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Microsoft president acknowledges the age of tech company self-regulation ‘is over’

The age of tech companies self-regulating themselves is over, the president of Microsoft has admitted, although he warned against excessive restrictions being placed on them by governments.

While promoting his new book 'Tools and Weapons', Brad Smith spoke to the PA news agency about the key issues facing the tech industry including data privacy and the inevitability of encroaching regulation.

“I do believe that the age of self-regulation is over. I might argue that it never really started because that would suggest that everybody really seized the opportunity and I don’t think that happened,” he told PA.

“But I think even more broadly than that, no technology in the history of technology has gone as unregulated for as long as digital technology as gone unregulated.

“Now, at the same time to say there needs to be regulation doesn’t mean that any form of regulation will be good. There needs to be thought, there needs to be a balance.

“We want innovation to continue. I think more than anything we need these conversations to begin by asking what problems we want to solve, and then using that knowledge to focus regulation in the right areas.”

Microsoft has recently had its own brushes with regulators and is currently being investigated by the Dutch Dutch Data Protection Agency over possible breaches of privacy rules.

Smith has also advocated the use of facial recognition by government agencies and Microsoft offers its own facial-recognition toolkit, Face API, which businesses can use to build facial recognition into their software.

He said the Facebook and Cambridge Analytica data scandal had been a “necessary reckoning” for the industry as it had helped raise key issues about data management publicly.

“One of the themes in the book is that there have been two significant inflection points in this decade that are coming to a close. One was in 2013 with the Snowden disclosures and the other was in 2018 with Cambridge Analytica,” he said.

“So, it means that we need to make the most of data at a time when people have more concerns and questions about data. Now that’s not the worst thing in the world because the concerns would be there even if they weren’t articulated.

“So the best way to address a problem is to get it out in the open. So, we can look in some ways at Cambridge Analytica and say that this is a necessary reckoning. This was going to happen at some point.

“I wish it had happened earlier but it is here today and so let's then talk about how we protect people’s privacy and ensure that people remain in control.”

Addressing the current trade spat between the US and China and the issues this has caused for tech companies such as Huawei, Smith warned against drawing a “digital iron curtain down the middle of the Pacific Ocean”.

He referenced Microsoft’s own landmark anti-trust case in the US in the 1990s, where the company was accused by the government of stifling competition, and warned that such “collisions” between government and technology were well-managed on both sides.

“I think fundamentally our plea in that chapter is that the United States and China think about the nuances of technology, because the details really do matter greatly,” he said.

“Our chapter in part is an argument, if you will, that the two countries not try to draw a digital iron curtain down the middle of the Pacific Ocean. That they, to some degree, separate issues of security and trust from issues of trade. They may connect at times, but they really are distinct and they’re better off if they’re kept distinct.

“Ultimately, we do make a broader argument at the end of that chapter that I think is very important – and you don’t hear elsewhere in my view.

“It’s a reminder that 80 per cent of the world’s people don’t live in either country and so we should all hope that when the United States and China sit down with each other, each country is thinking about its own interests, but they’re both thinking about the rest of the world as well.

“Because these are, in some ways, two countries that are going to have such a huge impact on the rest of the world and we need the two governments to keep that in mind.”

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