what was meant to be a cheap shopping day pay more.China’s Lipstick King sold an astonishing $1.7 billion in goods in 12 hours，The live-streamer is called Li Jiaqi, a head live-streamer in China, and before he appeared on the market all that was being discussed was how much money was being saved on singles day not how much money was being spent on purchases.Consumers pay more, merchants make less, and only the live-streamer get a profit at no cost to them.
Li Jiaqi has made a name for herself with her unique style.
- Live streaming creates problems that governments can regulate but platforms cannot
Governance through platforms does not work. This is because digital platforms are the infrastructure for serving and monetising customers(Gillespie,2018).The responsibility of the platform is only a medium and has no exercise for market control and legal sanctions.Regulation can only be affected through formal discipline by a government agency. Viya, for example, was eventually punished for breaking the law.Tax issues are beyond the intervention of the digital platform, as long as the live-streamer does not have problems during the live broadcast on the platform, the digital platform cannot check the live streamer’s tax issues on a private basis. However, the government can set up a specialised department to regularly check tax issues or require semi-disclosure of transaction information in order to check the amount.
Similarly, the issue of price fixing can only be controlled by the Government. If the prices of digital platforms are not controlled, capitalists will find ways to raise prices to the highest sellable range. Cracking down on the practice of raising prices and setting a price ceiling for similar goods can only be truly controlled by government regulations.
“The Evolution of the Internet Governance Ecosystem” by nexa.center is licensed under CC BY 2.0.
The Internet owes much of its composition to the Internet ecosystem.It regulates Internet behaviour in all aspects. But when a lot of money is involved in the live streaming industry, government agencies must be involved in managing it to be effective.
Baena-Díez, J. M., Barroso, M., Cordeiro-Coelho, S. I., Díaz, J. L., & Grau, M. (2020). Impact of COVID-19 outbreak by income: hitting hardest the most deprived. Journal of Public Health, 42(4), 698-703. https://doi.org/10.1093/pubmed/fdaa136
BBC world news. (2021, December 20). Viya: Top Chinese live-streamer fined $210m for tax evasion. https://www.bbc.com/news/world-asia-china-59732499
CGTN. (2020). China’s top beauty influencer Li Jiaqi: No makeup when I am offline. [Motion picture]. YouTube.
Cognizant. (N.D.). Digital platform. https://www.cognizant.com/us/en/glossary/digital-platform
Gillespie, T. (2018). Governance by and through Platforms. In J. Burgess, A.E. Marwick & T. Poell (Eds.), The SAGE handbook of social media (pp. 254–278). SAGE Publications.
Huileng, T. (2021, October 22). China’s Lipstick King sold an astonishing $1.7 billion in goods in 12 hours — and that was just in a promotion for the country’s biggest shopping day. Insider. https://www.businessinsider.com/china-lipstick-king-sold-17-billion-stuff-in-12-hours-2021-10
Internet Society. (2014, February 03). Who Makes the Internet Work: The Internet Ecosystem. https://www.internetsociety.org/internet/who-makes-it-work/
Kenton, W. (2023, July 30). What Is Web 2.0? Definition, Impact, and Examples.Investopedia. https://www.investopedia.com/terms/w/web-20.asp
Mansell, R., & Steinmueller, W. E. (2020). Economic Analysis of Platforms. In R. Mansell & W. E. Steinmueller (Ed.), Advanced Introduction to Platform Economics (pp. 35–54). Edward Elgar Publishing Limited. https://ebookcentral-proquest-com.ezproxy.library.sydney.edu.au/lib/usyd/reader.action?docID=6317825&ppg=45
Picard, R.G.& Pickard, V. (2017). Essential Principles for Contemporary Media and Communications Policymaking. Reuters Institute for the Study of Journalism. https://reutersinstitute.politics.ox.ac.uk/our-research/essential-principles-contemporary-media-and-communications-policymaking
ShanghaiEye. (2021). China’s ‘live-streaming queen’ Viya FINED 210 millions USD for tax evasion. [Motion picture]. YouTube.
Statista Research Department. (2023, August 29). Advertising revenues generated by Facebook worldwide from 2017 to 2027. https://www.statista.com/statistics/544001/facebooks-advertising-revenue-worldwide-usa/