June Political Insights: A Focus On Big Tech And AI

Last week, we shared the first edition of our new Public Affairs newsletter, Political Insights, with clients. We're now publishing these expert-written updates more widely on our blog to inspire and educate more people on the newest policies, regulations and legislations, as well as sharing our insight into all things political that might impact your organisation’s goals.

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Regulation of Big Tech and AI

June 2023's Political Insights focus is ‘Regulation of Big Tech and AI’. Regulation of the dominant players in tech has been talked about for years but the truth is it all happens at a snail's pace due to competing political philosophies: Regulate too quickly and you stifle innovation; too slow and small players are locked out. 

When policy makers get round to it the tech has often already moved on but the regulation is in place and cannot be ignored. Annoying cookie pop-ups anyone?

UK: Big Tech Gets Some Regulatory Attention

The digital economy has given startups and small businesses access to online platforms offering greater opportunities to sell to a wider customer base. However, the UK Government is keen to promote competition and has published the long-awaited Digital Markets, Competition and Consumers Bill. The legislation will strengthen the role and powers of the  Digital Markets Unit (DMU) within the Competition and Markets Authority (CMA) to identify big tech companies with significant control over key digital markets.

Amongst other things, the legislation will introduce requirements for firms to share more data with third party businesses, giving them greater access to customers and a fairer playing field. The bill will also address unfair or dodgy practices such as fake reviews, pressure selling, and subscription traps.

The DMCC Bill, alongside two other meaty bits of legislation progressing through Parliament - the Online Safety Bill and the Data Protection and Digital Information Bill - shows policymakers are strengthening their regulatory armoury. 

Photo by Marcin Nowak on Unsplash

UK: Government unveils its white paper regulating AI

Another part of the tech world that is in urgent need of some regulation is AI. We have no shortage of Cassandra-like soothsayers from Elon Musk and Steve Wozniak, to the latest ‘Godfather of AI’ Geoffrey Hinton leaving Google due to concerns about “scary AI”.

The UK Government is keen to get in on the action and has released via the Department for Science, Innovation and Technology (DSIT) a ‘pro-innovation approach” to AI regulation. This will make it “easier for businesses to innovate, grow and create jobs, whilst maintaining public trust”.

The white paper introduces an approach to AI regulation that is principles-based and agile.

Rather than establish a single AI regulator, the Government will coordinate existing regulators to produce a context-specific approach. It’s underpinned by a framework of five key principles to responsible AI adoption in all sectors:

1. Safety  2. Transparency  3. Fairness  4. Accountability  5. Contestability 

The CMA has been quick out of the blocks announcing initial review of competition and consumer protection considerations in the development and use of AI foundation models. They are taking evidence until 2nd June and will publish their findings in September 2023.

However, in a recent shift in mood music (more voices coming out on the side of AI is threat to humanity) the Government has been frantically back-tracking on its “let a thousand flowers bloom” approach by adding a touch of caution. A Downing St. spokesperson told the Guardian:  “The starting point for us is safety, and making sure the public have confidence in how AI is being used on their behalf. Everyone is well aware of the potential benefits and risks of AI. Some of this tech is moving so fast it’s unknown.” 

Photo by Possessed Photography on Unsplash

EU: Digital Markets Act comes into force…finally

The EU’s flagship piece of Antitrust regulation came into force on 2nd May 2023 and took aim at the big online players now known as  “gatekeepers”. You know who they are, Alphabet, Apple, Meta, Microsoft; and potentially many, many more as entry to the club starts when you have a turnover in the EU of €7.5 billion or a market valuation of €75 billion  - Apple’s is over USD$2 trillion!

Gatekeepers must not:

• treat the gatekeepers’ own services and products more favourably in ranking than similar offerings by third parties on the platform;
• track end-users outside the gatekeepers’ core platform service to target advertising without consent;
• prevent developers from using third-party payment platforms for app sales;
• process users’ personal data for targeted advertising, unless consent is granted;
• pre-install certain software applications or prevent users from easily uninstalling them.

