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By MARK SCOTT

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IT’S THURSDAY, AND THIS IS DIGITAL BRIDGE. I’m Mark Scott, POLITICO’s chief technology correspondent, and I bring you actual footage of Gen Z’ers trying to explain the latest tech trends to me. True story.

There’s a little for everyone this week:

— Europe’s new antitrust rules are now in force. It’s going to be a messy few years until we know how the rules change things, if they change anything.

— Global lobbying on artificial intelligence governance is creating different dynamics across Western capitals.

— Russia leaked damning audio of German military officials via its state-backed media. It is the quintessential influence operation.

THE DIGITAL MARKETS ACT COMETH

RONALD REAGAN ONCE QUIPPED: “The nine most terrifying words in the English language are: I’m from the government, and I’m here to help.” I can’t help but think of those words as the European Union’sDigital Markets Act comes into full force Thursday. The rules represent a step change in digital competition enforcement, for sure. With a few Big Tech giants already dominating much of the online world, so the theory goes, antitrust officials must keep ahead of potential abusive behavior.

That’ll happen via greater openness from these companies; more choice for consumers to switch away from omnipresent services; and a new degree of regulatory foresight in which Brussels will have powers to step in before so-called gatekeepers — systemically dominant firms — move into new markets. Through these changes — the most widespread antitrust overhaul anywhere in the Western world — Europe wants to give corporate upstarts more power to flourish and citizens the right to make their own decisions about where they spend time online.

Or, at least, that’s the theory. So far, only six (almost all American) companies — Meta, Alphabet, Microsoft, ByteDance, Apple and Amazon — have been labeled as gatekeepers. Others, including X (formerly Twitter) and Booking.com, a Dutch online travel site, may soon follow. These firms have had to explain how they’ll meet their new obligations. The changes, on paper, are extensive. Meta said it would allow people to separate their Facebook and Instagram accounts. Apple said it would allow rival app stores to sell their wares to iPhone users (not everyone is pleased.) Amazon said it would make more data available to digital advertisers. Google said it would allow users to choose different search engines, by default. ByteDance said it would give users a greater ability to move their data to rival social networks. Microsoft said it would offer consumers more choice about which services they could use.

This is where I come back to Reagan. For all the potential benefits to competition and consumer choice that Europe’s new rules represent, will this government intervention achieve that? More specifically, this top-down approach to regulation — and the capacity for about 80 officials within the European Commission to enforce them — is still very much a work in progress. One, I’ll add, that could do more harm than good in the short term. Before I’m accused of pessimism, let’s be clear: There is too much market concentration in digital markets (and reports that repeatedly confirm that). The current antitrust rules are too slow, too cumbersome and too outdated to deal with that problem. The litany of antitrust fines — and legally mandated remedies — doled out by Brussels over the decade has done little to foster competition and consumer choice. Something has to change.

But after following the Digital Markets Act since its inception, I’m just not convinced this is the way to go. It’s an open secret in Brussels the bloc’s new digital rulebook is starved for cash — meaning the European Union is groping around for resources and personnel to do the heavy lifting, both on its antitrust and content-moderation updates. Taking a so-called ex ante regulatory approach — the ability to intervene in a market before a company abuses its dominant position — is based on believing policymakers can foretell how the industry will expand. It also means taking a very hands-on approach to oversight — one that almost necessarily means scores of officials monitoring how gatekeepers operate. To suggest that fewer than 100 people (the Commission says more will be brought in from separate, existing competition teams) can do this work is, in my opinion, naive.

The companies, too, aren’t hanging about. Meta, Apple and ByteDance are challenging how some of their services have been designated as gatekeepers. These legal battles are likely to drag on for months, though Apple (with iMessage) and Microsoft (with Edge, Bing and its advertising service) have already successfully convinced Brussels to remove some of their offerings from the most onerous antitrust oversight. Expect more underhanded lobbying in the days to come. Google already said this week its mandated changes under the new regime may hurt some of its business customers. Apple, in its public statements, highlighted how allowing others to sell apps directly to iPhone users could create security problems. Meta said delinking people’s Facebook and Instagram accounts may lead to people’s inability to share content with friends. Are these fears real? It’s in the companies’ interests to show they are, even if it’s to bash regulators over the head with these problems.

