By Trisha Thadani 

Donald Trump's election victory is seen as a blow to Silicon Valley, putting the presidency in the hands of a vocal critic of several big technology companies and an advocate of policies tech executives have said could hurt the industry's development.

During his campaign, Mr. Trump didn't offer a specific plan for how he would tackle technology policy -- unlike his Democratic opponent Hillary Clinton, who in June issued a detailed tech platform that executives broadly applauded. Meanwhile, Mr. Trump's advocacy of tighter limits on immigration and trade alarmed an industry that prizes high-skilled immigrants and gets much of it business from overseas.

The electorate's endorsement of Mr. Trump's populist message, which broadly blamed elites for the problems of many disaffected Americans, could also spell trouble for Silicon Valley, which has spawned companies that delivered far more in profits and stock-market valuations than they have jobs for middle-class workers.

Mr. Trump took aim at several big names in technology during the campaign. He called for a consumer boycott of Apple Inc. over its refusal to help the Federal Bureau of Investigation access a terrorist's iPhone over privacy concerns. He accused Jeff Bezos of using the Washington Post, which he owns, to advance the interests of Amazon.com Inc ., the e-commerce giant he founded and runs -- a claim the Post and Mr. Bezos strongly disputed.

And, as he did with other companies outside technology, he claimed International Business Machines Corp. was moving jobs overseas.

The GOP candidate received scant public support from prominent technology executives other than entrepreneur and venture capitalist Peter Thiel . Stalwart Republicans from the industry including Hewlett Packard Enterprise Co. Chief Executive Meg Whitman and Cisco Systems Inc. Chairman John Chambers both said they backed Mrs. Clinton.

A number of tech executives and investors voiced alarm at the election Tuesday night, with one prominent venture capitalist, Shervin Pishevar, even suggesting California should secede. "If Trump wins, I am announcing and funding a legitimate campaign for California to come its own nation," said a post on Mr. Pishevar's Twitter account Tuesday night as the Republican candidate headed toward victory.

The tech sector thrived under President Barack Obama. The four most valuable companies in the world -- Apple, Google parent Alphabet Inc., Microsoft Corp. and Amazon -- are all tech companies. Mrs. Clinton's technology policy blueprint in its broad strokes echoed that of the Obama administration, emphasizing a close relationship with the private sector.

Alphabet enjoyed a particularly close relationship with the Obama administration and its chairman, Eric Schmidt, helped early development of Mrs. Clinton's campaign. The Internet company's policy positions aligned more closely with Mrs. Clinton than with Mr. Trump, including its support for policies to slow the effects of climate change, which Mr. Trump has called a hoax.

Alphabet also supports trade deals such as the Trans-Pacific Partnership, which was one of the central targets of Mr. Trump's campaign -- though Mrs. Clinton also came out against the trade deal.

Even within the relative harmony with Washington in recent years, tech companies clashed with Washington over the limits of government authority and surveillance, particularly after the 2013 revelations by former National Security Agency contractor Edward Snowden.

Apple earlier this year beat back a government attempt to force it to break the security on an iPhone used by a shooter in the San Bernardino terror attack -- the episode that prompted Mr. Trump's criticism of the company. Microsoft in April sued the Justice Department over secret orders to reveal customer data.

Debates over encryption and privacy are only likely to intensify during Mr. Trump's presidency, especially given his emphasis on homeland security. And he will take office as the tech industry appears on the cusp of disruptive innovations -- in areas such as self-driving cars, robots and artificial intelligence -- that would require new policy responses.

"You don't want innovation to happen in isolation and have people just deal with that disruption without having a plan," Aaron Levie, chief executive of online-storage company Box Inc. and a Clinton supporter, said in an interview ahead of the election. "In a world where the government and technology are sort of acting in isolation, what we are going to get is negative consequences from disruption."

Tusk Holdings, which advises tech startups on regulatory strategies, said in a note to clients that Mr. Trump's election could spur new discussion on technology's role in displacing workers -- such as concerns that autonomous vehicles could take jobs from truck drivers.

There could be a silver lining for tech companies if Mr. Trump and a Republican Congress enact changes to the tax code that reduce corporate rates or allow U.S. companies to bring home some of the estimated $2 trillion they have stashed overseas. Apple, for example, reported holding $237 billion in cash and investments as of Sept. 24, $216 billion of which was held outside the U.S.

But the lack of a specific policies from Mr. Trump during the campaign leaves much uncertainty for the tech sector on hot-button issues such as the Obama administration's "net neutrality" rules that generally bar telecom companies from favoring some traffic over others. Most technology companies support those rules, though many telecom providers oppose them.

While Mr. Trump didn't offer an official position on net neutrality, he expressed displeasure with the Federal Communications Commission's Open Internet Order through a tweet, "Obama's attack on the internet is another top down power grab. Net neutrality is the Fairness Doctrine. Will target conservative media."

Billionaire investor Mark Cuban said Mr. Trump's lack of positions on tech policy could be a "disaster" for the tech industry. "If his advisors end up being anti-technology, one of the greatest growth engines of the country could be diminished. In that case we could seem emigration of talent, rather than immigration," Mr. Cuban said in an email before the election.

Write to Trisha Thadani at trisha.thadani@wsj.com

 

(END) Dow Jones Newswires

November 09, 2016 13:44 ET (18:44 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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