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Russ Shaw

Founder, Tech London Advocates and Global Tech Advocates

The EU’s Google fine should act as a catalyst for the UK to review its stance on big tech

The EU’s decision to fine Google €4.3 billion is further confirmation that Brussels is not afraid to take on the global tech giants. This hefty slap on the wrist will do little to financially worry one of the world’s biggest businesses – with over a €100bn in the bank – but it certainly sends a message.

Google was found in breach of anti-trust laws, having used its Android software to further dominate the mobile search market, and has been accused of illegally preventing rivals from gaining any kind of a foot hold. Some would say that the industry is approaching monopoly status.

Integral to a prosperous tech ecosystem is competition. Over the years the EU has played an important role as a regulator and kept a strong eye on the dominant tech forces that have out grown many national economies in terms of financial muscle. In a landmark case that began in 2016 the EU very publicly took on Apple – and won. As of May this year, the Irish government has started receiving the first of several payments following the ruling.

There is certainly a narrow path to be trodden between facilitating massive scale and the employment, investment and support networks that the tech titans bring – equally avoiding the dangerous territory of monopolisation and unfair competition.

The UK tech sector has risen to become the fastest growing industry in Britain and now sits alongside the biggest global tech powers – defined by the challenger, the innovator and the disruptor.

Key policymakers have to be diligent and avoid a few firms blocking out the sun and limiting early stage growth for start-ups and scale-ups. The action taken by the EU is a welcome reminder that businesses of such enormous proportions are not immune to the law and must be held responsible for their actions.

Yet, it is worth recognising Google’s contribution to advancements in mobile technology both directly and indirectly. The company gives away Android to manufacturers for free which is no bad thing for consumers who benefit from reduced costs. Many tech companies, including Google, actively support the tech ecosystem through venture arms that provide capital to scale and accelerators that deliver the essential infrastructure that allow digital businesses to thrive.

What does this mean for UK tech?

Firstly, Google has been given 90 days to comply with the decision or face further financial penalty, yet it remains questionable as to the overall disruption this will have on the market. Even if Google has to stop bundling its offerings and rethink its mobile business model, a rival player that can compete at this level is not on the horizon at this moment in time.

We should be focused on what this precedent means post-Brexit. While the sort of political relationship we’re set to have with the EU remains unclear – regulation surrounding the trade of services and the legal framework within which companies will operate, is even hazier.

EU anti-trust laws will still apply to UK businesses that have effects within European territories, but the Commission will have far less power in Britain – the extent to which the UK will deviate from the current status quo is yet unknown.

Britain will need to carve out a unique position for itself as a regulator of big business. We need to create the structures that ensure we are presented as a digital nation that both attracts the tech titans, but equally supports healthy competition, the rise of the ambitious entrepreneur – ultimately enabling the tech ecosystem to thrive.

For example, the Financial Conduct Authority (FCA) is building a strong reputation within the industry and in areas such as FinTech (Financial Technology) for being innovative and creative with the ‘sandbox’ approach for projects and initiatives.

We must strike a balance that encourages growth across the tech sector and does not disproportionately favour the tech giants. Facilitating opportunity for small businesses to compete will generate benefits for all.

Google along with the likes of Apple and Facebook must be alert to the dynamics of the tech ecosystem, put the consumer first and be responsive; their progress is fuelled by the innovative start-ups and scale-ups that thrive in an environment that allows challenge. A rising tide lifts all boats.

As ever this should act as a catalyst for change and an opportunity to reevaluate the UK’s stance on big tech – now is the time to craft a regulatory framework for the post-Brexit digital economy.