Technology has long been a measure of human advancement and power. Today, the next revolution is well underway, and the world is rushing to adapt to the rising speed of development. What feels like incremental change today is truly exponential compared with the past, and expectations continue to rise. Disruption is the new normal and will drive relentless change.
Data privacy regulation. Data privacy concerns have increased across all geographies, but the magnitude and reason for concern varies across the globe. Ji Eun Chung, a former policy expert at the Organisation for Economic Cooperation and Development (OECD), notes that countries weigh three factors when developing data privacy regulations: innovation and economic outcomes driven by tech; personal data privacy and consumer concerns for privacy; and protection of existing industries on which new technology may encroach.
Europe and California have weighted the balance toward personal data privacy and enacted two landmark laws enforcing it. the EU’s GDPR and California’s CCPA. In contrast, some countries have prioritized innovation over privacy. Indonesia, for example, has allowed more access to health care and education data than other countries and is allowing more innovation in those sectors.99 In the middle sits South Korea, where consumers are generally open to data access in return for services but are now frustrated with the influx of spam calls.100 Recent South Korean regulation has focused on reducing the unintended selling of data, but the fines are a slap on the wrist compared with the GDPR.
Inequality divides. Technology has always created structural shifts in wealth, but the speed of the current industrial revolution has created both real and perceived inequality. For example, Chung notes that, in Indonesia, technology is a great equalizer for digitally educated citizens. But for the many citizens without access to even a laptop, it becomes a lever to increase inequality, with those less skilled becoming employed by the more digitally savvy. To help address the problem, most countries have prioritized retraining, including digital skilling. In South Korea, for instance, all children are now taught coding. In 2019, U.S. presidential candidate Andrew Yang brought a more radical solution to the mainstream, with universal basic income.
Unveiling algorithmic biases. As AI finds itself perched for mainstream integration, conversations have increased about “ethical AI” and biases embedded into AI algorithms. In 2019, while 58% of large companies reported adopting AI in at least one function or business, only 19% had addressed “explainability,” and only 13% had addressed systemic bias in underlying data.101 Advancing one solution, the EU and OECD have developed principles for ethical AI,102 and there’s been increased focus on explainable AI (XAI) to allow visibility into predictions.
Antitrust momentum. Arguably a backlash to inequality concerns, an avalanche of antitrust suits over the last few years have been filed against companies like Google, Facebook and Apple. In the EU, regulators gave Google a record-breaking $5 billion fine related to antitrust practices, finding that, by requiring Google Search as the default search engine on Android devices, the company was unfairly stifling competition.103 The concerns around antitrust have also appeared globally, with Japan proposing new legislation inspired by the GDPR, and the head of South Korea’s Fair Trade Commission, Joh Sung-wook, announcing upon her 2019 appointment she would prioritize breaking up data monopolies.104
Increased regulation is likely to occur globally in the areas of data privacy, antitrust and inequality. However, the degree to which regulation progresses will depend on how each country views the balance between rapid innovation, societal caution and native protectionism. For companies, that momentum drives the need to prepare for regulations internally and seek out opportunities to demonstrate ethical leadership.
In the U.S. specifically, antitrust litigation is likely to continue as a backlash to perceived inequality. Given the U.S. federal system, while the White House may lead on reskilling initiatives, the results will likely continue in a piecemeal effort led by individual states and companies. In Europe, regulators will continue to push forward on executing the GDPR and antitrust litigation in a more centralized way compared with the U.S., looking for opportunities to implement the new regulations.
In contrast, because of their more relaxed regulations, countries like Indonesia could serve as incubators for innovation in areas like fintech (finance technology). In between are countries, like Korea, that will continue to push forward regulatory measures while being careful to avoid stifling technical innovation. Such countries may also be more deliberate in reskilling workers, continuing to make digital skills a mandatory part of the education system.
At a more general level, technology is likely to exacerbate differences in economic wealth between countries. In response, countries often develop more policies to protect their own technical ecosystems.105 Finally, progress on explainable AI will continue, and standards around ethical AI will likely emerge in something approximating global consensus.
For companies, these developments result in several new imperatives: 1) gain deeper expertise in data privacy to ensure compliance with new regulations; 2) collaborate with governments to develop regulations that allow continued innovation while addressing concerns; 3) take a new approach to talent development that’s more hands-on in reskilling; and 4) lead in addressing inequality and concerns about ethical AI. The case for companies leading reskilling may be more obvious in a country like the U.S., where the government tends to take more of a backseat. That said, proactively reskilling employees displaced by AI provides companies an opportunity to showcase their values while gaining a competitive advantage in talent attainment.