Big Tech Gets Caught in a Regulatory Vise

Back in June, we talked about how US regulators were taking aim at Big Tech – gradually at first, but then suddenly, as federal anti-trust authorities launched investigations into large Silicon Valley firms' market power. The past week has brought some important new twists in the global campaign to rein in the industry. Here's a look at where the political heat is coming from.


Top-down pressure in Europe: On Tuesday, incoming European Commission president Ursula von der Leyen tapped Margrethe Vestager, one of the industry's most feared and revered tech regulators, for a new five-year term. The Danish politician, who US President Donald Trump has dubbed "the tax lady," has made waves with a series of multi-billion-dollar fines against huge US tech companies during her stint as EU competition commissioner. Under von der Leyen, Vestager will not only hold onto her anti-trust powers, she'll also take on broader responsibility within the EU for making Europe "fit for the digital age," including figuring out how Europe can maintain its "technological sovereignty" in a world dominated by US and Chinese tech firms. Vestager was already one of the most powerful enforcers in global tech. She just got even fiercer.

Bottom-up pressure in the US: Top prosecutors in 48 US states on Monday unveiled a "multi-state, bipartisan" competition probe into Google. This followed news of a similar anti-trust investigation into Facebook last week. The state-level action is interesting mainly because of Washington dysfunction: If federal investigations into Big Tech stall, could anti-trust become the latest example of state and local governments cracking down where national governments can't or won't? It's already happened in privacy, where a tough new California digital privacy law is set to fill the void created by Congressional inaction when it comes into force in January. Curiously, California was one of two states that declined to join the Google probe – its attorney general has remained tight-lipped about why, citing a need to "protect potential and ongoing investigations." Even so, the legal risks facing big tech companies in the US just got more complicated.

Bottom line: From all angles, Big Tech's regulatory squeeze in the West is only going to intensify.

Are the US and China headed for a new Cold War over technology? Judging by what we heard a few days ago at the Munich Security Conference, a major trans-Atlantic gathering for world leaders and wonks, you'd certainly think so. US, European, and Chinese officials at the event all weighed in with strong words on the US campaign against Chinese 5G giant Huawei and much more. Here are the main insights we gleaned from the proceedings:

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Bloomberg takes the stage – Tomorrow's Democratic debate will be the first to feature media tycoon Mike Bloomberg, who in recent weeks has thrown hundreds of millions of dollars behind an ad campaign designed to position himself as a viable, moderate candidate who can beat Trump. As his support in national polls has climbed to nearly 20 percent, Bloomberg – who largely sat out the earlier rounds of Democratic campaigning – has come under attack for sexist comments in the past as well as his support, as NYC mayor, for "stop and frisk" policing tactics that disproportionately targeted people of color. Bloomberg will immediately be at war not only with the moderates whom he wants to displace – Pete Buttigieg, Amy Klobuchar, and Joe Biden – but especially with the front running left-progressive Bernie Sanders. It will likely be quite ugly and we're certainly tuning in.

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150: As the Chinese government continues to expand travel restrictions, hoping that reducing human contact will stop the virus from spreading further, at least 150 million people are now facing government restrictions dictating how often they can leave their homes. That's more than 10 percent of the country's total population who are currently on lockdown.

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While attending the Munich Security Conference, former U.S. Secretary of State John Kerry was asked to respond to the news of the first coronavirus death outside of Asia. The victim, a Chinese tourist who arrived in France in January, was among 11 confirmed cases in that country. "I think everybody in the world needs to be concerned," Kerry told GZERO.

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