[House Hearing, 119 Congress]
[From the U.S. Government Publishing Office]
STREAMING SUCCESS: SMALL BUSINESSES IN THE
AGE OF DIGITAL INFLUENCE
=======================================================================
HEARING
before the
COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES
ONE HUNDRED NINETEENTH CONGRESS
FIRST SESSION
__________
HEARING HELD
SEPTEMBER 17, 2025
__________
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Small Business Committee Document Number 119-021
Available via the GPO Website: www.govinfo.gov
______
U.S. GOVERNMENT PUBLISHING OFFICE
61-899 WASHINGTON : 2026
HOUSE COMMITTEE ON SMALL BUSINESS
ROGER WILLIAMS, Texas, Chairman
PETE STAUBER, Minnesota
DAN MEUSER, Pennsylvania
BETH VAN DUYNE, Texas
JAKE ELLZEY, Texas
MARK ALFORD, Missouri
NICK LALOTA, New York
BRAD FINSTAD, Minnesota
TONY WIED, Wisconsin
ROB BRESNAHAN, Pennsylvania
BRIAN JACK, Georgia
TROY DOWNING, Montana
KIMBERLYN KING-HINDS, Northern Marina Islands
DEREK SCHMIDT, Kansas
JIMMY PATRONIS, Florida
NYDIA VELAZQUEZ, New York, Ranking Member
MORGAN MCGARVEY, Kentucky
HILLARY SCHOLTEN, Michigan
LAMONICA MCIVER, New Jersey
GIL CISNEROS, California
KELLY MORRISON, Minnesota
GEORGE LATIMER, New York
DEREK TRAN, California
LATEEFAH SIMON, California
JOHNNY OLSZEWSKI, Maryland
HERB CONAWAY, New Jersey
MAGGIE GOODLANDER, New Hampshire
Lauren Holmes, Majority Staff Director
Melissa Jung, Minority Staff Director
C O N T E N T S
OPENING STATEMENTS
Page
Hon. Roger Williams.............................................. 1
Hon. Nydia Velazquez............................................. 2
WITNESSES
Ms. Kayla Moran, Founder and Attorney, Kayla Moran Law, Coral
Gables, FL..................................................... 5
Ms. Christina Brennan, President, Renegade Talent Mgmt/
CelebExperts LLC, Endicott, NY................................. 7
Mr. Nicholas Luciano, Founder and Chief Executive Officer,
Tratter House, Millsap, TX..................................... 8
Mr. Jesse Appell, Founder and Owner, Jesse's Tea House, Los
Angeles, CA.................................................... 10
APPENDIX
Prepared Statements:
Ms. Kayla Moran, Founder and Attorney, Kayla Moran Law, Coral
Gables, FL................................................. 39
Ms. Christina Brennan, President, Renegade Talent Mgmt/
CelebExperts LLC, Endicott, NY............................. 47
Mr. Nicholas Luciano, Founder and Chief Executive Officer,
Tratter House, Millsap, TX................................. 49
Mr. Jesse Appell, Founder and Owner, Jesse's Tea House, Los
Angeles, CA................................................ 51
Questions for the Record:
None.
Answers for the Record:
None.
Additional Material for the Record:
Cornell University........................................... 54
Engine Letter................................................ 57
House Committee on Small Business Democratic Staff Letter.... 60
House Committee on Small Business Democratic Staff Letter 2.. 79
STREAMING SUCCESS: SMALL BUSINESSES IN THE
AGE OF DIGITAL INFLUENCE
----------
WEDNESDAY, SEPTEMBER 17, 2025
House of Representatives,
Committee on Small Business,
Washington, DC.
The Committee met, pursuant to call, at 2:04 p.m., in Room
2360, Rayburn House Office Building, Hon. Roger Williams
[chairman of the Committee] presiding.
Present: Representatives Williams, Stauber, Alford, LaLota,
Jack, Downing, King-Hinds, Schmidt, Patronis, Velazquez,
McGarvey, Scholten, McIver, Cisneros, Olszewski, Conaway, and
Goodlander.
Chairman WILLIAMS. Before we get started, I want to
recognize Congressman Alford from the great State of Missouri
to lead us in the pledge and the prayer. Would you please
stand.
Mr. ALFORD. Thank you, Chair.
Let's go in that order. We'll start with the Pledge of
Allegiance.
I pledge allegiance to the Flag of the United States of
America, and to the Republic for which it stands, one nation,
under God, indivisible, with liberty and justice for all.
Our dear Father in Heaven, we just thank you for this day.
Thank you that we have it to be here to make positive change
for America in small businesses. God, we thank you for our
Chair and our Ranking Member, for their leadership, and
bringing this Committee together for the common purpose of
supporting small businesses and making those improvements to
the SBA where we can.
God, I thank you for the witnesses here today. Give them
patience with us sometimes and us with them, and just help us
to learn something, that we can take that knowledge for the
betterment of America, and give them a safe trip home. It is
through Jesus Christ we pray. Amen.
Chairman WILLIAMS. Amen.
Good afternoon, everyone. I now call the Committee on Small
Business to order.
And without objection, the Chair is authorized to declare a
recess of the Committee at any time.
I now recognize myself for my opening statement.
Welcome to today's hearing, titled ``Streaming Success:
Small Business in the Age of Digital Influence.'' Today we will
examine one of the fastest growing sectors of our economy:
content creation. While some may think of content creators only
as online personalities, they really are a new generation of
entrepreneurs taking risk in navigating the rapidly growing
industry.
Content creators are more than just entertainers. They are
small business owners, entrepreneurs, and job creators. They
have transformed digital influence into sustainable careers by
launching product lines, providing education, and creating
loyal communities around everything from sports to law.
In fact, more than 1.5 million Americans now earn a full-
time living as creators. Americans are building small
businesses through platforms like YouTube. YouTube itself
contributes $55 billion and half a million jobs to the American
economy. Globally, this sector is already valued over $250
billion, and it is projected to drive $2 trillion in social
commerce by 2026.
The impact of this economy goes far beyond the creators
themselves. A single successful creator fuels jobs for editors,
designers, video producers, product manufacturers, and
countless other small businesses. This superb--or this
spiderweb effect shows what content creators aren't just
building brands but powering an entire ecosystem of small
business growth. But as with any small business, they face real
challenges. Unique tax situations, unpredictable revenue
streams, and costly intellectual property protections create
barriers for these small business owners. Like this Committee
has seen too often, red tape makes it difficult for these
entrepreneurs.
So the creator economy is a prime example of the American
entrepreneur spirit. Creators are innovative, they are fiercely
competitive, and contribute greatly to America's economy. By
reducing barriers and ensuring the government does not stand in
the way, we can ensure that these small businesses have the
freedom to thrive and grow in a digital economy. So I look
forward to today's discussion.
I now recognize my distinguished Ranking Member and my
friend for her opening remarks, Ms. Velazquez from New York.
Ms. VELAZQUEZ. Thank you, Mr. Chairman--and good afternoon,
everyone--for calling this important hearing.
Like with any emerging technology, nobody could fully
foresee the economic and social implications of social media as
it has been. Since then, the landscape of social media has
evolved. America is now home to a novel content creation
industry worth billions of dollars.
Content creators come from assorted backgrounds, and their
paths to content creation are just as diverse. Many are owners
of traditional small businesses, looking to advertise their
goods and services to new audiences. Others post about topics
that they are passionate in, go viral, and connect with their
devout following, and a golden opportunity for ad revenue
develops almost overnight. With the low to nonexistent capital
requirements and cost of starting and operating a social media
page, coupled with the prospects of instant fame, it is no
wonder so many American youths today dream of becoming content
creators.
America's content creators often encounter longstanding
issues that this Committee has addressed time and time again.
As the world becomes more interconnected, especially in the
online sphere, tariffs are an outside barrier to content
creators looking to grow their small businesses through product
and merchandise sales.
This spring, I led 67 colleagues in sending a letter to the
Trump administration's U.S. Trade Representative, Treasury
Department, Commerce Department, and SBA, calling on them to
consider and address the needs of small businesses in their
tariff decisions. I still have not received a response from the
Trade Representative or Commerce Secretary.
Mr. Chairman, I seek unanimous consent to enter the letter
into the record.
Chairman WILLIAMS. So moved.
Ms. VELAZQUEZ. With the new technologies and new industry
come new challenges. The rise of social media has also seen the
rise of online hate and harassment, the side effects of
algorithmic content creation, the proliferation of content
harmful to children, and the drowning of our discourse with AI
slop. I would also be remiss if I did not address the elephant
in the room: the ban on one of America's most important social
media platforms, TikTok.
TikTok has given small businesses a lifeline in a sea of
inflation, labor shortages, and ever-changing consumer
preferences. With this tool in their toolboxes, small business
owners can expand their reach and sales far beyond their
hometowns, making them profitable and sustainable. Now we are
in TikTok limbo. After President Trump's attempt to ban TikTok
through executive action and Congress' subsequent legislative
action, he has suddenly U-turned and is repeatedly delaying the
ban's enforcement for short periods of time. In fact, the last
delay was supposed to expire today and was only reextended
yesterday by 3 months.
President Trump claims he will reach a deal to keep TikTok
available in America within 30 to 45 days, but it hasn't been
finalized. Such short timeframes create uncertainty for the
content creators that rely on this platform, rendering them
unable to plan beyond a 2-month horizon and adding immeasurable
pressure to their business models.
America's content creators deserve a federal government
that is willing and able to support their endeavors. That
requires responsive agency and strong, stable public policy
conducive to a prosperous business environment. It also means
enacting thoughtful policies to rein in harmful content when
necessary.
With that, I thank all the witnesses for your presence
today, and I yield back. Thank you, Mr. Chairman.
Chairman WILLIAMS. The gentlelady yields back.
I now will introduce our witnesses. First witness here with
us today is Ms. Kayla Moran. Ms. Moran is an attorney and the
founder of Kayla Moran Law based in Miami, Florida. Ms. Moran
began her career as a personal injury attorney before finding
her own firm--founding her own firm to represent creators and
entrepreneurs in the growing creator economy. She is also the
host of ``The Let's Get Candid'' podcast, where she inspires
young women to pursue their passions and build careers on their
own terms. Ms. Moran earned her J.D. from the University of
Tennessee College of Law, and holds a bachelor's degree from
the University of Central Florida. We are looking to your
testimony this morning--or today.
Our next witness here with us today is Ms. Christina
Brennan. Ms. Brennan is the president of CelebExperts located
in New York City. She began her career in sales with the New
York Yankees----
Did you sell them out?
Ms. BRENNAN. You know it. Top of the board.
Chairman WILLIAMS. Okay.--and quickly rose to the talent
industry, becoming the youngest vice president of CelebExperts
history, while growing a roster of over 30 exclusive
influencers with a reach of more than 46 million followers. Ms.
Brennan now oversees partnerships, brand strategy, and talent
management for top-tier clients across the sports, food, and
digital career industries, having aggregated tens of millions
of dollars for both startups and Fortune 500 companies. Ms.
Brennan earned her bachelor of science in sports management
from Syracuse University.
Thank you for joining us today.
The next witness we welcome today is a constituent of mine,
Mr. Nicholas Luciano from Weatherford, Texas. Mr. Luciano is
the founder and chief executive officer of Tratter House
located in Weatherford, as I spoke. Mr. Luciano worked as a
mechanical engineer for the U.S. Department of Defense before
making a pivot in 2020 to launch his own brand and media
company. Since then, he has grown a digital audience of over 8
million, generated a 7-figure revenue through brand deals and
merchandise, and helped companies expand their online presence.
Nicholas earned his bachelor's degree in mechanical engineering
technology from the University of North Texas, the Mean Green.
And thank you for traveling here from the great State of
Texas to testify for us today, Nicholas.
I now recognize the Ranking Member from New York, Ms.
Velazquez, to briefly introduce our last witness appearing
before us today.
Ms. VELAZQUEZ. Thank you, Mr. Chairman.
Jesse Appell is a comedian and entrepreneur, owning and
operating Jesse's Teahouse, an e-commerce business specializing
in high-quality tea and tea accessories. Born and raised in the
Boston area, Mr. Appell became a Fulbright scholar, studying
standup comedy in China, an experience he leveraged to begin
posting about Chinese tea on TikTok during the COVID pandemic.
