This essay is drawn from Professor Bradford’s book Digital Empires, to be published on September 26, 2023, by Oxford University Press.
In the public conversation and news commentary, there is a commonly repeated narrative that suggests that the main contest over the future of the digital economy is taking place between the United States and China.These two powerful digital regimes compete for technological supremacy in an effort to enhance their relative economic, geopolitical, and military power. But the U.S. and China are also engaged in a fundamental battle of values, as they advance two competing visions for the global digital order: the U.S.’s vision of economic and political freedom and China’s vision of technological progress fused with state control. Some commentators predict that this battle will lead to the emergence of a “splinternet,” where the internet fragments into a Chinese internet and an American internet, with the rest of the world opting into one, or needing to navigate between the two. This development would further accelerate the broader decoupling of both countries’ tech ecosystems that is already underway.
What this narrative gets right is the growing contestation between the U.S. and China over technological supremacy. But it is misleading in drawing the main battleline between the American and Chinese digital orders. In reality, the European Union and several other jurisdictions are neither willing nor forced to choose between these two variants of digital worlds. Many governments that resent the Chinese state-led digital order also dislike the U.S.-led digital order where tech companies have assumed an outsized role in governing the digital society. They view the American regulatory model as increasingly flawed and unfit to respond to the challenges of today’s digital society. Foreign governments and citizens are increasingly rejecting the free market and free speech as cornerstones of their digital economies, growing distrustful of the once-admired tech companies that exercise outsized economic, political, and cultural influence over individuals and societies. Even Americans themselves are now questioning the virtues of the free-for-all global digital order the U.S. created, with the American public supporting stronger tech regulations and Congress debating the need for legislative reform.
With the American digital empire now being challenged, the question is what comes next and how those developments will shape the digital world going forward. We are already witnessing how the growing disillusionment with the American regulatory model is paving the way for the rising influence of China and the EU. In deserting the U.S.’s regulatory approach, countries around the world are either coalescing behind a version of the Chinese regulatory model or adopting the core tenets of the European regulatory model. A more consequential choice is thus emerging not between the U.S. and China but between the competing regulatory regimes promoted by the EU and China. In that scenario, the U.S. is left to choose between joining forces with the EU or acceding to China’s growing influence over the global digital economy.
Three Digital Empires
Today, there are three dominant digital powers—the U.S., China, and the EU—that can metaphorically be thought of as “digital empires.”These modern empires of the internet era are the leading technology, economic, and regulatory powers, each with the ambition and capability to shape the global digital order towards their interests and values. Each jurisdiction also holds a different vision for the digital economy, which is reflected in the regulatory models they have adopted. The U.S. has pioneered a largely market-driven model; China a state-driven model; and the EU a rights-driven model. They have further exported their domestic models in an effort to expand their respective spheres of influence, pulling other countries into the orbits of the American, Chinese, or European digital empires.
The U.S.’s market-driven regulatory model has provided the foundation for the global digital economy as it exists today. The U.S.’s regulatory approach centers on protecting free speech, the free internet, and incentives to innovate.It is characterized by its discernible techno-optimism and relentless pursuit of innovation. As a result, it exhibits uncompromising faith in markets and embraces a limited role for the government. The U.S. government has historically viewed the internet as a source of economic prosperity and political freedom and, consequently, as a tool for societal transformation and progress. According to this techno-libertarian view, government intervention not only compromises the efficient operation of markets; it also undermines individual liberty. Thus, while the U.S.’s commitment to innovation and growth provides the economic rationale against government intervention, its commitment to individual liberty and freedom is often invoked as a political reason to limit the government’s role. Minimizing government interference is seen as essential to producing a vibrant democratic society characterized by free speech and the engagement of diverse voices in civic life.
In contrast to the American market-driven regulatory approach, the Chinese regulatory model rests on a state-driven vision for the digital economy. The Chinese government seeks to maximize the country’s technological dominance while maintaining social harmony and control over its citizens’ communications.China is determined to leverage technology to fuel its economic growth and development. It is currently engaged in an unprecedented state-led effort geared toward becoming the world’s leading technology superpower. In addition to pursuing this economic goal, the government is focused on tightening the political grip of the Chinese Communist Party (CCP) by deploying the internet as a tool for control, surveillance, and propaganda, often with the assistance of Chinese tech companies. However, the Chinese government is increasingly adopting the view that the largest tech companies have grown too powerful. It has recently leveraged its antitrust laws to rein in domestic giants such as Alibaba and Tencent—the opening salvo of an unprecedented assault on its domestic tech industry. Yet even this newest turn in digital regulation serves the fundamental goal of the Chinese government: cementing the state’s control of the digital economy as a defining feature of China’s regulatory model.
The EU’s regulatory approach differs from both the US and Chinese models in being distinctly rights-driven. The EU embraces a human-centric approach to regulating the digital economy where fundamental rights and the notion of a fair marketplace form the foundation for regulation.According to this view, regulatory intervention is needed to uphold the fundamental rights of individuals, preserve the democratic structures of society, and ensure a fair distribution of the benefits from the digital economy. Technology must be harnessed towards human empowerment and with the aim of safeguarding the political autonomy of digital citizens. In contrast to the U.S. model, which focuses on protecting free speech as the fundamental right, the EU model seeks to balance the right to free speech with a host of other fundamental rights, including human dignity and the right to privacy. The EU’s regulatory model also emphasizes that digital transformation needs to be firmly anchored in the rule of law and democratic governance. Whereas the American market-driven model often emphasizes how governments do not understand technology and should hence refrain from regulating it, the European rights-driven model is more concerned that tech companies do not understand the pillars of constitutional democracy or the fundamental rights of internet users.
