Big Tech to come under the hammer in new EU regulatory landscape

• Brussels is taking the lead in promoting new regulation—including on AI—with a string of new laws targeting Big Tech’s business model
• Salesforce, Samsung Electronics, Nvidia, and Netflix face the lowest regulatory risk, as they do not face significant scrutiny in the critical regulatory arenas of data privacy, antitrust and online harm
• If the US and the UK align with Brussels’ approach, .OpenAI, Microsoft, Alphabet, and Meta will be deemed responsible for how their systems are used.

EU regulators will crack down on some of the world’s biggest tech companies, including Amazon, Google, Meta, X (formerly Twitter), Alibaba and Tencent over the next few years as sweeping new regulation will come on multiple fronts .

“Data privacy, antitrust, AI ethics and online harm will be the main targets of regulators’ investigations in the near term. These areas are critical to ensure a safe and efficient digital economy,” Laura Petrone, Principal Analyst, Thematic Intelligence at GlobalData, said.

She said that regulators will come after tech companies in 12 regulatory arenas: data security, data privacy, antitrust, tax avoidance, misinformation, online harm, artificial intelligence (AI) ethics, copyright, net neutrality, US-China tech sanctions, environmental, social, and corporate governance (ESG), and obstruction of justice.

Antitrust regulation

Salesforce, Samsung Electronics, Nvidia, and Netflix face the lowest regulatory risk, as they do not face significant scrutiny in the critical regulatory arenas of data privacy, antitrust and online harm.

However, she said that ad-funded internet companies treating data as a free resource—like Meta, Alphabet, Amazon and Baidu—face the highest regulatory risk.

While Microsoft and Apple are less at risk from data privacy issues, she said that they are both highly exposed to antitrust regulation and meet the criteria (alongside Amazon, Meta, and Alphabet) to qualify as ‘gatekeepers’ under the EU’s new antitrust legislation.

Brussels is taking the lead in promoting new regulation—including on AI—with a string of new laws targeting Big Tech’s business model.

In Washington, despite President Biden’s resolve to step up tech regulation, a divided Congress makes a change in the legal landscape unlikely.

For its part, the Chinese government must strike a delicate balance: maintaining regulatory oversight of the tech sector while innovating fast in the technologies most under pressure from the US.

 “All companies investing in AI will face significant scrutiny by regulators in AI ethics, but Big Tech again has the most at stake. The EU’s AI Act has the potential to hold providers of foundation models, which create content from limited human input (e.g., ChatGPT), accountable for assessing and mitigating possible risks,” Petrone said.

If the US and the UK align with Brussels’ approach, she said that companies like OpenAI, Microsoft, Alphabet, and Meta will be deemed responsible for how their systems are used, even if they have no control over specific applications of the technology.