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Tag: Big Tech

  • Big Tech vs Australia. New law to force platforms to pay publishers

    Big Tech vs Australia. New law to force platforms to pay publishers

    Australia is once again becoming a global testing ground in the state-BigTech relationship. The government in Canberra has announced plans to introduce a ‘News Bargaining Incentive’ – a mechanism to replace the existing, ineffective 2021 regulations. The new regulation presents giants such as Meta, Alphabet and TikTok with a stark choice: either negotiate commercial deals with local publishers, or face a tax of 2.25% of their local revenues.

    According to the bill, which is expected to come into force in July 2025, the proceeds of the new levy will not go into the general state budget, but will be redirected directly to media organisations. The key criterion for the distribution of funds is to be the number of journalists employed, in order to promote real content creation and not just coverage. Prime Minister Anthony Albanese, despite warnings from the US administration about possible retaliatory tariffs, emphasises the sovereignty of Australian economic policy.

    Australia’s move is a shift away from a soft negotiation model to hard fiscalism. The previous system allowed platforms to avoid payment by extinguishing contracts or, in extreme cases, blocking news content, something the Met has already tested in 2021. The current proposal is much harder to neutralise from an operational level – a tax on revenue is a cost that cannot be avoided with a simple algorithm change.

    However, the geopolitical risks are worth noting. Donald Trump’s announcements of tariffs on countries that tax US technology companies suggest that local journalism protection could become the trigger for a wider trade conflict. For the technology sector, this represents a period of increased volatility and the need to review strategies for presence in markets with strong protectionist tendencies.

  • Digital tax in the polish government’s work list. Who will the new tax cover?

    Digital tax in the polish government’s work list. Who will the new tax cover?

    Polish minister of digitalisation Krzysztof Gawkowski announced that a project including a digital tax has been added to the government’s work list. If adopted and enacted, the project will be a move that positions Poland alongside France or Italy, creating a local response to the sluggishness in developing a global tax agreement at OECD level.

    The proposed tax structure precisely targets the largest entities. With the revenue threshold mechanism set at EUR 1 billion on a global scale and PLN 25 million on the local market, the new burden will bypass Polish start-ups and medium-sized platforms. The Ministry of Digitalisation is sending a clear message: we are taxing scale, not innovation.

    Selectivity architecture

    The key to understanding the new regulation is who is missing from it. The government has opted for broad exemptions that protect traditional e-commerce and the financial sector. A fashion brand’s online shop or a bank’s mobile app remain outside the reach of the new tax. Instead, the tax will strike at the heart of the business model of platforms such as Google, Meta or Amazon – where revenue is generated through personalised advertising, marketplace intermediation and monetisation of user data.

    The maximum rate of 3% on gross revenues may seem low, but in the world of technology, where operating margins are under constant pressure, it is a significant amount. An important safety net for companies with a real investment presence in Poland is that the new levy can be reduced by the income tax (CIT) paid. This suggests that the government does not want to penalise companies with a physical presence in the country, but rather those that transfer profits to jurisdictions with more favourable taxation.

    Digital arms fund

    Behind the ideological façade of ‘levelling the playing field’ lies hard budget mathematics. Estimates indicate that by 2030, the tax could feed the state coffers with more than PLN 3 billion a year. However, Warsaw does not intend to use these funds for current consumption. The strategy is to create a closed loop: the money collected from the giants is to return to the market in the form of investments in Polish AI, cyber security and digital competence.

    For the local tech ecosystem, this is a double-edged sword. On the one hand, the announcement of billions in AI subsidies is promising. On the other – there is a legitimate fear that the platforms subject to the tax will simply raise commissions for Polish vendors or increase advertising prices, which will ultimately be financed by the domestic consumer.

    International context

    Poland is embarking on a path previously followed by Austria or the UK, among others, while ignoring the cautious attitude of Germany or Ireland. The decision comes at a time when discussions on the so-called OECD First Pillar have stalled. By introducing its own solution, Warsaw gains negotiating leverage, but exposes itself to potential trade retaliation, particularly from the US, which traditionally sees digital taxes as discriminatory towards its domestic champions.

