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 most of its
revenue 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 support from prominent
technology executives other than entrepreneur and venture
capitalist Peter Thiel . Hewlett Packard Enterprise Co. Chief
Executive Meg Whitman and Cisco Systems Inc. Chairman John
Chambers, two stalwart Republicans from the industry, both 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 become 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. Alphabet enjoyed a particularly close relationship with
the Obama administration and its chairman, Eric Schmidt, helped
early development of Mrs. Clinton's campaign. Mrs. Clinton's
technology policy blueprint broadly echoed the Obama
administration's, emphasizing a close relationship with the private
sector.
Even within that relative harmony 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, Calif., 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, privacy and other tech issues are
likely to intensify during Mr. Trump's presidency, which will begin
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.
Aaron Levie, chief executive of online-storage company Box Inc.
and a Clinton supporter, said much of Mr. Trump's rhetoric is
antithetical to many views of Silicon Valley. "What we need are
very sound policies and an approach that works for bringing
everybody into this innovation economy and into the future," Mr.
Levie said in an interview Wednesday. "And the only way to do that
is by a very productive partnership between both the private sector
as well as the public sector."
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, though. Scott
Kessler of CFRA Research said Mr. Trump's win, coupled with
continued Republican control of Congress, increases the chances for
changes to the tax code that could enable U.S. companies to bring
home more overseas profits. U.S. companies have an estimated $2
trillion stashed overseas -- including $216 billion in cash and
investments held offshore by Apple as of Sept. 24.
And Mr. Trump is likely to adopt a light regulatory touch that
could benefit tech businesses, said Robert Atkinson, president of
the Information Technology and Innovation Foundation. A Trump
administration is unlikely to expand regulatory oversight on
encryption, or in areas of innovation like artificial intelligence,
meaning there will be "a lot more freedom to innovate with data and
algorithms, so that is very good for tech," Mr. Atkinson said.
Still, the lack of specific policies from Mr. Trump during the
campaign leaves uncertainty on hot-button issues such as the Obama
administration's "net neutrality" rules, which 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."
Billionaire investor Mark Cuban worries that Mr. Trump will
embrace advisers who are antitechnology. If so, "one of the
greatest growth engines of the country could be diminished," Mr.
Cuban said in an email before the election. "In that case we could
see emigration of talent, rather than immigration."
(END) Dow Jones Newswires
November 09, 2016 17:48 ET (22:48 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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