The U.S., China, and the EU regulatory models are not confined to their own jurisdictions. Instead, each exports its model abroad, expanding its respective sphere of influence and thus the reach of its digital empire. The U.S.’s global influence today manifests through the dominance of its tech companies that exercise private power across the global digital sphere. China’s global influence can be traced to its infrastructure power, where Chinese firms—all with close ties to the Chinese state—are building critical digital network infrastructures in countries near and far. The EU exercises global influence primarily through regulatory power that entrenches European digital norms across the global marketplace. These modes of influence have ingrained American private power, Chinese infrastructure power, and European regulatory power deep into the economic, physical, and legal foundations of foreign societies.
The global reach of the American, Chinese, and European influence over the digital world can be viewed both positively and negatively. For example, many foreign consumers welcome the presence of American tech companies in their markets, not only embracing their products and services but growing to depend upon them. The Chinese Digital Silk Road is also not merely a manifestation of Chinese government’s deliberate expansionist strategy; instead, many foreign governments—in particular, those across the developing world—welcome Chinese infrastructure and capital as a pathway for digital development. Similarly, many foreign citizens relish the global reach of EU digital regulations that protect their privacy or help ensure a safer online environment; and many foreign governments willingly emulate EU regulations which they believe benefit their societies. However, American, Chinese, and European influence can also affect foreign societies in harmful ways, evoking negative connotations associated with the empires of the past era. Critics may accuse, for example, the U.S. of “free-trade imperialism,” the China of “surveillance imperialism” or the EU of “regulatory imperialism.”Thus, today’s digital empires can be both admired and reviled across the territories that fall under their influence.
The Waning Appeal of Techno-Liberalism and the Fall of the American Digital Empire
The U.S.’s influence over today’s global digital order is hard to overstate. That influence manifests through the global presence of American tech companies that are shaping the lives of digital citizens across all continents. Meta’s WhatsApp allows its two billion users across 180 countries to send 100 billion messages a day.In 2022, 40% of the world’s population had a Facebook account, and over 70% of daily social media users globally were Facebook users. Google operates in over 200 countries, where internet users make over five billion Google searches a day. In 2023, Google had over 86% of search engine market share worldwide —a figure that is all the more staggering considering that Google is banned in China. These are just few examples that reveal how a handful of large U.S. tech companies shape what people across Africa, Asia, Australia, Europe, and Latin America think, want, and buy. Despite their global influence, the ethos of these U.S. companies is far from global. They continue to reflect the American techno-libertarian instincts, exporting within their products and services the values of the U.S. market-driven regulatory model.
These tech companies’ global expansion has benefited from the full backing of the U.S. government. Since the early days of the internet in the 1990s, the U.S. government has cultivated an enabling domestic regulatory environment, contributing to the unhindered growth of its tech companies with limited privacy protections, lenient antitrust laws, and generally a hands-off approach towards content moderation. But the U.S. government also proactively sought to export this regulatory environment abroad as part of a consciously designed policy agenda. Throughout the Clinton, Bush, and Obama presidencies, the U.S. actively sought to persuade foreign governments to refrain from regulating digital technologies or censoring the internet as part of its “internet freedom agenda.”This agenda was geared at fostering commercial opportunities for U.S. tech companies in foreign markets. But it was also a deeply ideological, value-driven political project, designed to promote democracy and freedom as part of the broader U.S. foreign policy agenda in the post-Cold War era.
Initially, these U.S. government efforts were successful, enabling American tech companies’ ascent to global dominance while advancing the government’s foreign policy priorities. However, Jack Goldsmith has demonstrated how the outsized influence of U.S. tech companies and their harmful practices created a backlash across jurisdictions, contributing to the demise of the internet freedom agenda over the past decade.Too often, U.S. tech companies were seen as destabilizing foreign societies or undermining the fundamental rights or safety of their citizens. For example, Meta played a troubling role in the Brexit campaign that led the United Kingdom to leave the EU in 2020. Its Facebook algorithms amplified the more emotional and controversial messages that were associated with the pro-Brexit campaign, overshadowing the less inflammatory social media messaging of the Remain campaign. In another disturbing episode, Meta admitted in 2018 that it failed to intervene and remove content posted by military and radical Buddhist groups in Myanmar. These groups utilized Facebook to spread hate, calling for the genocide of Rohingya people. Instead of removing posts that were fueling hatred and discrimination towards the country’s Muslim minority, Meta provided a platform for advocating racist attacks and ethnic cleansing. These and other similarly disturbing developments across the world can be traced to the business models of U.S. tech companies —but also to the U.S. regulatory model that has enabled those business models to emerge and thrive.
