OPINION:
Envy is an ugly thing — one of the seven deadly sins.
The Europeans have long been dripping with jealousy that American firms dominate the tech sector—cell phones, search engines, social media platforms, AI and robotics. As the chart below shows, our “magnificent seven” just finished a very good year. Meanwhile, Europe is flatlined.
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One reason for this success is that the United States innovates while Europe regulates. Instead of fixing their economies, the EU bureaucrats want to kneecap America’s tech success stories with lawsuits and regulatory barbed wire fences to keep American firms from competing on a level playing field.
Their first target was Google, which had a rash of expensive antitrust lawsuits against search engines.
Even worse, EU bureaucrats are waging war against Apple with “the Digital Markets Act,” a law that requires “contestable and fair markets in the digital sector.”
They are also demanding of Apple something called “interoperability,” which absurdly requires Apple to hand over to competitors access to its private operating systems. They will also require iPhones to offer competitors’ applications. This makes as much sense as requiring McDonalds to offer Burger King fries with their “happy meals.”
The iPhone amenities and apps are part of a package deal that has made these devices the most popular worldwide, with billions of customers. This hardly sounds like monopolistic behavior. Of people who don’t like Apple’s apps, there are many other cell phone products, such as Galaxy, that consumers can turn to, made by T-Mobile, Google, or a handful made in China.
For all the talk about Apple’s monopoly, they now control slightly less than 20% of the global cell phone market.
What is especially dangerous about interoperability is what it means
For security and privacy. Apple places a premium on maintaining the integrity of its devices and protecting its users’ data. However, this privacy shield will be pierced if third parties are given unfettered access to the Apple platform.
Apple warns that outsiders could “read on a user’s device all of their messages and emails, see every phone call they make or receive, track every app that they use, scan all of their photos, look at their files and calendar events, log all of their passwords, and more.”
But the biggest danger of these kinds of raids on successful companies that spend billions of dollars innovating is that the incentive to innovate is stifled — in which case everyone loses. Sharing patented information with competitors in the name of “fairness” is a socialist idea that has rusted the Eurozone economy.
Suppose Europe wants to get back into the tech game. In that case, EU bureaucrats should focus on what made these companies so successful in the first place – and then try to create a public policy environment that will foster innovative companies that can compete and win — rather than run to the courts for protection. Punishing the winners is a good way to keep producing losers.
In the meantime, let’s hope the incoming Trump regulators at the FTC, FCC, and the Justice Department defend American companies against aggressive and hostile lawsuits that hobble our made-in-American companies. In other words, put America first and don’t let Europe take a bite out of our Apple.
• Stephen Moore is a co-founder of Unleash Prosperity and a co-author of the new book: “The Trump Economic Miracle.”
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