i3 - September/October 2017 - 2

From the CEO

Listen up EU: Innovation is a Survival
Strategy - Blocking it is a Dead End
American companies have done well in software
(Microsoft and Oracle), hardware (Apple
French President
Emmanuel Macron
and Cisco), chips (Intel, NVIDIA and Qualattended CES 2016
comm), search engines (Yahoo and Google), and
and CES 2017.
social media (Facebook and Twitter). European
regulators suggest many of these amazing innovators hurt competition as they are too big and strong. Yet many of these services
and platforms delight European consumers. Many compete with
each other for customers through advertising or visibility. More, it
doesn't take much investment to unseat a large software or services
innovator. The low technical and capital barriers allowed these big
companies to replace other dominant companies. Facebook
replaced Myspace. Google replaced sites like Ask
Jeeves and Yahoo. Instagram is now fighting to upend
Snapchat. Apple competed successfully with Sony
and went on to invent the smartphone market.
European regulators ignore this history. They see
a flow of new American growing companies. They
see few, if any, European tech startups hitting the big
time. They use ambiguous European antitrust laws to
club American companies into outrageous financial
settlements. So European regulators are increasingly
imposing huge fines on great American companies
like Apple and Google. This is the same trick they
tried with IBM, Microsoft, Intel and Qualcomm.
If you can't create your own great companies you
should try extracting cash from those that are successful. And if antitrust isn't enough of a tool, try using
Hopefully,
the Brexit vote privacy notions or follow the China model and assert
cyber and national security concerns to insist data,
may signal
cloud servers and other technologies be physically
a populist
hosted in the countries they serve.
uprising away
Innovation is and should be an American national
strategy.
It could be a European strategy. France has
from antidefi
nitely
turned to it under President Macron.
innovation EU
The EU is better off looking at its anti-innovation
policies.
work and social policies than seeking to choke great
American innovators. We have huge new technologies on the visible horizon. Every country can race to
the lead, but kneecapping the competition is not okay
in ice skating nor in global economic competition.

FOR OVER A DECADE, I've been preaching
the value of innovation. I've declared it from the
CES keynote stage. It has been my theme in two
books and hundreds of columns.
The need to innovate to survive applies to
companies. It applies to governments and
countries. It even applies to people!
Everyone needs to adapt. Environments
change. Competitors expand. New entrants
emerge. Old legacy companies die.
My generation witnessed cable, satellite, the
internet, wireless, social media, digital devices,
search engines and the sharing economy. All
began, blossomed, created wealth, made new
industries and affected legacy companies. The
next generation is seeing change from drones,
robots, self-driving cars, AR/VR, personalized
health and artificial intelligence.
We all choose one of three courses. We can be
complacent and accepting and let things happen to us. Or we can block innovation and fight
to remain in the past. Or we can create change
ourselves and define our futures.
Blocking innovation and the future is the North Korean approach.
The EU does not outlaw innovation but it is not totally embracing
it either. It has complex, conflicting rules and ambiguous laws.
It constantly challenges successful American companies. Hopefully,
the Brexit vote, and French election of pro-innovation CES attendee
Emmanuel Macron as president, may signal a populist uprising
away from anti-innovation EU policies.
2

SEPTEMBER/OCTOBER 2017

Gary Shapiro,
President and CEO

I T I S I N N O VAT I O N

i3 - September/October 2017

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