In many ways, the tremendous success of U.S. tech companies sowed the seeds of the demise of American digital empire, exposing the downsides of the freewheeling pro-market ethos that sustains it.As a result, digital regulations are now bourgeoning across the world, challenging the commercial non-regulation principle that was at the heart of the internet freedom agenda. Many authoritarian countries are also tightening their control of the digital sphere, challenging the other key tenet of the internet freedom agenda: the anti-censorship principle. At some level, this shift towards greater state control over the digital economy can also be understood as a response to the outsized influence of U.S. tech companies, which many governments saw as a threat to their ability to maintain authoritarian rule. Authoritarian leaders also called out the U.S.’s hypocrisy, pointing out how the U.S. was advocating for internet freedoms yet itself engaged in extensive digital surveillance, both at home and abroad. In 2013, former U.S. National Security Agency contractor Edward Snowden revealed how the U.S. government engaged in extensive intelligence operations —often with the help of its tech companies—giving these countries an additional reason to consolidate the power of the state over the digital realm.
This growing resentment against American tech companies’ global dominance is now contributing to the decline of the U.S. regulatory model, and, with that, the dwindling influence of the values associated with the most powerful digital empire. Yet what provides perhaps the strongest evidence of the decline of the market-driven regulatory model is that the U.S. itself is turning against it. American internet users have started to question the benefits of the techno-libertarian worldview, saying that they too want more digital regulation. For example, according to a 2020 survey, 72% of U.S. adults believe social media companies have “too much power and influence in politics.”The American public is even doubting the U.S. model’s traditionally inviolable commitment to free speech. The political left is concerned about harmful content online, including rampant hate speech, rife disinformation, and foreign interference with elections. At the same time, the political right accuses tech companies of a liberal ideological bias, allegedly reflected in their content moderation practices. This widespread domestic discontent is further eroding the foundations of the American digital empire, contributing to its demise and adding urgency to the question of what comes next.
The Digital Silk Road and the Expansion of the Chinese Digital Empire
While the American market-driven regulatory model is waning in popularity in both the U.S. and abroad, China’s state-driven regulatory model is on the ascent worldwide. It is common knowledge that the Chinese government deploys the internet as a tool for control and surveillance. Much of this surveillance is domestic, geared at curtailing political dissent and maintaining social stability within China. However, there is a growing concern among democratic governments and civil rights advocates that Chinese digital authoritarianism is proliferating throughout the world as Chinese companies build digital infrastructures as part of the country’s expansive “Digital Silk Road” project.Country by country, Chinese tech companies—all with varying ties to the CCP—have built the physical components of digital infrastructures, such as 5G networks or data centers, provided critical telecommunications and e-commerce services, and supplied surveillance technologies along the Digital Silk Road. This has allowed Chinese tech companies to make critical inroads into numerous markets across Asia, Africa, Latin America, and even parts of Europe.
One example of such concerns materializing involves the headquarters of the African Union (AU) located in Addis Ababa, Ethiopia.The Chinese government built and financed the building complex hosting the AU, and the Chinese information and communications technology (ICT) giant Huawei was contracted to provide most of the IT solutions for the building. But in January 2018, the leading French newspaper Le Monde reported that it had uncovered a multi-year hacking operation of the headquarters. The report disclosed that, between January 2012 and January 2017, servers inside the AU building transferred data every night between 12 a.m. and 2 a.m. to unknown servers hosted in Shanghai. After this data theft was discovered, a further investigation revealed microphones hidden in the desks and walls of the building. While it is often difficult to prove that Chinese companies transfer data gained through their overseas operations to the Chinese government, the suspicion of this potential for espionage is already shaping business opportunities for companies such as Huawei. The U.S. is now leading the quest to rein in Huawei’s—and, according to the U.S., the Chinese government’s—global influence by banning Huawei from U.S. networks and urging other nations to do the same. This prominent battle involving the U.S. government and a Chinese tech company illustrates how the reach of one digital empire into the territory of another can morph into a conflict with global implications.
As a growing number of countries are choosing Chinese technology, Chinese technical standards associated with those technologies are also becoming more common—ultimately reaching the point of becoming default standards around which other technologies must be built. The foundational Chinese digital infrastructure is designed to be interoperable with subsequent Chinese technology and can typically be maintained by Chinese vendors, nurturing path dependency.As a result, these countries can become more reliant on Chinese supply chains going forward, tying them closer to the Chinese sphere of digital influence and potentially exposing them to greater influence by, and dependency on, the Chinese government. To further solidify its global influence, China has made a concerted effort to place its nationals into leadership positions in many of the key international standard-setting organizations, giving Chinese firms—and, indirectly, the Chinese government—increasing sway over the standards that govern new technologies. This has facilitated the Chinese government’s efforts to entrench its regulatory standards and surveillance practices—and, with that, its values—across the world.
China’s ascent and growing influence over the digital world is raising concerns for the U.S. and its allies. Seen from the vantage point of the democratic West, China’s technological development is impressive, but its way of harnessing that technology is deeply oppressive.The Chinese government has converted the internet from a tool that advances democracy to an instrument that serves autocracy, illustrating that freedom is not inherent in the character of the internet, but rather subject to a political choice by those with the power to permit or suppress that freedom. China’s digital authoritarian governance model infringes individual rights and deprives Chinese citizens of key civil liberties. It also contributes to the political oppression of the country’s minorities through far-reaching government surveillance. China’s success in exporting its norms and surveillance technologies abroad through the Digital Silk Road further suggests that the Chinese regulatory model presents a threat to liberal democracy and individual freedom not just in China, but across the world.
