Digital Governance with Jeffrey RoyICTTechnology
May 15, 2019

The Socialization of Big Tech

Very soon, two of the world’s largest privately-held companies will go public. The highly-anticipated IPO’s (initial public offerings) of both Uber and Airbnb will fully legitimize ride-sharing and home-sharing operations offered by both these disruptive pioneers and many like-minded competitors.

Going public presents not only an investment opportunity for retail investors but a myriad of new responsibilities for the companies themselves – across millions of new shareholders on the one hand, and via key stakeholder groups on the other hand. One such stakeholder is government, or rather governments, since technology companies operate in literally thousands of jurisdictions around the world encompassing national, regional and local state entities.

For more established players – notably Facebook, Amazon, and Google – the growing pains of balancing profitable innovation and societal expectations have been fully on display in recent months.

In the case of Facebook, the social media giant has been labeled a “digital gangster” by a UK Parliamentary Committee, while German authorities imposed new rules limiting the company’s data gathering abilities in that country (a model that could be uploaded to all of Europe, although the ruling is under appeal). In response to such storms, Facebook recruited a former British Deputy Prime Minister to overhaul and strengthen government relations.

With respect to Amazon, after a two-year media circus that saw the company essentially extorting local and state governments for assistance in building a second global headquarters (HQ2), the final selection was ultimately awarded to both New York City and Northern Virginia. Whereas the former was viewed as ideal for diverse human talent, the latter’s proximity to the U.S. federal government underscores the importance of working with public sector authorities (even despite the over-arching tensions between Donald Trump and Jeff Bezos).

Yet in a stunning reversal, Amazon abandoned NYC in the face of mounting, albeit uneven, political opposition to the several billions of local and state subsidies offered to the company to effectively redevelop Long Island City. Critics of the deal hailed the decision as victory for the community, despite public opinion sharply in favour of the huge investment, while the Mayor of NYC lamented Amazon for its weakness in not staying the course.

Google (now Alphabet) has faced anti-trust allegations in Europe, much as its data-gathering partnerships with the National Health Service in the UK have been a source of controversy. In Canada, Google’s efforts to partner with the City of Toronto to create a new ‘smart district’ in downtown Toronto (Sidewalk Labs) have become an important magnet for privacy activists and others concerned about the privatization of waterfront land.

The initiative has been called a “colonizing experiment in surveillance capitalism” by the former head of Research in Motion, Jim Balsillie. City of Toronto representatives have been invited to a Parliamentary Committee to explain the privacy implications of the experimentally connected community, while several local Councillors are calling for annulment as details have leaked out from a process that has not exactly been characterized, on either side, by proactive openness.

Across all such examples, legitimate questions have been raised about the lobbying prowess of these tech giants, seemingly ill-equipped to forge stronger collaborative ties with governments and communities. At the same time, these companies are relatively young and – as noted, operate across a plethora of varying governance models with rules and expectations often in flux.

Two key lessons present themselves. For governments, an important challenge is to find new ways to work together to orchestrate public interest capacities in at least a partially globalizing manner. The collaborative gatherings of legislators from nine countries, including Canada, to forge common privacy protocols – particularly with respect to social media – is one such fledging example.

The second lesson for emerging companies such as Uber and Airbnb is to invest more proactively in building a stronger and more supportive stakeholder eco-system. The CEO of Uber, for example, has sought to cultivate a more collaborative path forward than his predecessor, whose start-up mission was disruption and growth. In an increasingly digital world, integrative arrangements enjoining private and public interests are risky, unavoidable and central to the new world order.

About this author

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Jeffrey Roy

Jeffrey Roy is Professor in the School of Public Administration at Dalhousie University’s Faculty of Management. He is a widely published observer and critic of the impacts of digital technologies on government and democracy. He has worked with the United Nations, the OECD, multinational corporations, and all levels of government in Canada. He has produced more than eighty peer-reviewed articles and chapters and his most recent book was published in 2013 by Springer: From Machinery to Mobility: Government and Democracy in a Participative Age. Among other bodies, his research has been funded by the IBM Center for the Business of Government and the Social Sciences and Humanities Research Council of Canada. He may be reached at: roy@dal.ca

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