Big Tech is currently assessing the advantages and disadvantages of a second Trump term, which may lead to antitrust actions being deprioritised while introducing new aspects of a global trade war.
There is no doubt that one Big Tech titan is already a big winner from Donald Trump’s election Presidential election victory — Elon Musk’s currency is literally and metaphorically riding high at Mar-a-Lago, Trump’s Florida base, where he is planning his transition to power.
But what about other Big Tech leaders? Google’s Sundar Pichai, Apple’s Tim Cook, and Meta’s Mark Zuckerberg were all seen cosying up to Trump during the election campaign, but it remains to be seen how Trump will handle the growing power and influence of Big Tech.
Meanwhile, Amazon boss Jeff Bezos came under fire after the newspaper he owns — the Washington Post — opted not to endorse Trump or his rival Kamala Harris, on the same day the billionaire met with the incoming President to discuss business.
Says Bill Whyman, tech industry expert and former senior manager at Amazon Web Services: “What do we know about Trump from his first presidency is that he showed a willingness to disregard conventional wisdom and at times overruled the advice of his own experts. Which creates more uncertainty and unpredictability.”
From antitrust to tariffs
So, what do we know? Trump has an increasingly close relationship with tech entrepreneur Elon Musk, with Musk likely to exert considerable influence on how Trump’s relationship with Big Tech evolves.
So far, Trump has said he’ll make drastic reforms to the entire federal government, and he has discussed granting Musk huge power over agencies which regulate his and other tech companies.
Trump will take office with a series of antitrust cases underway, challenging the market power of several big tech firms, headed by the anti-monopoly chair of the Federal Trade Commission, Lina Khan.
Many expect Khan to make way for another head of the FTC and for the antitrust actions against players such as Google and Microsoft, which characterised the Biden administration, to take more of a back seat.
Trump will focus more on Big Tech’s contribution to the US economy. Still, that contribution could be hugely affected by one of Trump’s favourite themes of the election campaign — tariffs.
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He’s threatened to slap China with 60-100% tariffs on goods, and the prospect of a global trade war looms — a trade war that neither Big Tech nor the US consumer will appreciate as it’s likely to re-stoke inflationary pressure on the economy.
Undoubtedly, Big Tech, Apple, and Tesla, especially, have a lot riding on continued access to the Chinese market and supply chains.
Apple’s manufacturing relies heavily on Chinese facilities, while Tesla counts China as one of its fastest-growing markets.
Any downturn in US-China relations under Trump could trigger a backlash that might slow demand and disrupt production.
Anyone interested in Trump’s approach to US-China relations is looking at the situation with TikTok; the social platform must find a foreign buyer for its Chinese owner or risk being banned from the USA.
He could leave the current administration’s decision to force owner ByteDance to sell in place or use it as a bargaining chip with the Chinese government, a move that would fit in well with his reputation as a dealmaker.
“What happens with TikTok will be a good guideline as to what might be expected over the next four years,” says lead technology analyst at the Economist Intelligence Unit, Dexter Thillien.
Lighter regulation
One subject that is much more predictable is regulation, which is expected to be much lighter under Trump. AI, in particular, is one area which is expected to benefit from less top-down regulation.
Silicon Valley venture capitalists Mark Andreessen and Ben Horowitz each donated $2.5 million to the Trump campaign, and Andreessen — historically a strong supporter of the Democrats — switched to Trump in this election because he disagreed with White House plans to “over-regulate” AI, a move which Andreessen insists will stifle innovation.
A top-down heavier regulatory approach certainly can favour the market power of existing Big Tech players because – unlike the start-ups – they have the resources and expertise to deal with it, says Bill Whyman.
He’ll likely push for a deregulatory approach in isolation, focussed on competition with China and less on protecting citizens’ values and rights.
This will contrast the EU and UK approaches, which are more interventionist. For instance, the EU’s AI Act has already created a clear framework for the future regulation of the industry.
Another sector set to benefit in the deregulatory world of Trump 2.0 will be crypto.
Previously a cryptocurrency sceptic, Trump is now its biggest fan, no doubt partly down to the influence of crypto and Dogecoin-enthusiast Elon Musk.
The crypto industry hopes that after big donations to the Trump campaign, the regulatory hurdles holding back the cryptocurrency revolution will ease up.
Trump has even suggested that crypto might help pay off the US’s increasing pile of government debt. But as they say, if a deal seems too good to be true, it probably is.
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