However, even if a strong normative case could be made against the Chinese regulatory model, it is harder to predict its demise in practice. The state-driven model is faring well, as indicated by several governments around the world emulating many of its key censorship and surveillance features. Many receiving countries have welcomed Chinese technologies and accompanying regulatory standards as a path towards digital sovereignty and development. For example, the Export-Import Bank of China lent Pakistan $124.7 million and waived most of the interest on the loan in return for Pakistan choosing Huawei as its 5G supplier—which Pakistan did without even conducting a competitive bidding process for the project.And even while some governments may share the U.S.’s concern over potential Chinese surveillance, they are willing to overlook those concerns when faced with the opportunity to gain access to telecom and other digital infrastructures that they otherwise cannot afford. For example, Malaysian former prime minister Mahathir Mohamad dismissed the U.S.’s concerns about Huawei’s presence in the country by retorting, “What is there to spy on in Malaysia?” Given this view, it is perhaps not surprising that the Malaysian government signed a Memorandum of Understanding in 2017 with Huawei concerning public security and smart cities solutions
For authoritarian governments, an additional motivation to use Chinese vendors has been to gain access to surveillance technologies that they eagerly use towards illiberal ends. These governments do not share the U.S. and EU’s concern about the future of liberal democracy. The number of countries embracing that view is also rising as democracy is in decline worldwide and countries around the world are turning more authoritarian. According to research by the U.S.-based NGO, Freedom House, 2022 was the twelfth consecutive year of a decline in global internet freedom, as governments were increasingly curtailing speech online, arresting internet users for nonviolent political, social, or religious speech, and suspending access to various social media platforms, or the internet itself.This trend bodes well for the global appeal of Chinese digital authoritarianism as an ideology, while increasing the demand for Chinese-made surveillance technologies or censorship techniques that help governments ingrain that ideology into the structures of their societies.
The U.S.’s recent response to the U.S.-China tech war may have further elevated the standing of China’s regulatory model, however unintentionally. The intense U.S.-China tech rivalry has led the U.S. government to abandon many of the key principles—such as openness and non-discrimination—underlying the American market-driven regulatory model.In an effort to preserve its technological lead and limit China’s access to strategic technologies, the U.S. has moved to restrict exports of, and investments in, key technologies such as critical hardware, semiconductors, and communications platforms that are central to the U.S.-China geopolitical rivalry. The U.S. government is also considering ways to ban or restrict access to TikTok due to national security concerns. In addition, the U.S. is now shoring up its strategic capabilities by pouring unprecedented amounts of government funding into technologies such as AI and semiconductors, fueling a subsidy race that is now leading to growing techno-nationalism around the world. Thus, instead of embracing and exporting its values around freedom, or advocating a limited role for the government as it has traditionally done, the critics are now accusing the U.S. government of playing Beijing’s game. In doing so, the U.S. is modeling elements of China’s state-driven model and thus, effectively even if inadvertently, leading the world away from the values underpinning the U.S.’s market-driven model towards those that reinforce China’s state-driven model.
The Brussels Effect and the Expansion of the European Digital Empire
The Chinese regulatory model is not the only one benefiting from the decline of the American regulatory model. The turn away from the market-driven regulatory model has also elevated the EU’s role in shaping the global digital order. While the authoritarian governments are emulating China’s state-driven regulatory model, deepening discontent with the U.S. model is pushing much of the rest of the democratic world towards the EU’s regulatory model. For many democratic countries, the U.S.’s market-driven regulatory model has proven to be too permissive, while China’s state-driven model is seen as too oppressive, leaving the EU’s rights-driven model the most attractive one to follow. As a result, a growing number of governments and individuals around the democratic world are now coalescing around a view that the EU’s regulatory model best enhances the public interest, checks corporate power, and preserves democratic structures of society, and are increasingly emulating that model as a result.
While the EU has not matched the U.S. and China in technological prowess, the EU wields significant international influence through its digital regulations that have spread across the world. Through its digital regulations, the EU shapes the global business practices of leading tech companies, which often extend these EU regulations across their global business operations in an effort to standardize their products and services worldwide—a phenomenon known as the “Brussels Effect.”The Brussels Effect describes the EU’s unilateral power to regulate the global marketplace. Because of the size and the attractiveness of the EU market, most large tech companies want to access that market, which requires them to comply with the European regulatory standards. While these tech companies could, of course, adopt one standard for the EU market and various other standards for the rest of the world, scale economies and other benefits of uniform business practices often make such a customization strategy unappealing. Instead, these companies frequently choose the most stringent regulatory standard—which is typically the EU standard—as their global standard to ensure regulatory compliance worldwide. In this way, market forces and companies’ business incentives alone are often sufficient to convert the EU’s digital regulations into global regulations.
While the GDPR can be viewed as the posterchild of the EU’s global regulatory influence, antitrust law, regulation of online content, and rules for emerging technologies such as artificial intelligence can similarly be exported through the Brussels Effect. These laws often shape tech companies’ global business practices, leading to more competition, less hate speech, and stronger digital rights for citizens around the world. For example, the EU’s AI Act, which is expected to be adopted later this year, may also generate Brussels Effect. Developers of AI systems who want to use European data to train algorithms empowering AI systems will be bound by the EU’s AI Act even beyond the EU’s borders. To escape EU’s regulatory constraints elsewhere, those developers would need to retrain their algorithms without European data, which can be unappealing as more extensive data often leads to better performance of the underlying models. This may globalize the EU’s AI norms and extend the EU’s global digital influence in the process.
