Recent antitrust lawsuits against Meta and Google resulted in minimal consequences ("nothing burgers"), signaling a more permissive regulatory environment. Combined with anticipated economic stimulus, this creates ideal conditions for a wave of large-scale M&A ($25B-$250B) among major tech companies in the coming year.

Companies often focus on avoiding fines by being overly cautious with data, a practice called "under-permissioning." This creates a huge opportunity cost by shrinking the marketable audience and leading to wasted ad spend on generalized campaigns.

Anthropic's $1.5B copyright settlement highlights that massive infringement fines are no longer an existential threat to major AI labs. With the ability to raise vast sums of capital, these companies can absorb such penalties by simply factoring them into their next funding round, treating them as a predictable operational expense.

In response to UK privacy regulations, Meta is offering an ad-free subscription. This move frames data tracking as a choice: pay to opt-out, or get free access in exchange for your data. This effectively creates a system where non-subscribers have given consent, satisfying legal requirements while preserving the core ad business model.

Rather than simply failing to police fraud, Meta perversely profits from it by charging higher rates for ads its systems suspect are fraudulent. This 'scam tax' creates a direct financial incentive to allow illicit ads, turning a blind eye into a lucrative revenue stream.

Many social media and ad tech companies benefit financially from bot activity that inflates engagement and user counts. This perverse incentive means they are unlikely to solve the bot problem themselves, creating a need for independent, verifiable trust layers like blockchain.

After an internal team successfully slashed problematic ad revenue from China by 50%, Meta CEO Mark Zuckerberg personally intervened. Following his input, the effective anti-scam team was disbanded, as its success was negatively impacting the company's $18 billion in Chinese ad sales.

Companies like OpenAI knowingly use copyrighted material, calculating that the market cap gained from rapid growth will far exceed the eventual legal settlements. This strategy prioritizes building a dominant market position by breaking the law, viewing fines as a cost of doing business.

Internal Meta documents project that 10% of the company's total annual revenue, or $16 billion, comes from advertising for scams and banned goods. This reframes fraud not as a peripheral problem but as a significant, core component of Meta's advertising business model.