Apple App Store investigation

It’s still unclear whether the regulator will launch a formal probe into Apple. However, reports indicate that China’s probe into Apple App Store fees would focus on policies that the tech giant uses to take up to 30% share of in-app spending.

Chinese competition watchdog, State Administration for Market Regulation (SAMR) will also be investigating Apple for allegations of blocking third-party payment services and app stores. Reports of China’s antitrust probe on Apple came just a day after SAMR commenced an antitrust probe into Google.

The two investigations coe shortly after the US introduced an extra 10% tariff on goods imported from China. The new tariffs will have a significant impact on US tech giants whose consumer products are assembled in China. The Asian country is reportedly considering launching a probe into another US tech company, Intel.

Reliance of China

Apple’s iPhones are assembled by its manufacturing partner, Foxconn in China. However, the tech giant has diversified its supply chain in recent years. Besides China, the company now produces iPhones in Vietnam and India. Last quarter, Apple’s sales revenue in the Chinese market dipped by 11%.

The iPhone manufacturer has been facing fierce competition from domestic smartphone manufacturers like Huawei and Vivo that have taken the Chinese market by storm. In recent months, Apple’s App Store has come under serious scrutiny by regulators globally. The company was forced to open up its App Store in Europe after the EU Digital Markets Act took effect.

This move gave non-Apple firms access to the platform, allowing them to offer app stores across the EU. App developers in the region are able to use third-party payment systems as well. Should China push through with its probe, it will spell more trouble for Apple in one of its largest markets.

Widespread Troubles

Apple is facing antitrust scrutiny in the US and UK. Last month, a UK antitrust watchdog commenced investigation into the big mobile ecosystems owned by US big techs, Google and Apple. The focus of Apple-Google antitrust probes is to establish whether the companies have violated the country’s stringent digital competition regulations.

Early last year, the Department of Justice in the US filed an antitrust lawsuit against the iPhone maker causing its shares to drop by 4% the same day. Apple stock declined further in 2024 after the EU slapped the company with a $2 billion fine for violating competition laws abroad.

US tech industry advocates expected a slow down in US antitrust scrutiny under President Donald Trump. However, recent actions by the new administration suggest that US big techs may not get a free pass on matters pertaining to big acquisitions and mergers.

The post Apple Shares Fall by 3% as China Considers Antitrust Investigation on App Store appeared first on Tech Research Online.

Official Lapse of Deadline

The deadline for prohibitions of specific AI systement and requirements to ensure adequate literacy of technology lapsed on February 2. This means that tech companies are expected to comply with the new restrictions. Companies that fail to comply with the new law will attract AI Act penalties stipulated in the regulatory framework.

EU AI Act enforcement could see companies that violate the Act receive fines as high as $35.8 million or 7% of their global yearly revenues, whichever is higher. The stipulated fines are possibly higher than those provided for in EU’s data protection law, the General Data Protection Regulation (GDPR). Under the GDPR, companies can be fined a maximum of 20 million Euros or 4% of the company’s annual global revenue.

The law pegs penalty amounts on the size of the company and the nature of infringement. Under the AI Act, various manipulative AI applications are banned in the EU. These include real-time facial recognition applications, social scoring systems, and other kinds of biometric identification apps that categorize citizens by sex, race, sexual orientation, and other attributes. in the EU. These applications are deemed to pose unacceptable risk to EU residents.

Investor Concerns

Some investors and tech executives have expressed concerns over the stringent provisions contained in the AI Act for fear that they could constrain innovation. In mid last year, Netherland’s Prince Constantijn raised concerns over the focus that the EU was giving towards AI regulation.

“Our ambition seems to be limited to being good regulators. It’s good to have guardrails. We want to bring clarity to the market, predictability and all that. But it’s very hard to do that in such a fast-moving space,” Constantijn said.

Even with these concerns, there are tech executives who view clear AI regulation as critical in fiving the EU a leadership edge in the industry.

“While the U.S. and China compete to build the biggest AI models, Europe is showing leadership in building the most trustworthy ones. The EU AI Act’s requirements around bias detection, regular risk assessments, and human oversight aren’t limiting innovation — they’re defining what good looks like,” Diyan Bogdanov, Director of Engineering Intelligence at Payhawk said.