European digital regulations have not only been incorporated into tech companies’ global business practices, but they are often also entrenched in legislation by foreign governments. As governments are turning away from the American market-driven model, they are increasingly embracing the European rights-driven model as an alternative way to govern their digital economies. To date, nearly 150 countries have adopted domestic privacy laws, most of them resembling the EU data protection regime.Many governments emulate GDPR because they perceive it to be the gold standard, providing the highest and most widely accepted standard to follow. After a certain tipping point, there is such widespread convergence behind the EU norm that it is harder for any government enacting data privacy laws to justify a deviation from that global norm. Similar development is now underway in other policy domains, with governments across the world—including those in Australia, Brazil, Canada, Japan and South Korea—moving away from a market-driven regulatory model and increasingly emulating European digital regulations to regain control over their digital economies.
The Brussels Effect is both celebrated and criticized abroad. Many civil rights advocates praise the EU for its commitment to fundamental rights, dignity, and democracy, including its efforts to steer the digital economy towards those values through regulation. The EU’s regulatory model protects internet users’ privacy more than the extensive “surveillance capitalism” of the U.S.’s market-driven model, where tech companies track internet users’ every move online and acquire a trove of personal data that they then monetize through targeted advertising.Americans are also increasingly conscious that harmful online content has too often trumped the decency, dignity, and safety of individuals, with Section 230 of the Communications Decency Act coming to the rescue of tech companies no matter how repulsive the content they host. This in part explains why many foreign stakeholders welcome a global shift towards the EU’s content moderation norms.
The EU’s regulatory model is also seen as appealing, in part, because it is associated with greater economic fairness and distributional justice. Its central goal is to foster a fairer digital economy that ensures that the gains from the digital economy are divided more equally. In practice, this has entailed leveraging European antitrust, employment, and tax laws to redistribute power away from platforms, vesting more power instead with internet users and consumers, platform workers, smaller businesses, and the public at large. This regulatory philosophy is more in line with today’s political environment, where the ideological underpinnings of neo-liberalism, including any manifestations of capitalist excess, are increasingly criticized. As a result, there is a growing number of voices arguing that the EU’s regulatory model facilitates greater economic success, not because of its ability to maximize wealth through digital transformation, but because of its commitment to distribute that wealth more evenly across society.
While many foreign stakeholders welcome the global reach of the European laws, others criticize the EU for engaging in digital protectionism and regulatory imperialism while tampering with innovation and free speech—not just in Europe, but across the world. Several industry advocates and companies describe the EU’s regulatory model as overly protective, compromising tech companies’ incentives to innovate, and thereby curtailing the technological and economic progress that societies depend on. Few successful tech giants are emerging from Europe, which is often attributed to the EU’s stringent antitrust enforcement and other protective regulations that interfere with tech companies’ innovative zeal.Many proponents of free speech ideals also allege that the European rights-driven model risks undermining free speech and stifling public debate. U.S. tech companies often agree, with Google arguing that the EU’s approach towards content moderation—including its online hate speech rules and the “right to be forgotten” provision in the GDPR—could to lead to harmful censorship. Some scholars and rights advocates further fear that the EU’s regulatory approach may even be used to legitimize governments’ tightened grip on public speech and private data. According to this view, the EU’s regulatory approach can, in some instances, become a veneer for authoritarian control, under which the rights of internet users deteriorate and internet freedoms decline.
A different line of criticism is less concerned with the EU over-regulating; rather, they point to well-known deficiencies in the implementation and enforcement of European regulations.These critics acknowledge that the EU has been successful in promulgating ambitious digital regulations and globalizing them through the Brussels Effect but maintain that the EU has seen less success in translating those policy goals and regulations into concrete changes in the marketplace. Tech companies’ market dominance remains undented, the internet continues to be flooded with hate speech and other harmful content, and internet users’ personal data is still being exploited by companies and governments alike. At worst, the EU thus imposes regulatory costs on tech companies without harnessing the full benefits of its regulations.
Another strand of criticism leveled against the Brussels Effect relates to its inherent ability to undermine democratic institutions in foreign countries. According to this view, the EU’s global regulatory influence compromises the democratic prerogatives of foreign sovereigns and undermines the political autonomy of their citizens. The most pointed criticism invokes the language of “regulatory imperialism,” accusing the EU of exporting its norms abroad without seeking the consent of foreign regulators, companies or consumers.The EU can counter this criticism by arguing that it is simply regulating its own market, which it has the sovereign right to do. If the self-interest of multinational corporations leads these companies to voluntarily extend EU regulations across their global operations, the EU can hardly be accused of engaging in imperialism. However, it is difficult to deny that, in practice, the Brussels Effect often constrains foreign governments’ regulatory freedom by overriding less-constraining regulations elsewhere. This arguably undermines the ability of foreign governments to serve their citizens in accordance with their democratically established preferences.