Later, he went viral, used the attention to launch a tea
business, and still posts today about his products,
intercultural exchange, and his greatest standup hits. His work
has also been featured on TEDx, PBS, NPR, and Chinese media.
Mr. Appell holds a bachelor's degree in East Asian studies and
international and global studies from Brandeis University.
Welcome, Mr. Appell.
Chairman WILLIAMS. If you are a comedian, you are going to
do great up here.
We appreciate all of you being here again before us. And
before recognizing, I want to--I would like to remind that oral
testimony is restricted to 5 minutes in length. And if you see
the light turn on in front of you, if it is red, if it turns
on, it means your 5 minutes has concluded and you should wrap
up your testimony. And if you keep going, you are going to hear
this, and it will just get louder and louder, and finally you
are going to have to stop, okay. I know you will do it just
right. So anyways, it will be easy.
I now recognize Ms. Moran for her 5-minute opening remarks.
STATEMENTS OF MS. KAYLA MORAN, FOUNDER & ATTORNEY, KAYLA MORAN
LAW; MS. CHRISTINA BRENNAN, PRESIDENT, CELEBEXPERTS LLC; MR.
NICHOLAS LUCIANO, FOUNDER & CEO, TRATTER HOUSE; AND MR. JESSE
APPELL, FOUNDER & OWNER, JESSE'S TEAHOUSE
STATEMENT OF KAYLA MORAN
Ms. MORAN. Thank you, Mr. Chairman and Ms. Ranking Member
of the Committee, for the opportunity to speak with you today.
And thank you to my fellow experts for joining me in giving
creators in the creator economy a platform.
My name is Kayla Moran, and I am the founder and managing
attorney of Kayla Moran Law, a dedicated creator economy firm
with an innovative creator-first approach to help influencers
and entrepreneurs build, scale, and protect their businesses. I
am a first-generation American born to a Latin family in Miami.
My father is a Marine Corps veteran turned banker, and my
mother is an operations executive.
I entered this industry as a creator myself in 2018, and
during the rise of TikTok, I realized creators need lawyers who
understand their perspective. I have been a small business
owner in the creator economy for over 4 years, first as a
blogger and podcast host, then as an influencer manager, and
now as an attorney.
The story of American entrepreneurship is changing. Today,
the storefronts of main street have moved online. The creator
economy with its low barriers to entry and flexibility open new
career paths for Americans. Starting in its early years with
bloggers and evolving into marketing agencies hiring social
media influencers, the creator economy has disrupted
traditional and costly multimillion dollar marketing
productions. It has become a very lucrative career path, and
now creators need Congressional backed support and protection
to support and protect them as they navigate the industry as it
continues to grow.
Running a business from a phone allows millions of
Americans to turn their skills, voices, and ideas into
businesses. Creators can turn side hustles into careers, stay
at home while still putting food on the table, and students can
even pay their way through college.
While the average American may discredit influencing as a
hobby, Goldman Sachs, in their 2023 creator economy report,
projected the industry could grow to almost $0.5 trillion by
2027. In the U.S., there are full strategic teams at marketing
agencies sourcing the right influencer for their client's
marketing goals and allocating million-dollar budgets. And
these businesses, at the heart of economic growth, deserve the
same protections as traditional ones.
The Small Business Administration's mission of providing
aid and protecting the interest of small business owners should
be extended to this industry. Creative entrepreneurs need
access to dedicated creator economy experts, including lawyers,
accountants, and wealth management services, to give them the
same level of support and protection the SBA provides to
restaurants and mechanic shops so they feel equally valued and
respected.
The rise of the creator economy has elevated the importance
of the right of publicity, the ability to commercialize your
name, image, and likeness, and it requires federal attention.
Currently this right is governed by a patchwork of inconsistent
State laws originally designed to protect privacy, which gives
little guidance to creators across State lines. Federal
statutory guidance would be helpful to us as service
professionals seeking to standardize a very cyclical industry.
Managers are not always equipped with the resources to
support their clients. Perhaps creator economy lawyers having a
federal license similar to the patent bar could be a solution.
If creators know to hire an attorney, they turn to their
neighborhood lawyer, but the issues impacting this growing
cohort of American entrepreneurs needs dedicated and tailored
support, which we could provide if we were not in fear of
triggering unauthorized practice-of-law issues.
Another growing concern is the concentration of power among
a few large marketing agencies. This trend toward
monopolization is creating a severe imbalance in bargaining
power between contracting parties. Due to the overall lack of
education and the legal implications of intellectual property
ownership and other deal terms, marketing agencies are
restricting a creator's ability to negotiate their rights while
continuing to offload their responsibilities of production and
distribution, leaving all parties frustrated.
Similarly, the one-sided payment terms marketing agencies
rely on hinder a creator's ability to earn a steady income.
Often payment terms are net 60 or net 90, meaning a creator
won't be paid for their work for up to 3 months, and payments
are still late or they never come. Unfortunately, creators are
unaware that they can sue in small claims court. And the
ineffective governing law clauses in these agreements, if they
are present at all, are yet another disadvantage they face.
While Congress is currently acknowledging the mental health
of minors on social media, and there are a few scattered State
laws that require protective financial trust for children
performers, another issue is the lack of national oversight
enabling forum shopping and exploitation of child creators
where no regulations exist.
And, lastly, there are growing platform volatility issues
creators face with the rise of AI and account hacking. Right
now, a creator's only mechanism to recover their account and
loss of income is a Digital Millennium Copyright Act takedown.
However, because a DMCA takedown action often requires
registration of an account holder's trademarks and/or
copyright, which is cost prohibitive at volume, and creators
are often unaware these traditional IP protections are
available to them, it is not the most feasible option. This
impacts small businesses using social media as well, where
there is a growing practice of bigger companies using the DMCA
takedown tools built into platforms to restrict and shut down
their competition, what are traditionally considered unfair
trade practices.
I hope I have demonstrated today how creators are small
business owners and how they need the same infrastructure of
support and protection that other American entrepreneurs
receive. This is a pivotal moment, and I am honored to be here.
Thank you, and I look forward to your questions.
Chairman WILLIAMS. Great job.
And I now recognize Ms. Brennan for her 5-minute opening
remarks.
STATEMENT OF CHRISTINA BRENNAN
Ms. BRENNAN. Good afternoon, Chairman Williams, Ranking
Member Velazquez, and distinguished Members of the Committee.
My name is Christina Brennan, and I am honored to appear before
you today to discuss the impact of social media on small
businesses, entrepreneurs, and local economies.
When people think of social media, they often picture a
feed of birthday photos, vacation selfies, or the occasional
``no excuses'' gym post. But beneath the surface is an entire
web and ecosystem of commerce. Social media is a marketplace, a
workplace, and in many cases, a lifeline for small and large
businesses alike.
In the United States, the social media industry has grown
into a multihundred-billion-dollar industry, touching
everything from advertising and publishing to retail and
entertainment. But its impact is perhaps most deeply felt by
small businesses. For a restaurant owner, a craftsman, or a
young college athlete building her brand, social media isn't
just marketing, it is survival and it is scale.
For influencers, whether they have a few hundred followers
or millions, revenue streams are diverse: brand partnerships,
affiliate revenue, platform payments, merchandise, and even
their own product lines. Every influencer fuels an ecosystem of
offshoot businesses: attorneys, assistants, editors, publishing
houses, and managers like myself. Some even play strategic
roles in fundraising and acquisitions for emerging startups.
Consider Azuna, a Buffalo-based brand whose digital
strategy helped it scale to 25 employees, a Buffalo Bills
partnership, and four agencies. Additionally, they have
contracted over 100 influencers, some of which sit on their cap
table. Or Chef Darian Bryan, an immigrant entrepreneur with
multiple restaurants and a recent Snickers campaign at Highmark
Stadium creating food so delicious it would make you want to
break a table. These are local economic engines powered by
digital reach.
And the beauty of social media is its accessibility. I
helped scale CelebExperts and Renegade Talent Management while
living outside Fort Bragg, North Carolina, as a proud military
spouse. Unlike many in my community who face staggering
unemployment rates, I was fortunate to continue my career
remotely. Social media allows for people to earn a living,
contribute to their families, and bring economic opportunity to
their hometowns in various locations, whether that is Buffalo,
Fayetteville, or Endicott, New York.
Most recently, our organization has begun work in the NIL
space, specifically, young, dynamic women who are learning to
build long-lasting businesses around passions that they love.
This next generation represents not just a cultural shift but a
chance to democratize entrepreneurship itself.
But as powerful as this industry is, it faces real
challenges. Today, I would like to highlight three. First, cash
flow. Too often, influencer partnerships are paid months after
services are delivered. For many creators and small businesses,
waiting that long is not just difficult, it is unsustainable. I
do want to add, we were one of the first ever influencer
agencies, and that is not how it was when this originally
started.
Second, the rise of AI. We are entering a world where it is
increasingly difficult to know what is real and what is fake.
Bot influencers, content theft, dubbing, and misrepresentations
don't just hurt credibility, but it can have dangerous
consequences.
Third, the resource gap. Many new entrepreneurs lack the
knowledge to navigate contracts and offers. Education and
transparency in this space are critical. This isn't just about
the creators I manage, it is about the creators I don't.
Social media is no longer just about pictures and posts. It
is about people, jobs, and communities. It deserves thoughtful
consideration, protection, and support as we navigate its
future together.
Thank you.
Chairman WILLIAMS. The gentlelady yields back.
I now recognize Mr. Luciano for his 5-minute opening
remarks.
STATEMENT OF NICHOLAS LUCIANO
Mr. LUCIANO. Good afternoon, Chairman, Ranking Member, and
Members of the Committee. Thank you for the opportunity to
speak with you all today. My name is Nick Luciano. I grew up in
Maryland, not far from here, but for the last 10 years, I have
called Weatherford, Texas home. I came to Texas, fell in love
with the western lifestyle--riding, roping, and rodeo--and I
built my life there.
Before I ever made a piece of content, I earned a degree in
mechanical engineering technology from the University of North
Texas, and worked for 3 years as a mechanical engineer for the
Department of Defense. My job was to design protective systems
and run high-speed cameras to safeguard our soldiers. That
experience taught me problem solving, systems thinking, and
responsibility at the highest level.
I bring that same mindset to the digital space. Along the
way, I have built an audience of over 8 million followers
across platforms, and I have created the third most-liked
TikTok in the entire world. That moment showed me that, not
only the global impact of this new digital landscape, but also
that I have played a role in help crafting and shape it.
I first started posting content not to get famous but to
help people. I realized that something as simple as a video
could reach someone at just the right time. In college, I would
get messages from classmates saying my posts encouraged them to
keep pushing forward. But years later, I have received messages
from people saying that my videos have literally saved their
lives.
One man wrote--he actually emailed me while he was sitting
on the tailgate of his truck, ready to end it all, but after
coming across my video, he didn't pull the trigger. I was
crying in an airport when that happened. Moments like that
showed me that this work is bigger than clicks and likes. It is
about impact. It is about using digital platforms to reach
people, to build trust, and to create positive changes.
That is where my journey shifted from being ``just an
influencer'' to becoming what I call a creatorpreneur.
Influencers chase trends and attention, but creatorpreneurs
like me build businesses, solve problems, create jobs, while
still connecting with millions of people online. For me that
meant founding Tratter House, the first western lifestyle
content house. What started as a group of creators under one
roof, grown into a business that partners with major brands
like Ariat, Spotify, Red Bull, et cetera; and we support
artists like Bailey Zimmerman and Will Moseley; and now we are
focused on artist development and marketing strategy.
We don't just post videos, we roadmap careers. We help
artists build merchandise lines, manage online stores, and
craft content strategies that cut through the noise. We also
run a nonprofit, the Tratter Foundation, where every year we
fly a family to Texas to give them a once-in-a-lifetime western
experience.
Tratter House has created jobs directly--my cofounders,
full-time team members, editors, accountants, merch members--
and indirectly, through partnerships with printers, fulfilment
companies, record labels, rodeos, and a bunch of small
businesses across the country.