Much Needed Action

The EU says that the AI Act is not in full force yet and that these are just the initial steps. Mozilla Head of EU Public Policy, Tasos Stampelos says the AI Act is much needed.

“It’s quite important to recognize that the AI Act is predominantly a product safety legislation. With product safety rules, the moment you have it in place, it’s not a done deal. There are a lot of things coming and following after the adoption of an act. Right now, compliance will depend on standards, guidelines, secondary legislation or derivative instruments that follow the AI Act that will actually stipulate what compliance looks like,” Stampelos said.

Last year, the newly created EU AI Office posted the second draft of the practice for general-purpose AI models. These are systems such as OpenAI’s GPT large language models. The draft provided for exemptions for companies that provide specific open-source AI models.

It also highlighted the requirements for systemic general-purpose AI model developers to undergo meticulous risk assessment. The EU AI Office was set up to regulate the use of AI models in line with the AI Act.

The post Europe Introduces Stringent Tech Rules as AI Act Enforcement Commences appeared first on Tech Research Online.

Shifting Chip Production

Trump’s tariff threats are aimed at shifting chip production from Asia to the US. To achieve this, the US president is getting ready to extend high tariffs beyond electronics assembled in China to semiconductor chips produced in Taiwan.

“In the very near future, we’re going to be placing tariffs on foreign production of computer chips, semiconductors and pharmaceuticals to return production of these essential goods to the United States,” the President said.

He argued that top US big techs have been importing processors from Taiwan and he wants that production back to the US without having to spend billions of dollars.

“And we don’t want to give them billions of dollars like this ridiculous program that Biden has given everybody billions of dollars. They already have billions of dollars. They’ve got nothing but money Joe. They didn’t need money. They needed an incentive. And the incentive is gonna be they’re not gonna wanna pay a 25, 50 or even a 100 % tax,” Trump said.

“They’re gonna build their factory with their own money. We don’t have to give them money,” he added.

The President slammed the Chips and Science instituted by the Biden administration to invest more than $52 billion in domestic chip production. Trump is counting on high tariffs to push American big techs into shifting chip production to the US.

Taiwan’s Reaction

Responding to Trump’s tariff threats, the Taiwanese government highlighted its commitment to leverage its ties with the American government to address the issue in a way that benefits Taiwan’s chip business and the US.

“Taiwan and the U.S. semiconductor and other technology industries are highly complementary to each other, especially the U.S.-designed, Taiwan-foundry model, which creates a win-win business model for Taiwan and U.S. industries,” Taiwan’s Economy Ministry said in a statement.

The statement further stated that the ministry “will continue to pay attention to U.S. policy going forward, and there will be close contact and cooperation between the two sides to ensure that Taiwan’s and US’ industries and national interests can develop in a mutually beneficial way in the face of global challenges.”

Another statement from the presidential office of Taiwan stated that the US and the Island have a close relationship and enjoy mutual trust.

Taiwan-US Trade Ties

Taiwan is home to the world’s biggest contract chip manufacturer, Taiwan Semiconductor Manufacturing Company (TSMC). The Asian island serves as an important link in the global supply chain with tech companies like Nvidia and Apple relying on it to meet their semiconductor supply needs.

The company has set up a factory in Arizona from where it is servicing American companies like AMD, Qualcomm, Apple and Nvidia. However, most of its chip production functions are still in Taiwan. TSMC had committed to invest $12 billion in the US to construct the Arizona plant during Trump’s first term. The chip maker increased that amount during the Biden administration. Today, TSMC US investment stands at $65 billion.

Early this month, Taiwanes government said it expected Trump tariffs to have minimal impact on the Taiwan semiconductor industry due to its tech superiority. However, the Island country faces a new challenge after Trump directed US federal agencies to probe allegations of currency manipulation, unfair trade practices and trade deficits by other countries.

Last year, the trade surplus between Taiwan and the US rose by 83% as exports to the US hit a high of $111.4 billion. This growth was driven by high demand for tech products like chips.

The post Trump Threatens Chip Import Tariffs as Taiwan Terms Business with US a Win-Win appeared first on Tech Research Online.