However, not all foreign actors view the EU’s global regulatory influence as sovereignty-infringing. Some even welcome the Brussels Effect. For example, 75% of Americans believe there should be more governmental regulation on what companies can do with their personal data.EU regulations also often help foreign advocacy groups raise awareness of a policy problem at home, and influence domestic debates on the issue. For example, the American Civil Liberties Union has argued that “the U.S. can learn from the approach being taken by the European Union” and that “Congress should look to this model and similarly enact comprehensive privacy legislation.” This suggests that any foreign criticism of the Brussels Effect is unlikely to be uniform, and examples of foreign stakeholders embracing the reach of the European rights-driven regulatory model abound as well.
The Post-American Digital World and the Path Forward for the U.S.
Today, the U.S. government finds itself at an inflection point, forced to rethink the foundations of the global digital order that it built. As the U.S. is witnessing the decline of the American digital empire, it needs to ask whether it even ought to try to reverse that decline or concede that its market-driven model no longer serves the U.S., or the world, well. There is a broadening consensus across the world that the era of tech companies’ self-regulation is over and that governments need to reclaim their role as guardians of the digital economy. As a result, the U.S. needs to decide if it will join that consensus and embrace a variant of the EU’s right-driven regulatory model or continue to watch from the sidelines as the EU sets the rules for the digital economy. Additionally, the U.S. needs to decide what, if anything, it can do to halt the expansion of the Chinese digital empire and the emergence of a global digital order built around digital authoritarian norms.
Despite a number of concerns associated with the EU’s regulatory model and the Brussels Effect, it is plausible that the U.S. will align itself more closely with the EU through a series of legislative reforms in the coming years. Under the American regulatory model, a free market was never the end goal in itself, but rather the means to safeguard both economic and political freedom. Keeping the government at bay was seen as necessary to maximize economic progress and innovation, while also ensuring that democracy will thrive. However, today’s concentrated digital marketplace dominated by a handful of tech giants is hardly a reflection of economic freedom as conceived by early techno-libertarians. Similarly, recent scandals—including those revealing how online disinformation campaigns can undermine democratic elections—have shown that strong democracy does not necessarily flow from an unregulated digital marketplace.Consequently, a more regulated digital economy in the U.S. may be one where, in the end, greater political and economic freedom will prevail.
The American public is increasingly endorsing the EU-style regulatory model as it becomes more skeptical of the role that tech companies play in society. This shift in public opinion is now also reflected in the views of many political leaders, who are starting to question the merits of the market-based regulatory model. The U.S. Congress is debating several bills seeking a reversal of the long-standing policy of non-regulation in policy areas such as antitrust, content moderation, and data privacy.After a long hiatus, the U.S. government is leveraging its antitrust powers, with the Department of Justice and the Federal Trade Commission challenging the business conduct of Google and Meta, respectively. This suggest that the U.S. may no longer be committed to defending the increasingly shaky foundations of the American digital empire but gradually conceding that the market-driven model is no longer fit to address the challenges of today’s digital society.
At the same time, many voices remain skeptical that any meaningful change will take place in the U.S. Market-driven values are deeply entrenched in Americans’ institutions and mindsets, making it difficult to reverse the regulatory model that, despite all its limitations and false promises, continues to be associated with tremendous wealth and technological progress. The U.S. Congress is also debating regulatory reforms in the shadow of the U.S.-China tech war, which adds to Congress’ hesitancy to adopt any regulations with the potential to undermine the U.S.’s technological, economic, geopolitical, and military power. Relentless lobbying by tech companies, together with persistent political dysfunction in Congress, may also prevent Congress from translating the emerging shift into concrete legislative reform.If it turns out that Congress will be unable to enact key laws—whether on data privacy, antitrust, or content moderation—the U.S. may retain its market-driven regulatory model in place even while the rest of the world is moving away from it. Here, the best hope for those advocating for reform in the U.S. may, indeed, lie in the Brussels Effect and its ability to deliver to Americans the kind of digital regulatory model that they have increasingly come to support.
However, what now provides an even greater impetus for bridging the remaining transatlantic differences is the U.S. and EU’s shared concern about China’s rise and the impact of that rise on the future of liberal democracy. China’s AI-powered mass surveillance, internet censorship, and government propaganda are all antithetical to the values of democracy and freedom that the U.S. and the EU have long embraced at home and championed abroad. This shared concern will increase the U.S.’s resolve to align its technology policies with those of the EU, in an effort to consolidate a democratic front to counter the global spread of digital authoritarian norms. A closer transatlantic alignment could also form a basis for a cooperation among all techno-democracies, including countries such as Australia, Canada, Japan, South Korea, New Zealand, and the United Kingdom.As the unipolar moment of American digital hegemony is over, the U.S. knows that its best strategy for shaping the global digital order is closer cooperation with the EU and these other like-minded nations.
The idea of an alliance between techno-democracies benefits from strong political backing by the U.S. government. President Biden has made cooperation with democracies a hallmark of his foreign policy.He often depicts the world as a contest between democracy and autocracy, emphasizing the need to counter China’s ambitions and global influence. In this contest, battle lines over digital policy are being drawn around political ideology: on the one side, jurisdictions where digital technologies are harnessed to empower individuals to protect their rights; on the other, jurisdictions where those technologies are leveraged by authoritarian leaders as tools for political control. In April 2022, these U.S. efforts to enhance cooperation among the world’s techno-democracies culminated in the U.S. government announcing a partnership with 60 countries who signed a “Declaration for the Future of the Internet,” which pledges to harness digital technologies to “promote connectivity, democracy, peace, the rule of law, sustainable development, and the enjoyment of human rights and fundamental freedoms.” This political commitment seeks to send a message of unity among the nations that share a vision for the “[i]nternet that is an open, free, global, interoperable, reliable, and secure [one]” and who are committed to “respecting human rights online and across the digital ecosystem.”