    The details of the definition of ‘digital interface’ and the role of the tax representative will be crucial in the coming months. It is in these technical provisions that the question of how profoundly the new tax will affect the profitability of digital operations in Central Europe will be decided.

  • The Greenland effect in IT: How unpredictable US policy is driving the European cloud

    The Greenland effect in IT: How unpredictable US policy is driving the European cloud

    Until a few years ago, the term ‘technological sovereignty’ was the domain of academic debates and niche reports prepared by EU officials in Brussels. For a CEO or CTO in Europe, US Big Tech was like gravity – fixed, inevitable and, despite some privacy controversies, guaranteeing stability. However, recent months have brought a brutal verification of this optimism. Events on the Washington-Brussels line, including Donald Trump ‘s staggering territorial ambitions for Greenland, have catalysed changes that could redraw the map of digital business in Europe forever.

    The end of digital optimism

    Why has the ‘Greenland Effect’ become a symbol of change in IT? While the US administration’s attempted annexation of the island may have seemed like a media anecdote, for European business leaders it was a clear warning: we live in a time where existing rules of the game and alliances can be challenged in a single tweet or unpredictable political decision.

    Risk is no longer theoretical. Today, European business has to ask itself a question that until recently sounded like a sci-fi movie script: what will happen to my company if access to SaaS services, cloud computing or data centres from the US is blocked as a result of a diplomatic dispute? The answer to this question today is building a new strategy of ‘limited trust technology’.

    The statistics of addiction: Landscape after the battle

    To understand the scale of the challenge, it is important to look at hard data. In 2024, European customers will have spent nearly $25 billion on cloud infrastructure provided by the five largest US players. According to IDC data, US companies control as much as 83% of the European cloud market.

    This contrast is striking when we recall Europe two decades ago. In the age of mobile telephony, it was our continent that dictated the terms thanks to the power of Nokia and Ericsson. Today, in the age of the data economy, Europe finds itself in the deep shadow of the United States and China. Attempts to build local search engines or social networks have failed, crushed by American scale, high-risk culture and almost unlimited access to capital.

    EU business leaders point to three main inhibitors: excessive bureaucracy, market fragmentation into 27 national systems and a fear of risk that paralyses innovation at an early stage.

    Fortress Europe: A new defence strategy

    Faced with rising tensions, Germany and France – the two largest economies in the Union – have stopped waiting for a pan-European consensus and have gone on the offensive. The strategy is clear: if we cannot (yet) create our own Google, we must secure the foundations.

    The German Federal Ministry of Digitalisation has just implemented openDesk, an open source alternative to Microsoft tools. This signals that open source software is ceasing to be the domain of enthusiasts and is becoming an ‘insurance policy’ for state institutions and strategic enterprises. France, on the other hand, is promoting Visio, a local videoconferencing solution, eliminating dependence on US platforms in public administration.

    President Emmanuel Macron is going one step further, offering cheap nuclear power to companies building data centres in the region and actively supporting Mistral AI – the European answer to software from OpenAI. This is no longer just politics; it is the construction of a new business ecosystem in which the ‘origin of technology’ becomes a key parameter of choice.

    Giants’ response: Camouflage or adaptation?

    US tech giants are not going to stand idly by and watch their loss of influence in a region that generates hundreds of billions of dollars in revenue for them. Big Tech’s adaptive strategy is fascinating: they are building ‘European clouds’ to look and act like local companies.

    Microsoft is stepping up its collaboration with Delos Cloud (a subsidiary of SAP) and Google is setting up independent entities based in Germany and staffed exclusively in the EU. The aim is clear: to circumvent concerns about the US Cloud Act, which in theory allows US services to see data stored abroad.

    However, for the informed CTO, this is still a half-hearted solution. The question of whether the US giant’s ‘local company’ will realistically resist pressure from its own government in a crisis situation remains open.

    Change management: People, not just bits

    As Frank Karlitschek, CEO of NextCloud, points out, technology is only half the battle. The biggest challenge for the European business is change management. Migrating from comfortable, familiar US systems that have been around for years to European or open-source alternatives is an operationally painful process.

