What Does the President’s Executive Order Mean for the American Technology Industry?

On Friday 9th July, POTUS Joe Biden announced an Executive Order to promote the interests of American workers, businesses, and consumers. The Executive Order would ensure that America’s technology market remains fertile and sustainable for robust competition. For too long, the US economy has been considered too rigid for new technology entrants, often facing killer competition from existing giants in the industry.

Read More: 5G, IoT And AI: The Work Of Art And Technology At Play In 2021

How the New Executive Order Supports American Economy?

Let’s try to understand the impact of Biden’s new executive order from the point of view of new emerging technologies, such as 5G Wireless connectivity. According to Accenture’s recent report, 5G will have a multiplier effect on various facets of the American economy, such as jobs, technology innovation, and customer service. Accenture reported – “5G will add up to $1.5 trillion to the U.S. GDP, larger than the annual GDP of 94% of world economies.”

In April, US President Biden and Japanese Prime Minister Suga Yoshihide met to discuss the future of 5G wireless networks. Clearly, the US is pushing the boundaries in 5G and security with openness at the center of this collaboration.

The official press release from the White House announced:

“The United States and Japan will engage with others through our enhanced Global Digital Connectivity Partnership to catalyze investments and to provide training and capacity building to promote vibrant digital economies. We will also partner on sensitive supply chains, including on semi-conductors, promoting and protecting the critical technologies that are essential to our security and prosperity.”

By merely opening the American economy to more competitive 5G opportunities, Joe Biden’s executive order could impact the effusion of technologies, such as AI, Machine Learning, Computing, and so on, in agriculture, manufacturing, telecommunications, digital / o*************** and advertising, retail. e-commerce, and defense sectors.

Let’s understand the impact of the Executive Order on some of these industries.

Advertising

The Executive Order clearly acknowledged the scenario in the publishing industry where small newspapers and magazines have either shut down or downsized their operations due to the raging dominance of internet platforms in the recent past. With an undue advantage on their side, internet platforms seemingly play it hard to promote and distribute content without passing the benefits to the American economy. The EO mentioned the monopoly of internet platforms when it comes to gathering, and using user’s Personal Information and other types of data to their own advantage.

Healthcare and Pharma

The EO identified that consumers are paying considerably high prices for drugs and healthcare services. This was particularly evident during the peak of the ongoing COVID-19 pandemic. The existing barriers in the form of patents and technology advancements with AI and Machine Learning capabilities further prevent the consumers from benefiting.

The latest EO would open up the economy by enhancing competition in the market where generic drug makers and bio-pharma companies that make biosimilars would be able to compete to produce low-cost drugs.

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Fintech and Banking

The US is home to some of the largest fintech companies in the world. These include VISA, Klarna, Stripe, and Plaid. The fintech market is still consolidating around payment Americas, B2B spend management software, and AI-based consumer products that make the banking and financial services industry all the more attractive for emerging companies. In order to safeguard consumers from paying hefty fees for accessing fintech platforms, the EO will provide wider support to small-scale companies.

Siamac Rezaiezadeh, Director of Product Marketing at GoCardless, says:

“This is the first step along the path to a truly competitive, open banking ecosystem in the US. The government has now recognized that customer banking data is precisely that — the property of the customer. Before, a more laissez-faire approach to open banking in the US meant that many banks had no incentive to provide third parties with access to customer data. This led to ‘closed banking’ and runs counter to the principles of innovation and competition that open banking is built upon.

What this Exec Order means is, in the near term, more competitive retail banking in the US by making it easier for customers to switch providers. However, we hope that it will also spur innovation which will make it easier for third-party providers to access customer data via APIs. This will enable even greater competition and really push the US down the path of open banking.”

The Biden regime is also focusing on enforcing anti-trust laws to prevent monopoly and monopsony in the labor markets, healthcare, manufacturing and repairs market across the US. These markets are often influenced by foreign cartel collaborations and foreign-owned alliances that put American entities at disadvantage.

Currently, the US has the following antitrust laws,

• Sherman Act,
• the Clayton Act, and
• the Federal Trade Commission Act (Public Law 63-203, 38 Stat. 717, 15 U.S.C. 41 et seq.)

As the EO reads: ” This order reasserts as United States policy that the answer to the rising power of foreign monopolies and cartels is not the tolerance of domestic monopolization, but rather the promotion of competition and innovation by firms small and large, at home and worldwide.”

The White House Competition Council [WHCC]

Joe Biden’s Executive Order announces the arrival of “The White House Competition Council” to address overconcentration, monopolization, and unfair competition. The EO grants power to the WHCC to take strict action against companies that are involved in unfair data collection and surveillance practices that may damage competition, consumer autonomy, and consumer privacy.

More information available here.

Source: Executive Order on Promoting Competition in the American Economy