The EU is in the spotlight this week: It has just published its list of critical technology areas, similar to the lists which other countries have drawn up, which it will assess for risks to its economic security. In other news, Kenyan lawmakers want to halt Worldcoin’s operations in the country, whereas Microsoft’s testimony as part of the ongoing US trial against Google shows how intense the race to data is.
The four critical technologies the EU will assess for risks: AI, advanced chips, quantum tech, and biotech
The European Commission announced on Tuesday that it will review the security and leakage risks of four vital technology domains – semiconductors, AI, quantum technologies, and biotechnologies, among the 10 technologies areas most critical to the EU’s economic security.
What it means. The EU wants to make sure that these technologies do not fall in the wrong hands. If they do, they could be exploited to hurt others. For instance, biotechnologies used for medical treatment can be exploited for potential biowarfare applications. If quantum cryptography designed to safeguard a country’s critical infrastructure is misused, it could potentially undermine or disrupt the critical operations of that same country. We can only imagine what lies in store for AI if it’s used for hostile purposes.
Dual-use. These four technologies were prioritised due to their transformative nature, their potential to breach human rights, or the risk they carry if they’re used for military purposes. In fact, they all share dual use capabilities, that is, they all have the potential for both civilian (healthcare, communications etc) and military applications (weapons, etc.).
Other risks. In addition to tech security and leakage, the EU thinks there are other critical risks that will eventually also warrant attention: those linked to the resilience of supply chains; those affecting the physical and cybersecurity of critical infrastructure; and those with implications for the weaponisation of economic dependencies and economic coercion.
Countries of concern. The recommendation does not mention any specific country that would be targeted, but there’s one term that gives it away. The concept of ‘de-risking’ (in contrast with decoupling), mentioned several times in the recommendation, forms part of the EU’s policy of reducing reliance on China. It’s therefore, quite clear that China will be one of the main targets of the risk assessments.
Issue #1: Divergences. The risk assessments will be carried out in collaboration between the commission and its member states (with input from the private sector). They are the first steps towards implementing the new European Economic Security Strategy, published in June. As with all things new, competing interests and diverging geopolitical concerns are a main challenge: European countries are divided, with France and Germany favouring an investment-first approach, with central Europe adopting a more critical approach to China.
Issue #2: Protectionism. The EU is set to make crucial decisions next year on the measures it will implement, and whether it will carry out collective risk assessments on the remaining 6 technologies. A potential challenge is that these measures could portray the EU as increasingly adopting protectionist policies, in the eyes of China. If this perception takes hold, it has the potential to significantly harm the trade relations between the EU and China. EU Commissioner Thierry Breton’s assertion that ‘protection does not mean protectionism – again, I insist on this’, is unlikely to assuage concerns.
A geopolitical trend. Though the EU is the latest actor to move ahead with its plan to reduce risks, it’s by no means the first. Other countries, notably the USA and Australia, published similar lists of technologies they were assessing for the risks they pose.
Yet, there’s a notable difference: The foundation of Europe’s approach is to de-risk, not decouple, supporting the economic security strategy’s tripartite approach of protecting, promoting, and partnering. What needs to be seen is whether the latter will be consigned to a simple theoretical construct.
Digital policy roundup (2–9 October)
// AI GOVERNANCE //
In USA v Google, Microsoft says companies are competing for data to train AI
Testifying in the ongoing US trial against Google, Microsoft CEO Satya Nadella (appearing as a plaintiff’s witness) said that tech giants were competing for vast troves of content needed to train AI. Companies are entering into exclusive deals with large content makers, which are locking out rivals, Nadella said.
The lawsuit concerns Google’s search business, which the US Department of Justice and state attorneys-general consider ‘anticompetitive and exclusionary’. They are arguing that Google’s agreements with smartphone manufacturers and other firms have strengthened its search monopoly. Google has counterargued that users have plenty of choices and opt for Google due to its superior product.