Our biggest win to date has been helping our new artist,
Tyce Delk. We launched his debut single. And with our strategy,
his very first release hit over 5 million streams in just under
a month, reached number one on Spotify Viral 50 in both the USA
and Canada, climbed to number six on Texas radio, and charted
globally. That is not just a viral moment, that is building a
foundation for a sustainable career, and it is proof that
digital creators like me can generate real economic results.
But here is the challenge. When many people hear the word
``influencer,'' they picture kids making silly videos for
clicks, and that is a stigma that I want to break. Behind the
scenes, many of us are educated, disciplined, and purpose-
driven. We are running teams, managing payrolls, filing taxes,
and partnering with brands and other small businesses. We are
contributing to the economy just like any other entrepreneur.
That is why the term I prefer is ``creatorpreneur,'' because,
yes, I create content, but I also employ people, serve clients,
and build businesses.
My vision for the future is clear. The creators who
endure--who build trust, and serve their audiences, and
innovate in business--are the next generation of entrepreneurs.
We are not just chasing clicks; we are building foundations. We
understand how to attract millions of people online, nurture
those relationships, and channel that trust into businesses,
nonprofits, and movements that make a real difference.
And if I could leave you with one takeaway, it is this:
People like me aren't in it for the money and fame. We are in
it to change lives, build businesses, and strengthen
communities. We are part of a new economy, one rooted in trust,
creativity, and purpose. So when you think about influencers, I
ask you to see us not as just entertainers but
creatorpreneurs--innovators, small business owners, and job
creators who are here to stay.
Thank you for your time, and I look forward to your
questions.
Chairman WILLIAMS. Thank you.
I now recognize Mr. Appell for his 5-minute opening
remarks.
STATEMENT OF JESSE APPELL
Mr. APPELL. Good afternoon, Chairman Williams, Ranking
Member Velazquez, and Members of the Small Business Committee,
and to everybody watching on YouTube. I want to thank you all
for the honor and opportunity to represent my fellow creator
small businesses and to farm the aura of this esteemed chamber.
My name is Jesse Appell. I am the founder of Jesse's
Teahouse. I run an online teahouse, which is really two
businesses--it is a media company and an e-commerce business.
Every day, my 1.5 million followers watch me make and drink
tea, and some of these followers actually buy the tea that I
drink. As of today, we have sent over 80,000 orders to
customers all over the country.
I source my teas from farmers in China and Taiwan, many of
whom I met during my time as a Fulbright research fellow in
China. My work as a cultural ambassador has now moved online,
and I spend several months a year in Asia, going to tea
mountains, filming videos with our farmers so people can see
the tea that they are drinking and know the people who grow it.
I started this business with my own savings from my dad's
kitchen during COVID, and it has just been amazing to see how
it has grown.
I get tons of messages from customers who have shared a tea
time with their spouse or kids or parents, but sometimes emails
even go deeper. One customer was a veteran who told me that the
ritual of tea making, along with the socialization of inviting
people over, was the best treatment for PTSD that he had found
so far. Another told me that he had replaced hard drugs with
tea, swapping one habit for another and the mantra, ``Only tea
in the house.''
All of this good is possible because of two uniquely
American pillars: a free internet, where I can share my story;
and a free market that allows me to sell the best tea in the
world. It is to the protection and improvement of those free
systems that I hope to call the committee's attention today.
On challenges related to internet freedoms, the most
immediate issue for my business is the potential banning of
TikTok. A few hours before this statement was due, news broke
that there was a TikTok deal. And if there is a good deal, I
think that is excellent news for creators. If TikTok is banned,
I lose 600,000 followers and sales losses likely in the
hundreds of thousands.
But even if the TikTok deal is perfect, this process was
not comfortable for creators. There was a real chance that
creating what amounts to an American version of the great
firewall, which would have solved this problem with reactive
isolation rather than the American ideals of openness, law, and
transparency. And in the end, a deal is not a law and deals can
be undone, so I urge Congress to codify any deal.
Because even if every national security issue with TikTok
were resolved, the battle on copyright enforcement, on data
privacy, and algorithm manipulation, these all continue. And as
Congress considers these issues, I hope that you will consult
us creators. I definitely don't want foreign powers
manipulating my algorithm, but I also don't want domestic CEOs
or even a for-profit board manipulating my algorithm. Creators
want clearly defined rules which all platforms will play by,
not just foreign ones.
As for challenges in the free market, the recent tariffs
have had a devastating impact on my business. I estimate that
we have lost approximately $250,000 in sales as a direct result
of the most recent trade war. I run a subscription tea club
where every 3 months I send new teas to all the subscribers,
but our May subscription box just sat in the port during the
trade war, and we couldn't send it. We had to skip it all
together. We also couldn't get a single restock shipment in
from the entire time between January and August. This is all in
addition to the increased taxes.
Further, the chaotic nature of the policy changes has also
been a challenge. I woke up one day to find the de-minimis
clause had been closed completely, without exception. The
Postal Service had to shut down all packages coming from China
while they awaited further instructions. Then it was reversed,
and then it was reinstated. And will it be reversed again? It
is hard to tell.
Developing a new product takes 6 to 9 months, and it is
hard for me to know what U.S. trade policy will be in 6 to 9
months. And beyond my personal stake, should it really be
necessary for small business owners to need day-to-day updates
on my new trade policy issues in order to run a small business?
In the end, I sell tea. I am a tea guy. There are no
national security implications and no jobs to be gained from a
tariff. And yet the real jobs that I have created for myself
and my five American employees have been staked as leverage and
are being treated as less important than hypothetical jobs that
might come from a hypothetical success of the tariff. I urge
the Members to consider exempting small businesses from these
tariffs. As small business, we simply do not have the resources
to withstand these added costs and uncertainties.
Finally, I want to thank the Members for their time and
attention. I paid for my own ticket to come here and share my
experiences in good faith. If any Members believe I can be of
help in any way going forward, please contact me. I am here to
try to solve these problems.
A wise man once said, Do it for the 'gram. Today, I do not
just for the 'gram, but for America and all creators.
Thank you very much.
Chairman WILLIAMS. The gentleman yields back.
Thank you all for that, and we will now move to the Member
questions under the 5-minute rule.
I recognize myself for 5 minutes.
Mr. Luciano, you left your career at the Department of
Defense to pursue content creation full time, as you said, in a
leap that many would see as unconventional. But today, we are
seeing more people make that jump. So the question is, what
aspects of the content creator industry inspired you to make
that transition? What opportunities motivated your decision?
Mr. LUCIANO. Yes, sir. Thank you for the question.
Honestly, what motivated me was to start a purpose-driven
career. I loved working for the Department of Defense, but
there was always a fire in me to help people. And I felt like
me, myself, as a Christian, it gave me the reach to talk about
my faith and talk about mental health in ways that were
unconventional, especially with the start of TikTok.
I realized very quickly, me being a systems guy, that the
systems of this algorithm were built different and I wanted to
use it for good. So I downloaded TikTok at my desk in 2019, and
the rest is history. And I have been able to work with dream
brands and start my own businesses, and I feel like I am
walking in a path of purpose. So that is really the main driver
behind it.
Chairman WILLIAMS. Thank you.
Ms. Brennan, the rise of name, image, and likeness--
something we are all interested in--has changed the landscape
for athletes and creators, opening new doors for entrepreneurs,
and establishing a lasting market presence. So the question is,
how have you worked with your clients to navigate this space
when it comes to protecting and strengthening their personal
brands?
Ms. BRENNAN. Thank you so much for that question. You know,
it is a really cool time to be involved with, you know, young
athletes, because they are able to finally monetize their
brands and build businesses beyond just what they do. They can
explore passions and build out big programs. I mean, we are
talking about equity programs and things like that, interests
outside of their sports.
I have worked with companies like IPSY Beauty Box, and that
is really exciting, because you think athlete, okay, you think
ball and stick, things like that, but you don't necessarily
think about the offshoot businesses created because of that.
And that has just been a honor and a blessing. We work with--
our firm works with both NIL athletes and pros, and it has just
been incredible to see these young women grow, learn more about
business, and have real passions and goals outside of their
sport as well, further extending their longevity, may I add, as
well. Thank you.
Chairman WILLIAMS. Good. This question will be to all of
you in my remaining time, so we will start down here and move.
Content creation has become a powerful driver in today's
economy, expanding opportunities for entrepreneurship. So from
each of your perspectives, how important are creators to the
American economy and their communities?
Ms. MORAN. Thank you for the question. I think as many of
us have said, it creates jobs not only for ourselves, but I
have my staff here with me, some of them, my family helps me
out, and I do pay them when they create content for me. I think
also, as Jesse has said, you know, they create sales. They are
creating product lines and merch and beauty companies and
service businesses and product-based businesses as well. So I
think they are a driver of the economy because, as we are here,
it is a small business, and at the end of the day, this country
is built on small businesses.
Chairman WILLIAMS. Good. That is right. Thanks.
Ms. BRENNAN. Seventy-seven percent of small businesses in
the United States use social media for essential functions,
such as sales, marketing, and customer service, according to
BusinessDasher. That is significant, and I would argue that
that is a dated number. Social media is not just a vehicle for
sales; it is branding, it is voice, and it is connecting with
the consumer.
Small businesses have the opportunity to geo tag where they
are and have this plethora of, you know, new views and new
opportunities that come from that. I work with Azuna, the
Buffalo-based company, and they are expanding like wildfire due
to their digital strategy. It is impressive and it is
incredible. And they are intertwined with the creator economy.
It is a really exciting time, and I am looking forward to, you
know, finding additional ways that these creators can expand.
Thank you.
Chairman WILLIAMS. Good. We have got 50 seconds, so, Mr.
Luciano, if you could come and then we will finish up----
Mr. LUCIANO. Yes, sir. I will make it brief. I will just
reference a video of mine where I adopted a dog at a local
shelter in Stephenville, went viral, and we started an annual
event called K-9s and Coffee, where we brought all small
businesses together to help raise money to fund a new shelter
because they are underfunded in the local community.
Chairman WILLIAMS. Good.
Mr. APPELL. Thank you, Chairman. For my part, I just want
to add more of a spiritual addition here. The enjoyment that I
get out of life of being my own boss, going in my own
direction, doing what I love to do, this is, I think, what
really is making creators so eager to find a way to make a
living so that they can live this kind of lifestyle. Thank you.
Chairman WILLIAMS. Great. Well, I will yield my time back.
I now recognize the Ranking Member for 5 minutes of
questions.
Ms. VELAZQUEZ. Thank you, Mr. Chairman.
Mr. Appell, how do small businesses and content creators
earn money and grow on social media?
Mr. APPELL. Thank you, Congresswoman. There is a couple
ways you can make money. One of them is you can make money off
of views. If you get enough views, they will pay you for the
views, different platforms will. People can do branding deals
and merchandising deals; the other witnesses have talked about
that. Another way is by creating your own brand and essentially
going way beyond merch, so rather than just the T-shirt or a
hat with my name on it, to be able to sell tea pots and
equipment and specialized teas and stuff like that. So there
are various ways that creators can make money.
Ms. VELAZQUEZ. Thank you. And you mentioned the tariff
wars. President Trump's escalating trade wars have caused
tariff rates to change often. What business uncertainty did
that pose?
Mr. APPELL. Thank you. It adds a lot of uncertainty. It is
very difficult to price items when I don't know how much I am
paying for them. During the--kind of the worst parts of the
tariff war, I had already had boats with tea that had left the
port, and I didn't know what I would be paying for them when
they would arrive. That was an extreme version of this. But
even beyond it, if a tax is raised, I can kind of adjust, but
it is difficult to know how much extra I should adjust based
off of future uncertainty given that we are working on 60- or
90-day schedules until the next deal.
Ms. VELAZQUEZ. What knowledge do you need to navigate the
tax tariffs?
Mr. APPELL. Obviously, we need to spend a lot of time, a
lot more than before, keeping our eyes on the news, keeping our
eyes on tweets where a lot of times the news breaks earlier
than other places. And also, I need to spend a lot more time
communicating with my suppliers in China. They are ready to go.
I am ready to go. They message me asking what is going on, and
I feel like I owe them at least an explanation of my best
understanding of what is going on with the U.S. trade policy.
They are not going to get it anywhere else. So there is a lot
of extra communication that comes into effect that is
completely unrelated to the tax price.
