The Battle for Digital Supremacy: No Clear Victor in Sight
In her new book, Anu Bradford, a professor at Columbia Law School, examines the intricate power struggles for digital dominance among the United States, China, and the European Union.
By Audrey Hatfield
Today’s battle for power over the digital ecosystem hasn’t escaped anyone’s notice. The almost unnerving tempo of technological advancement has been felt globally and has already revolutionized how societies work and interact with one another — and there’s still the next frontier of generative AI technologies to consider.
The pace of innovation is made all the more alarming by clashing approaches which the three dominant digital powers employ to govern the digital economy and its players. As Anu Bradford, a leading expert in EU regulation and a professor at Columbia Law School dissects in her new book “Digital Empires”, the U.S., China, and the EU are all vying to impose their own interests and values in a new global digital order.
Bradford’s book overflows with her extensive knowledge of these digital battlegrounds, as evidenced by the 146 pages worth of references that buttress her research. Each government is introduced by its chosen regulatory model and accompanied by a historical backdrop: the U.S. following a market-driven regulatory approach, China leveraging a state-driven approach, and the EU embracing a rights-driven approach.
Bradford then further breaks down the battlefield into two categories for conflict. There are the horizontal battles being fought among different governments, where rivalry for dominance in technological supremacy and influence is at the center, and then there are the vertical battles that take place between governments and the tech companies they seek to regulate.
The U.S. market-driven regulatory model centers on the protection of free speech and the pursuit of unencumbered innovation — values that have historical roots in California’s techno-libertarian ideology that distrusts authority and believes in entrepreneurial zeal to safeguard internet freedom. As such, despite the unprecedented global scale of economic and political power that today’s leading US tech giants Amazon, Apple, Google, Meta, and Microsoft have achieved, the ethos of America’s market-driven regulation has continued to manifest in the absence of regulation.
In contrast, the Chinese state-driven approach has used domestic technological advancement to further cement the Chinese Communist Party’s control of the country and leveraged that technology as a tool for surveillance and propaganda. However, this tightly state-controlled environment has also given birth to rivalrous market leaders like Alibaba, Baidu, Tencent, Huawei, and Xiaomi, demonstrating that a techno-nationalist approach with little separation between tech companies and the state can also result in high tech-driven growth.
Then there’s the EU rights-driven approach to regulation. The EU values privacy and free expression in part because of the legacy of World War II where systematic abuse of personal data aided atrocities. It’s common in Europe to hear complaints that stringent regulation has impeded innovation and the growth of large European tech companies. However, as Bradford outlines, the EU’s innovation gap is better explained by a fragmented digital single market, underdeveloped capital markets characterized by punitive bankruptcy laws for risk-taking entrepreneurs, and comparatively unattractive immigration policies that deter foreign talent.
It is ironic that the U.S., China, and the EU can all agree on at least one thing: tech companies have become too powerful. Each government’s vertical battle reflects a desire to reign in tech companies, from China’s swift crackdown and imposition of fines on its domestic tech industry to the sweeping legislation the EU passed in 2022 to regulate Big Tech. Even the inchoate steps towards tighter antitrust constraints the U.S. is making stems from the documented societal harms a laissez-faire approach has yielded thus far.
In a sign of how quickly this battlefield is evolving, new developments have emerged since Bradford’s up-to-publication data collection. The month of August 2023 alone saw four strategic moves made by the digital empires.
First, China responded in-kind to the US government’s October 2022 restrictions on exports of advanced semiconductor chips by clamping down on the exportation of gallium nitride and germanium dioxide, two semiconductor critical materials China dominates in production. Then, American President Joe Biden signed an executive order prohibiting new U.S. investment in Chinese entities related to semiconductors, quantum information technologies, and certain AI systems. The Silicon Valley semiconductor giant Intel had to terminate its planned merger with Israeli chip manufacturer Tower Semiconductor the same month following a fruitless 18-month wait for a review by Chinese regulators. Finally, the EU’s Digital Services Act went into effect on August 25th, imposing new content moderation, user privacy, and transparency requirements on designated tech behemoths.
Bradford argues that the battle for digital dominance is overlaid on the parallel battle between free democracies and the rising wave of authoritarian states. On one side, there will be the techno-democracies championed by the EU and U.S. endorsing a rights-driven regulatory model, and on the other side will be the techno-autocracies, supported by China’s exportation of affordable digitalization for countries seeking to entrench surveillance and control over their citizens.
More importantly however, this battle may not produce a winner. Attempts to decouple the highly interconnected global economy are underway, but the tit-for-tat escalation in the U.S.-China tech war shows how aware each side is that all out conflict would only result in a Pyrrhic victory. Bradford concluded that moderating the regulatory extremes will at best “pave the way for a world characterized by limited cooperation, managed conflict, or bearable coexistence.”
Audrey Hatfield is a masters graduate of Columbia University’s School of International and Public Affairs (SIPA). She has previously worked with the United Nations Development Programme (UNDP) on the topic of mis/disinformation and consulted for UNESCO on the Internet for Trust initiative.