A lot is riding on the changes for Europe and its long-held belief that Brussels, and Brussels alone, does God’s work on digital competition. Margrethe Vestager, the bloc’s outgoing antitrust chief, has been hit with a series of regulatory setbacks. It’s not a surprise that, just days before the Digital Markets Act came into force, Brussels fined Apple $2 billion for abusing its dominance in app stores — a sector covered by the new legislation. The company said it would appeal. Opponents always say the Commission doesn’t distinguish between its lawmaking and enforcement powers. And Apple’s fine this week is another sign that the Berlaymont’s political and regulatory powers remain as intertwined as Vestager’s knitting. With the U.S. Department of Justice likely to file its own lawsuit against the iPhone maker as soon as this month, Brussels isn’t the only regulator willing to take on Big Tech.

The question I’m still struggling to answer is: Will Europe’s new rules change how we all use these digital services? It’s true Silicon Valley has had to open up — arguably, only in the 27-country bloc — in ways it has opposed for years. Smaller rivals like Epic Games, the maker of the “Fortnite” franchise, are likely to benefit from selling directly to consumers. Other startups, too, could potentially access people’s data and internal Big Tech insights to level the playing field. But if history has shown us anything (looking at you, Google shopping remedies), it’s that our own digital habits are pretty entrenched, no matter what policymakers say about the need for greater consumer choice. Is that because dominant players abused their positions? Possibly. But given an option between using Apple’s Safari browser and scrolling through an endless list of alternatives, most will click on the default and get on with their lives. That is an underlying truth with which Brussels’ digital antitrust overhaul has yet to contend.

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HOW AI LOBBYING IS EVOLVING THIS YEAR

IN THE WORLD OF ARTIFICIAL INTELLIGENCE, if you blink, you’ll have missed something. That’s certainly true when it comes to AI governance, where last year’s litany of standards, voluntary commitments and tentative legislative dealmaking has continued at pace into 2024. We’ve had the company-led initiative to combat election-related AI misuse (misuse, I should add, that mostly comes from tools created by these firms). We’ve seen appointments to the AI Safety Institute in the United States — hot on the heels of a similar body in the United Kingdom. The EU is in the final stages of rubber-stamping its Artificial Intelligence Act. And — ‘cos it’s Brussels — there’s already bickering over personnel and resources for its so-called AI Office. That group, housed within the European Commission, will focus on the latest AI systems (akin to the AI Safety Institutes in the U.S. and the U.K.). It will also coordinate how the bloc’s legislation is rolled out over the next two years. G7 digital ministers will discuss AI governance in Trento, Italy next week.

Just like in 2023, the main lobbying themes haven’t changed. Despite greater overlap between (Western) governments than I had expected, there’s still a battle between mostly Washington and Brussels over how hard to push binding legislation. Some EU officials dismiss the White House’s executive order on AI as a noble effort, but one that lacks legislative bite. U.S. policymakers warn the EU’s AI Act is too cumbersome to foster innovation. The long-term vs. short-term risk debate, equally, has not been resolved. Despite the multitude of public letters warning about the apocalyptic AI future that awaits us, those favoring near-term oversight of existing AI systems have won supporters, especially in Washington.

A push to license the most advanced large language models to a select few — mostly Big Tech — players has not curbed enthusiasm for so-called open-source AI options. In this fight, national security hawks still peddle threats about AI-generated bioweapons and other weapons of mass destruction, created by open-source tools, as a reason why the most complex AI systems should be limited to “trusted vendors.” Such fears have garnered greater support in Washington and London over Brussels, where officials are less worried about bioweapons (arguably, an issue for member countries, not the Commission) than how to implement the bloc’s pending AI legislation.

It’s not a perfect science, but I’m seeing different lobbying dynamics develop among Western capitals. Again, this is more art than science. But in London, British officials are more willing to adopt industry-led proposals, especially on testing the latest AI models for harm. The U.K. won plaudits for its AI Safety Summit in the fall. But those expectations — particularly the country’s AI Safety Institute testing the latest AI models — have so far fallen flat. Companies’ public policy officials are spending more time in London, mostly because it represents a halfway point between EU- and U.S.-style AI governance. Yet the U.K.’s eagerness to foster inbound investment from AI firms means it’s viewed as more industry-friendly than elsewhere.

In Washington, there’s a dual lobbying strategy at play. In Congress, despite the lack of actual lawmaking, companies are eager to demonstrate their willingness to listen — if not an appetite to fall under a more onerous regulatory regime. Many U.S. lawmakers are still on a steep learning curve on AI, and three tech executives told me they’d spent much of the last six months educating staffers on the basics. Yikes. In the Biden administration, the White House’s Office of Science and Technology Policy and National Security Council remain in the driving seat, though the U.S. Commerce Department — and its uber-wonky National Telecommunications and Information Administration — are doing much to implement last year’s executive order. One to watch: Will the Commerce Department impose further AI-related export control bans, targeted mostly at China?