Market Status

Through the UK antitrust probes, the Competition and Markets Authority wants to determine whether the two tech giants hold strategic market dominance in their mobile systems. The watchdog will be investing their market status in app stores, operating systems, and smartphone-based browsers.

“More competitive mobile ecosystems could foster new innovations and new opportunities across a range of services that millions of people use, be they app stores, browsers or operating systems. Better competition could also boost growth here in the UK, with businesses able to offer new and innovative types of products and services on Apple’s and Google’s platforms,” Sarah Cardell, CMA CEO said in a statement.

The UK Google antitrust investigation comes just a day after Indonesia fined the search giant $12.6 million for monopolising its Google Play Store billing system. According to the Competition and Markets Authority, the UK investigations into the Apple and Google mobile empires will “explore the impact on people who use mobile devices and the thousands of businesses developing innovative services or content such as apps for these devices.”

Dan Aldridge, a Labour MP, noted that CMA’s decision to launch the Apple Google antitrust investigation was an important step towards promoting fair competition in the UK digital economy.

“Companies such as Apple and Google decide which ones we access and how much we pay,” he said in an emailed comment Thursday. “These investigations will examine these practices, as they can stifle innovation and lead to higher prices for consumers.”

Big Tech Reactions

Both Apple and Google have reacted to the UK’s move to investigate their systems for antitrust practices. Apple has emphasized its commitment to ensure that users trust its products and highlighted its commitment to engage the UK watchdog constructively.

“Apple believes in thriving and dynamic markets where innovation can flourish. We face competition in every segment and jurisdiction where we operate, and our focus is always the trust of our users. In the U.K. alone, the iOS app economy supports hundreds of thousands of jobs and makes it possible for developers big and small to reach users on a trusted platform. We will continue to engage constructively with the CMA as their work on this matter progresses,” an Apple spokesperson said.

The Senior Director for Competition at Google, Oliver Bethell noted that the Android platform, which is owned by the company has given users more choices, democratised access to apps and smartphones, and lowered user prices.

“It’s the only example of a successful and viable open-source mobile operating system,” said Bethell.

She urged for a solution that will not stifle opportunities and options for UK users and businesses, and one that does not put growth prospects in the country at risk.

Regulatory Powers

Early this week, the UK hired former Amazon UK country manager Doug Gurr to chair the Competition and Markets Authority. The watchdog’s regulatory powers have been strengthened after the UK’s new law, the Digital Markets, Competition and Consumers Act (DMCC) took effect this year.

This new law seeks to ensure that anti-competitive practices do not thrive in the digital market. Under the DMCC, the regulatory authority can impose the strategic market status tag on big companies that demonstrate significant market power in a specific digital activity. The UK antitrust body can also impose changes to discourage potential antitrust practices from any company that is assigned the strategic market status.

The competition regulator says that all mobile devices in the UK market come with pre-installed Android or iOS systems. It also claims that Apple and Google App Stores and browsers have leading or exclusive positions on their platforms, compared to other products. The regulator will be examining these aspects during the investigation.

The post UK Launches Antitrust Probes Against Apple, Google Mobile Systems appeared first on Tech Research Online.

Google Investigation

Indonesia’s antitrust body KPPU commissioned investigations into Google’s market dominance back in 2022. Specifically, the search giant required app developers in Indonesia to use the Google payment system available on its Play Store. The Indonesia antitrust body’s investigation showed that this Billing system charged app developers up to 30% more fees than other payment systems.

Google has designed its Play Store to handle in-app purchase payments between users and developers via its Google Play Billing System. The search giant requires that all purchases of digital services and products in the Google Play Store be channeled through this billing system.

“Google’s behaviour of requiring the use of the Google Play Billing System for every purchase of digital products and services distributed in the Google Play Store and not allowing the use of other payment alternatives in the GPB System, caused various impacts to its users,” the KPPU said in its statement.

The search engine also prohibits alternative payment options to Google Play Billing. In its statement, KPPU argued that by limiting payment options on Google Play Store resulted in few app users. This meant less transactions and lower revenues for app developers.

