Weekly Roundup: Geopolitics are in the Drivers Seat
Geopolitics are shaping AI funding, social media legislation, and antitrust laws.
I wrote last week on the shifting geopolitical winds remaking the emerging technology investment landscape, and this week has been mostly a continuation of this pattern.
Weekly Roundup: Giving Away The Farm
On the face of it, President Trump’s recent Middle East business-diplomacy tour seems pretty straightforward: The U.S. administration is continuing its foreign affairs reshuffling and driving bilateral trade deals around emerging technology, and the Gulf States are continuing to shift their economy to something other than oil.
For a post-mortem of the U.S.-UAE deal, read this:
China warns US chip curbs could derail trade talks
Chinese officials warned Monday that Washington’s recent move to tighten export controls on advanced Huawei chips could undermine US trade talks with Beijing.
The US Commerce Department said last week that firms anywhere using the Chinese AI chips could face criminal investigations — Beijing said the measure threatened global semiconductor supply chains…
Washington’s targeting of Huawei could offer Taiwan more opportunities to strike deals with American chipmakers, an analyst told Bloomberg: At the conference Monday, Nvidia announced plans to build an AI supercomputer on the island and deepen its partnerships with Taiwan-based chip firms Foxconn and TSMC.
However, building in Taiwan and the billions of dollars worth of recent deals don’t seem to be enough for Nvidia. Nvidia CEO says US chip export controls on China are a ‘failure.’ Others and I have written extensively defending sanctions, and I won’t rehash all of that here, however, if the export controls were such a failure, it seems odd that the PRC is fighting so hard against them.
South Korea has legislation in the works modeled after the GDPR.
The legislation is also meant to prevent big tech monopolization and “to restrict dominant platforms from prioritizing their own products over competitors’ (that is, self-preferencing) and bundling products and services together. It also requires platform companies to include most-favored nation clauses to ensure that the terms provided to other countries also apply in South Korea.”
The current legislation, known as the Monopoly Regulation and Fair Trade Act (MRFTA), has drawn the ire of several major U.S. tech companies, including Google, Apple, and Meta. These companies have criticized the act as discriminatory and urged the U.S. Chamber of Commerce, industry lobby groups, Congress, and the U.S. trade representative to push back against it.
The U.S. seems particularly well poised to address the MRFTA in the context of bilateral trade. U.S Trade Representative Jamieson Greer stated on April 9 that President Trump would not permit “the European Union, or Korea, or any other jurisdiction set the rules for digital trade.” Prior to becoming the trade representative, Greer also argued, “I would urge caution on the part of Korean officials to avoid another clash. There is no good path forward where Korean regulations treat U.S. companies more restrictively compared to domestic—and Chinese—companies operating in the digital space.”
The U.S.-South Korea trade talks, in addition to a June 3rd election, make immediate passage of the MRFTA unlikely, but not off the table entirely, as it will likely be an important chip in negotiations.
“The European Commission is creating a new category of ‘small mid-cap’ companies that will be exempted from eight EU laws.”
The eight laws in question that will be changed through targeted amendments are:
General Data Protection Regulation;
Regulation on Protection against Dumped Imports;
Regulation on Protection against Subsidised Imports;
Markets in Financial Instruments Directive;
Prospectus Regulation;
Batteries Regulation;
Critical Entities Resilience Directive;
Fluorinated Greenhouse Gas Regulation.
Google moves to reassure EU cloud users amid concern over Trump threat
Google is beefing up its “sovereign cloud” options in the EU, as US tech companies move to reassure the continent’s users that their access to crucial technology will be safeguarded at a time of escalating trade tensions with Donald Trump.
The Silicon Valley giant provides cloud computing offerings in Europe that ensures sensitive information remains on local servers and adhere to EU laws on data privacy.
Google told the Financial Times on Wednesday it was broadening these so-called sovereign cloud options, including a new “data shield” that provides additional cyber security protections to European clients.
After White House Clash, South Africa Sets the Stage for Starlink Approval
Officials on Friday began a policy review process that could pave the way for Elon Musk to bring his satellite internet service into South Africa for the first time without having to sell shares to Black South Africans.
South African law requires foreign companies to provide partial ownership to historically disadvantaged groups, which were prohibited from participating in many business opportunities during apartheid.
The law is meant to redress the economic inequality that persists three decades after that brutal system of racial segregation came to an end. Mr. Musk, who was born in South Africa, has called the laws racist.
“Starlink is not allowed to operate in South Africa, because I’m not black,” he posted on X in March.
For the record, it appears that Starlink is currently not allowed to operate in South Africa, not because Elon Musk is not black, but because he does not want to sell stock to Black South Africans.
Child Safety
“SkinnyTok” is being investigated by the EU and is the latest example of empirically documented harm aimed at children by social media companies.
“SkinnyTok” is a genre of videos about weight loss, ranging from “harsh motivation” to food diaries showing what women eat to stay “lean.” It has been compared to “pro-anorexia” and “pro-eating-disorder” communities that have thrived for over a decade on platforms like Tumblr.
A 2021 survey of 273 women who used TikTok found that 64 percent had been “exposed to disordered eating content” on the For You page of the platform. TikTok has since added a feature to show eating-disorder recovery resources to users who search terms associated with them, including “SkinnyTok.” The resources do not appear when searching for “harsh motivation,”
Lauren Breithaupt, a Harvard Medical School clinical psychologist and cognitive neuroscientist who specializes in eating disorders, says “patients are reporting specific TikTok and Instagram trends that amplify their anxiety or trigger disordered behaviors.”
A handful of EU countries are pushing to codify EU-wide age verification access and limitations for children’s social media access. Technical limitations remain: kids are using pictures of President Trump to bypass age restrictions on video games.
Also:
Apple’s Tim Cook called Texas Gov. Greg Abbott to personally lobby against online child safety bill.
AI Moratorium
Some good analysis on the proposed AI moratorium law—a nugget in the House’s version of the budget bill that would preempt all state laws on AI for 10 years.
In other news
The most immediate threat of a ban comes from a clause in the 2025 National Defense Authorization Act, a U.S. law that sets the annual military budget. Passed in late 2024, it requires DJI to clear a national security review or face an automatic ban by the end of 2025. No review has yet been scheduled, and the legislation does not specify which agency should carry it out.
Young Indonesians applying for tech jobs via Facebook and Telegram are trafficked to scam farms.
Scammers use deepfakes, voice clones, and other technologies to dupe victims around the world.
Americans alone lost $12.5 billion last year, mostly to investment scams.
And, two investigative long reads:
3 Teens Almost Got Away With Murder. Then Police Found Their Google Searches. “An arson attack in Colorado had detectives stumped. The way they solved the case could put everyone at risk.”