The lobbying in Brussels, again, is different. With haggling now done on the bloc’s AI Act, much has shifted to a basic question: How is this all going to work? Tech executives are busily trying to dissuade officials from looking into their firms’ specific uses of AI. As mentioned, there’s a political dogfight over the Commission’s newly created AI Office. And many in Brussels are smarting from the perceived (but not real) deception from Paris after French tech darling Mistral signed a deal with Microsoft — thus cementing American tech’s role within the EU’s AI scene. For the EU, the next two years will be about legislative focus, public spending and bureaucracy. That means AI lobbying is already shifting to that new reality.

What I still view as a missing piece to this puzzle is greater international collaboration. No one is expecting Washington to enact Brussels’ AI Act. But Italy has not made AI a priority within its G7 presidency this year. Neither has Brazil under its G20 leadership. The EU-U.S. Trade and Technology Council, which meets in Leuven, Belgium in early April, will namecheck transatlantic cooperation, but mostly on geeky AI technical standards.

Officials, tech executives and civil society groups grumble that despite similar language being used in different Western capitals, there’s a movement toward separate — often not overlapping — regulatory approaches. With China seeking to pick off countries by pursuing bilateral relationships on AI governance, that’s a worry. There’s more that democracies share on AI governance than they don’t. But if the ongoing lobbying shows us anything, it’s that — like many digital policy areas — turning those common principles into joined-up policymaking is harder than most of us think.

BY THE NUMBERS

DIGITAL DEMOCRACY: RUSSIAN DISINFORMATION TACTICS 101

WHEN MARGARITA SIMONYAN, editor-in-chief of Russian state-backed media outlet RT, published an audio clip of German military officials discussing the potential of sending cruise missiles to Ukraine, it represented a major embarrassment for Berlin. Germany’s defense ministry confirmed the leak’s authenticity and blamed an unsecured line for how the Kremlin was able to listen in on the internal deliberations of its historic rival.

The episode is another example — if that was necessary — that we should not treat Russian-backed media as anything more than a propaganda arm of Vladimir Putin. RT is part of his global influence operation and is not akin to other state-owned outlets like the BBC or France24. It’s a vehicle to promote disinformation, sow dissent across the West and must be treated with an immense amount of skepticism.

RT’s role in this leak is as a mouthpiece for Moscow’s public-facing influence campaign. It was able to leverage its worldwide, digital audience (and not just via Simonyan’s followers) to foster bickering between Western allies about the now-confirmed leak. That’s what disinformation campaigns are all about — the drip, drip, drip of confusion and doubt.

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WONK OF THE WEEK

BREAK OUT THE GUINNESS; WE’RE HEADING TO DUBLIN. Des Hogan and Dale Sunderland have been appointed as commissioners within Ireland’s privacy regulator after the recent departure of Helen Dixon. Hogan will chair the agency.

Both men took up their roles on Feb. 20 — and will oversee Europe’s data protection enforcement of Big Tech companies headquartered in Ireland. They will both serve five-year terms. Hogan was most recently the country’s assistant chief state solicitor, a body that provides legal services to the Irish government.

Sunderland is well-known in privacy circles after serving as deputy commissioner at the Irish data protection regulator since 2016. He previously spent almost 14 years at the country’s Department of Justice and Equality.

THEY SAID WHAT, NOW?

“We agree to maintain the current practice of not imposing custom duties on electronic transmissions until the 14th session of the ministerial conference,” according to a World Trade Organization document that extends the body’s ban on taxing digital goods until at least 2026.“The moratorium and the work program will expire on that date.”

WHAT I’M READING

— OpenAI published a series of interactions between its leadership team and Elon Musk to rebut the billionaire’s claims the company abandoned its original mission. More here.

— Lee Tiedrich from Duke University lays out the legal and regulatory complexities of companies scraping data from the internet to power their large language models. Read it here.

— Meta announced that it would not pay Australian publishers any additional money under the country’s news media bargaining code when existing deals lapse. More here.

— The ChinaTalk newsletter speaks to Garrett Berntsen, the U.S. State Department’s chief data and AI officer on how data and emerging technologies are changing the face of diplomacy. Read it here.

— Gender-based digital disinformation undermines women’s public credibility and can lead to their abandonment of the political sphere, argues Argelia Queralt Jiménez in the International Journal of Constitutional Law.

— U.S. lawmakers should test different regulatory approaches over a short, defined period in ways that would help them understand the costs and benefits of digital regulation, claim J. Scott Babwah Brennen and Matt Perault for the Brookings Institution.

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