KPPU Directive

In addition to the fine, KPPU directed Google to terminate the mandatory use of Google Play billion in its Play Store. The competition watchdog ordered the US search giant to allow developers access to the User Choice Billing program.

As a remedy for Google’s monopolistic practices, the Indonesian agency has asked the company to give developers at least 5% discount on service fee. The discount should run for a year following finalization of the decision.

KPPU said that Google must settle the $12.6 million fine within 30 days after the decision is finalized. Should Google delay the payment, Indonesia will apply a late penalty of 2% of the fine amount each month.

The competition watchdog noted that Google Play Store is the single app store that is pre-installed in Android devices. This alone allows the search engine access to more than 50% market share. This is in addition to the 95.16% market share that the company has in the search engine market in Indonesia. Search engines like DuckDuckGo, Yahoo, and Bing held the remaining share as of January 2024.

Google’s Reaction

Google has expressed its commitment in complying with Indonesian regulations. The search giant has also said that it will appeal the ruling issued by the KPPU. The search giant argued that its practices support healthy competition in the app development ecosystem.

“We strongly disagree with the KPPU’s decision and will appeal. Our current practices foster a healthy, competitive Indonesian app ecosystem, offering a secure platform, global reach, and choice, including user choice billing – which enables alternatives to Google Play’s billing system. Beyond our platform, we actively support Indonesian developers through a comprehensive suite of initiatives, including Indie Games Accelerator, Play Academy, and Play x Unity, reflecting our deep investment in their success. We remain committed to complying with Indonesian law and will continue collaborating with the KPPU and stakeholders throughout the appeals process,” Google spokesperson Danielle Cohen said in a statement.

Google is currently facing a series of legal suits for violating antitrust practices and abuse of its dominant market power. Besides Indonesia, the search giant has been slapped with hefty fines by India, France, South Korea, the EU and the US.

The post Indonesia Fines Google $12.6 Million for Monopolising Play Store Billing System appeared first on Tech Research Online.

“Thanks for your patience and support. As a result of President Trump’s efforts, TikTok is back in the US!,” TikTok’s welcome notification to users read.

Joint Venture

While committing to delay the US TikTok ban through an executive order, Trump said that America will be pursuing a joint venture to continue making the video streaming app accessible to over 170 million US TikTok users. The app had been inaccessible to US users since late Saturday evening.

“A law banning TikTok has been enacted in the U.S. Unfortunately, that means you can’t use TikTok for now,” A section of TikTok’s message read.

TikTok returned within hours of Trump’s announcement with millions of US users welcoming the news. Most users use the video-streaming app everyday to find entertainment, news, and communities, and earn a living. Trump said he would be extending the duration before the divest-or-ban law can take effect. He said the extension will enable his administration to strike a deal that protects US national security.

“I would like the United States to have a 50% ownership position in a joint venture. By doing this, we save TikTok, keep it in good hands, and allow it to stay up,” Trump wrote on Truth Social.

Trump said that the executive order extending the divest-or-ban law will place no liability on the company that enabled the social media app from going off before his order.

Political Victory

By reviving TikTok, Trump may well be on the way to scoring political victory by attributing continued usage of the popular social platform to himself. On Sunday, TikTok said that his promise made it possible for the platform to restore TikTok US service even before the executive order is signed.

“In agreement with our service providers, TikTok is in the process of restoring service. We thank President Trump for providing the necessary clarity and assurance to our service providers that they will face no penalties providing TikTok to over 170 million Americans and allowing over 7 million small businesses to thrive. We will work with President Trump on a long-term solution that keeps TikTok in the United States,” TikTok said in a statement.

Trump had met TikTok CEO last December, after which he said he could keep TikTok running in the US a little longer. TikTok’s appreciation of the incoming President, just a day before his inauguration, comes at a time when tensions between the US and China remain high.
Trump has expressed commitment to increase tariffs on China. He has also indicated willingness to meet the Chinese leader. When asked about Trump’s readiness to strike a deal on TikTok ownership, the Chinese foreign ministry held that companies should be allowed the leeway to divide on their deals and operations independently.

“TikTok has operated in the U.S. for many years and is deeply loved by American users. We hope that the US can earnestly listen to the voice of reason and provide an open, fair, just, and non-discriminatory business environment for firms operating there,” Ministry Spokesperson Mao Ning said.

