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Tariff threats will follow tech tax but internet monopolies must be addressed

Posted by Warwick Business School at 04 December 2019, 16:40 CET |
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Professor Mark Skilton, digital media expert at Warwick Business School and industry director of the Artificial Intelligence Innovation Network, comments:

"Action on the problematic dominance of social media platforms and internet giants has been a long time coming. These platforms dominate global and local markets with little or no competition.

"The digital services tax being pursued by France and the UK is a result of market forces that are seeking to create a fairer playing field for countries that have to deal with these monopolies.

"The threat of tariffs will come, but the truth is that post-Trump the digital market will be reset by the many other countries that make up the world, not America. It is a matter of when, not if.

"Facebook, Google, Amazon and others claim they add more value and are 'free', so they will have to pass on the costs to the public if anyone tries to regulate them.

"That is a one-sided version of the truth. They are not really free as consumers have no choice but to give up control of their own data, which is a hugely valuable commodity.

"The rapidly emerging problems around privacy and fake news underline the fact that a more drastic strategy is needed to redress the Wild West of the early internet and achieve better governance. I would not be surprise if many more countries followed suit with their own form of the digital services tax."

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