August 18, 2022
The power clashes of big tech companies and governments represent a complex interplay of authority

Big tech companies and the Chinese and US governments are embroiled in a complex relationship of harmony and conflict. We are all at the mercy of the consequences.

“Simply put, they have a lot of power,” said US Congressman David Cicillain of American Big Tech at a 2020 congressional hearing. In the same year the Chinese government announced new rules that forced Chinese company Alibaba to cancel the listing of its ally Ant Group on the stock exchange. China later ordered the termination of Ant Group’s financial activities, leaving only its e-payments business intact.

These fights between states and corporations represent a complex interplay between the world’s most powerful actors. Tech giants help define the mix of nationalism and globalism of their home countries.

They are bishops in the strategic and long-term chess game of their kingdoms for world power. However, tech giants also challenge the power of their states and contribute to polarization in their home countries.

The fight is not only between corporations and their home states. The US denied some Chinese enterprises access to the US market – a well-known example being a ban on Huawei for blocking the development of 5G technology.

Meanwhile, the US pressured other countries to follow suit and force Chinese businesses out of their markets.

Google, proving its support of the US and noting the threat to its own business of Chinese technology, restricted Huawei’s access to essential smartphone apps, forcing Huawei to use or develop new ones. was forced to. In addition, the US attempted to prevent international scientific cooperation with scholars based in China.

The US presents these measures as a response to unfairly competing China. Allegations of Chinese disrespect for intellectual property, state subsidies and protectionism reinforce a generalized critique of China’s political system.

China’s Great Firewall, which limits foreigners’ digital operations, is seen as provocative, especially given the importance of data harvesting in the AI ​​race. Certainly, the firewall has played a key role in catching Alibaba and Tencent in that race.

China has also developed advanced telecommunications infrastructure, encouraged its tech companies to adopt and innovate AI, and fostered collaboration between industry and public universities.

As China advances in AI, Chinese tech giants are emerging. This has set off alarm bells for both the US tech giants and the US government.

An ad-hoc group called the National Security Commission on Artificial Intelligence (NSCAI) is headed by Eric Schmidt, former Google chairman, and includes senior managers from Google, Microsoft and Amazon.

In 2021, the group released a report commissioned by the US government that made a strong case for techno-nationalism.

NSCAI wrote: “For the first time since World War II, America’s technological dominance – the backbone of its economic and military power – is under threat. China has the power to surpass the United States as the world leader in AI in the next decade. has the strength, talent and ambition, if current trends do not change”.

The report states that most AI research and development, while funded by the state, should be done by firms and universities. It also called for more stringent intellectual property rights for AI, data and biotechnology, arguing that inadequate protections have made inventors prioritize trade privacy.

Tech giants will benefit from this approach: While the US government invests heavily in R&D, Big Tech will retain and consolidate profits.

“The American Jobs Plan” launched by US President Joe Biden in 2021 is completely in line with the diagnosis of American weakness. To defeat what is perceived as a Chinese threat, this includes $180 billion (about Rs 1,390 crore) for R&D in AI and biotechnology.

Similarly, the NSCAI report states: “The United States must commit to a strategy to be at least two generations ahead of China in cutting-edge microelectronics and provide funding and incentives to maintain multiple sources of cutting-edge microelectronics manufacturing.” in the United States”.

Biden’s plan includes subsidies of $300 billion (about Rs 23,18,298 crore) for manufacturing, including helping chipmakers producing in the US.

The interdependence between US and Chinese states and digital corporations is evident when it comes to surveillance. The relaxed US data governance has enabled the tech giants to harvest data without any restrictions.

In turn, Google, Apple and Facebook feed US institutions such as the US National Security Agency with data. Chinese giants do the same with their government. Tech giants also absorb financial wealth and technical capabilities from the rest of the world that are partially channeled into their home countries.

However, the techno-globalization of tech giants sometimes clashes with the techno-nationalist objectives of their home states. Research shows that these companies form collaborations with academic institutions and enterprises around the world.

For example, Chinese universities are among Microsoft and Amazon’s most frequent collaborators in AI science, and Tencent and Alibaba conduct most of their AI research in US hotspots such as Silicon Valley and Seattle.

Generally speaking, the size and mode of operation of tech giants threaten state sovereignty, even in superpowers such as the US and China. The fact that Facebook can block US President Donald Trump from its platform, which enjoys near-monopoly status, exemplifies the problem. Alibaba and Tencent taking a share of state-owned commercial banks in China is another example.

While the US and Chinese states increasingly move towards new and more extreme forms of techno-nationalism, the tech giants continue to operate globally and collaborate with competing country organizations. But it plays into the respective global ambitions of the nations. The tech giants remain either Chinese or US citizens.

Big Tech’s global reach reinforces US world dominance and supports China’s ambition to challenge it. When it comes to policy recommendations, tech giants tend to be ‘techno-nationalists’. They are dependent on the support of the state and their autonomy is being discussed continuously.

The global development and use of AI needs to be understood in light of that interplay – one of both reconciliation and conflict between the tech giants and the US and Chinese states. These major digital players make and shape each other and influence the rest of the world.

Tech giants privatize, monopolize, and turn critical elements of technology into private property, while their respective states create new barriers to the international flow of knowledge.

It undermines the global knowledge commons and open science. This reduces the possibilities of innovation for other organizations and the rest of the world. The result is growing income inequality and a growing global divide between AI producers and users.

In the light of urgent global challenges, there is a need for new forms of global governance and knowledge-sharing beyond market rules.


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