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25 March 2024 -- When I look at the engagement on my newsletters, it’s very clear that anything I write about regulation gets the least engagement, except for my subscribers who are in Big Law firms and those in the litigation support vendor market. The *real* tech market subscribers - not so much. Oh, everybody reads them but only the litigation industry members respond. The tech community is more a collective 🥱
And the media trend lines I follow say the same - stories about tech regulation get less traffic. My real tech crowd - the TMT (technology, media and telecommunications) members, the cybersecurity cohort, the advertising/creative media folks - are interested in lots of other things, from cars to chips to advertising to VR, etc.
"WHAT!!?? But the government is coming for you and you don’t care?"
"Nope. We don't".
There are some obvious reasons for this - regulation is boring, mostly - but I think one could also suggest that most of the laws and rules that are being discussed simply won’t affect most people in tech very much at all, nor most tech companies.
At the simplest level, realize that several thousand companies are founded in Silicon Valley alone each year, and very few of them are social networks. And not many more are ad-funded.
So, two of the biggest areas of the tech backlash - content moderation and privacy - simply don’t really apply. If you let consumers share files then you need to worry about CSAM (child sexual abuse material), and if you handle user data you need to think about Europe's General Data Protection Regulation and Digital Markets Act and Digital Services Act, and so on.
Note to readers: today the European Commission opened investigations into Apple, Alphabet and Meta Platforms over alleged unfair market practices, outlining concerns the three technology giants fell short of conforming with its Digital Markets Act. The Commission said it intends to conclude the investigation within a year. If breaches are found, the Commission can impose a fine worth up to 10% of the company’s total worldwide turnover, which can go up to 20% in case of repeated infringement. A colleague at a major Brussels law firm who defends technology companies against these types of actions said, in reality, this can run years if the tech companies decide to run the clock, and all 3 companies have good preliminary defenses.
But these regulatory acts are annoyances and really just a cost of doing business rather than existential problems. If you’re building enterprise SaaS DevOps they just don’t cross your mind.
Equally, there are some consumer businesses where Apple’s App Store policies are an issue, or where its destabilization of mobile advertising a few years ago was a problem. But these aren’t issues for the likes of tech majors like Cisco or Databricks or Okta.
Taking this one step further, not only do a large proportion of tech companies sit outside the main areas of policy concern, but I think one could also at least suggest that most people even inside Google or Meta aren’t really affected by this in their day-to-day jobs either. The EU’s new Digital Markets Act says that messaging apps must be interoperable, and if you work in the iMessage team at Apple this is a big deal (but you'll probably be able to give the EU a bruising as I wrote last week). But if you’re working on chips or ID management or photos, is it on your radar at all?
Because there is "regulation" - which brings new rules for someone else in your company, or more likely people in other companies - and then there is "structural intervention" which can mean breakups, and, yes, that sounds like a bigger deal. Make Instagram a separate company! Spin off YouTube! Break up Apple! Release the hounds!
But as I have noted many times before, I don’t think this would actually change the competitive landscape that much. It might, for example, make the online ad market more competitive - but not create more competitors to Instagram or YouTube.
Right now such moves still seem very, very unlikely - a lot would have to change in the U.S. - so we are years away from anything. And even if they did happen the paradigm shows they’d be very narrowly focused on very particular parts of particular companies.
More fundamentally, though, very little of even the most apparently *dramatic* laws under discussion would actually represent a fundamental change in how tech works and what most people spend their time working on. The automobile industry is often used as an analogy for regulating tech. But if Google and Apple are as big as GM and Ford were back in the 1950s, a lot of tech companies are GE, Lockheed Martin or DuPont: they’re all big manufacturing companies, but they’re not all making consumer products. And if you worked at Douglas Aircraft you didn’t spend much time thinking about how GM treated its suppliers.
It’s as though we’ve created safety standards and emissions standards for cars, and shouted about it a lot. But they’re still made from steel, in Detroit, and still burn gasoline, and meanwhile you work on gas turbines.
Until, of course, they’re not made in Detroit and they don’t burn gasoline. Hence the challenge of electric vehicles.
But that's my point. There are new waves of fundamental, structural changes in tech, which today mostly means AI. But there’s quantum, and LEO satellites, and the complete reconfiguration of the chip industry, and the mass-unbundling of email, Excel and Salesforce into new productivity software. Plus AI that can modify and/or replace complete email threads and their associated metadata, as well as create complete artistic narratives formally the provenance of motion graphic artists.
These are the types of things that actually do change everything. Not regulation.
And all of these things could change/might change/will change what tech companies actually do and how people in tech spend their days. Not regulation.
It's those stories that get me my highest engagement. Because they are the shape-shifters. Not regulation.
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