Ms. VELAZQUEZ. The President says that China will move
TikTok to U.S. ownership, but he hasn't closed a deal. Instead,
he paused the TikTok ban for 3 months. Do you feel whiplash
from the constantly changing news?
Mr. APPELL. Yeah. I mean, we don't know what is going to
happen with the platform. As a creator and an artist, my
reaction has been to put my head down and try to keep creating.
But that could mean, if it is banned, I have just put more time
and energy into a platform that is now destroyed.
Ms. VELAZQUEZ. Secretary Bessent says President Trump was
willing to let TikTok go dark today. Does that scare you?
Mr. APPELL. Yes.
Ms. VELAZQUEZ. Last year, Committee staff issued a report
warning that AI-made content is unfairly crowding out human
creators.
Mr. Chairman, I would like to enter the report into the
record.
Chairman WILLIAMS. So moved.
Ms. VELAZQUEZ. How does AI slop compete with your content?
Mr. APPELL. Sure. So the most basic thing is when you are
on an app, which is primarily recommendation based, they have a
mix of things that come up on that feed, and a lot of that
stuff can be determined to be AI slop, or at the very least is
perhaps not the best, like, you know, real creator content that
is out there. That gums up the air waves. It makes a very bad
user experience for people who are trying to watch quality
media. And for some industries, it is much worse than others.
I am here today as a tea guy, but I will say as a standup
comedian, go and check when you see a standup video, check to
see if it is the actual standup comedian posting. I would say 9
out of 10 times it is all stolen, and we work for a long time
to get a couple jokes onto a TV show. To have that just stolen
and repeated or to have the video on the top while somebody
plays Subway Surfer on the bottom, you know, this is very
discouraging to people who really want to put time and energy
into making really good content.
Ms. VELAZQUEZ. Ms. Brennan, anything to add on AI risk for
creators?
Ms. BRENNAN. Thank you so much for that question. Yes. The
content theft and dubbing over words is extremely dangerous. I
represent a number of medical professionals, including a
surgeon. At one point his content was taken and they dubbed
over a completely different ad, were using it in whitelisting
and targeting, and people were buying this product. Now, this
was an overseas company selling it, so that adds additional
complications. But that is dangerous. They know this doctor
because he has millions of followers and he is a practicing
surgeon. So, you know, that is a very, very big problem.
I think AI can be helpful as well. When we are talking
about content scraping from, you know--for children's sake, I
think it can be a very, very helpful tool. But it has to have a
human element to it, and it always has to be checked. Thank
you.
Ms. VELAZQUEZ. Thank you. I yield back.
Chairman WILLIAMS. The gentlelady yields back.
I now recognize Mr. Stauber from the great State of
Minnesota for 5 minutes.
Mr. STAUBER. Thank you, Chair Williams and Ranking Member
Velazquez, for holding the hearing today, and all the witnesses
for your testimony.
In northern Minnesota, small businesses are the backbone of
our economy, and many of these entrepreneurs are blending
online content with traditional operations to expand their
customer base, build brand recognition, and reach markets well
beyond Minnesota's Eighth Congressional District.
The digital economy isn't just about influencers in Los
Angeles. It is the real estate agent in Brainerd, Minnesota,
looking to reach new buyers. It is the photographer in Duluth
who is looking to share their portfolio capturing the beauty of
northern Minnesota. These creators are building something real,
and like every other small business, they face red tape that
Washington is too slow to recognize.
Mr. Luciano, you have turned your platform into a full-
fledged business. Can you talk about the biggest challenges to
formalizing your operation, particularly in accessing capital?
Mr. LUCIANO. Yeah. I mean, the biggest challenge as far as
accessing capital is just education, the misrepresentation of
what we do. So a lot of the times you are having to tell people
that I am not just an influencer in it for clicks and likes,
that I am actually like these small businesses in the squares.
And just because you can't see it on a storefront doesn't mean
we are not in our houses doing live streams and trying to build
revenue.
And luckily, I have partnered with CrowdSurf to explore the
funding side of things, so I am taking investments in my
business as well. So it has been really interesting to explore,
and I am looking forward to actually having people in my back
pocket to make them proud when I make Tratter House a
flourishing company.
Mr. STAUBER. Ms. Brennan, what risk do creators face when
handling contracts and business deals on their own, and what
protections do they need to avoid exploitation?
Ms. BRENNAN. Thank you so much for that question. When
creators start, it is not necessarily given that they have a
business degree from Harvard. So there is a inherent lack of
education in the creator economy, and they deserve to receive
that education, whether that is through the platforms or
something else. Education is fundamental to decision-making
processes. You know, you have to be informed to be able to make
the decision if you want to go forward or not and understand
the implications that come to that.
As far as management, oftentimes creators, especially when
they are first starting, have not quite hit their revenue where
it makes sense from a business perspective to pursue. So they
are doing it on their own, and that can have longstanding
implications to their business. Thank you.
Mr. STAUBER. Thank you. I am glad you said you don't have
to have a business degree from Harvard, because you are looking
at two Lake Superior State University grads out of Sault Ste.
Marie, Michigan.
Ms. Moran, as not only a creator but someone who advises
creators, are there specific legal or tax hurdles that
disproportionately impact new digital entrepreneurs, especially
those who are just starting to grow their digital business?
Ms. MORAN. Thank you for the question. As Ms. Brennan said,
I think a lot of times they think I need to have a manager to
help me make a business and make more money, but they don't
think of the legal implications of the contracts that they are
signing or if there is a contract at all, especially when the
tax season comes around. On Monday, the Q3 estimated taxes were
due. I paid mine. I don't know if a lot of these creators know
that they need to be doing that, and then come April, there is
a really large tax bill that they are frightened by.
And, you know, having advisers and people who can assist
them in understanding what a business is--because as we said, a
lot of them, they know they are small businesses. Even when
they start out, once you start making money, you are a
business, and I think we know that inherently. We don't
necessarily think of, you know, the formalization of it,
starting an LLC to protect their intellectual property, you
know, having a lend-out company, who is the contracting party.
A lot of them let their managers sign for them, which isn't
necessarily bad, but having an understanding of what that
means. Yeah, there is a lot of things to consider, honestly.
Mr. STAUBER. With my last 50 seconds, I would like to take
a quick poll of all of our entire panel. Within the last year,
has your content creator business hired another small business
to help your business in any way? Ms. Moran?
Ms. MORAN. An accountant and employees.
Mr. STAUBER. Ms. Brennan?
Ms. BRENNAN. We have been established for a long time, so
we do have parties we work with. We continue to expand our
creator roster, which expands our business. Thank you.
Mr. STAUBER. Mr. Luciano?
Mr. LUCIANO. Yes. And I am proud to shout out my tax team,
Decipher Financials.
Mr. STAUBER. Perfect.
Mr. LUCIANO. Yeah, because they have helped--they
understand me as a creator to get my taxes right.
Mr. STAUBER. Thank you.
Mr. Appell?
Mr. APPELL. Yes. We have been working with Rare Flower
Media in Los Angeles for additional editing help and social
media posting.
Mr. STAUBER. Perfect. Good shout-out to those folks.
Mr. APPELL. Represent.
Mr. STAUBER. Thank you, all. I yield back.
Chairman WILLIAMS. The gentleman yields back.
I now recognize Ms. Scholten from the great State of
Michigan for 5 minutes.
Ms. SCHOLTEN. Thank you so much, Mr. Chair.
And thank you so much to our incredible, young
entrepreneurs for being here today. We recognize the work that
you do is a part of generating not only important content but
drawing others to incredible products that are already in the
market. We know increasingly businesses rely on content
creators to help elevate their products in the absence of a
traditional advertising market space. You all can help get this
content out to where it needs to be.
As the mom of two pre-teen and teen boys, who are
constantly telling me all about the latest trends that they see
online, I can tell you, I know firsthand about the importance
of your work.
Ms. Appell [sic], I want to thank you for joining us here
today and giving us an idea of what it is like to be a content
creator in an ever-changing economic and social landscape. As
social media continues to evolve with technology, I am curious
about your thoughts on the use of Generative AI in content
creation. We know Gen AI can be used to augment a wide variety
of online content. Have you used or considered using Gen AI for
your business, and are you concerned about the potential for
Gen AI to pose unfair competition for human creators?
Ms. MORAN. Are you speaking to me or to Ms. Brennan?
Ms. SCHOLTEN. To you.
Ms. MORAN. Me, okay.
Ms. SCHOLTEN. Yeah.
Ms. MORAN. I just wanted to double-check. I have actually
considered using AI in my business. I think sometimes there is
a lot of concern with the open-source/close-source situation in
a legal capacity. Actually, one of my associates was telling me
about a new AI legal tool, so I have some research to do when I
get back to my hotel room.
But I think--yeah, I mean, I am not going to say I don't
use ChatGPT or Claude. I do prefer Claude sometimes. I think it
is just educating creators on not putting a full contract with
personally identifying information into ChatGPT--no names, no
addresses, company names, things like that.
For creators using AI, I think making sure they understand
where they are getting their information from and always
checking sources when they get an output, making sure that the
information that ChatGPT or whatever AI tool they are using is,
you know, it is accurate and correct information. There is
history of it making up case law or stories and facts.
I think also for creators, I get clients asking me all the
time, when I create content for my clients as a social media
manager, can I use a Pinterest image in a graphic that I make?
You know, they want to understand the licensing. I think
understanding, most of us, when we sign up for a new account,
we check, yes, we read the terms of service. None of us
actually read the terms and conditions of anything, because
they are really long, but I think making sure you understand
what you are agreeing to.
When CapCut changed the terms a couple months ago, you
know, I created a video explaining what these terms of service
changes are and what they mean for you as creators. And I think
a lot of people are really upset by them, but no one has
stopped using CapCut. So I think making sure you know what you
are using.
Ms. SCHOLTEN. Yeah. Do you think--I want to stick on this
question line just a second, because it is such a new and
emerging technology. And I--you know, I agree with the gist of
what you were saying, which is it can be such a helpful and
important tool for content creators, but there is a lot of
parameters and rules of the road people need to understand.
Do you think content creators and young people in
particular are getting the education they need around how best
to use these tools, whether in school or, you know, is that
potentially a lane for, you know, the SBA?
Ms. MORAN. I think both. I think there is room for
education from fellow creators. I think knowledge creators are
a really growing community of creators. Professionals
ourselves, we are content creators. That is how we market our
services to other creators. I think having the SBA provide
guidance, you know, resources, you know, having a database of
experts to go to, not just lawyers and accountants but also,
you know, an AI expert, someone explaining what these terms
mean.
But I think there is also--the issue is a lot of
misinformation. There is, myself included, multiple creators,
every single time a new status update changes or something, we
are sharing what this actually means in a video, but then
someone is discrediting us because they don't want that to be
true.
Ms. SCHOLTEN. Yeah.
Ms. MORAN. And I think, again, flagging ``is this correct
information?'' is important.
Ms. SCHOLTEN. Yeah. Thank you. My time is expiring here,
but really, really appreciate your comments. Thank you.
Chairman WILLIAMS. The gentlelady yields back.
I now recognize Mr. Alford from the great State of Missouri
for 5 minutes.
Mr. ALFORD. Thank you, Mr. Chair, and thank you, Ranking
Member Velazquez, for this important hearing.
Today's hearing is about more than social media. It is
about recognizing that digital creators are America's next
generation of small business owners. Whether it is a farm
family sharing their story on YouTube--we have several of those
in my district, Missouri--a veteran teaching lessons on
Instagram, or young entrepreneurs selling products online,
creators are turning influence into real businesses that drive
jobs and growth, some 1.5 million content creators in America.
Social commerce projected to reach $2 trillion by 2026.
But like many small businesses, they are running into
barriers, from confusing tax rules to trouble accessing
capital, simply because their income looks different on paper.
Our job on this Committee is to make sure that Washington does
not hold back innovation. Supporting creators is not about
promoting trends. It is about empowering small business owners,
like yourselves, who are driving economic growth in the digital
age.
My mom is 84 years old. She is in assisted living down in
Houston, Texas, area, and we spend a lot of time on the phone
now talking about her memories as a child. She talks a lot
about the family sitting around listening and watching the
radio, before there was television, and then her dad going to
the town square to the radio store where they had just put a
television in the window, and they would stand around and watch
a test pattern.