The Challenge Ahead

Trump’s executive order may not resolve the TikTok ban issue in its entirety. The order will likely experience challenges from members of Trump’s party who are opposed to extension of the ban.

“We commend Amazon, Apple, Google and Microsoft for following the law and halting operations with ByteDance and TikTok, and we encourage other companies to do the same. The law, after all, risks ruinous bankruptcy for any company who violates it. Now that the law has taken effect, there’s no legal basis for any kind of ‘extension’ of its effective date,” Republican Senators Pete Ricketts – Nebraska and Tom Cotton – Arkansas said in a statement.

The two Senators claimed that TikTok should only resume usage in the US by cutting all ties with China to ensure that Americans are fully protected from the privacy and security threats it poses.

The post Trump Restores US TikTok Service, Proposes 50% American Ownership of the Short Video Platform appeared first on Tech Research Online.

DORA Requirements

The new Digital Operational Resilience Act (DORA) requires financial service providers and companies that support them technologically to bolster their IT systems. DORA compliance is aimed at ensuring that the financial industry across the EU remains resilient in the event of disruptions like cyberattacks.

Institutions that breach the new EU bank security rules could be slapped with high penalties. Fines for failing to comply with the new regulations could be equivalent to 2% of a banking entity’s annual global revenue. The new rules also provide for the liability of managers in financial service firms. This means that individual managers may be held responsible for breaches of the law. If found liable, managers could face sanctions as high as $1 million.

As part of complying with DORA, financial entities have to conduct rigorous IT risk assessment and incident management. They also have to assess their classification and reporting processes, test their operational resilience, and share information on cyber threats and vulnerabilities.

Financial firms are also expected to assess their concentration risk in relation to outsourcing important functions to third parties.

Mixed Compliance

But Cisco Deputy General Counsel and Chief Privacy Offer Harvey Jang, says DORA compliance in the EU has been mixed.

“I think we’ve seen a mixed bag. Of course, the more mature-stage companies are further along looking at this for at least a year, if not longer. We’re really trying to build this compliance program, but it’s so complex. I think that’s the challenge. We saw this too with GDPR and other broad legislation that is subject to interpretation – what does it actually mean to comply? It means different things to different people,” Jang said.

In the absence of common knowledge of what robust compliance with the EU’s new cyber rules entails, most financial institutions are forced to improve their security standards beyond the required levels.

A survey by Cyberdefence shows that 43% of financial entities in the UK have not complied fully with DORA. Although the UK is no longer part of the EU, these statistics are concerning because the new law applies to all financial institutions that operate within the EU.

“Whilst it is clear that DORA has no legal reach in the U.K., entities based here and operating or providing services to entities in the EU will be subject to the regulation,” Orange Cyberdefense Consultant Richard Lindsay said.

Despite these challenges, most financial experts feel it will not take long before financial institutions across Europe comply with the new rules.

“Banks in Europe already comply with significant regulations which cover the majority of the areas that fall under DORA,” Accenture EMEA Financial Service Security Lead Fabio Colombo said.

IT Supplier Regulation

DORA also provides for penalties for IT suppliers. The rules provide for levies equivalent to about 1% of the average daily global revenue for a period of 6 months.

“These sanctions are necessary. They are a powerful motivator, pushing leaders to take compliance and operational resilience more seriously than ever,” Sonatype CTO Brian Fox said.

But Linsay from Orange Cyberdefense says this poses long-term risks for financial entities that shift critical security services and functions in-house.

“Advances in technology may allow financial institutions to move services back in-house, simplifying this aspect and reducing the risk of non-compliance. Either way, existing contracts will need to be updated to ensure compliance is contractually mandated and monitored between entity and provider,” Lindsay added.

The post Financial Firms’ Readiness in Question as New EU Cyber Rules Take Effect appeared first on Tech Research Online.

A Strategic Deal

Sources close to the two companies said the Guillemont family association and Tencents, a Chinese tech firm are currently evaluating Ubisoft assets to determine their valuation and decide which ones to include in the new entity.

