Cities’ backlash against big tech is only starting

European cities are increasingly wary of how American tech giants like Google and Uber are trying to access their public transport systems. [Alper Çuğun/ Flickr]

American tech giants like Google and Uber are facing backlash from regulators across Europe—and increasingly from city governments.

London, Paris and other big cities are wary of letting US-based companies cash in on their move towards driverless buses and public transport technology that collects huge amounts of data, Ross Douglas, CEO of the Paris-based mobility conference Autonomy, said in an interview. The backlash against Silicon Valley firms is only just starting, Douglas said.

A number of European cities are creating transport strategies that focus on integrating autonomous systems, like Paris’ plan to have driverless shuttles by the 2024 Olympics and London’s for autonomous buses. Are more European cities going to follow that trend?

Obviously, the big data companies are either Chinese or American so the leaders in connected mobility are the Qualcomms and Broadcoms and the Ciscos of the world. There are a lot more types of the data technology coming from the US and that’s not surprising. What you see coming out of America is an incredibly data-centric, autonomous-centric vision and it’s being driven by the American industry, which is very strong on tech.

Europeans have a very different approach and their approach is trying to use data to make multi-mobility happen. The American perspective is private ownership of autonomous vehicles. The European mobility perspective is of cities trying to own and manage data in order to enable multi-mobility to happen across a number of different vehicles and, in the future, including autonomous vehicles.

Are European cities’ developments in autonomous vehicles driven by American tech giants or are there more active European startups?

When you speak to Europeans, they tell you Europe is behind and when you speak to Americans, they tell you that America is behind and Europe’s ahead. If you are in the car sharing or bike sharing business or the electric scooter sharing business, you don’t want to be in America because everybody is still stuck with car ownership. The mobility of today is not dominated by the American tech giants at all.

But if you look at the mobility of tomorrow, American tech giants are starting to move incredibly quickly into that space because they see the size of the prize. Google is starting to communicate very strongly that human beings are not capable of driving motor cars, we are too dangerous. We kill 1.2 billion people a year through accidents. Qualcomm put a massive banner in Paris last week saying ‘5G is coming, brought to you by Qualcomm’.

The big American companies are jumping for the big, big winner take all scenario, which is the autonomous vehicle on demand, the robo-taxi. Uber obviously has slowed down after the accident [a woman was killed by a driverless Uber car last month in the US] but the massive race from America is big companies, many tech companies going full speed ahead for on-demand robo taxis.

That’s Lyft, Uber, Google, Qualcomm. Europeans haven’t really got a tech company going for on-demand autonomous vehicles. What they have are car companies trying to become more autonomous and those companies have a vision of drivers being behind the wheel and when the driver doesn’t want to drive the car, the car can drive autonomously. They have a few car companies starting to have car sharing. BMW’s DriveNow, Daimler’s car2go. But those are very, very small investments compared to GM, which spent $1 billion on Cruise Automation.

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Because European companies invest less than American companies, will the development towards autonomous transport be much slower in Europe compared to in the US?

My sense is that the prize in Europe will not be as big as the prize in the US. America is a country where the culture of the economy is very much winner takes all, it has very little public transport spending. It’s very car-centric and what is happening in America is that in the future there is a very strong likelihood that single car driving of combustion cars is going to be replaced almost entirely by single car occupancy of autonomous and electric vehicles with a very rich digital infrastructure. So you’ll call an autonomous vehicle without a steering wheel, you’ll jump in it, it’ll sell you stuff on Amazon, it’ll sell you Facebook ads. It’ll be crunching your data and if you’re a wealthy person who is prepared to opt-in for your data, it’ll give you a free lift in exchange for selling you ads, for you shopping on Amazon, etc.

What’s happening in Europe is that Europeans are starting to talk for the first time against American tech. They’re starting to be concerned about ‘big tech’, about GAFA [Google, Apple, Facebook and Amazon], and they’re also concerned about the negative side of the future of autonomous vehicles. Americans don’t have as many concerns about the downsides of autonomous vehicles, of which there could be many. For example, the massive reduction in what we call active mobility, walking and cycling.

