«Europe hopes to become the promised land—in the digital realm, at least. Harmful posts on social-media platforms will be rapidly removed. Texts will fly between rival messaging apps. You will be able to get apps from all over the internet, not just from your phone’s app store. And artificial intelligence (AI) models will be trained exclusively on data free of bias.
This is the noble aim of a set of new digital laws in the eu. Implementation of the Digital Services Act (DSA), which regulates social media, and the Digital Markets Act (DMA), which aims to keep big tech firms from competing unfairly, is entering a critical phase. Earlier this month, the European Commission designated what it calls “gatekeeper” firms, ranging from Alphabet to Microsoft, which will have to follow the DMA’s rules or risk vast fines.
And as if these new rules were not enough, the powers in Brussels are already negotiating their next big tech-policy package: an AI Act. (...)
In AI, however, the chances are that the outcome will be very different. For a start, being the keeper of the rules was useful in a world based on rules and markets, but may prove irrelevant in one defined by a growing rivalry between great powers.
Secondly, in privacy and social media, the EU can rightly claim it represents one of the world’s biggest markets, so that tech giants need to follow its rules. While this is still true, Europe’s global position in ai is much weaker. According to another study by Stanford University, eu researchers have yet to contribute in a significant way to such models as GPT-4. Whereas 54% of makers of ai models were American in 2022, only 3% came from Germany, which leads the EU pack. The picture is similarly one-sided when it comes to private investment in AI: in America it amounted to $249bn between 2013 and 2022, while Germany spent only $7bn. (...)
Finally, America seems to be adding the web of new tech rules to its own underground empire—or at least trying to neutralise Europe’s role as the rule-setter. Despite recent congressional hearings on AI, an American ai act is still unlikely. But the White House is trying to develop its own alternative to the EU’s regulatory network. In July it secured “voluntary commitments” from the principal model-makers, including Openai and Alphabet, to limit the technology’s risks.
Thus the geopolitical and technological “monster” that is America will eventually overpower the Brussels effect, predicts Mr Farrell. For the EU, this means that it cannot rest on its regulatory network. Instead it should redouble its efforts to strengthen its own AI industry, especially by completing the EU’s single digital market, which would make life easier for European startups. Since Europe is unlikely to become an AI superpower soon, the Centre for European Reform, a think-tank, argued in a recent report, it should also focus on getting businesses to adopt the technology.
Observers often ask how long America can use its invisible networks to throw its weight around the world. It is a good question: excessive use of network power can push other countries to seek alternatives. But perhaps the more pressing question to consider is how long the EU can lay claim to the role of global standards-setter, when it may well play such a minor role in the next wave of technology.»
[Why the EU will not remain the world’s digital über-regulator]
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