Why is it relevant?First, Nadella’s comments highlight the resources required by AI technology: computing power, and large troves of data. Second, Nadella said these exclusionary data agreements reminded him of ‘the early phases of distribution deals’ – which is to say that agreements with content providers are monopolising valuable content just as Google allegedly did with smartphone manufacturers and other companies.
Case details: USA v Google LLC, District Court, District of Columbia, 1:20-cv-03010
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The writers’ strike is over. A historic strike and almost five months later, the Writers’ Guild of America – which represents over 11,500 screenwriters – struck a deal with Hollywood companies on the use of AI: AI-generated material may not be used to undermine or split a writer’s credit, or to adapt literary material; companies can’t force writers to use AI tools; and companies have to disclose whether material given to writers is AI-generated.
// ANTITRUST //
Korean communications authority fines Google, Apple
The Korean Communications Commission (KCC) is fining Google and Apple for abusing their dominant position in the app market. The fine can go up to KRW68 billion (USD50 million).
Google and Apple were found to have forced app developers to use specific payment methods and to have delayed app reviews unfairly. In addition, Apple implemented discriminatory charging of fees to domestic app developers.
Why is it relevant? South Korean authorities have taken aim at Big Tech companies’ practices in recent years. In April, the country’s Fair Trade Commission (FTC) fined Google USD32 million for blocking the growth of local rival app One Store Co. marketplace. In 2021, the FTC fined the company around USD1 million ‘for obstructing other companies from developing rival versions of the Android operating system.’
// WORLDCOIN //
Kenyan lawmakers want Worldcoin to cease operations in the country
A Kenyan parliamentary panel called on the country’s information technology regulator on Monday to shut down the operations of cryptocurrency project Worldcoin within the country until more stringent regulations are put in place.
The lawmakers’ report concluded that Sam Altman’s Worldcoin project constituted an ‘act of espionage’. The panel also urged the government to launch criminal probes into Tools for Humanity Corp, the company behind Worldcoin’s infrastructure, for operating in Kenya illegally.
Why is it relevant? First, Kenya could set a precedent on how countries could deal with Worldcoin, even though the operations are being scrutinised in other countries as well. Second, it shows the speed at which new technologies can enter a market, leaving regulators to grapple with the policy implications.
// INFRASTRUCTURE //
Amazon launches first test satellites for Kuiper internet network
Amazon launched its initial pair of prototype satellites from Florida last week, the company’s first step before it deploys thousands more satellites into orbit.
However, Amazon is up against pressing schedules on multiple fronts. First, the Federal Communications Commission mandates that at least half of the proposed 3,236 satellites in Project Kuiper’s constellation must be launched by mid-2026. Second, Amazon faces the challenge of catching up with SpaceX, which already boasts over 2 million customers for its satellite internet service.
Why is it relevant? Low-orbit satellites, like the ones launched by Amazon, can expand global connectivity significantly. By operating closer to the Earth’s surface, these satellites enable faster communication speeds, lower latency, and wider coverage.
The week ahead (9–16 October)
Ongoing till 12 October: The annual Internet Governance Forum (IGF2023) is taking place in Kyoto, Japan and online this week. Follow our dedicated space on Dig.Watch for reports. Expect a round-up in next week’s edition.
16–17 October: This year’s International Regulators’ Forum will be hosted in Cologne, Germany. The Small Nations Regulators’ Forum takes place on the second day.
Cyberattacks have increased globally, with government-sponsored spying and influence operations on the rise. The primary motives? Stealing information, monitoring communications, and manipulating information. These insights are from Microsoft’s latest Digital Defense Report, covering trends from July 2022 to June 2023.
Empowering everything with AI
This Wall Street Journal article (paywalled) talks about the growing role of AI in practically every aspect of our lives – from virtual assistants like Siri and Alexa to automated systems in the workplace. We’ll soon be unable to escape it.