We have gone a remarkable way in the last 80 years in
America. From the Founding Fathers, the money was in
independent printing presses, then it transitioned to
newspapers, then the money followed radio when it was invented,
and then television and then cable, and now social media. And I
look forward to telling my granddaughter, who is only 9 months
old--her name is Naomi--about when social media came on to the
scene and content creators and the difference that it made in
our society and in our economy.
So I applaud what you are doing. And I think our job here
is to try to find ways that we can help you be even more
successful than you are. It is an inspiration to me and I think
the Chair and the Ranking Member and others on this Committee
just the spirit of entrepreneurism that you guys have captured,
that you have reached beyond the boundaries that some have been
standing in your way to find a way to do business online, and
seeking out these guardrails for protecting your business, to
make more money, and to make sure that we stay in these lanes,
especially with the advent of AI.
So I just want to know, Ms. Brennan, how can we--there is a
lot of generalities out there, but what do we need to be look--
we probably should have looked 10 years ago at this, but what
can we do now to help you and the industry be even more
successful for the economy of America and main street?
Ms. BRENNAN. Thank you for that question. And I think it
comes back to education. I think, you know, tax breaks are
always helpful for new businesses that are starting and coming
up, specifically creator-led businesses. If we are identifying
these individuals--and they are--as the next generation of
entrepreneurs, they deserve the same protections and education
on how to grow. I think that is a really dynamic way.
And then looking at it from perhaps the NIL standpoint,
where there is a lot of marketing deals. And I am going to
speak to marketing deals. I am not going to speak to the actual
contracts with the universities. Right now, it is not a
national registration for agents. Right now, it is segmented by
the States and it varies, and it becomes costly for small
businesses. For the big guys, it is no problem, but you start
adding up those bills and start swiping those credit cards and
it adds up. These athletes deserve to be protected. However,
you know, let's kind of avoid the barriers to entry that aren't
necessary. Thank you.
Mr. ALFORD. Thank you very much.
Mr. Luciano, appreciate your work. I have seen a little bit
online. What drives you to do this? You said you wanted to give
something back, you wanted to make a difference. Expound on
that just a little bit.
Mr. LUCIANO. For me, I refer to the younger you principle.
When I was 16 years old, I really struggled with my mental
health. And I go around to FFA events across the country, and I
speak to 16-year-olds on the daily. And to see them do what I
want to do is amazing, but I also want to protect them and
their mental health, and as these ladies were saying, the
misinformation that can be harmful. So I just want to put a
good message out into the world and protect these kids as they
take in this media.
Mr. ALFORD. Well, thank you. There is a lot of hate out
there right now, especially after last week. And I applaud what
you are doing. Thank you. God bless you.
And I yield back.
Chairman WILLIAMS. The gentleman yields back.
I now recognize Mrs. McIver from the great State of New
Jersey for 5 minutes.
Mrs. MCIVER. Thank you so much, Chairman, and thank you to
the Ranking Member. Thank you so much for holding this hearing.
I want to thank our witnesses today for joining us.
Online content creators are not just influencers. They are
entrepreneurs, job creators, innovators, and small business
owners. They deal with money management, taxes, compliance, and
marketing engagement like any other business. But they face
unique challenges, as we have heard already from some of our
testimony today, unique challenges when their primary
storefronts are intangible online platforms.
Content creation can often make or break a small business.
Congress must identify where federal policy can help creators
operate on a level playing field, protect their business
revenues, and compete fairly in a consolidated and often crazy
online marketplace.
With that, we heard some testimony from Mr. Appell about
how the tariffs have, you know, definitely disrupted your
regular, normal process. And I am sorry to hear that,
especially when you talk about $250,000, that is a lot of
money, and even the unsettledness of where your business is
going and how to plan for that.
I would love to hear more from some of the other panel
members. Based on your experience, how have the tariffs
impacted content creators' ability to maintain product quality,
affordable pricing, and customer satisfaction? We can start at
the end.
Ms. MORAN. For me, I am in the service-based business and
my clients as well, digital content creation, but I think
access to personal capital. You know, income isn't coming in.
Money isn't going as far as it used to, so not having the
ability to hire service professionals to guide them.
I heard from a lot of my creator friends. They, you know,
filed their own taxes this year instead of hiring an accountant
last year. Hopefully things went well. We won't know until, you
know, refunds come through or things like that.
Yeah, I just don't think money is going as far as it used
to, and so people are skipping steps where they can--to cut
costs. And I understand that, but it is also worrisome. You
know, people don't want to hire a lawyer to read their
contracts, but these are really bad contracts. Sometimes they
are very one-sided. They are very favorable to the marketing
agencies or to the brands directly if they are the contracting
party.
So I think, you know, skipping steps is dangerous.
Mrs. MCIVER. Thank you.
Ms. Brennan?
Ms. BRENNAN. Thank you. With the tariffs came uncertainty,
and I think it is going to go back to education and how to
mitigate risk as a business owner because, again, that is what
these people are, they are business owners.
How do you mitigate risk? How do you have multiple streams
of income coming from everywhere? And again, I will hit on it
again. It is about the creators I don't manage, the creators
that maybe don't have a manager in their corner with, you know,
tons of different services.
As far as the tariffs and small businesses, I did hear from
one small business that due to the, I guess you could say the
exit of two very, very big ad buyers, it actually led to less
competition as far as ad buying and ad auction, giving them a
really interesting opportunity to grow. And if we can build off
of that in a very unique way, right, hiring more influencers
and local creators and things like that, I think that is a home
run.
So, yes, tariffs definitely cause uncertainty, and I can't
say what the impact will be year-to-date, but, again, it is
going to go back to education and mitigating risk as a business
owner. Thank you.
Mrs. MCIVER. Thank you so much.
Mr. Luciano?
Mr. LUCIANO. Yeah. For me, I have built my brand, and we go
around the country. We set up booths from FFA events to the
NFR, and just over the years, we have had to hike up prices. So
we see people come by the booth and go, $40 for a cap? No way.
When I used to be able to sell it for $29 4 years ago, right.
So it has just been me seeing the prices hike up, and then,
in turn, that affects my top line, and then I am not able to,
you know, reinvest as much as I can back into that revenue
stream.
Mrs. MCIVER. Yeah. Thank you so much for that.
Anything you want to add to that? I know you already spent
some time talking about it, but anything else you might want to
add, I would love to hear.
Mr. APPELL. Sure. I would just like to add, I mean, I came
to tea through being a full-bred scholar in China and drinking
tea and meeting tea farmers there and speak Chinese. For me,
this is not a matter of, oh, if the market is cheaper to sell
Japanese tea or Indian tea, oh, we will just switch it. On
paper, you might be able to do that, and maybe to the country
it will look on paper like there is a similarity between the
business.
For me, that would be not only just a total upheaval of my
life, and I would have to learn Japanese, but it is also--
again, spiritually, the best part of being a creator is I get
to chase what I really care about, and I get to do it with the
people that I love, and I get to do it with the people who have
been good to me, and I can be good to them, and sometimes they
are in China.
Mrs. MCIVER. Thank you so much for sharing, to each of you.
With that, I yield back, Mr. Chairman.
Chairman WILLIAMS. The gentlelady yields back.
And now I recognize Mr. LaLota from the great State of New
York for 5 minutes.
Mr. LALOTA. Thank you, Mr. Chairman. I appreciate your
leadership on this issue.
Ms. Moran, how are you doing?
Ms. MORAN. Good. How are you?
Mr. LALOTA. Good. My memo here says that the internet
content creation industry is a $250 billion industry as of
2023, but it is expected to grow to $500 billion by 2030.
And you are an attorney who represents a lot of internet
content creators?
Ms. MORAN. Yes. Most of my clients are talent directly or
talent management agencies, like Ms. Brennan here. So there are
hundreds of creators and hundreds of talent managers in this
country, and there is a lot of money circulating.
Mr. LALOTA. Yeah. And about what kind of content do they
often create?
Ms. MORAN. Anything from fashion and beauty to educational
content, mental health, sports, anything. It could be anything
you want.
Mr. LALOTA. Cool. And on what platforms do they usually
place this content?
Ms. MORAN. I think the majority of creators use your main
three: TikTok, Instagram, YouTube. But there is Twitch,
streamers, gamers. There is--I can't think of any right now. I
am blanking. Lemon 8, which is owned by ByleDance as well.
Facebook is still a primary source for some companies. Yeah,
there is--Pinterest is another one. There are several.
Mr. LALOTA. This hearing is enlightening for me because I
didn't realize how big this industry is, and you four are able
to tell us exactly how big it is and where it reaches and
whatnot.
I take it that because you are an attorney, you probably
don't work for free?
Ms. MORAN. No, I do not.
Mr. LALOTA. Good. Good for you. You should charge.
Nevertheless, so the clients that pay you, they are
profitable too. They are paying taxes. They are feeding their
families. They are contributing to society?
Ms. MORAN. I would hope so.
Mr. LALOTA. Good.
Ms. MORAN. I always advise them to do so, yes.
Mr. LALOTA. Smart. That wasn't a trick question, I promise.
Ms. Brennan, I really want to spend my time talking to you
about the New York Yankees, the greatest sports franchise we
have ever seen on the face of this Earth. I am going to try to
stay a little focused here and not spend my time on that.
But knowing how economically viable the industry that you
are involved in is, when a entrepreneur's content gets stolen
or copied, how damaging could it be to that person's ability to
operate as a small business?
Ms. BRENNAN. Thank you so much for that question. It can be
extraordinarily damaging. I gave the example of a surgeon who
had his content stolen, and it was used by a offshore brand to
sell a supplement that wasn't even third-party tested. He got
DMs from people who follow him saying they bought it because
they saw he endorsed it. And that is scary.
So that is a very, very, very big issue, because that is
not just an issue of, you know, credibility; that is an issue
that maybe has safety implications. So those situations should
be, you know, thought of in high regard. Thank you.
Mr. LALOTA. Great. So when an individual's work product
gets stolen, it is damaging to the individual. What about the
rest of the industry? Does it have a chilling effect on the
rest of the industry? Do people then want to put less resources
into creating the content because they anticipate, perhaps
reasonably, that their stuff is going to be stolen?
Ms. BRENNAN. That is a great question, and I don't
necessarily have a full answer for you. What I can say is, from
a consumer standpoint, if we are seeing content that is stolen
with AI dubbing, and there are no disclosures, that is a big
issue. So from a consumer standpoint, when we go to purchase
products, what is it doing to that consumer's psyche? Is it
real? Is it fake?
I believe right now as far as the disclosures go, they are
optional for the parties using it, but as a consumer, I would
like to know if something is heavily edited using AI. I would
like to know if it is a CGI influencer who are taking brand
deals that are valued at a lot of money when they are not real
people or groups of people, and that needs to be clearly
disclosed.
Mr. LALOTA. Great.
Mr. Appell, I am going to go to you now.
Mr. APPELL. Yes.
Mr. LALOTA. What are you drinking over there?
Mr. APPELL. I am drinking ancient tree red tea with roses
in it from Yunnan, China. It is great.
Mr. LALOTA. You are welcome. I know you did the----
Mr. APPELL. I can make you some if you would like.
Mr. LALOTA. I wanted to make sure we got the YouTube
version of it.
Mr. APPELL. Thank you.
Mr. LALOTA. Tell me, piggybacking on what I just said
before, how does a lack of consistent right of publicity
protection leave small creators especially vulnerable?
Mr. APPELL. Yes. So my business is called Jesse's Teahouse.
So one of the reasons I did that is because it is very hard to
fake Jesse. I make the tea myself. I show the farmers we work
with. All of these things really are antipiracy ways of going
about business.
You know, I learned definitely from my career as a comedian
online the content will be stolen. The question is not whether
it will be stolen. The question is when they steal the content,
does it help your business or hurt you?
If people decide to steal Jesse's Teahouse videos with
Jesse hosting, they are really kind of advertising for me. But
this was a long workaround that it took really a decade of
dealing with a very leaky rights protection system for creators
that led me to figure out this very specific way I could try to
protect my rights without any additional regulation.
Mr. LALOTA. Great. Thanks.
Mr. APPELL. Thank you.
