Divided Digital Europe: Connect at Different Speeds | #cybersecurity | #cyberattack

When the DSA was first envisioned, policymakers planned to focus on illegal speech. They believed it represented the most poisonous type of illegal content found on digital platforms. But it proved impossible to find a common continent-wide definition of illegal speech or even illegal terrorist propaganda while free expression concerns limited how far countries could agree to crack down. France took a hard line, outlawing everything from Holocaust denial to blasphemy. In contrast, Demark opposed restrictions on freedom of expression, while both France and Italy pushed social media platforms to control propaganda and extremism. Poland pushed back against almost all restrictions on speech, fearing overreach on content control.

The resulting DSA refrained from obliging Internet platforms to remove specific forms of speech, leaving that to individual countries to define. Instead, it forces platforms to add ways for users to flag illicit content and to take actions to stop dangerous disinformation from going viral. Users gain the power to refuse recommendation algorithms. Companies will be obliged to publish transparency reports about their content moderation.

Europe’s strategy to achieve “digital sovereignty” will require similar compromises. Although most Europeans approve of the goal to improve Europe’s digital performance, they differ on tactics. Should critical industries such as electric batteries, cloud storage, and semiconductors be subsidized? If so, by how much? Should the measures contain some protectionism, or at least favor European champions? Some countries, most notably France and Germany, aim to see Europe pursue digital sovereignty by limiting data flows and subsidizing European companies. Others, led by the Nordics, see digital sovereignty as promoting European standards and values and reject most infringements on free trade. And still others, particularly in former communist Eastern Europe, fear that efforts to crack down on illegal hate speech will result in silencing legitimate conservative voices.

Upcoming digital legislation will require a balance between national positions. In December 2021, the European Commission unveiled a proposal to make most drivers for Uber, Bolt, and other gig platforms become full-time workers. The European Parliament is toughening the opt outs and a final bill is expected to be approved in 2023. Denmark, with its strong welfare state, and Italy, hobbled by strong tax unions, say yes — but crucially, France, perhaps the EU country with the most stringent labor laws, says no.

In some key policy areas, such as how to tax large tech companies, alliances within Europe are shifting. France has led a campaign to impose a levy on digital platforms requiring tech firms to declare revenues and profits and pay taxes in the countries where they sell their products, rather than routing them through low-tax European headquarters in countries such as Ireland. Initially, Denmark opposed this effort, fearing it would lose tax revenues from its tech innovations to France and Italy where they were consumed. But Denmark has now switched course out of concern that large firms were not paying their fair share.

An unresolved debate concerns state aid and protectionism. France is leading the charge. It has succeeded in lobbying Europe to launch ambitious Europe-wide programs to build electric car batteries and semiconductors.  While the battery and semiconductor projects are concrete, and receive broad Europe-wide support, fears remain over other projects, such as one to create a European cloud. Danish, Dutch, and other critics see it as a dangerous lurch into protectionism against US providers — Amazon, Microsoft, and Google —most of whom are building data centers on their territories.

Artificial intelligence (AI) remains another subject of fierce debate. Although Europeans generally agree that AI should be ethical and controlled to avoid abuses, they disagree on how to achieve this goal, arguing over the proper level of restrictions.  Denmark, wary of slowing innovation, and wary of technology used to conduct surveillance, wants a light-touch regulation, with only a few types of high risk areas considered off-limits. In contrast, Italy and France are willing to require more restrictions. Warsaw refused to support a text on AI and human rights that included the term “gender” equality.  The final AI act, expected to be finalized by the end of 2022, will almost certainly fall in between these positions.

Data represents a key dividing point. Europe is planning a series of new data acts, some of which could promote data localization and discriminate against US cloud computing leaders, Amazon, Microsoft, and Google.  France is pushing hard to build a French and European cloud, limiting the role of US firms.  But Denmark and others are skeptical and fearful that the Gallic quest for digital grandeur will end up wasting European public funds on cloud white elephants — and believe the US cloud players are indispensable.

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