When big tech meets big government
Fight between the London government and Uber is just the start as tech firms grow in power and continue to flout rules
If there has been one common thread running through almost every industry in the last decade, it has been how a handful of tech companies have revolutionised how the world does business.
There is Google for accessing information; Twitter for sharing opinions and news; Facebook for interacting with friends; Amazon for shopping; Airbnb for places to stay; and Uber for getting around.
With their slick lobbying and public relations operations, the tech entrepreneurs of Silicon Valley were courted by politicians and civil society alike.
That is changing.
The decision by the authorities in London to strip Uber of its licence to operate in the British capital is part of a wider backlash in an escalating war between governments and the tech companies that they believe have become too powerful and contemptuous of rules and democratic authority.Uber and its biggest rival Lyft were ejected from Austin, the capital of Texas, last year for refusing to fingerprint their drivers.
In 2013, in San Francisco and Oakland, tech giants such as Google’s and Apple’s private employee buses, which were illegally using public bus stops, were blocked by protesters.
New York’s city regulators early this week said they were looking into their own Uber probe, specifically at its impact on the city’s yellow cab sector.
Getting too close to tech companies now brings its own political dangers.
US think-tanks that had happily embraced funding from Google now find themselves criticised for it, accused of reining in any debate critical of the company and its counterparts.
Amazon’s success is at the heart of what trade analysts are referring to as the “retail apocalypse”, the shutting of growing numbers of stores across the United States and beyond.
Uber has proved toxic to more tightly controlled taxi industries. The drivers of London’s famous black cabs have been particularly hard hit, and their aggressive lobbying of politicians is seen as one of the key factors behind London Mayor Sadiq Khan’s decision to suspend Uber’s operating licence.
For all the criticisms of Uber – that it ignores regulators and the employment rights of those who drive for it, and the reports of abuse and sexual assaults by drivers – it has slashed transport costs for its users.
It has also provided opportunities – although without much in the way of job security – for hundreds of thousands around the world. An Uber-launched petition to reverse the London ban quickly notched up 600,000 signatures.
Facebook, Google and Twitter in particular have been tangling with governments since they began operating in relatively autocratic countries, such as Russia, China and those in the Middle East, where those in authority have long felt threatened by the quick and easy access they offer to information.
Sometimes, tech companies have found themselves blocked outright. Increasingly, the perception has become that many of these companies are willing to push their luck to see what they can get away with.
In many respects, Uber and Airbnb seen among the most egregious examples of companies that have seriously and deliberately pushed the limits of what is strictly legal.
While London’s already more stringent taxi regulation means Uber needs a licence, in many other cities, both it and its drivers operate outside the conventional taxi licensing system.
Airbnb lets out rooms in cities that explicitly ban short-term rentals.
Both have based their entire business model on working around, if not entirely flouting, pre-existing local regulations. The authorities often seemed to lack the ability, or the political will, to enforce the rules.
The Uber decision in London is perhaps the most significant escalation in that war so far. The most likely scenario is that the company and regulators reach a deal – although that could be a difficult process.
On Monday, Uber’s chief executive sent the London authorities a contrite letter saying the company realised it had to change. Mayor Khan welcomed the statement, saying he favoured talks to resolve the issue.
What Mayor Khan has demonstrated, however, is that the company can operate only if the authorities allow it to do so.
Giant tech companies are unlikely to go away.
But neither are governments.
With a host of new technologies coming down the line – self-driving cars, automatic shops, artificial intelligence – many controlled by the same companies, these fights are only going to get bloodier. – REUTERS
The writer is a Reuters global affairs columnist, writing on international affairs, globalisation, conflict and other issues.