Mr. LALOTA. Mr. Luciano, great that you are here. My time
has expired. Thanks for being here, sir.
I yield.
Chairman WILLIAMS. The gentleman yields back.
I now recognize Dr. Conaway from the great State of New
Jersey for 5 minutes.
Mr. CONAWAY. Thank you, Mr. Chairman.
And thank you, Messrs. and Mrs. for--not Mrs. Mrs.? Anyway,
thank you, ladies and gentlemen, for presenting yourself here
today and giving very important information at least to yours
truly who is not involved very much with social media at all,
believe it or not. But it has not passed me by exactly, but I
don't spend a lot of time there because I don't have that much
time, but I am glad you are doing very well at the work that
you are doing, and clearly it is work that you love doing, and
it is always nice to hear from people who are enjoying their
work.
One of the things that struck me as I listened to your
comments as small business persons and understanding the
environment in which we all operate today, how has Big Tech, if
you will, how does that impact you? And do you have some
suggestions about how we defend your space and your purchase in
this economy?
Anybody can take it. That is a round-robin question.
Mr. LUCIANO. Yeah, I will go for it. I like to specifically
speak to like Meta and how these certain platforms offer
verification processes through our actual identity and through
our government paperwork, but when--specifically me, there are
thousands of fake accounts of me, but I am paying this platform
with my government ID to say that I am who I say I am. So when
I report an account, why isn't it not taken down immediately?
So that is one of the big things where I was like, you
know, people are DM-ing me about crazy things that have
happened from a fake profile of mine.
Mr. CONAWAY. So more focus by the Justice Department, I
presume, on this kind of trade violation, I suppose.
Mr. LUCIANO. Yeah. Yeah, it is just very easy to steal
someone's content.
Mr. CONAWAY. Ms. Moran?
Ms. MORAN. Yes. To piggyback off that, I think also there
is a lot of disincentivizing of creators disclosing with the
FTC guidelines that they are monetizing their content because
the platforms don't push it out. So not only is there fake
accounts being made and harassment and bullying, but also
creators don't want to put these disclosures on, that they are
contractually obligated to do so and legally obligated to do
so, because then the content won't get pushed out and then the
views won't be as high and then they might not hit the targets
that the contract set to get bonus money.
So Big Tech disincentivizing disclosures is a big issue. I
think also these big companies, not just tech but any big
company, there is this trend of monopolization. So these
contracts are very one-sided. They are very unfavorable to the
small businesses, to the creators.
And, again, there is not a lot of education on what these
contract terms mean. Also, arbitration. A lot of these
contracts have arbitration clauses in it instead of a mediation
clause or suing in small claims court.
These contracts are not that big. Some of them are. Some of
them can be very lucrative, but a lot of times being lucrative
is at volume. But these deals are, for the most part, 2 to 5 to
10 to $20,000, and arbitration is just not feasible at that
point.
Mr. CONAWAY. That is another issue.
Ms. Brennan, just quickly, if you can, because I do want to
get to another question.
Ms. BRENNAN. So I like the saying, if you can't play nice,
you can't play at all. So these companies that are stealing
this data, and perhaps they didn't know, right. Let's assume
the positive and they didn't know. Have some sort of step and
education where they have to complete it. Similarly to, you
know, if you commit a crime, you have to go through some sort
of program, right. And if you can't play nice, you can't play
at all because this is a serious issue.
Mr. CONAWAY. Thank you.
Mr. Appell?
Mr. APPELL. Yes. And just really briefly on that. I think
the algorithm and the lack of control about what legally you
can do with a recommendation algorithm is something that can be
looked at.
I have 1.5 million followers, but there is no law that says
they have to show my video to anyone. I have worked on it for
years to build the accounts, but will they show it? Maybe not.
Additionally, if, you know, any given tech company realizes
that they make marginally more money showing coffee videos
rather than tea videos, they could just only show coffee videos
and never show tea videos, and I would never know. I have to
work endlessly hoping they show it.
Mr. CONAWAY. And just for the record, you know, hate speech
has been mentioned. It is certainly something that is top of
mind. Many persons in minority communities face discrimination
online. If they say something that is unpopular or perceived as
being unpopular, the Big Tech companies, those who are sort of
controlling access to the world digitally, can censor them,
quite frankly.
Have any of you experienced hate speech or censorship in
the things that you have been doing?
And thank you, Mr. Chairman. I yield back.
Chairman WILLIAMS. The gentleman yields back.
I now recognize Mr. Downing from the great State of Montana
for 5 minutes.
Mr. DOWNING. Thank you, Mr. Chair, and thank you to the
witnesses for being here.
You know, this is an exciting topic for me. You are coming
out of technology. This has been something that we have been
talking about since my formative years.
And my last job before I was in Congress, I was a regulator
of the insurance and securities industries in the State of
Montana, and artificial intelligence, machine learning, big
data all became a big part of the conversation on how we make
use of this as a tool and understand really where, you know,
reasonable sideboards are so you inspire and, you know, invoke
innovation in the United States of America. Make sure that we
continue to be innovators there but understanding what the
implications are, and some of these conversations have just
been really, really intriguing.
You know, a couple of top line comments. Artificial
intelligence is really set to transform the whole scope of the
American economy, you know, including revolutionizing how
business owners invest in their ventures, employ workers,
manufacture products, and, you know, as I mentioned before,
even, you know, how it rates insurance.
There are so many opportunities there, and a lot of folks
are, you know, excited about the opportunity but concerned
about what it means, because a lot of folks just want to be
able to look into that black box. And, you know, I always say,
well, once that black box has an N equals infinity matrix, you
know, network in there, how does any human understand it. So
there are interesting problems before us.
Ms. Moran, in your testimony, you discussed the growing
role that artificial intelligence will play in the digital
creator economy. Notably, you highlight some AI-associated
challenges that online content creators face in forwarding
their brands, including, you know, deepfakes and account
hacking.
So with computing and machine learning capabilities set to
become more and more powerful in the coming years, how do you
think online small businesses and creators are positioned to
deal with these AI-associated challenges going forward?
Ms. MORAN. Thank you. I think as we have all said,
education, and I think disclosure, disclosing that AI is being
used and in what capacity it is being used, to the extent.
Having a percentage of how much AI can be used or how much is
inputted versus output. I mean, I don't know how feasible that
really is, but I think education and disclosure are primary
things with deepfakes.
I know there are countries, in Europe primarily passing
copyright laws. Denmark passed a law that you could copyright
your face, basically, so they can't make deepfakes. I don't
know if that is feasible here but some sort of regulations.
Mr. DOWNING. So I am glad you brought up, you know, foreign
countries. So from your experience, what foreign countries and
actors are the most culpable for promulgating malicious
activities like hacking and spam accounts and, you know, target
online creators?
Ms. MORAN. I think there is a big--I don't know if I
necessarily want to call out specific countries, but there are
countries that are associated with bot followers. So a lot of
times companies or people will maliciously purchase followers
for an account that they want to blow up to then try to steal
the account, or, you know, I will offer you $500,000 to buy
your account from you, and, you know, you have to--you should
sell it because now it is no longer yours.
Mr. DOWNING. Right.
Ms. MORAN. And so that is a business model that also needs
regulation, but a lot of times these followers are coming from
who knows where.
Mr. DOWNING. Right. So despite these challenges, the
growing power of AI also has incredible potential to assist
entrepreneurs as well, including those based online. So what do
you think could be some positive developments that could come
from AI that could help digital creators generate better
content to better compete in the online economy?
Ms. MORAN. Efficiency. AI is a great tool for efficiency.
You know, I have friends who have created tech apps with closed
source AI tools where I can upload a video. It can watch my
video and create a script for me----
Mr. DOWNING. Thank you.
Ms. MORAN.--instead of me sitting and scripting out the
video itself. So things like that are really helpful.
Mr. DOWNING. Thank you.
Ms. Brennan, from your experience managing your clients'
online presence, what has your experience been with AI? How has
it factored into your firm's business strategy and operations?
Ms. BRENNAN. I think that is a great and multifaceted
answer. As far as the pros, it can, you know, detect, you know,
potentially harmful content as far as the user experience, so
that is great. We want everyone safe online, including our
children. And then as far as efficiency and accessibility, that
is quite helpful if you are a small business and you don't have
the resources to, you know, produce more jobs at the time.
As far as cons, the fake AI influencers, that is scary, and
the content theft and dubbing over people's name, image, and
likeness and creating false ads with faulty supplements--and I
can go on and on with that--that needs to be regulated. There
has got to be clear disclosures, and when there is a concern,
it has to be escalated and escalated quickly to remedy that.
Mr. DOWNING. Right. Unfortunately, I have run out of time,
but I really appreciate you all participating.
And I yield my time, Mr. Chair.
Ms. KING-HINDS. [Presiding.] Thank you.
I now recognize Ms. Goodlander from New Hampshire for 5
minutes.
Ms. GOODLANDER. Madam Chair, thank you.
To our witnesses, I just want to thank you so much for
being here today. I know you are not doing it for the 'gram.
And I have a confession to make. Herb and I had to Google what
that meant, but now we know, and we know you are not doing it
for the 'gram. You are doing it for America.
And so I am farming your aura, another phrase I didn't know
about until today, so thank you for that. Because you are
talking about freedom; you are talking about fairness; you are
talking about public safety in the most important arena of the
present and the future, and that is the digital world.
Much of what has been discussed today really cuts across
small businesses across our country. You know, you have talked
about the high cost of doing business both because of
regulatory red tape, and I am making lists and taking names.
You show me red tape. Let's work together to cut it. That is
why I am on this Committee.
You have talked about the high cost of lawless trade wars,
and I want to thank you, Mr. Appell--am I pronouncing that
right?
Mr. APPELL. Appell.
Ms. GOODLANDER. Appell. Jesse.
Mr. APPELL. Yes.
Ms. GOODLANDER.--for quantifying just part of the invoice
that you are paying as a result of these trade wars.
We have got a bill, the Small Business Liberation Act, that
would protect small businesses from these lawless trade wars,
and, look, this is basic fairness. You shouldn't be paying this
kind of tax, and it is especially ironic for someone who has
got a tea shop, because we all know how this great experiment,
the United States of America, began.
But I want to say, you know, the creator economy, when we
talk about the creator economy, Ms. Brennan, you mentioned 77
percent of small businesses use social media. I agree with you.
That is, I would think, a real undercount, and I see it every
day on this job.
You know, I was in a great town in my district, Littleton,
New Hampshire. I met a fellow millennial who owns a small
business called Tailswag, and it is an amazing--it is right on
main street in Littleton, New Hampshire. It is a pet boutique,
a treat bar. I had never been to a small business quite like
this.
You know, she has used social media so effectively, and I
will give you all a pitch. Dachtoberfest is happening.
Littleton, New Hampshire, October 4, 11 a.m. to 3 p.m. She
advertised this on the 'gram, among other social media
platforms. And as a direct result of this one post, we saw a
booming business in Littleton, New Hampshire.
It is a win, win, win. Everyone wins when these platforms
can be used to the effect that we all want to see them being
used for.
Now, I came to Congress having worked in the Department of
Justice in the Antitrust Division. So I spent a lot of time
thinking about the harms and abuses of power we see from Big
Tech monopolists. And, you know, you have touched on so many
today, but I really want to invite you--and I am going to be
sending you, I hope it is okay, questions for the record,
because there is so much in your testimony that I think we
could really benefit from in this Committee.
But I wanted to just put the question out. You know, part
of the challenge with Big Tech monopolists is they are really
these days getting to make big decisions about who gets heard
and who gets paid and how much. And I just--I want to throw
this out to the panel.
And I am sorry I have taken up so much time in my questions
because I am just so grateful that you are here, and I hope we
can stay in close touch.
When you think about--you mentioned there are many methods
of being paid, but when you think about how Big Tech
gatekeepers, Big Tech monopolists are actually controlling the
purse strings and controlling the microphones, what would you
point us to as your top priorities for barriers that you are
facing that you really believe Congress has got to tackle?
Ms. MORAN. I can start.
I think payment terms. I think, a lot of these payment
terms are net 60 and net 90, meaning creators aren't being paid
for 2 or 3 months after the work, if they even get paid at all.
I think having thresholds. Maybe if it is under a certain
amount, it needs to be net 30.