    It requires excellent communication and preparation of employees to change their habits. However, in the new geopolitical paradigm, this effort is seen not as a cost, but as an investment in Business Continuity.

    Technology as a diplomatic currency

    “The Greenland effect” has made Europe realise that in the 21st century sovereignty does not end at land borders – it begins at servers. Europe does not seek complete isolation from American technology, because that would be economic suicide. It does, however, seek to create a ‘fuse’.

  • Retreat from confrontation. Brussels abandons ‘internet tax’ for Big Tech

    Retreat from confrontation. Brussels abandons ‘internet tax’ for Big Tech

    European telecoms operators hoping to systemically force US tech giants to co-finance network infrastructure may be feeling disappointed. Instead of the announced revolution and hard regulation in the ‘Fair Share’ discussion, the European Commission intends to bet on diplomacy.

    According to reports on the draft Digital Networks Act to be presented by Commissioner Henna Virkkunen on 20 January, Brussels is moving away from imposing binding financial obligations on the largest generators of network traffic. Instead, the document envisages the introduction of a framework for voluntary cooperation under the supervision of the Body of European Regulators for Electronic Communications (BEREC). Giants such as Google and Meta would only be encouraged to attend meetings and define ‘best practices’, effectively dismissing the vision of direct cash transfers to European telcos.

    The European Commission’s change of course is a clear sign of geopolitical pragmatism. Faced with the new administration of Donald Trump, who sees every attempt to tax US corporations as an economic provocation, Brussels is opting for a strategy of conflict avoidance. In a situation of strained transatlantic relations, where Washington is reacting more and more aggressively to attempts to regulate its digital champions, the Digital Network Act becomes part of a delicate diplomatic game. The EU seems to be calculating that escalating trade tensions is too risky at the moment, even at the expense of the interests of local internet providers.

    However, the bill is not only an issue of relations with the US, but also an attempt to harmonise the internal market, which is meeting resistance from member states. Key economies, including France, Germany and Italy, remain sceptical of the centralisation of telecoms governance, preferring to maintain control over regulation at national level.

    The document also addresses infrastructure issues, proposing a unification of spectrum auction rules and a potential revision of digital targets. The Commission allows for the possibility of postponing the date for the complete extinction of copper networks and their replacement by fibre, originally planned for 2030. If local authorities demonstrate that this deadline is unrealistic, Brussels is prepared to be flexible, further evidence that the upcoming legislation will be a set of compromises rather than a radical breakthrough.

  • Brussels twist: EU delays key AI legislation under pressure from Big Tech

    Brussels twist: EU delays key AI legislation under pressure from Big Tech

    The European Commission is taking a clear step backwards on the digital regulation front. Responding to growing criticism from US tech giants and concerns about the region’s economic competitiveness, Brussels on Wednesday proposed a package of changes known as the ‘Digital Omnibus’. The proposal involves not only simplifying the bureaucracy, but above all significantly delaying the implementation of the restrictive requirements of the Artificial Intelligence Act (AI Act).

    The most important element of the proposal is the postponement of deadlines for AI systems classified as ‘high-risk’ solutions. Originally, the stringent rules were due to take effect in August 2026, but the Commission is now suggesting postponing them until December 2027. The decision represents a significant breather for companies deploying algorithms in sensitive areas such as employee recruitment, credit scoring, healthcare services, critical infrastructure or biometric identification.

    However, the change of course goes beyond the implementation calendar itself. The proposed adjustments also touch upon the ‘holy grail’ of European regulation, the RODO. The new legal framework is intended to make it easier for giants such as Alphabet(Google), Meta and OpenAI to use Europeans’ personal data to train their artificial intelligence models. This is a direct response to the arguments of the industry, which has long pointed out that the EU’s stringent data protection creates an insurmountable innovation barrier in the race against the US and China. In addition, the package provides for the simplification of user-annoying cookie consent mechanisms.

