EU Antitrust Chief Margrethe Vestager will meet with chief executives of Apple (AAPL), Alphabet (GOOG, GOOGL), Nvidia (NVDA), Broadcom (AVGO), and OpenAI in Palo Alto and San Francisco next week to discuss digital regulation and antitrust policies.
Axios Global Tech Correspondent Ryan Heath joins Yahoo Finance to give insight into what to expect from the meetings and potential outcomes from the meetings for these companies.
“They [Big Tech] have come to realize the EU isn’t going away. They don’t particularly like the way the EU approaches regulation, but they know that it’s a very lucrative market, and it makes more sense to play ball with them at some level,” Heath explains. “There’s this constant tension between how do they give a little bit to the EU, look cooperative, but at the same time, don’t do anything to cannibalize their business.”
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Editor’s note: This article was written by Nicholas Jacobino.
Video Transcript
RACHELLE AKUFFO: EU antitrust chief Margrethe Vestager announcing she will now meet with chief execs from key tech giants next week, including leaders from Apple, NVIDIA, alphabet, and Broadcom. For more on this, we turn to Ryan Heath, Axios Global tech correspondent.
Thank you for joining us this morning, Ryan. So we know that the EU has really been taking the lead here on framing an AI framework here. What are the expectations for this trip?
RYAN HEATH: Well, it’s a doublE-hatted trip actually. So yes, the EU has locked down its new AI Act. But the big thing there is it’s actually not going to be enforced for another year for the first half. And the second half, it’s going to be two years before they start implementing it. But the way regulators work, obviously, is playing catch up to markets a lot of the time. So the previous big piece of legislation, which is about trying to limit the power of big tech gatekeepers. That’s really coming into force from March this year.
So Vestager is going to be here previewing the AI Act, but also a little bit reading the Riot Act about this digital markets legislation, which is really trying to make sure that the big companies run open ecosystems. They don’t try and lock you into their app stores. They don’t preference their own systems. So she’s going to go around these companies one by one. And work through how they’re going to relate on this legislation together.
RACHELLE AKUFFO: And Ryan, how do you think this is going to be received? Because they’re really being perceived as gatekeepers here, but they also want to be at the really at the forefront of some of the legislation, as well. How do you balance that?
RYAN HEATH: Yeah. It’s really tricky. So the companies have a very different attitude to 10 or 20 years ago. And some of them are very new too. So they’ve only ever known this very aggressive European Union. But I think the Googles of the world, the Metas, the Apples, they’ve come to realize the EU isn’t going away. They don’t particularly like the way the EU approaches regulation. But they know that it’s a very lucrative market. And it makes more sense to play ball with them at some level.
So there’s this constant tension between how do they give a little bit to the EU, look cooperative, but at the same time, don’t do anything to cannibalize their business. And that’s the constant back and forth between the companies and people like Vestager. And she’s back in the hot seat now because she was running for a new position to be head of the European Investment Bank. And she lost out. So now, she’s coming back with her tail a little bit between her legs. And she’s got one year left to secure her legacy and make a difference.
So you might see a slightly fine tuned Vestager in these meetings as well.
RACHELLE AKUFFO: So are we expecting her to really try and make her mark here, or really try and do what it takes to really get some results here? As you said, because the legislation isn’t supposed to kick in for another year.
RYAN HEATH: Yeah. I think she’s really got to try and secure some results. She’s a pragmatist at the end of the day. She said fairly radical and ambitious goals. And then she puts her head down and tries to find pragmatic ways to get some of the way there. And now, she’s really into that tail end of her time in Brussels. And she’s had a few defeats in big court cases over the past 12 and 18 months. So it’s really time to show some results. It’s not enough to just wave a piece of legislation around. She’s got to actually make a difference in how these companies operate and how the market itself is structured.
And so I think there’s going to be a lot of that pragmatism on show during this visit.
