Rethinking tech sovereignty

THIS IS DIGITAL POLITICS. I'm Mark Scott, and continued my Euro-trash existence this week in Geneva where I'm moderated a panel on March 24 on tech sovereignty and data governance. I'll include a write-up in next week's newsletter.

Talking of events, I'll also be co-hosting a tech policy meet-up in hipster East London on March 27 at 6:30pm. There are a few spots left for this (free) event. Sign up here.

— We're living through an era of 'tech sovereignty.' No one knows what that concept means — and that's quickly turning into a problem.

— Brussels forced Apple to open up to competitors. That's going to help many US firms that, in principle, oppose the bloc's competition revamp.

— In what must be the least-shocking fact about the latest AI models, almost none of the data used to train these systems comes from Global Majority countries.

Let's get started.

Tech sovereignty in an era of zero-sum geopolitics

MAYBE IT'S BECAUSE I WAS IN SWITZERLAND to talk about this topic, but we need to focus on tech sovereignty. Bear with me. For most of us, this concept is either unknown or irrelevant. Or possibly both. But over the last five years, policymakers and lawmakers — first in Europe, but increasingly everywhere — have embraced this catch-all term for efforts by individual governments to regain control over parts of the technology industry that have historically been left to the private sector.

Think the United States (or European Union) Chips Act, or efforts to bring back high-end semiconductor manufacturing to the "homeland." Think Washington's Joe Biden-era export controls to stop Beijing getting hold of next generation chip manufacturing equipment. Think Brussels' litany of initiatives — from the creation of so-called 'data spaces' to the (badly named) AI 'gigafactories' — to give itself a seat at the global table of tech powers.

At its core, tech sovereignty is a realization by elected officials that they are no longer in control. They see complex technological global supply chains, the rise of world-spanning tech giants and the influx of billions of dollars in private capital and worry their voters (and homegrown companies) won't see the economic and social benefits of how tech has become so ingrained in everything from buying a car to sending your child to school.

Well, maybe that's one (slightly cynical) definition. After more than five years since 'tech sovereignty' became a thing, governments are still grappling with exactly what it means, how to implement it and what the consequences will be when everyone from London to Brasilia wants to "onshore" tech to boost their local interests.

Before 2025, that remained almost exclusively a headache for uber-policy types (like myself.) But this year has shown, already, that we are living in a more transactional, zero-sum mercantilist world where all elected leaders — and not just US President Donald Trump — are willing to use all the levers at their disposal to reshape the world order to their needs.

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That means, inevitably, revisiting how we define 'tech sovereignty' because, like it or not, how we collectively approach the topic will have significant real-world implications for how technology is developed, governed and used in the years to come.

If done well, it could build upon the core tenets of what made the internet such a game-changing technology: open, rights-based core infrastructure that allowed anyone (read: with money and technical capacity) to build whatever they wanted, however they wanted.

If done poorly, it could undermine those key principles that have made technology crucial to both economic and social benefits for all.

Case in point: if a country decides to keep all of its citizens' data within national borders — a term known as data localization — for either commercial or national security reasons, then it makes it harder to trade, based on a reduction of global data flows, and starts to cut off specific countries from the now-fraying world order. This is not hypothetical: Russia, Nigeria, India and China are among states that already have such rules on the books.

What is urgently needed is an honest conversation about what people mean by 'tech sovereignty.' Currently, that falls into two camps.

Camp One leans toward isolationism. In this world, politicians funnel public cash into homegrown 'tech champions' that use siloed-off local data and technical skills to create services/products that are then sold worldwide in a race to build global giants.

Camp Two relies on each country shifting to tech-related areas where it can compete globally (eg: Taiwan/South Korea on microchips; Vietnam on device manufacturing), and then opening up each market to overseas competition. The goal isn't to own everything in tech. It's about figuring out where you can compete, globally, while giving local citizens access to (cheap) outside services/products that improve their daily lives.

You can probably figure out which version of 'tech sovereignty' would be my preference.