Every single European city is trying to improve their walking and cycling. For good reason: it improves congestion, reduces pollution, it improves the health of their citizens. Something that they as socialist countries with national health budgets have to pay for the downsides of health. In America, with private healthcare, people are suffering from obesity, and that cost is not born by the state or the city, it’s born by private citizens. A city like Paris has put €150 million into bike lanes, they actively are pushing an incredibly ambitious biking programme.

Paris is very ambitious with autonomous vehicles, but they want what we call autonomous shuttles, these things that can move 15-16 people at a time. It has a small footprint for moving a lot of people. Americans are pushing for basically a computer on wheels with massive connectivity, using your data, selling you stuff online. I think because of the politics, the culture, the history of American tech companies, we’re starting to get two very different narratives driving mobility in Europe and in America.

It’s very hard for regulators to say to tech companies, ‘You can’t sell to my citizens’. But when it comes to mobility, cities have the right to say ‘You can’t operate on my roads because these are public spaces’. Transport for London did that with Uber [in September 2017. The app still works in London while Uber appeals the city’s decision]. They did not renew their license because they thought their corporate behaviour was not appropriate.

Suddenly you’re seeing, for the first time, trans-tech companies understand they need to play nice in cities because these guys hold the keys. It’s not like combining Apple and using Google software, it’s not going to be so easy to come in onto European roads and put your tech through and behave the way you want to. As Uber has found out.

There has been a broader backlash recently from European regulators and governments against American tech giants.

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Are European city governments’ concerns focused on American tech giants accessing people’s data through public transport partnerships?

I see a couple of concerns and fears from European policymakers. One is the extent of power the American tech giants can have and how fast American tech giants can move in transport. There’s not a city that doesn’t talk about ‘Uberisation’, that doesn’t understand how quickly Uber went and took over the taxi industry and reduced its value. The way the taxi industry works in Europe is they give list licenses. And a taxi driver, when he or she retires, can sell their license to a younger person, which they do normally for €200,000. And that was normally their retirement.

So this system, even though it wasn’t efficient for us as commuters, it was enabling them to retire quite wealthy and they were therefore less of a burden on states and cities. The price of a taxi license in Italy has gone down now from €200,000 to €100,000 because of Uber. That price will go down to zero, making them a further burden on the state. The one big fear I have is that the change in business model that Uber has and the speed that American tech companies can move at can replace European companies that pay tax and employ people, etc.

At the same time, tech coming out of China now with new mobility is so much better, so much quicker, so much cheaper than anything Europe can produce, that they are concerned about where Europe will fit in. Europe was a leader in transport because transport was mechanical, used combustion engines and was non-digital. Now transport is electric and digital. Americans are masters of digital, Chinese are masters of electric. Europeans are masters of neither of those two. From having been leaders with airplanes, trains, buses, motor cars, bicycles. They’re now looking very behind because transport is effectively being replaced by smartphones on wheels.

European governments are increasingly concerned about American tech companies’ dominance in areas like logistics as well. Are some cities moving to come up with ways to limit their access to transport data through specific legislation on data access?

Absolutely. That’s exactly what we’re seeing and it’s all starting with data. Uber last year announced their programme Movement, which is opening their data to cities. The reason why they did it is they understand it’s good for mobility, for the city, to have access to all the transport data. And the other reason why they did it is they realise Uber can only operate in cities with the blessing of the cities.

Once the cities don’t renew the license like Transport for London did, or the cities start coming up with reasons why Uber can’t pick up passengers there or there, its competitive advantage goes. The power cities have is over public infrastructure, the roads, the parking and pickup points. Cities will actively use that to punish companies that don’t pay tax, that use data to direct consumption into companies that are not benefiting the city, etc. It’s the only lever they have and it’s a lever they will be using.

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