Despite efforts to build a more cohesive coalition of techno-democracies, it is unclear how effective such a coalition will be in shaping the global digital order towards the values articulated in the 2022 Declaration. The group of techno-democracies is heterogeneous and existing disagreements among them may impede any meaningful collaboration. It is even unclear who should be included in any coalition of techno-democracies.There are many prominent countries sitting between the democratic and authoritarian spheres of influence that often break liberal democratic norms. The question for the U.S. and the EU, therefore, is whether they refuse to accept countries such as India and Brazil into any alliance of democracies and thus risk pushing these countries closer to China.
Rallying the world around the cause for democracy is also a tall order at a time when the U.S. and EU are facing particularly stark challenges to their own democratic institutions at home. Some EU countries, including Poland and Hungary, have experienced severe democratic backsliding in recent years. These countries’ illiberal policies undermine the EU’s moral legitimacy when it seeks to defend and export its commitments to fundamental rights, democracy, and human dignity around the world. The U.S., too, can be accused of hypocrisy. The U.S. government today is monitoring social media accounts of visa applicants, seeking to ban the Chinese social media app TikTok, and pursuing many other policies that are hard to reconcile with its lofty rhetoric around democracy and internet freedoms.
Techno-democracies may also struggle to persuade these “swing states”—the non-aligned countries straddling the democratic and authoritarian divide—to abandon their collaboration with China for economic reasons. The U.S. cannot halt China’s economic rise and technological prowess, nor can it easily cajole other nations to forgo the opportunities that China’s dynamic and growing economy presents. Already today, China is the largest trade partner for almost twice as many countries as the U.S.The U.S. is also pursuing increasingly protectionist trade and technology policies, which likely give additional pause to any country asked to abandon its economic engagement with China in favor of the U.S. Democratic countries have also not provided these countries with an alternative to China’s Digital Silk Road, leaving collaboration with China for many countries as their only viable path for digital development. Thus, when confronted with a choice between the U.S and China, these countries may well choose China.
In this battle between techno-democracies and techno-autocracies, China and its state-driven regulatory model have certain additional advantages. First, many countries view China’s regulatory model as more “effective.” While the U.S. struggles to legislate and the EU struggles to enforce its digital regulations, the Chinese government can operationalize its regulatory model in the absence of the constraints of democratic rulemaking. Not only is China effective in passing regulations, but it faces little resistance in enforcing those regulations. It tolerates little dissent from tech companies—whether domestic or foreign—all of which know that compliance is their only option. It was telling that on the same day that the Chinese government fined the Chinese e-commerce giant Alibaba a record $2.8 billion, the company made a public statement saying that it “accept[ed] the penalty with sincerity and will ensure… compliance with determination.”In stark contrast, European and American regulators often face lengthy legal battles as tech companies contest, rather than acquiesce to, the regulatory actions targeting them. These features make the Chinese state-driven regulatory model attractive for governments that are reluctant at being drawn into the kind of battles that the U.S. and EU are struggling to win.
China has also shown that political freedom is not necessary for technological and economic progress, which provides authoritarian-leaning countries with an additional reason to embrace the Chinese regulatory model. Although the U.S. has traditionally been viewed as the leading technological superpower, China is quickly catching up, and even surpassing the U.S. in several domains.For example, Chinese tech companies currently lead the world in sales of smartphone and telecommunications network equipment. China is also well on its way to become the world’s premier AI superpower, potentially surpassing the U.S. in the next decade. China’s emergence as a technological superpower suggests to many that state control over the digital economy can coexist with a culture of dynamic innovation, technological progress, and economic growth. Techno-democracies therefore have a hard time arguing that by emulating China’s state-driven regulatory model, countries would compromise their digital development. Instead, by looking at the Chinese model, some of these governments see the best of both worlds: effective political control and impressive economic success.
Notwithstanding these challenges in countering the Chinese regulatory model, the need to preserve liberal democracy remains the most compelling battle cry for the U.S. and other democratic governments seeking an alternative to China’s state-driven regulatory model. By framing the battle as one between digital democracy and digital autocracy, the U.S. presents a stark choice to the countries around the world, appealing to their political convictions and fundamental values that organize digital societies. This battle is a political and ideological fight that tests the strength of liberal democracy as a model of government at the time when the spheres of influence between the digital empires are still being drawn. It is also the battle that most defines what kind of society we will live in for years and decades to come—a battle that neither the U.S. nor the EU can afford to lose.
© 2023, Anu Bradford.
Cite as: Anu Bradford, After the Fall of the American Digital Empire, 23-10 Knight First Amend. Inst. (Sept. 21, 2023), https://knightcolumbia.org/content/after-the-fall-of-the-american-digital-empire [https://perma.cc/Z8H3-R5YK].
Steven Erlanger and Adam Satariano, Europe Feels Squeeze as Tech Competition Heats Up Between U.S. and China, N.Y. Times (Sep. 11, 2020), https://www.nytimes.com/2020/09/11/world/europe/eu-us-china-technology.html (on file with author).
