The US election and tech – five areas where politics will have major influence
The tech industry's fortunes rest on who wins the White House and who has the power to pass legislation that could radically change how it does business.
ANALYSIS: President Trump may not have conceded the presidency to Joe Biden yet, but it will take a miracle and some acrobatic legal work to keep him in the White House with the popular vote and electoral college votes stacking up for Biden.
Less certain is the outcome in the Senate elections, with the tally of seats locked up at 48 each for Democrats and Republicans. the ultimate result could come down to two run-off races in Georgia scheduled for January. That could prove pivotal. With Democrats maintaining control of the House of Representatives, a majority in the Senate as well would clear the way for sweeping legislative change. A Republican-controlled Senate, on the other hand, acts as a roadblock to not only a Democratic president, but true blue Democratic lawmakers too.
But when it comes to technology and the digital economy, so much of which is influenced by large US tech companies and the digital platforms they control, the themes for the next four years are already emerging.
Breaking up Big Tech
While President Trump has been busy cutting regulatory red tape since entering the White House in 2017 and largely maintained the light-handed regulation of the tech sector, the worm started to turn on Big Tech in the last two year of his first term.
Last month the US Department of Justice kicked off a major antitrust lawsuit against Google, which it accused of illegally monopolising the market for online search and advertising. That lawsuit could take years to play out and if successful may force a separation of parts of Google and a change in its business practices, such as paying billions of dollars to hardware makers like Apple to make the Google search engine the default on their devices.
But even broader antitrust action against the other major digital platform companies – Facebook, Amazon and Apple, could be on the cards under Joe Biden and particularly if Democratic lawmakers claim a majority in the Senate. Democrats led the publication of a major 449-page report last month by House of Representatives congressional subcommittee looking at the impact of Big Tech’s monopoly power on the digital economy.
It suggests sweeping changes including “structural separations and prohibitions of certain dominant platforms from operating in adjacent lines of business”. In real terms that could see Facebook forced to divest Instagram or Amazon required to either host third-party sellers in its giant online store or sell products himself, but not both.
Bottom line: While Democrats and Republicans alike have been talking up antitrust action against Big Tech, the threat of substantive action that could change how these major online platforms operate is greater with a Democrat in the White House and a Democratic majority in both houses of Congress.
Social media clampdown
No one in US politics appears to be happy with how the likes of Facebook, Twitter and Youtube handle political content. There is discontent, particularly among Democrats, with the level of misinformation and hate speech allowed to circulate on these platforms and which some claim helped propel Trump into the White House in 2016.
The political argument has centred on Section 230 of the Communications Decency Act of 1996, which affords protections to internet companies who host content generated by users. Democrats have pushed for reform of the legislation to make tech companies legally responsible for the content that they publish and distribute. That call has been echoed both by Joe Biden and President Trump. The latter furiously responded to Twitter fact-checking his tweets in May by issuing an executive order to rewrite Section 230.
Tech companies hate that idea as they would then be liable for the billions of messages they publish daily. But there is a lot of rhetoric here and plenty of self-interest – Trump continued to blast social media platforms for suppressing conservative content in the run-up to election day. Biden was outraged that other posts critical of him and the Democrats were allowed to stand.
Again, Congress is all over the issue with red and blue politicians rightly pointing out the need for some systematic change to tackle the spread of misinformation.
Bottom line: Biden would likely lead a push for tighter regulation of social media platforms and Democratic politicians would likely seek to go further. The tech sector favours self-regulation, but even Facebook founder Mark Zuckerberg has called for lawmakers to give more guidance to ease the tensions over content moderation.
The US has no overarching data privacy protection to mirror the likes of the European Union’s General Data Protection Regulation. Some see that as integral to the excesses of Big Tech, with companies able to gather large amounts of customer data and use it for broad-ranging purposes.
In general terms, Biden and the Democrats are in favour of better privacy protection for consumers while Trump is ambivalent about it, or in some cases, has even pushed for privacy in the digital realm to be eroded. He famously pushed back privacy laws allowing internet providers to collect more data from their customers.
He has also threatened to force tech companies to build back doors into their encryption system to allow law enforcement agencies easier access to data in the interests of fighting terrorism. Still, many of the more hawkish Democrats mirror that view and former president Barack Obama urged the tech sector to build a system allowing authorities into encrypted systems. That hasn’t come to pass, but the pressure to do so will escalate in the near term.
Bottom line: Biden and the Democrats are more like to push through data privacy reform for consumers but national security and anti-terrorism priorities will likely see both sides united on a desire for backdoors into the tech sector’s encryption systems.
The US-China tech war
Trump’s trade war with China featured a high-tech component as he crimped Chinese 5G mobile equipment maker Huawei’s global ambitions. He banned US companies from doing business with Huawei and asked Five Eyes intelligence partners, including New Zealand, to freeze the company out of 5G network builds around the world.
China has responded by urging its tech companies to become fully self-sufficient and the likes of Huawei are accelerating development in areas they’ve previously relied on US help, such as mobile phone computer chips. Dozens of other Chinese tech companies are on a US trade blacklist, but the manufacturing of iPhones and many other US-designed devices continues uninterrupted.
The antipathy towards China has also extended to Trump threatening to shut down the US arm of Chinese social media company TikTok and to ban the app from the US completely. That fight is currently going through the courts and it isn’t all going Trump’s way.
Bottom line: With China-US relations showing no sign of warming up, its likely the tech war would have accelerated with Trump back in the White House. Biden and Democrats are likely to pursue a less adversarial approach to trade, while continuing Hilary Clinton’s policy as Secretary of State, of standing up to China on national security issues.
The tech workforce
Silicon Valley’s success is in large part down to the foreign talent that has flooded into its research and development labs and start-ups over the decades. But to the dismay of the industry, Trump’s tightening of immigration extended to a long-running programme designed to supply a pipeline of top talent to the tech sector.
President Trump has moved to limit the number of H-1B visas on offer to tech workers, reducing the international flow of workers into the tech sector.
Biden wants to reverse that, expanding the number of visas on offer and revise the green card system to make it fairer to workers.
While Trump’s domestic tech skills efforts have focused on beefing up US cybersecurity capabilities and efforts in areas of emerging technology, Democrats skew towards developing a more diverse workforce and getting disadvantaged people into highly skilled jobs.
Both parties and presidential candidates consider innovation as a priority, though with Trump there is a more nationalistic imperative with a desire to bring high-tech production back to the US and to catch in areas where the US is trailing, such as 5G technologies.
Bottom line: Trump’s anti-immigration stance is likely to be undone now, which will be welcomed by Silicon Valley as it will open the doors again to the global talent pool.