I don't know. There are so many different ways that this
could be framed, but having some sort of regulation on payment
terms would be really, really helpful. And I think also having,
you know, in our termination clauses that if the creator
terminates for whatever reason--life happens, things happen--
force majeure clauses and pro rata shares in our termination
clauses are really helpful. I think also indemnification
clauses, limitations of liability, caps on damages. Creators
are small businesses. We can't go up against a Big Tech company
and have unlimited damages. We don't have that money.
Ms. GOODLANDER. And you don't have an army of lawyers to do
it.
Ms. MORAN. No.
Ms. GOODLANDER. Well, my time has passed, but I want to
thank you all and really look forward to working with you.
Chairman WILLIAMS. [Presiding.] The gentlelady yields back.
I now recognize Ms. King-Hinds from the Northern Mariana
Islands, the great Northern Mariana Islands for 5 minutes.
Mrs. KING-HINDS. Thank you. Thank you, Mr. Chair and
Ranking Member, and Hafa Adai.
So I credit my election to my relationship with social
media influencers. I come from the island of Tinian, and the
island of Tinian has one of the smallest population in the
Northern Mariana Islands. And no one from my island ever wins a
commonwealth-wide election. I am the first, and I credit that,
basically, to the work that was put in by Palm Treo. I have to
give them a shout-out because they totally helped out.
And I also had the privilege of hosting the first ever Palm
Treo social media awards. And this is where I kind of learned,
you know, the value and the importance and all the work that
goes behind content creating.
And as I sit here and as I listen to what Ms. Goodlander
was talking about, right, you know, just the intricacies of
these conversations, and I think about the social media
influencers back home who are struggling to go, you know, from
having an online presence into actually developing a
sustainable business, and as I tie in Mr. Luciano's statement
about, you know, just the challenge in terms of classification,
right, and what all this means with regards to regulations, IRS
taxes, and so that is the kind of conversation that I want to
have with all of you today.
And I want to hear more from you, Ms. Moran, because you
are an attorney and, obviously, you have helped a lot of these
people get through some of these legal hurdles. And so if you
could just start off by kind of sharing, you know, what are
those--what are a couple of the top barriers that these entries
to the market are--that Congress can assist with in terms of
regulations?
Ms. MORAN. Thank you. I think to Nick's point earlier about
not knowing how to classify yourself on a cap table, I think a
lot of times the mindset of an entrepreneur as a small
business, once you start making money, you are now a business.
So I think having them have guidance from the SBA and other
organizations. You know, access to lawyers who can help them
draft an operating agreement or file for their LLC. Knowing
what address to put on an LLC, because some States don't let
you put a P.O. box, but you don't want your address publicly
out there because for mental health and safety concerns.
So I think having guidance on when and how to formalize a
business could be really helpful.
Ms. KING-HINDS. Okay. How about we just move down the line
and get your thoughts on the matter.
Ms. BRENNAN. Thank you. Yeah, I would agree with Ms. Moran.
Education is a huge component to this. You know, how do you
classify yourself? It is for the people who don't have access
to all the things a management firm may bring--attorneys,
accountants, things like that. So really education on what they
can do to build their business would be crucial. Thank you.
Mr. LUCIANO. Yeah, I will touch on what Kayla said, but
just classifying yourself. Like, there were no resources for me
to understand in order to go from once I am making money to
this threshold to now I am making this amount of money, okay, I
need to be classified as an S corp and pay myself a proper
payroll, right. So I had to learn all of that myself.
And then I have had to seek out resources to understand
what I am actually trying to do. So that is why my whole
accountant team, their entire team just works with creators
alone, because I have actually had the other--my other
accountant team, they didn't know how to classify me, and I had
to go re-amend all my taxes from the past couple of years.
So those are some challenges I face as a creator.
Mr. APPELL. Thank you, Congresswoman. I agree with
everything that they have said as well. I would add an extra
loop, an extra element to this.
I sell a physical item, and so I sell my tea in every State
in the country. You know, even in like, you know, big cities,
you would be surprised how hard it is to find really good
Chinese tea. So that means that I have to pay State sales tax
in every State in the country. That means a separate
registration in every State income tax board.
I hire a third-party company to do this, which is just a
total loss to the business in terms of the processing fee that
I need to pay them to be able to register 50 different times.
Some are quarterly. Some are every year. Some are, you know,
biannually.
There are different definitions of what makes a nexus of
sales that requires me to register. Every State has different
amounts that you have to pass before you have to register. It
is a very confusing system, and I am not sure federally what
can be done about that, but as a small business who is trying
to pay their State sales taxes, it is incredibly difficult. And
if I didn't, basically, just pay somebody else to solve that
problem for me, there is absolutely no way I could do it.
Ms. KING-HINDS. All right. I am about to run out of time,
but before I do, I want to give a shout-out to Zori Talks and
Eddie C who are amazing content creators from the CNMI.
Thank you, Mr. Chairman. I yield my time.
Chairman WILLIAMS. The gentlelady yields back.
I now ask Mr. Olszewski from the great State of Maryland
for 5 minutes.
Mr. OLSZEWSKI. Thank you very much, Chairman Williams. I
want to thank our Ranking Member Velazquez, and to our
witnesses, for your time today. It is truly exciting to be with
you to discuss the social media landscape that has led many
Americans to entrepreneurial adventures beyond their wildest
dreams.
Back home in Maryland's Second, local social media accounts
like Marianne Mehrer's Home Sweet Baltimore are helping to
contribute to the success of businesses in our region. Marianne
provides amazing real estate advice through her content while
also shouting out some great small businesses that stimulate
Maryland's economy. Douglas Clayton has a Charm City Food
Adventures account that uplifts local restaurants and food
festivals. And these are the constituents, like all of you, who
are creating business opportunities for themselves while also
boosting brick and mortar businesses and small businesses in
our district. It is such a positive thing.
But we know that as these industries arise, the federal
government has to make sure that we are working harder to
support and protect our constituents from the harms that can
and do exist online. As the father of a young daughter who just
started fourth grade this year, I am especially acutely aware
of the dangers that our children are exposed to online in
particular.
In Maryland, our State police have launched the Internet
Crimes Against Children Task Force, alongside 61 task forces
across the nation. They have partnered with State, local, and
federal law enforcement on a month-long initiative to combat
online child exploitation. The task force has initiated 595
investigations, resulting in 41 arrests and 17 child victims
rescued from ongoing abuse.
While it is horrific that resources even need to be used to
combat these crimes, there is no excuse not to battle this
epidemic head-on in a bipartisan way.
So I look forward to advancing bipartisan legislation that
works to protect everyone online, both from crimes as well as
the hate speech which is so pervasive today. We know the web is
a powerful tool that can connect Americans in positive ways,
and that is needed now more than ever.
So with that, I will ask a question of all the panelists,
and I hope I can save time for one other issue for Ms. Moran.
But I just want to ask everyone, what actions might you
recommend Congress take that can both help us better protect
children from being exposed to violence, harassment, hate
speech, and more, while also ensuring that you can do your jobs
and grow your businesses effectively? I think there is a
balance to be struck, but we want to be doing both.
So I just want to open it up for the panel.
Mr. APPELL. I think from my perspective, I really like the
idea of saying--you know, looking at the internet as a village,
and if somebody breaks the law in the village once, do you let
them create another account? Do you let them create another
hundred accounts? Do you have some sort of thing that they have
to go through where they recognize the problem that they had
with the first account and with the first speech before they
are able to go on and then continue to speak?
I think different issues should be dealt with differently,
but I like the idea of having the internet be full of people
that are, you know, being righteous actors. And if there are
people that are problematic actors, that they are just not
allowed right back onto the internet immediately with no
problem after they have been caught.
Mr. LUCIANO. I would say for me it starts with, like, the
parents at home, with really just filtering the amount of
screen time that kids have because that can--down the line,
especially because I am really big into mental health, that
can, you know, carry down through generations. So just starting
with the parents and really educating on what it means to limit
screen time and--yeah.
Ms. BRENNAN. Yeah, I would agree with Mr. Appell. Repeat
offenders cannot be on those platforms. If there is an issue,
whether it is dealing with a child or whether it is dealing
with an adult getting harassed, and there is, you know, a
process where it goes through discovery beyond just AI, because
I know some of the platforms just look at AI and there is no
human interaction, that needs to be dealt with, and it needs to
be dealt with and addressed by another human being. It can't
just be banned, here we go, we are done. Maybe some
intervention further than that would be helpful. Thank you.
Mr. OLSZEWSKI. Ms. Moran, in addition to your answer on
this, if you can also respond to--I know that you have called
the TikTok ban and President Trump's repeated short-term delays
an emotional roller coaster. In your 30 seconds, if you can
both answer that question and elaborate on what you mean by
that roller coaster.
Ms. MORAN. Sure. I think the Coogan laws--you know, States
like California, Utah, Illinois have passed Coogan laws for
child performers having trust accounts. Parents have to put a
percentage away that is in a trust for children that when they
turn 18 they can access.
We have seen this a lot with actors like Jennette McCurdy
from iCarly. You know, when her mom passed away, she got access
to her income and realized that it was all gone. Her parents
took it. And she is not the only one.
Children performers', family vlog channels are very popular
on YouTube and TikTok, and these creators are being exploited
by their own parents for money, and they are not getting to see
any of that. So I think federalizing Coogan laws or
incentivizing States to pass Coogan-type laws would be really,
really helpful.
And then with the TikTok ban, I think--I mean, Jesse and
Nick have said it too, but it hurts not knowing, you know, can
I post content today? Is anyone going to see it? You know, not
knowing that TikTok got pushed back, I created a lot of content
during the ban in December and January. I was abroad. I was in
Europe, and I was waking up early to talk about it.
Chairman WILLIAMS. The gentleman's time is up.
Mr. OLSZEWSKI. Thank you for that.
I thank the Chairman for his indulgence.
Chairman WILLIAMS. Next, I now recognize Mr. Jack from the
great State of Georgia for 5 minutes.
Mr. JACK. Well, thank you very much, Mr. Chairman, and I
want to commend you and the staff of this incredible Committee
on convening this hearing. It is exciting. As a member of the
generation of many of our panelists, it is exciting to see you
all accomplishing incredible things.
And I am curious. One of the questions I would love to
start with is, as somebody who obviously follows, you know,
content creators that are working to generate small business
leads for people across my community, I am interested in
talking about search engine optimization. I am interested in
learning how you all navigate that.
So we can go down the line, and we will start with Ms.
Moran. I would love for you to explain to this Committee how
you navigate the topic of SEO.
Ms. MORAN. Thank you. I mean, I wouldn't be here if it
wasn't for SEO. You know, Danielle found me through Instagram,
and now Instagram is searchable. When you Google someone, you
know, whatever was in the caption of your post or your video on
Instagram now comes up on Google. That was recent as of like I
think 2 weeks ago.
So I think, you know, platforms are starting to understand
that search engine optimization is not just for small
businesses and marketing of products and service-based
businesses but also creator content, because there is a lot of
really great education, and there are a lot of really great
businesses using social media because it is cost-effective. It
is more affordable for businesses to use digital marketing than
traditional multimillion dollar productions and commercials.
Mr. JACK. Wonderful. Thank you.
Please.
Ms. BRENNAN. I think we are seeing the rise of blogging
again, which is an interesting platform that kind of took a
little bit of a break. And as there is more competition in SEO,
it will become costlier. So going back to education and
resources, as well as funding for these small businesses will
help them compete in an ever-growing landscape.
Mr. JACK. On what platforms are you seeing that expansion
of blogging? Is it now that X has long-form posts, or are you
seeing it in different--I mean, it used to be Tumblr, but I am
curious what it is now.
Ms. BRENNAN. That is a great question. So there is SEO on
the platforms and then there is traditional blogs. So a lot of
these creators have their own websites where they are SEO-ing
various things. And Substack, yes. Thank you. Substack as well.
Mr. JACK. Sure. Thank you.
Please.
Mr. LUCIANO. So me personally, as a creator, I rely more on
SEO with optimizing my landing pages for where I am trying to
drive traffic, but as far as online creation, I am really in
the space of like audience retention. So I build my platforms
as far as like strong hooks, ping points, et cetera, going down
to the bare bones of marketing.