The buyout deal is very strategic for Tencent. Should the deal succeed, the gaming and social media platform will own a stake in the new venture, which will expand its control over some intellectual properties in Ubisoft. This will enable the Chinese tech giant to boost its video gaming business outside China.

Deliberations are ongoing and no final decisions have been made, the people said. A representative for Tencent declined to comment. A spokesperson for Ubisoft referred to the company’s Jan. 9 announcement, when it said it had appointed advisors to review and pursue various options to boost value, declining to comment until that process has been completed.

Stabilizing Ubisoft

Tencent and the Guillemot family were reportedly talking to advisors on strategies for stabilizing Ubisoft and boosting its stocks that had plummeted. Ubisoft’s market value has dropped significantly due to a drop in share prices. The stock plunge was triggered by a delay in the release of several games, including Star Wars Outlaws and Assassin’s Creed Shadows. For instance, the company pushed the launch of Assassin’s Creed Shadows from November 2024 to February 2025.

Investors have also expressed concerns over the company’s financial performance and game quality which have made it challenging for it to remain competitive. Sources close to the company say a Ubisoft buyout was among the options under consideration. As of March 2024, the Guillemot family and Tencent owned 25.4% of the French video game publisher’s share capital and held 29.6% of voting rights in the company.

The Biden administration has included Tencent on the list of firms that are working with the Chinese army or making a significant contribution to the country’s industrial base. Although companies on this list do not attract any specific sanctions, the US government discourages American firms from engaging such companies.

Market Performance

News of the buyout triggered a Ubisoft share surge on Wednesday, January 15. Shares of the video game company rose by 4.3%, the largest intraday rise in close to three weeks. Over the last year, Ubisoft stocks have lost an estimated 47% of their value, placing the company’s market valuation at $1.6 billion. Last September, Ubisoft reduced its sales outlook and announced a delay in the debut of the Assassin’s Creed Shadows. The company pushed the launch of this game a second time to March 20, 2025, last week.

On the contrary, Tencent profit margins have been surging. In November 2024, the company reported that its quarter profits grew by 47% to reach $7.37 billion, surpassing the LSEG $6.39 billion estimates for the period. The Chinese gaming and social media company attributed this performance to growth in advertising, games, and cloud services.

Tencent owns WeChat Pay, one of the large mobile payment apps in China. The company reported an 8% increase in annual revenues to reach 167.2 billion yuan, up from 154.6 billion in quarter three. This increase is largely within analyst forecasts of 167.9 billion yuan. The company expects to generate significant cash flow over the next year through share buybacks and dividends.

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The lawsuit against Elon Musk filed by the SEC claims he broke “securities laws in delaying disclosure that may impact the transparency of markets and investors’ confidence.” The Elon Musk SEC lawsuit sparks a debate over compliance and fairness in financial markets.

As per an SEC rule, the investors need to reveal within 10 days if they own more than 5% ownership but Elon Musk was given time till 24th March 2022. The SEC said, “At the expense of unsuspecting investors, Musk instead bought more than $500 million of Twitter shares at artificially low prices before finally revealing his purchases on April 4, 2022, by which time he owned a 9.2% stake. Twitter’s share price rose more than 27% following that disclosure”

Allegations and Potential Consequences

The SEC lawsuit against Elon Musk is because of the delayed disclosure of Twitter shares. This allowed him to buy additional shares at a lower price, giving him an unfair advantage. Additionally, X’s CEO also raised funding worth $6 billion for his AI startup to compete with Open AI’s Chat GPT.

If proven, violations could lead to penalties, which may include fines and further scrutiny from regulators. The SEC is also trying to drive home a point about disclosing rules, specifically for high-profile individuals like Musk.

One of Elon Musk’s lawyers, Alex Spiro, called the SEC lawsuit the culmination of the regulator’s “multi-year campaign of harassment” against his client. He said, “Today’s action is an admission by the SEC that they cannot bring an actual case. Mr. Musk has done nothing wrong and everyone sees this sham for what it is.”

Broader Implications

This is the latest step in the long history of complicated dealings between Musk and the SEC. For years, the agency has watched over his public statements and actions that affect the price of Tesla’s stock. The stake in Twitter’s shares is a latest example of Musk’s non-conformist attitude toward compliance.