See generally Mark A. Lemley, The Splinternet, 70 Duke L. J. 1397 (2021); Lora Kolodny, Former Google CEO Predicts the Internet Will Split in Two—And One Part Will be Led by China, CNBC (Sep. 20, 2018), https://www.cnbc.com/2018/09/20/eric-schmidt-ex-google-ceo-predicts-internet-split-china.html
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Katherine Atha et al., SOS Int’l LLC, China’s Smart Cities Development 65 (2020), https://www.uscc.gov/sites/default/files/China_Smart_Cities_Development.pdf.
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Anu Bradford, The Brussels Effect: How the European Union Rules the World (2020).
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See Bradford, Digital Empires, supra note 3, chapter 9.
See Shoshana Zuboff, The Age of Surveillance Capitalism: The Fight for a Human Future at the New Frontier of Power 8–12 (2019).
See Carmelo Cennamo & D. Daniel Sokol, Can the EU Regulate Platforms Without Stifling Innovation?, Harv. Bus. Rev. (Mar. 2021); U.S. Chamber Calls for Legislators to Vote Down Antitrust Bills That Would ‘Stymie Innovation, Harm Consumers and Weaken America’s Technology Leadership’, U.S. Chamber of Com. (June 22, 2021), https://www.uschamber.com/technology/us-chamber-calls-legislators-vote-down-antitrust-bills-would-stymie-innovation-harm.
Case C-131/12, Google Spain SL v. Agencia Española de Protección de Datos, ECLI:EU:C:2014:317, ¶¶ 30-31, (June 25, 2013); Peter Fleischer, Implementing a European, Not Global, Right to be Forgotten, Google Europe Blog (July 30, 2015), https://europe.googleblog.com/2015/07/implementing-european-not-global-right.html; Farhad Manjoo, Google’s Grand Plans: A Conversation With Larry Page and Sundar Pichai, N.Y. Times (June 26, 2014), https://bits.blogs.nytimes.com/2014/06/26/googles-grand-plans-a-conversation-with-googles-larry-page-and-sundar-pichai/ (on file with author).
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Joanne Scott, From Brussels with Love: The Transatlantic Travels of European Law and the Chemistry of Regulatory Attraction, 57 Am. J. Comp. L. 897, 920-28 (2009); see also, generally Katerina Linos, The Democratic Foundations of Policy Diffusion: How Health, Family and Employment Laws Spread Across Countries (2013).
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See, e.g., Competition and Antitrust Law Enforcement Reform Act, S. 225, 117th Cong. (2021); A Bill to Repeal Section 230 of the Communications Act of 1934, S. 2972, 117th Cong. (2021); SAFE DATA Act, S. 2499, 117th Cong. (2021).
See Press Release, Dep’t of Justice, Justice Department Sues Monopolist Google For Violating Antitrust Laws (Oct. 20, 2020), https://www.justice.gov/opa/pr/justice-department-sues-monopolist-google-violating-antitrust-laws; Press Release, Fed. Trade Comm’n, FTC Sues Facebook For Illegal Monopolization (Dec. 9, 2020), https://www.ftc.gov/news-events/press-releases/2020/12/ftc-sues-facebook-illegal-monopolization.
Cat Zakrzewski, Tech Companies Spent Almost $70 million Lobbying Washington in 2021 as Congress Sought to Rein in Their Power, The Wash. Post (Jan 21, 2022), https://www.washingtonpost.com/technology/2022/01/21/tech-lobbying-in-washington/ (on file with author).
See Jared Cohen & Richard Fontaine, Uniting the Techno-Democracies: How to Build Digital Cooperation, 99 Foreign Affairs 112, https://www.foreignaffairs.com/articles/united-states/2020-10-13/uniting-techno-democracies (on file with the author).
See The Summit for Democracy, U.S. Dep’t State (Feb. 2021), https://www.state.gov/summit-for-democracy/.
See Jon Bateman, Biden is Now All-In on Taking Out China, Foreign Pol’y (Oct. 12, 2022), https://foreignpolicy.com/2022/10/12/biden-china-semiconductor-chips-exports-decouple/ (on file with the author).
See A Declaration for the Future of the Internet, White House (Apr. 28, 2021), https://www.whitehouse.gov/wp-content/uploads/2022/04/Declaration-for-the-Future-for-the-Internet_Launch-Event-Signing-Version_FINAL.pdf.
See Janan Ganesh, The US Cannot be Choosy About its Allies, Fin. Times (Mar. 30, 2021), https://www.ft.com/content/ff8abf95-abb4-48d9-83b6-728a0deec9ae (on file with the author).
See Biden’s New China Doctrine, The Economist (July 17, 2021), https://www.economist.com/leaders/2021/07/17/bidens-new-china-doctrine (on file with the author).
See A Letter to Our Customers and to the Community, Alizila (Apr. 10, 2021). https:// www.alizila.com/ a-letter-to-our-custom ers-and-to-the-community/.
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See Final Report, Nat’l Sec. Comm’n on Artificial Intelligence (Mar. 19, 2021), https://www.nscai.gov/wp-content/uploads/2021/03/Full-Report-Digital-1.pdf.
Anu Bradford is Henry L. Moses Professor of Law and International Organization at Columbia Law School and the author of a forthcoming book “Digital Empires: The Global Battle to Regulate Technology.”