A weekly digest of the latest news and research related to the work of the Technology, Economics, and Governance Working Group. Topics covered in the digest include cybersecurity, domestic regulation, innovation, international competition, social media disinformation, and the California exodus.
Industrial Policy, International Competition and Cooperation
What tech does China want? | The Economist
Over the past few months, China has demonstrated a change in its policy towards the country’s tech companies, shifting from an initial “growth-at-all costs” model to tighter state control that prioritizes social fairness and national security. As a consequence of this shift, it is estimated the country’s biggest tech companies have lost a combined market capitalization of $1 trillion. Analysts also note that Beijing’s tighter regulation of the software industry has aimed to boost deep-tech industries like AI, cloud-computing, and hardware development, areas the CCP feels China can surpass the United States.
An agenda for US-EU cooperation on Big Tech regulation | Brookings
This piece argues that the EU-US Trade and Technology Council (TTC), formed in June, represents an opportunity for policymakers in the US and Europe to align their respective efforts to regulate the online world, particularly disinformation and influence operations. It proposes that the first step of the TTC should be to develop a comprehensive picture of the scope of disinformation and hate speech and the role of algorithms in spreading such content. From there, it argues, we must shift from a reactive to a proactive approach to keep up with the ever-evolving digital environment.
Domestic Regulation
Big Tech’s Stranglehold on Artificial Intelligence Must Be Regulated | Foreign Policy
Bhaskar Chakravorti, the dean of global business at Tufts University’s Fletcher School of Law and Diplomacy, argues that greater regulation is needed as Big Tech companies (Facebook, Google, Microsoft, etc.) continue to acquire AI startups. Since 2007, Google has purchased at least 30 AI companies, and Microsoft, Amazon, and Chinese counterparts are in position to become the primary AI suppliers. Chakravorti questions whether we should have confidence in these companies to lead AI in a positive and safe direction when they have previously struggled to maintain public trust. The piece also provides policy recommendations to avoid possible pitfalls.
Washington vs Big Tech: Lina Khan’s battle to transform US antitrust | The Financial Times
Over the past two months, the FTC has undergone a fundamental revamp, led by its newly appointed commissioner Lina Khan and White House adviser Tim Wu. It has signaled the greatest change in the FTC’s posture since the late 1970s under Robert Bork, who believed that government enforcement of antitrust rules prevented efficiency and negatively impacted consumers. Under Biden’s direction, Khan seeks to bring greater order to the commission with vaster antitrust enforcement. Conservatives have criticized Khan’s recent changes, arguing the commission lacks the authority and the capacity to take on the reforms.
A new Senate bill would totally upend Apple and Google’s app store dominance | TechCrunch
Sen. Richard Blumenthal introduced a new bill this week that would force tech companies like Apple and Google to allow app developers to use alternative app stores where they can sell their software for cheaper. Currently, app developers must give 30% of their earnings from app sales to Apple and Google. Supporters of the bill hope it will foster innovation and allow smaller startups a better chance. Apple and Google argue that limiting app sales to their official marketplaces protects consumers from downloading malware or buggy software.
Innovation
Much of the NSA’s most prized intelligence data may be moving to the cloud | Nextgov
The National Security Agency has awarded Amazon a $10 billion cloud computing contract. Codenamed “WildandStormy,” the contract is the second multibillion-dollar cloud contract from the U.S. intelligence community in the past year. The acquisition appears to be an effort by the NSA to modernize its data repository by moving it to the cloud, as exponential data growth has made it difficult for the NSA to meet data storage demands at its internal repositories. Amazon’s web services division is considered the market leader in cloud computing and is Amazon’s most profitable business unit.
Cyber
Another big company hit by a ransomware attack | CNN
Consulting firm Accenture was hit this week by a ransomware attack that threatened to publish the company’s encrypted files on the internet unless the company agreed to pay. The attack originated from the LockBit ransomware gang, who lease their malicious software to third-party criminals and then receive a cut of the ransoms. Other victims of the LockBit group include UK rail network Merseyrail and the Press Trust of India. A spokeswoman for Accenture confirmed the attack took place and that it had no impact on Accenture’s operations or their clients’ systems.
Freedom of Speech, Domestic Democracy, and Extremism
YouTube suspends Rand Paul for a week over a video disputing the effectiveness of masks | The New York Times
On Tuesday, YouTube slapped Kentucky Senator Rand Paul with a one-week suspension from the platform after he posted a video disputing the effectiveness of wearing masks to limit the spread of COVID-19. The suspension was in line with company policy, which bans videos that spread misinformation. Sen. Paul’s claims about mask-wearing go against a near-unanimous recommendation from health experts that masks do help. Sen. Paul responded by calling this type of censorship “dangerous, incredibly anti-free speech and truly anti-progress of science.”