The charges against Musk by the SEC remind corporate executives and large investors about the importance of transparency in financial markets. The SEC’s action ensures that even influential figures like Musk are held accountable under the law. Tesla’s founder is a part of another major lawsuit. Elon Musk sued Open AI to stop them from shifting to profit.

Elon Musk has not responded to the SEC lawsuit, but legal analysts are expecting a strong defense. Musk may claim the delay was unintentional or due to administrative oversight.

Given Musk’s history of challenging the SEC, he may argue that the regulator is unfairly targeting him. This legal battle could set a precedent for how the SEC enforces disclosure rules for prominent figures.

The post US SEC Files Lawsuit Against Elon Musk Over Delayed Twitter Stake Disclosure appeared first on Tech Research Online.

Protecting US AI Leadership

According to the US government, the Biden administration AI policy is designed to maintain America’s dominance in the AI technology industry across the globe. The purpose of the policy is to keep advanced computing power within the US and among its close allies while blocking access to China, Iran, Russia, and North Korea.

The lengthy AI chip export restrictions are being introduced in the final days of the current President Joe Biden.

“The US leads AI now – both AI development and AI chip design, and it’s critical that we keep it that way,” US Commerce Secretary Gina Raimondo said.

Nvidia argues that the rules restrict a technology that’s already in use in consumer hardware and gaming PCs According to the giant chip manufacturer, the new regulations “threaten to derail innovation and economic growth worldwide,” they would “undermine America’s leadership,” Ned Finkle, Nvidia VP of Government Affairs said.

Country Tiers

The new AI chip export rules alter the AI chip landscape around the world by creating three country tiers. One tier comprises 18 countries that will be exempted from AI chip exports. These include countries like Britain, Japan, South Korea, Britain and the Netherlands.

The other tier has a set of 120 other countries that will face limits. These include Israel, Singapore, the UAE, and Saudi Arabia. The last tier comprises arms-embargoed countries that are barred from accessing US AI technology. These include Russia, Iran, and China.

Under the chip export regulations, US big techs like Microsoft and AWS can only deploy 50% of their AI computing power beyond the US borders. The law caps this deployment to 25% for tier-one countries and not more than 7% in tier-two countries.

“The U.S. has to be prepared for rapid increases in AI’s capability in the coming years, which could have a transformative impact on the economy and on our national security,” US National Security Adviser Jake Sullivan said.

Authorized companies have to comply with the stringent restrictions and conditions to get government approval. These include having a good track record of respecting human rights and complying with reporting and security requirements.

Far-Reaching Implications

The new Nvidia AI regulations are the climax of Biden’s administration’s efforts to stagger China’s access to advanced AI chips and prevent the Asian country from supercharging its military capabilities with these technologies. But Nvidia argues that US leadership in AI technologies will suffer under the new regulations.

Nvidia also argues that the restrictions will not improve national security in the US. The new rule “would impose bureaucratic control over how America’s leading semiconductors, computers, systems, and even software are designed and marketed globally.

“Rather than mitigate any threat, the rules would only weaken America’s global competitiveness, undermining the innovation that has kept the U.S. ahead,” Finkle said.

Oracle also criticized the new regulations last year. The data center provider argued that the rules will hand over the global AI chip market over to Chinese competitors.

Although it’s still unclear how the incoming US President Donald Trump will implement the new regulations, both administrations hold similar views with regard to China. The AI chip export regulations will take effect in 120 days. This will allow the Trump administration to give it careful consideration.

The post New Chip Export Restrictions Will Hurt US Global AI Competitiveness, Nvidia Says appeared first on Tech Research Online.

A Counterproductive Move

According to Nvidia, the efforts by White House to control technologies that already exist could be counterproductive. Nvidia is an industry leader in the production and sale of AI accelerators. Big techs need these accelerators to facilitate data-center operations and develop the latest AI models. Nvidia’s technology leverages graphic processing units that are used in gaming.

“It makes no sense for the Biden White House to control everyday data-center computers and technology that is already in gaming PCs worldwide, disguised as an anti-China move,” Finkle said.