    Although officials in Brussels at the briefing asserted that ‘simplification is not deregulation’ but merely a critical review of the regulatory environment, the move is part of a wider trend. As with the recent relaxation of environmental regulations, the EU seems to be bowing to pressure from business and the risk of political retaliation from Washington. “The Digital Omnibus has yet to be approved by member states, but the very fact of its creation signals that Europe is beginning to review its role as global digital sheriff in favour of economic pragmatism.”

  • Brussels relaxes AI Act. Big Tech can take a temporary breather

    Brussels relaxes AI Act. Big Tech can take a temporary breather

    It looks like intense lobbying by big tech companies and criticism from the US administration is bearing fruit. The European Commission is considering relaxing some of the provisions of its landmark Artificial Intelligence Act (AI Act), which could give valuable deferral to players such as Apple and Meta.

    The move is part of the new Commission’s wider drive to ‘simplify’ the complex digital regulations the EU has adopted over the past two years. Key to this is to be the so-called ‘Digital Omnibus’, a simplification package to be unveiled by the EU’s new executive vice-president for digital, Henna Virkkunen, on 19 November.

    According to a draft document accessed by Reuters, the Commission is proposing “targeted simplification measures” to ensure proportionate implementation of the rules.

    What does this mean in practice? First of all, companies can be exempted from registering their AI systems in the EU database for high-risk systems if the tools are only used for ‘narrow or procedural tasks’. This is a significant reduction in the bureaucratic burden that the industry has been calling for.

    Moreover, the industry may gain additional time to comply. The document introduces a one-year grace period for the imposition of financial penalties, which would not be enforced until 2 August 2027. The transitional grace period would also cover a key requirement to flag AI-generated content – a mechanism to combat deepfakes and misinformation.

    This change of course is not isolated. Brussels also recently relaxed its ambitious environmental rules after strong opposition from industry and farmers. For technology companies, which had criticised the AI Act for potentially stifling innovation, this is a clear signal that their voice (and pressure from Washington) has been at least partially heard. The document is still subject to change before the official presentation.

  • New H-1B visa fee hits Big Tech. Trump administration introduces $100,000 fee

    New H-1B visa fee hits Big Tech. Trump administration introduces $100,000 fee

    President Trump’ s administration has announced the introduction of a new one-off $100,000 fee for H-1B work visa petitions. The decision caused an immediate and nervous reaction in the technology sector, which relies heavily on foreign professionals, mainly from India and China.

    Initial reports, suggesting that the fee would be annual, caused a wave of uncertainty. In response, tech giants such as Microsoft, Amazon, as well as investment banks including JPMorgan and Goldman Sachs, immediately recommended that their employees with H-1B visas refrain from international travel or return to the US as soon as possible.

    The White House eventually clarified that the fee would be a one-off and would only apply to new visa petitions, not to current visa holders or renewal applications. Nonetheless, the confusion has caused concern among thousands of workers and demonstrated how sensitive the sector is to changes in immigration policy.

    The administration argues that the drastic fee increase is aimed at levelling the playing field for American workers and discouraging companies from replacing them with cheaper foreign labour. The aim is to get corporations to invest in training US college graduates rather than importing talent.

    The move is part of the administration’s broader immigration policy, which has sought to restrict legal immigration since the beginning of its term. The new regulations are also intended to prioritise highly skilled and highly paid professionals under the H-1B programme.

    The technology sector and market analysts warn of the long-term consequences. The new costs are likely to hit smaller companies and startups particularly hard, for which it will become financially unattainable to hire a key specialist from abroad. There is a risk that companies, instead of hiring in the US, will start moving advanced projects and jobs abroad.

    Critics point out that such a policy could undermine the US economy’s innovative capacity and its position in the global technology race, especially in the crucial field of artificial intelligence. In the short term, Washington may gain additional revenue for its budget, but in the long term it risks losing the competitive advantage it has built up over the years by attracting the best talent from around the world.

    The stock market’s reaction was immediate, with shares of IT services companies, which rely heavily on workers with H-1B visas, seeing declines. The situation remains tense, with the technology industry anxiously awaiting further details and guidance on the implementation of the new regulations.