Big tech regulation: Lessons for India from Korean fiasco

Big Tech regulation
South Korea's stalled attempt for Big Tech regulation highlights the global struggle to rein in tech giants while fostering healthy digital ecosystems.

The meteoric rise of Big Tech has prompted governments worldwide to scramble for more effective regulation. The United States and the European Union have implemented stringent laws, with others taking inspiration from these examples. South Korea announced plans to enact one of the toughest competition laws outside of Europe to curb the influence of major technology companies. However, the country’s antitrust regulator has temporarily shelved these plans in the face of criticism from the domestic internet industry.

South Korea’s journey towards implementing stringent laws illustrates the challenges involved. The Korea Fair Trade Commission, supported by President Yoon Suk Yeol, announced in December its intention to create a regulatory framework modelled after the European Union’s 2022 Digital Markets Act. While American tech giants are a concern globally, South Korea faces similar challenges with its own internet conglomerates. However, the Commission’s proposal met fierce opposition from South Korean industry lobbyists, consumers, and even the US government, forcing a delay in the bill’s formal introduction to gather more opinions. With elections looming, the bill has been put on hold.

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India’s attempt at Big Tech regulation

In an ambitious move to regulate Big Tech, India is charting a course towards stringent oversight of digital behemoths that have largely operated under minimal regulatory constraints. This initiative, embodied in the proposed Digital Competition Bill, represents India’s stance to address the complexities of the digital economy and safeguard consumer interests.

With over 800 million internet users and a digital economy poised to hit the $1 trillion mark by 2025-26, India’s regulatory efforts are not just about curbing the disproportionate influence of tech giants; they are about setting a precedent for digital governance worldwide. By focusing on issues such as data privacy, market dominance, and fair competition, India seeks to strike a balance between fostering innovation and preventing monopolistic practices that could stifle its burgeoning digital marketplace.

Understanding why South Korea struggled to pass its regulation is crucial. South Korea’s internet firms, dominant domestically yet with little global influence, strongly opposed the bill, arguing it would favour competitors from China. This echoes the sentiments of American tech giants, which have criticised regulatory overreach in their own country.

Global regulatory practices

The United States and the European Union are at the forefront of a global push to regulate Big Tech, driven by growing concerns over privacy breaches, misinformation, anti-competitive practices, and market monopolisation. In the US, debates around antitrust laws and Section 230 of the Communications Decency Act highlight the government’s intent to clip the wings of tech titans like Facebook, Google, and Amazon.

The EU’s Digital Markets Act and Digital Services Act have set ambitious benchmarks for operational transparency, data usage, and competitive fairness, underscoring a rigorous approach to digital regulation. The regulatory endeavours by the US and EU signify a pivotal shift towards establishing a legal framework that aims to rebalance the power dynamics between big tech companies and the societies they serve, ensuring that technological progress does not come at the expense of democratic values and economic equity.

The prospect for India

India’s situation is distinct from South Korea’s. India’s focus is primarily on foreign tech giants, not domestic heavyweights. The government’s scrutiny of companies like Google, Apple, Facebook, and Amazon reflects a global concern over market dominance abuses. India’s Digital Competition Bill, inspired by the EU’s Digital Markets Act, includes regulations to ensure interoperability, data sharing, and portability.

Unlike South Korea and Europe, India do not have large homegrown tech companies that could be negatively impacted by such regulations. Both the Digital Markets Act and Digital Competition Bill seek to limit the power of dominant tech services. Following the EU’s lead, companies like Apple, Meta, and Microsoft have announced operational changes to comply with new regulations. Regardless of the outcomes in South Korea or the potential impact on India’s tech industry, it is clear that there is a global movement towards stricter regulation of technology firms.

The situation in South Korea reiterates the ongoing debate between fostering innovation and regulating monopolies in the digital economy. Governments and policymakers worldwide are tasked with balancing these two objectives, focusing on enacting legislation specifically targeting the digital market’s major players. This approach may lay a solid foundation for addressing future challenges in digital markets.

From Europe to South Korea and India, governments are navigating the uncharted territory of Big Tech regulation. While challenges like industry pushback and balancing innovation with competition remain, the global momentum towards curbing tech monopolies suggests a future where regulatory frameworks become the norm. This shift promises a more equitable and competitive digital landscape, ultimately benefiting both users and smaller players in the long run.