Before I get angry emails, I realize there's a lot of nuance that lies between those two extreme positions. Those who want to create a so-called "Euro stack," for instance, would probably argue their efforts are about giving Europe greater autonomy at a time when the US is not perceived as a trusted partner. Those in Brazil supportive of the country's data localization mandate would likely say such provisions are about keeping local's personal information safe under national laws.

I get it. Everyone has a reason why their version of "tech sovereignty" is OK, while everyone else's take is blatant protectionism.

But here's the problem with that. This ongoing nibbling at what has made technology an inherent force for good (despite, ahem, some significant downsides) has placed increased onus on equating national power as the only mechanism to get things done. That is especially true, in 2025, when long-standing allies are starting to not trust each other, and retaliatory tariffs are leading us toward a potential global trade war.

What I would prefer to see is a recognition by lawmakers about what they can — and what they can not — change when it comes to tech. Yes, much of the current global power dynamics mean the likes of the US, China and Europe have more say than other parts of the globe. That is not something, unfortunately, that will change overnight.

But while it's 100 percent legitimate for national leaders to want greater control of various forms of technology, I don't see how the ubiquitous calls to spend public money to "bring back" global supply chains to national shores as something that will achieve that.

First, it won't — given that these complex systems have grown over decades and won't just change quickly. And second, it will lead to short-term higher prices for consumers because of the inevitable cost hikes that will result from spending over the odds to onshore manufacturing when other countries can just do it cheaper (and faster.)

"Tech sovereignty" is a concept that sounds good as a talking point, but fails to deliver when confronted with reality. Yes, some form of greater control (or, at least, the semblance of control) over global tech forces is probably good for democracy, writ large. That's especially true for countries beyond the US and China that are net-takers of technology, at a global stage.

But you don't achieve that by putting up barriers to outsiders and investing public funds to develop clunky national champions that will struggle to compete worldwide.

What would be better is to set out a positive definition of 'tech sovereignty' that builds on what has worked for almost everyone over the last 80 years. Caveat: I understand that is a difficult pitch, politically, given the current geopolitical climate.

That would include: reaffirming open global markets based on right-based digital regulation that allows each country to 1) promote their own unique tech-related specialisms, both home and abroad and 2) allow national lawmakers to step in, where appropriate, when global tech forces undermine the rule of law or other key tenets within a nation state.

We already have such systems in other sectors like financial services and pharmaceuticals — and no one (at least not yet in 2025!) makes much political capital in undermining how those industries currently operate. Yes, tech is somewhat different as it's nominally not a separate industry. But, I would argue, neither is financial services.

Unfortunately, I don't see that positive agenda in any of the ongoing 'tech sovereignty' discussions that have become embedded in the geopolitical tensions of early 2025. That goes from Trump's MAGA approach to maintaining "US dominance" over AI to European Commission president Ursula von der Leyen's pitch to make the EU the hub for the next technological revolution.

That is a shame.

It's a shame because it undermines what has been built over the last 80 in so many tech-related fields that have benefited so many people worldwide. And it's a shame because it equally foretells a growing "splinternet" between countries/regions that solely focus on their short-term interests — without recognizing what damage that will produce over the mid-term.

Chart of the Week

THE LATEST ARTIFICIAL INTELLIGENCE MODELS already skew toward more developed countries. But researchers analyzed the most common datasets used to build these systems, from 1990 to 2024, to figure out where that information actually came from.

Not surprisingly, regions like Africa and South America were massively underrepresented, both on the number of datasets (see "by count" below) from those regions and the amount of information (see "by tokens or hours" below) included from those parts of the world.

That's a problem when next generation AI models are being rolled out globally in ways that won't meet regionally-specific needs because of a lack of local data baked into these complex systems.

The darker the part of the maps below, the more data was used from that region to train AI models.

