Date Posted
10 April 2024 10:04 BST
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How to break open Big Tech

That Big Tech has amassed unsustainable global power is nowadays universally recognized. But despite widespread resentment of this power, everyone is so desperately dependent on Big Tech’s services that counter-action quickly tends to become unpopular or unsustainable.

With Big Oil and Big Pharma, alternatives exist in the form of smaller and “good” energy and pharma companies. No realistic alternatives exist yet for Big Tech, however.

A global movement is needed to break open Big Tech and promote a federation of smaller tech entities that are interoperating and “open”, as in: open-source software, open networks, open data, open protocols, and open AI. This would democratise digital power – that is, control over how digital artifacts are shaped and their benefits distributed - and hand this power back to users, communities and nations.

 

The nature of Big Tech’s power

One basis of Big Tech’s huge power is that once good software is developed, the cost of copying or distributing it over the Internet is almost zero. A tech corporation, unlike a company that produces physical goods or services, can service any number of clients globally with very little incremental cost.

These ever-increasing returns to scale render software monopolies much easier to build. This could be called “software power”. The Microsoft of the late 1990s to early 2000s became the most valuable corporation in the world for a while by employing such “software power” but also because it enjoyed network effects with its Microsoft Office Suite working best with Microsoft documents.

The network effect exploded with Google, Facebook and Amazon, the true Internet companies. The more users they had, the greater their “network power”, as their services became ever-more useful and attractive in an almost geometric progression. Potential competitors were left far behind and eventually dropped out.

Soon the data footprints left by users on these platforms became even more valuable than the underlying networked software. Data provides granular, real-time, and exclusive intelligence not only about the users but the entire ecology of business. Data-based “intelligence power” builds on software and network powers and together these constitute “digital power” which becomes the supreme source of economic value.

Left to themselves, all these three kinds of powers (and their combination), strongly and almost invariably tend towards the unique kinds of digital monopolies that we see today.

Platform companies posses a brain-like centralised data-based intelligence, or digital intelligence, of such extraordinarily high calibre that they can unilaterally command and control entire sectors. They supplant not just regulation but also open and free markets, as demand and supply is assessed and matched by digital intelligence and not by market signals.

The collective means to tame these beasts were surrendered even before the contest began. The first policy document on the Internet, the United States’ Framework for Global Electronic E-commerce in 1997, made clear that governments would let the private sector lead. The US Telecommunications Act had ruled a year earlier that while telecommunication would be regulated, the Internet would not be.

Since the Internet came from the US, US-born policy models were cut-pasted everywhere else. With US backing, the private sector-led Internet Corporation for Assigned Names and Numbers (ICANN) set internet-related standards, interconnection protocols, numbers and names rather than the United Nations’ International Telecommunications Union (ITU).

Such lassez faire was supposed to trigger a Cambrian explosion of private-sector creativity, cultural expression, and even revolutions for democracy. By the 2010s, however, it was becoming clear that a handful of global monopolies were cornering the Internet, and killing or eating up digital start-ups that might have provided competition. Big Tech was becoming stronger than states and frequently taking them on.

Private sector-led multistakeholderism became the new mantra for governance of the digital space.Since small businesses hardly ever make it to the policy table, this has given Big Tech what amounts to a veto on governance issues, made worse by its immense lobbying power and influence over civil society organizations in the digital space.

The more that global digital monopolies create deep embeddedness and dependencies in societies and economies, and the more seamless the ‘digital’ flows across borders, the harder it becomes for states to confront them with legal controls or constraints.

This is the situation that we find ourselves in today.

 

Three ways to take back power from Big Tech

The key factors behind the global power of Big Tech need to be systematically recognised and demolished in order to return digital power to users and people, communities, democratic governments and small private businesses while preserving the benefits of the technology. Of the series of actions that will be needed, three are the most important.

Firstly, resisting global digital trade agreements that compromise national policy space which is required to regulate Big Tech. Tech companies have to be rendered considerably national, in the sense of being based in a national space and subject to national law.

The US itself, the key architect of global digital trade deals, has recently withdrawn from the most important provisions in these negotiations to give itself more space for domestic regulation of tech companies. If the home country of most Big Tech can read the writing on the wall, it should be a no-brainer for other countries to withdraw from problematic digital trade deals.

Secondly, Big Tech has captured digital infrastructure for its exclusive use and vertically integrates it with digital services which should work independently on the top of shared infrastructure. The competition law response to this should not just be behavioral remedies, as planned by a series of new EU laws, but also structural separation of different tech layers.

Data and computing need to be considered as independent, third-party infrastructures, on the top of which "digital intelligence”-based services can be provided competitively. It is even possible to separate core data-based intelligence services at the back-end as against consumer-facing services in different sectors, like transport, e-commerce, healthcare and tourism A 2020 paper puts forward a detailed proposal for undertaking such separations.

Structural separation would also require the building of digital public infrastructures, by the state and various kinds of communities, as well as private utilities, which can support competitive digital businesses of all kinds in the same way that roads and electricity grids do today. These infrastructures could be global or national. If they are national, which means they can also be used to implement regulation, then global standards and institutions will be needed to make sure that they are interoperable.

Thirdly, we need self-managed digital industrialization of all countries. It is increasingly recognised that the digital age, like the industrial age before it, requires strong national policies to promote domestic digital industry. However, the emerging digital industrial policies in the US, EU and China are largely devoted to promoting a Cold War-like global split into two spheres of influence and dependency.

For developing countries, digital colonisation is well underway, in the sense that mostly foreign Big Tech increasingly shapes every aspect of their societies. What is needed instead is non-aligned digital industrialization, not just for economic empowerment but so that countries can maintain their political independence,

Digital industrial policy will mean building data and computing infrastructures, other horizontal public infrastructures (for digital payments, for example) and sectoral public infrastructures such as health data exchanges. It will mean pro-actively promoting domestic industry through government procurement, subsidized capital, preference for domestic firms in some sub-sectors, joint ventures with foreign firms and other strategies of industrial policy, whether of a traditional kind or new.

Smaller nations may look at regional digital markets, including creating regional public infrastructures. The EU is doing this by promoting a ‘single digital market’, and Africa is exploring it through  a digital protocol to the Africa Continental Free Trade Area. Such regional markets will need to be diligently protected by design from predatory Big Tech, at least in those areas earmarked for domestic companies.

 

Building a global movement to break open Big Tech

A global movement is needed to “Break Open Big Tech”, into a federation of smaller tech business units that are open and interoperating. The benefits currently provided by Big Tech would not simply disappear: instead, they would be made available by a competitive field of smaller tech companies that are well-regulated and work over public or community-owned digital infrastructures in a manner which promotes the digital power, rights, and sovereignty of people, communities and nations.

The proposed global movement will need to develop appropriate campaigns at global and national levels, backed by painstaking research and advocacy for legal changes. The movement will need to work in particular towards structural separation in digital business and against digital colonisation. It should embrace the ‘tech openness’ movement, the entrepreneurial energies of small and medium-sized digital enterprises, and public-spirited community tech initiatives.

Disenchantment with the domination of Big Tech is being experienced by progressive actors in media, health, agriculture, education, climate change, trade and tax justice and other fields. A global movement to Break Open Big Tech could not only channel this discontent but also come up with workable alternatives which meet the genuine digital needs of all.

Parminder Jeet Singh is with Just Net Coalition, a global network of groups working towards social justice and equity in the digital age.

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