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Obama accuses Europe of tech protectionism. (He kinda has a point!)

Stuart Lauchlan Profile picture for user slauchlan February 16, 2015
I really wish I could work myself up into a fury about Obama's protectionist allegations about European technology firms, but there's plenty of evidence that he has a point thanks to the efforts of the European Commission.

No, they can't

European technology companies are sore losers and are using their governments to gain footing against American rivals.

That was the President’s Day message from US President Barack Obama in an interview with Re/code.

It’s a wide ranging interview, but the bit that’s rattling the cages in Europe today is this section where the President states:

In defense of Google and Facebook, sometimes the European response here is more commercially driven than anything else.

There are some countries like Germany, given its history with the Stasi, that are very sensitive to these issues.

But sometimes their vendors — their service providers — who can’t compete with ours, are essentially trying to set up some roadblocks for our companies to operate effectively there.

We have owned the Internet. Our companies have created it, expanded it, perfected it, in ways they can’t compete. And oftentimes what is portrayed as high-minded positions on issues sometimes is designed to carve out their commercial interests.

OK, deep breath first.

Now, some observations Mr President - and not all against your PoV incidentally.

Let’s start with the obvious ones. We’ll leave aside for now the mental picture I’m getting of Angela Merkel’s face when she reads that Stasi comment. But I look forward to the next photo opportunity between her and Obama.

The European Commission’s Google-bashing agenda has been well-documented. We’ve tracked it closely here at diginomica across a range of stories.

Check out the sheer daftness of the Google break-up call last year - Europe’s posturing futility with Google break-up call - or the terrifying implications of the obsessive pursuit of enforcing the odious Right to be Forgotten in law - European court’s Google ruling provides a blunt instrument to rewrite history.

I’m aware that there are those with genuine data privacy concerns about the reach of firms like Google and Facebook, but equally I’m conscious that there are those in Brussels who instinctively lash out at anything to do with Google.

Sadly they appeared to include the former Justice Commisisioner Viviane Reding and the former Digital Agenda Commissioner Neelie Kroes. See Europe’s Thanksgiving gift to the US – a list of demands .

Even more sadly, their respective successors appear to be cut from exactly the same cloth - I’m right, you’re wrong, says Europe’s new Justice Commissioner to data privacy critics and New EU digital chief Oettinger shows how little he knows cloud.

Reding - where to begin?
Reding - where to begin?

As for Obama’s protectionist claim, here I see his point and have gone on the record on this subject before - see Is Europe blinded by Silicon Envy? I have considerable sympathy with his allegation that there are those in powerful positions in Europe who are acting out of an ill-thought-out attempt to rig the market in favor of domestic interests.

From a US perspective, the haranguing cries coming out of Brussels are easily interpreted as protectionist in nature. articulated in their most naked form by Reding - Viviane Reding’s ‘play by my rules’ warning to the US tech industry.

As for owning the internet…well, hmmm Mr President, here you’re on thin ice.

OK, so the underlying internet infrastructure started in the US - didn’t Al Gore invent it or something? (NOT!) - but as lots of commentators have pointed out today, CERN - birthplace of the World Wide Web - is in Europe and the ‘midwife’ of the online baby was of course a Brit, Sir Tim Berners-Lee.

Yes, US firms ran with the opportunity in a way that most (not all) European firms didn’t, so to that extent the US dominates, not owns, the internet.

But there are European success stories - SAP, for example - that compete on a global playing field. There’s just not enough of them and that - as I’ve said before - is nobody’s fault but successive European governments and investors who failed to cultivate and support a Euro-tech industry.

My take

At the end of the day, this is Obama on a kiss-and-make-up session with Silicon Valley.

He’s been an increasingly regular presence to the Bay Area. We’ve seen the visits to Salesforce, for example, while one of this past weekend’s rounds of golf took place on a private course in Rancho Mirage owned by Oracle’s Larry Ellison. Meanwhile Obama's thinking of getting an Apple Watch apparently, which must please Tim Cook.

But the fall out from the Snowden revelations about the NSA snooping program had been, he acknowledged:

were really harmful in terms of the trust between government and many of these companies, in part because of the impact it had on their bottom lines.

Certainly it’s telling that the top brass at Google, Facebook, Microsoft and Yahoo all declined White House invitations to attend a cyber-security summit at Stanford University that Obama was attending as well as a private lunch with the President.

So his protectionist allegations should be taken within the context of playing to the home crowd and telling them what they want to hear.

But as the Commission works itself up into a self-righteous state of indignation, the uncomfortable reality must be acknowledged: he kinda has a point.

Disclosure: at time of writing, Oracle, Salesforce and SAP are premier partners of diginomica. 

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