The complexities of antitrust enforcement

WHEN THE EUROPEAN COMMISSION ANNOUNCED last week it had forced Apple to make changes to comply with the bloc's new competition rules, the iPhone maker was quick to cry foul. The decision, according to the company, "wraps us in red tape, slowing down Apple's ability to innovate for users in Europe and forcing us to give away our new features for free to companies who don't have to play by the same rules."

Yet in many parts of the global tech world — including inside companies that equally dislike the EU's Digital Markets Act — there were cheers of victory. The split response highlights how these new competition rules, which allow European regulators to step into online markets before one specific company becomes too dominant, aren't as easy to define as many first thought.

First, a quick backstory. Last year, the European Commission's competition enforcers opened an investigation into how Apple allowed rival firms to interact with its products. On March 19, Brussels then ordered the iPhone maker to make it easier for non-Apple devices to connect to the company's products. It also demanded the Cupertino-based firm to provide its technical specs to outsiders so they could build services which more easily interact with Apple's operating systems.

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The paper outlines steps Microsoft is taking to combat these risks and provides recommendations as to how the EU's existing regulatory framework can be used to combat the abuse of AI-generated content by bad actors. We thank Women Political Leaders, the MenABLE project, the Internet Watch Foundation, the WeProtect Global Alliance, and the European Senior’s Union for their important work and support. Click here to read more.**

What does that mean? Over the next 12 months (caveat: Apple may still appeal these changes), it will become easier, say, for Garmin smartwatches to connect seamlessly with your iPhone — just as an Apple watch currently does. Rival apps will also be able to take advantage of Apple's technical wizardry to compete more directly with the company's own services that work hand-in-glove with its in-house software.

You can understand why Apple is not a fan. But, equally, it will be a boon for the likes of Meta and Alphabet, as well as scores of smaller tech firms, that have long complained that Apple creates artificial technical barriers so that rival devices/apps just don't work as well as the iPhone maker's own offerings. Mark Zuckerberg, Meta's chief executive, even called out Apple in January over how it didn't allow other headphones to connect as well as the firm's (expensive) devices.

Yes, you read that right. The European Commission and Zuckerberg are on the same page when it comes to digital competition.

That complexity can make my brain hurt. In the ongoing lobbying around new digital competition rules (looking at you, United Kingdom), the playbook often relies on claiming such legislation places regulators too squarely at the heart of business decisions of some of the world's largest tech companies. "It's killing innovation!," comes the claim. "Officials should keep their noses out of our business!"

I have some sympathy for that argument, especially when it comes to so-called ex ante regulation, or policy efforts to curb unfair dominance before a firm becomes too entrenched in a digital market. But I can also see a massive upside for consumers if a non-Apple product/service works as effortlessly as an in-house device designed in Cupertino.

For what such competition decisions lead to, we only have to look at a previous European Commission ruling to force the iPhone maker to switch all of its devices over to USB-C technology. Apple executives equally met that 'common charger' ruling with derision. But now, USB-C is the de fault global standard, allowing one cable to connect everything from iPhones to Samsung tablets.

It's still unclear if the recent Apple decision will lead to US pushback after the White House threatened retaliatory tariffs on countries/regions that went after American tech firms. But beyond the iPhone maker, many US companies remain supportive of this specific European Commission competition decision — mostly because it's good for their own business interests.

What I'm reading

— A subcommittee of the US Senate Committee on the Judiciary will hold a hearing on the "Censorship Industrial Complex" on March 24. Watch along here. A counterpoint to that subcommittee's focus.

— Company responses to the White House's call for input on a "AI Action Plan." Palantir. OpenAI. Alphabet. Microsoft. Frontier Model Forum. Anthropic. If anyone has seen Meta's submission, please let me know.

— AI Now gives the European Commission a report card on tech for the Berlaymont Building's first 100 days. More here.

— The UK regulator Ofcom outlined what companies must now do after a deadline passed for firms to conduct illegal harms risk assessments. More here.

— Small AI language models offer a cheap option for indigenous communities to take advantage of this emerging technology, argue Brooke Tanner and Cameron Kerry for the Brookings Institution.