Introducing US AI chip export limits will place a cap on the sale of AI chips manufactured in America both for countries and companies. This move would put a tight limit to the amount of exports that American manufacturers export to most countries. The AI chip export curbs are part of the broader US strategy to keep China and Russia from accessing the latest technology.

“The extreme ‘country cap’ policy will affect mainstream computers in countries around the world, doing nothing to promote national security but rather pushing the world to alternative technologies,” Nvidia VP of Government Affairs Ned Finkle said in a statement.

Chip Curb Tiers

The new regulations on AI chip export curbs will most likely go public soon. Sources who are familiar to the regulations say they will form three tiers of chip limits that will see a group of American allies get full access to US-made semiconductors.

However, the majority of countries across the world will be slapped with restrictions, including limitations on the computing power that they can access. If the Biden administration proceeds to introduce the new rules, it will be doing so just weeks before President-elect Donald Trump takes office.

“This last-minute Biden administration policy would be a legacy that will be criticized by US industry and the global community. We would encourage President Biden to not preempt incoming President Trump by enacting a policy that will only harm the US economy, set America back, and play into the hands of US adversaries,” Finkle added.

Nvidia vs Trump policies

Nvidia has said that it expects the Trump administration to regulate the chip industry less than the Biden administration. Speaking at the Consumer Electronics Show earlier this week, Nvidia CEO Jensen Huang said less regulation would be good for an industry that wants to move fast.

Early this week, Jensen said he was willing to meet the President elect and offer help to the incoming administration.

“I’d be delighted to go see him and congratulate him, and do whatever we can to make this administration succeed. We will give them as much insight as we can from our perspective. I am sure the administration will make the right moves,” Huang said during a Bloomberg Television interview.

Big techs have been cozying up to the President-elect in anticipation of the incoming administration. Huang is yet to pay Trump a visit. In the last two years, Nvidia has benefited immensely from surging AI spending that has turned it into the world’s most valuable chip manufacturer. Last year, Nvidia stocks tripled after gaining 239% in 2023.

Trump’s administration is expected to play a significant role in Nvidia’s future plans. The policies that the new administration puts in place will determine how fast the chip maker can achieve its global goals.

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It is one of the major changes in Meta’s policy as the CEO Mark Zuckerberg intends to end the Meta vs Trump debate. These changes will affect the biggest social media platforms in the world i.e. Facebook, Instagram, and Threads. Recently, Meta also appointed Joel Kaplan as the new Global Policy Officer as the tech giant aims to make better relations with the new President.

The Meta fact-checking program was launched to stop the spread of misinformation, particularly during elections and public health crises. By putting it on hold, Meta has a growing problem in balancing free speech with its responsibility to keep information accurate on its platforms.

Meta Policy Reversal Sparks Controversy

The suspension of the fact checking program marks a shift for Meta towards less strict regulation regarding content. Criticism about the Meta’s move to roll out the fact-checking program, argued that such policies might mean leaving open opportunities for uncurated information circulation.

According to Meta, this decision falls within its pursuit of adapting to shifting regulatory landscapes. Critics say this is yielding to political pressures, particularly now that the heat is mounting between Meta and Trump in their battle over moderation policies the company previously employed.

Zuckerberg said in a video, “We’ve reached a point where it’s just too many mistakes and too much censorship. It’s time to get back to our roots around free expression.”

When Trump was asked about the suspension of Meta’s fact checking program, he said, “They have come a long way – Meta. The man (Zuckerberg) was very impressive.”

Implications for Social Media Regulation

Suspension of Meta’s fact-checking program suggests a larger shift in the changing political landscape among social media firms, which review their policies more frequently. Meta’s decision would have long-term implications for the reputation of Meta and its management of misinformation.

According to critics, any such Meta policy change will serve to undermine the public’s trust in the company’s commitment toward transparency and accountability. With these political dynamics playing out, other platforms will similarly follow Meta’s move as they look to deal with identical concerns.

Meta’s decision to suspend its fact-checking program marks a landmark shift in how it handles content moderation. Amid the Trump administration’s influence in tech policy, the move illustrates the precarious line social media must walk between serving regulatory requirements and public trust.

The debates over Meta vs. Trump will go on, but the impact of policy-shifting for the future of misinformation management and free expression online will be furthered scrutinized.

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