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Tech & Digitalisation

Tony Blair's Foreword to A New Deal for Big Tech


Commentary31st October 2018

From the early days of the Internet in the early 1990s, when sparks of curiosity quickly became commercialised, the last decade saw the industry’s accelerated speed from infancy to adolescence. Disrupting the old incumbents, companies that enjoyed economies of scale and strong network effects began to form the cradle of a new economy, but also created unforeseen ripple effects on politics and society, the impact of which we’re still trying to understand.

The pace and all-encompassing nature of this revolution could not have been imagined. But with some of these companies now the largest on the planet, their influence requires a more mature and responsible approach. Mistakes have been made, and the power of technology has become too concentrated in the hands of too few. But the policy response being suggested by populists of both left and right, which is one either of knee-jerk reaction or of rash opportunism, should be rejected. Instead, we need a fresh approach that makes these firms more accountable and more transparent to consumers but does not erode their ability to innovate.

This issue is key for the centre ground of politics today. Technology should be shaping our thinking across the whole policy platform. In education, it can help us better map out individual learning requirements. In health, companies such as DeepMind have already begun to show the potentially vast consequences for diagnostics. And in energy, clean renewables may be key to the health of the planet in the long term. In the UK, the party that best grasps this will shape public service delivery for decades.

This profusion of technology has been driven by people. The adoption curve of computing was quick, but the proliferation of smartphones has been astonishing. Increasingly, they are simply remote controls for our lives. And as technology has spread, becoming nearly universal in the West, it has raised a whole number of issues, such as the potential impact on jobs and its contribution to rising polarisation.

It means that now, more than ever, the private incentives of firms need to align with the public interest. And in setting out a new vision for regulation in the 21st century, today my Institute publishes a progressive proposal for a new approach to regulation of tech: one that harnesses the benefits but mitigates the risks.

At the heart of this approach is a new transatlantic alliance for technology. Parallel regulators in the United States and at the European Union level should be established, tasked with the remit of rewriting the rules for the Internet age.

It would be a radical departure from old policymaking, grounded in values rather than hard-and-fast rules, and would recognise and engage with the complex interaction between firms, users and society as a whole.

It would start by focusing on the big technology companies; those that have the greatest power and an outsize impact on the world around them.  

It would place a new responsibility on these firms, with standards built in unison with the communities they serve.

It would focus on the rights and well-being of consumers, with more powers handed to the individual to understand how their data are being used and by whom.

It would also renew competition policy to be relevant for the economies of today. Practically, this means a stronger process to stop large companies from buying out potentially competitive start-ups. With international tax reform unlikely to be forthcoming in the near future, it would also be given powers to place companies temporarily in a corporate-tax regime that allocates profits geographically in proportion to active users.

Together the reforms would place the US and the EU at the forefront of setting ethical standards for tech worldwide. But importantly, they would encourage, not stifle, innovation.

This competitive edge will be key. Many parts of the developing world have begun to converge economically with Europe, while China is vying with the US. This should not be a zero-sum game; it is simply the new reality. In tech, China is the only nation that comes anywhere close to Silicon Valley. Alibaba, Baidu and Tencent are already some of the world’s biggest tech firms, while the government has already signalled its intention to be the world leader in AI by 2030. It is an ambition they will very likely realise.

India might also not be far behind either. The number of tech unicorns has hit a record this year, although they are unlikely to touch China’s dominance in AI, which will be driven by a different approach to rights and freedoms.

This is also why a fully multilateral approach is unlikely to work, even if some firms exist across almost all jurisdictions. Since a potential high point in the 1990s with the creation of the World Trade Organisation, on a whole host of issues we’ve seen the limits of global governance and effective collective action, a trend that is likely to continue. In an increasingly disconnected state of international affairs, there is likely to be little agreement on a common path forward for regulation in the Internet age.

Instead, the liberal democracies of the US and the EU, which have historically shared values, should make shaping the future of technology their number one priority. These are the industries that will shape our common future, and we should shape them together. This new report provides a brilliant blueprint for how this might work.

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