And if they do, it’s more than just a slap on the wrist:

• a fine of up to 10% of its total worldwide turnover;
• or up to 20%  for repeat offences;
• Forced selling-off of (parts of) its business, as a last resort for systematic failure to comply.

Photo by Dima Solomin on Unsplash

EU: Artificial Intelligence Act takes top-down approach

The EU’s AI Act takes a more interventionist approach focusing primarily on strengthening rules around data quality, transparency, human oversight, and accountability. It also addresses ethical questions and implementation challenges in various sectors ranging from healthcare and education, to finance and energy.

Thierry Breton, the EU’s Commissioner for Internal Market, said: “The Act strengthens Europe's position as a global hub of excellence in AI from the lab to the market and ensures that AI in Europe respects our values and rules, and harnesses the potential of AI for industrial use.”

The cornerstone of the AI Act is a classification system that determines the level of risk an AI technology could pose to the health and safety or fundamental rights of a person. The framework includes four risk tiers: unacceptable, high, limited, and minimal.

The Artificial Intelligence Act proposes steep non-compliance penalties. For companies, fines can reach up to €30 million or 6% of global income. Companies deploying generative AI tools, such as ChatGPT, will have to disclose whether copyrighted material was used to develop their systems.

Now in the final stages, the legislation is set to become the world's first set of comprehensive laws governing AI. 

U.S: Big Tech in their sights too! (sort of) 

Officials in the U.S. Department of Justice and Federal Trade Commission, and bipartisan US politicians, have been on the case of big tech too. This is in spite of the perceived wisdom that their hearts can’t really be in it when so many big tech companies come from the West coast.

But the U.S. *is* big on Antitrust (a collection of mostly federal laws that regulate the conduct and organisation of businesses to promote competition and prevent unjustified monopolies).

The dominance of the household behemoths: Alphabet, Meta, Microsoft, Apple, and Amazon is not a problem in itself… but when they limit the business potential of others a line is crossed. Back in 2021, five pieces of legislation were introduced, but the two key ones still being picked over by industry lobbyists and politicians are: The American Innovation and Choice Online (AICO) and The Open App Markets Act (OAMA).

Over two years on, and following intense scrutiny, legislation remains bogged down in a quagmire of committees, and still needs key floor votes in the full House of Representatives. 

U.S: taking a more philosophical approach to AI

The White House has released a Biden-backed Blueprint for an AI Bill of Rights to help keep the public from harm. Including:

• You should be protected from unsafe or ineffective systems

• You should not face discrimination by algorithms and systems should be used and designed in an equitable way

• You should be protected from abusive data practices via built-in protections and you should have agency over how data about you is used

However, there is little information on just how these rights will be upheld. Just as well that Senate Majority Leader Chuck Schumer (D-NY) has come to the rescue. He has launched a first-of-its-kind effort to build a flexible and resilient AI policy framework across the federal government that “can adapt as the technology continues to advance, allowing for innovation and continued U.S. leadership in the development of this critical technology, while enhancing security, accountability, and transparency”.

If that wasn’t enough it seems The Organisation for Economic Co-operation and Development (OECD) has managed to map out the AI regulatory efforts across the entire globe with an interactive dashboard offering a live repository of over 800 AI policy initiatives from 69 countries, territories, and the EU. 

UK: Do May’s 2023 Local Election results point to a similar outcome for the 2024 General Election?

For Keir Starmer to win a likely General Election in 2024 he would need a bigger swing than Tony Blair’s landslide victory in 1997 - which was in itself the biggest swing since WWII.

The results have been very very disappointing for the Conservatives but have Labour secured the results needed to guarantee an outright majority? And what about the Liberal Democrats and Greens?

As the Local Election results are pored over in the coming months we’ll be keeping a close eye on the key election battlegrounds including the so-called Blue Wall seats where traditionally the Conservatives are on home turf, and the Red Wall seats where until 2019 Labour used to weigh the votes.  

The landscape is shifting in Labour’s favour… but with the Liberal Democrats and Greens also doing well at the expense of the Conservative Party, Keir Starmer now needs to seize the initiative and leap into the breach to scotch talk of a hung Parliament next year.

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