So the SEO for me is literally just trying to optimize my
pages of where I am driving traffic online. But organically, I
want people to connect with me with strong hooks, ping points,
resolutions, calls to actions, stuff like that.
Mr. JACK. Helpful context.
Please.
Mr. APPELL. Yes. Thank you, Congressman, for your question.
I agree with Mr. Luciano. I feel like as a creator, if I do
a really good job of making awesome content, making videos,
sharing what I know and what I care about, that those people
will fight through bad searches to find my website. But if I
just have a mediocre--mediocre at everything, SEO will not save
me.
Now, that is kind of my mentality. I don't know if that is
literally true, like, in the numbers, but I think that is a
healthy mentality to have as a creator, to try to focus on the
video.
We do do SEO now, especially as the business has gotten
bigger, to try to get more people who may have seen a video of
mine once on a train 7 months ago and now they want tea. You
know, that can help that person find my website if they have
already had a real interaction with me online.
But I think that as a business owner, you are asking--I
would be asking a lot of SEO to convert somebody who has like
never seen me, doesn't know the brand, doesn't know the tea.
That is not really how I would look to use it. I think it is
that final push to get somebody who already does know you up to
the top of the list.
Mr. JACK. Wonderful. And I have got just a minute left. So
I am curious, on an analytics perspective, if you could share
with the Committee, are you using Google Trend? What analytic
structure are you using to help at least see how successful
your advertising has been?
And we can start with you and go as far as we can.
Ms. MORAN. I mean, each platform has its own analytics
tools. I think Google Alerts are great to see, you know, what
people are searching for and what comes up when they are
searching. But I have a newsletter on beehiiv, and beehiiv has
really great analytics for email open rates and, you know,
click rates within an email, but each platform has its own
tools.
Mr. JACK. Thank you.
Ms. BRENNAN. Yeah, I think it is really important to look
at the platform specifically, but I do want to voice that there
are aggregate platforms that companies can buy, and I hate to
say it but a lot of times they are wrong. So businesses are
then getting this data, and it is based on things that aren't
correct.
So there is another, I guess you could say, issue that
needs to be addressed there. Thank you.
Mr. JACK. Thank you.
Please.
Mr. LUCIANO. My bread and butter has always been audience
retention, so I look at retention curves and I look at, you
know--I mean, TikTok specifically has done a great job of
including more analytics of where we can improve our videos.
Mr. JACK. Thank you.
Lastly.
Mr. APPELL. Yeah. I also look at creator--like, the
interaction. If I am getting great comments from people that
really care about what I am talking about, I kind of hope that
the rest of it is going well. But, you know, in terms of raw
analytics, I use the Google Analytics platform.
Mr. JACK. Thank you very much.
Mr. Chairman, I think this is a great hearing. I appreciate
you for convening it, and I yield back my time.
Chairman WILLIAMS. The gentleman yields back.
I now recognize Mr. Schmidt for 5 minutes.
Mr. SCHMIDT. Thank you, Mr. Chairman. I want to thank you
for convening this, thank the witnesses, and express my
apologies for my late arrival. It wasn't a lack of interest. I
will never get back the last 5 hours of my life in the
Judiciary Committee with Director Patel. And it was a--let's
just say I am in the mindset where sort of the darkness of
human nature is currently on my mind. So this is uplifting.
Tea would do it. That would be fantastic, yeah. Although
Kash would say it is spiked with something we imported from
China. So, you know, it is a whole different deal.
So sort of in that spirit, let me ask you a question. It is
kind of the flip side of what our colleague from Maryland asked
you. He asked you your initial thoughts using the illustration
of child exploitation and ICAC work online, you know, what can
be done to make things safe. Let me ask you the flip side of
that.
One of the things the Director said to us repeatedly today
in multiple contexts--and it wasn't an internet hearing. It was
a wide-ranging around the world, and yet he came back I think
four or five times when asked, you know, what is the one thing
we could do in Congress that would make America safer. And he
said, give us more eyes and tools to find bad guys doing bad
things online. It was a constant theme.
Let's assume for the sake of discussion we take that advice
and try to figure out from very smart people what things we
could do that would be helpful. From your vantage point, what
should we be keeping in mind so that we don't throw the baby
out with the bath water, kill the goose that laid the golden
egg--pick the metaphor that you want--but so we don't foul up
the good things you are doing online while we are trying to
address the really awful things a lot of folks are doing
online?
We can just go down the line.
Mr. APPELL. I may have a little unconventional angle on
this because I spent 10 years in China doing Chinese social
media. And in China, political interests were always the thing
that was dictating what the people who are regulating the
internet were doing. It wasn't business. It wasn't art. It was
politics.
And so I think finding a way that if we have the eyes and
the ears to be able to go and catch bad people on the internet,
that it can be done in a data-forward way as opposed to a
politics-forward way. And make sure that those tools are used
and people know that they are being adjudicated fairly and not
because of any given political cycle. Thank you.
Mr. LUCIANO. I will actually give you an interesting story
on this topic of the bad guys. My dad was robbed. I am from
Maryland. My dad lives in Maryland, and his Side-by-Side was
stolen. And me as a creator, I went to the internet and was
like, hey, this is the footage. This is what happened. And
literally the entire--I am from Cecil County, Maryland. Cecil
County came together through comments and through--like
singular comments of people going to work at 4 a.m. in the
morning, I saw that Side-by-Side riding down the road. And
through that we were able to catch the guy.
So I think things like that are really great, and social
media has that community aspect where, even if it is not
regulated, like, single comments can help things like that go a
long way to catch the bad guys.
Ms. BRENNAN. Thank you. And I think there was a documentary
around cats that did something similar where there were
internet sleuths around there. I won't say the name of the
documentary. You will have to look that one up.
But as far as, you know, using AI for good, scraping is
wonderful, because if we can catch these guys before the
content even airs, and I am talking about explicit images,
things that have to do with children, I mean, that is a win.
Now, the guidelines need to be clear and explicit. So that
is a very, very, very important factor in this sort of, I guess
you could say, content policing and, you know, the safety of
our kids. Thank you.
Ms. MORAN. And I will zoom out a little bit from just the
AI aspect of it, but I think mental health, which I think we
can all attest to, community. Brands can build businesses using
community. They can build community first and then launch a
product, and then they have sales immediately built into that.
But I think also, at least for me, I wouldn't be here today
if I hadn't had a community online when I was in law school in
my darkest days, and the rise of social media really allowed me
to have a voice and share it and find like-minded people.
And I think for children as well, there are really great
tools. There are a lot of, you know, learn how to read, learn
how to color, learn your numbers, online educational
programming using social media that could be really, really
helpful.
And I think if we regulate and disclose when AI or bad
actors are being, you know--when they are caught and they are
taken down and banned from using the platform so more good
content can keep coming up.
Mr. SCHMIDT. Thank you.
Thanks, Mr. Chairman. I yield back.
Chairman WILLIAMS. Okay. The gentleman yields back.
I now recognize Mr. Patronis from the great State of
Florida for 5 minutes.
Mr. PATRONIS. Thank you, Chairman. Thank y'all for being
here.
I am not going to try to lead with questions--or lead you
with my questions I am asking, but let's talk Section 230. How
important is its existence to each of you?
Ms. MORAN. Can you expand on the section, please?
Mr. PATRONIS. If we repealed Section 230, would your life
change?
Ms. MORAN. Can you expand what the section is for those who
don't know?
Mr. PATRONIS. Oh, Section 230 is providing liability
protection to social media companies.
Ms. MORAN. I mean, I think that would be really helpful,
especially from the legal perspective. I think, again, the
education, the regulation, the disclosure, limiting liability
for creators if they are, you know, being the one violating
these platforms. But I think the platforms being regulated and
held accountable.
Mr. PATRONIS. Sure.
Ms. BRENNAN. I don't know enough about the section to be
able to talk about it. As far as limitation of liability as far
as creators are concerned, that would be very helpful in
navigating the business and the landscape that is ever
changing. Thank you.
Mr. PATRONIS. Great. Thank you.
Mr. LUCIANO. Yeah, I don't know enough about the section to
form an opinion on it.
Mr. PATRONIS. Got you.
Mr. APPELL. I don't know specifically about that section
either, other than I think the responsibility on the side of
both the platforms and the creators is important. If we all
know that everybody has responsibility for what they are
putting up, you generally will get better actions, I think.
Mr. PATRONIS. Cool. So parent of a 14-year-old and a 17-
year-old. It is fascinating. When I was a kid, I would open up
this catalog called JCPenney, and I would circle all the things
I wanted for Christmas in it. Now, because of what my children
now are able to find, they are writing very detailed lists
because of how they have been influenced on social media of the
exact model, color, style, model number of what they want. It
is crazy. Their desire for different colognes and how social
media has steered--you are laughing because you know exactly
what I am talking about, and it is so stinking powerful.
So now here is my concern. Should the liability--if we were
going to try to regulate this for the health of our kids, is it
easier for us to say, all right, Congress, if you want to fix
this, why don't you just fix it with two players, and that is
Apple and Google, or do you go out there and create a solution
that is going to affect every social media company, or do you
do both?
I would love any input you have about that.
Ms. BRENNAN. Yeah. Thank you for that question. I think it
needs to be everything, because we don't know the next social
media platform and how fast it is going to grow. So instead of
being, you know, perhaps, behind, we get ahead. And I also
think it is really important to look at biometric information
and how that is being collected and how that is being used.
Mr. PATRONIS. Elaborate.
Ms. BRENNAN. So I know Illinois, I think back in 2008,
passed the Biometric Information Privacy Act, and that has to
deal with--and, again, please look into this, but to my
understanding, it dealt with written consent, clear consent.
And as soon as the content or the information that was being,
you know, collected was done with, they delete it and it
couldn't be sold.
So I think we need to look into that as far as, not only
collecting content, but when companies buy it, can they pair it
up with the users there so they can create a full, you know,
image.
And I know the EU--I will let Ms. Moran speak to that. And
the legal implications did pass some, you know, data protection
acts.
Mr. PATRONIS. Yeah, I think they are a little more--a
little stronger in their protections than here.
Ms. MORAN. I mean, in general, the EU has a lot stronger
protections for things, even beauty products and chemicals and
things. So, yeah, I think looking to other countries that have
done similar things.
I like the idea of biometric regulation. You know,
companies, you know--an influencer's swimwear line, they use
where their customers are coming from. You know, how many times
did they shop this year? What colors do they like? What prints
do they like to, you know, design new collections. But how much
information are they really getting? And, yeah, what are they
doing with it? Maybe they are not selling it, but bad actors
are coming in and hacking into it and selling it.
Mr. PATRONIS. So do you think--again, getting back to the
question, do you think, if Congress was going to act on trying
to create some protections, do we just put the expectations on
Google and Apple because they have the market share, or do you
go and pivot to Facebook, Meta, Twitter, TikTok?
Ms. MORAN. I think, as Christina said, I think everybody. I
think those two for sure, Apple, Google. Start there. Meta,
they are a monolith. You know, they own Instagram, they own
Edits, they own--what is the other one? They own WhatsApp. You
know, they are huge.
So I think going after Meta as well, and then through
TikTok and Snap Inc. Even Uber and Lyft, you know, they are
using social media as well. The dating apps. Like, everybody.
Mr. PATRONIS. Yeah. Don't get me started on dating apps.
Mr. APPELL. And then just very briefly, I think it is a
good thing for the country if everybody plays by the same
rules. But that being said, if we do have one or two parties
that are just bigger, making sure those people play by the
rules as a way to make sure everybody else knows the rules have
changed would be great.
Mr. PATRONIS. Great. Thank you.
Thank you, Mr. Chairman. My time is up. I appreciate you
all.
Chairman WILLIAMS. The gentleman yields back.
What a great hearing this has been. We appreciate all of
you, and I would like to thank all of our witnesses for your
testimony and for appearing before us today.
Without objection, Members have 5 legislative days to
submit additional materials and written questions for the
witnesses to the Chair which will be forwarded to the
witnesses. So I ask the witnesses to please respond promptly if
that happens.
And if there is no further business, without objection, the
Committee is adjourned. And we want to come down and shake your
hand, so don't leave yet.
Thank you.
A P P E N D I X
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