Internet firms’ legal immunity is under threat

GOOGLE, Facebook and other online giants like to see their rapid rise as the product of their founders’ brilliance. Others argue that their success is more a result of lucky timing and network effects—the economic forces that tend to make bigger firms even bigger. Often forgotten is a third reason for their triumph: in America and, to some extent, in Europe, online platforms have been inhabiting a parallel legal universe. Broadly speaking, they are not legally responsible, either for what their users do or for the harm that their services can cause in the real world.

It is becoming ever clearer, however, that this era of digital exceptionalism cannot last for ever. Governments and courts are chipping away at the sovereignty of internet firms, and public opinion is pushing them to police themselves better. Given their growing heft, this shift is likely not just to continue but to accelerate.

When the internet went mainstream in the mid-1990s, online firms feared being held liable if their services were used in illegal ways—for instance, when subscribers posted copyrighted content or defamatory information. The danger was underlined in...