Dear Reader,
In the years to come, this past June may well be remembered as a historic milestone. With the official signing of a US-Iran memorandum of understanding, the month marked what many regard as one of the most humiliating military defeats in United States history. Whether this fragile peace endures or gives way to another round of fighting remains uncertain, but many analysts see the ceasefire as a decisive turning point. It lays bare the true contours of the situation: the imperial hegemon no longer possesses the capacity to enforce its will, and this military retreat is symptomatic of a larger waning of structural power.
Indeed, from the perspective of the Silicon Valley-centred tech economy, there is reason to believe that much of the damage has already been done. As economists have warned, the full economic impact of the war has yet to be felt, and it may be many months before commercial activity and trade return to their previous patterns. Much like the war in Ukraine, the disruption of global supply chains is likely to fuel a sustained period of inflation. While this bodes ill for working people, it is also an ominous sign for the tech sector. As many critics have observed, the industry has become so dependent on abundant flows of cheap capital that any significant tightening of financial conditions is liable to wreak havoc.
If this were not enough, the fallout from this adventurism in West Asia has also significantly weakened the United States’ geopolitical clout. It has generated new tensions with allies in the Gulf and East Asia, both important sources of investment and key markets for Silicon Valley, which may no longer be as willing to play that role. Moreover, as Trump’s position vis-à-vis China has become increasingly constrained, he appears less able to advance the AI industry’s interests on the geopolitical stage with the same degree of force, leaving the sector exposed to a range of new vulnerabilities.
This broader context helps explain why the AI giants are racing to go public. This month saw the first of the anticipated IPO bonanzas, with SpaceX’s record-breaking market debut raising nearly $80 billion and briefly pushing Elon Musk’s net worth past the trillion-dollar mark. While the scale of the offering is undeniable, it is important to understand the nature of its success. Rather than reflecting the company’s technological novelty or underlying business fundamentals — which analysts have long questioned — it represents a class act in narrative-building. The subsequent collapse in the share price, widely anticipated once the IPO euphoria subsided, wiped hundreds of billions from the company’s valuation and underscored the fragility of the story. Yet the IPO had already served its purpose. It provided a lucrative exit for early investors, transferring the risks of the company’s future onto public shareholders. This is the logic of Silicon Valley’s financial model — and one we must learn to recognise and challenge.
In other news, June saw the unveiling of the European Union’s new ‘Technological Sovereignty Package’. It is positioned as a comprehensive strategy to build and safeguard the EU’s autonomy across the full AI stack, from semiconductors to cloud infrastructure, platforms, and large language models. The package consists of a set of legislative measures designed to limit the extent to which foreign companies can expand their presence in European markets, alongside initiatives aimed at strengthening domestic firms and enabling member states to develop greater technological and infrastructural capacity within Europe.
Overall, the package makes a strong case for addressing the structural dependencies on which the EU’s digital economy currently rests. In doing so, it reflects policy approaches to digital governance that have become increasingly prominent across the Global South, including the use of open-source technologies, data localisation requirements, and forms of digital industrial policy.
However, there are significant obstacles to even these efforts. To begin with, critics have noted that while the legislative component is relatively robust, building the hardware foundations of sovereignty is far more costly and long-term in nature, and it remains unclear whether the necessary resources have been committed. The question of funding looms over the entire undertaking, with the initial draft relying heavily on private capital and forms of ‘blended finance’ that have historically struggled to deliver large-scale infrastructure projects.
Beyond this, the EU continues to straddle both sides of its relationship with the United States. Having recently joined the latter’s ‘Pax Silica’ initiative to sanction China and reinforce America’s tech sphere of influence, it will be difficult for Europe simultaneously to present itself as a counterweight seeking digital autonomy. Genuine digital sovereignty would likely require a more fundamental reappraisal of alliances: moving beyond the US technological umbrella, and potentially even forging closer ties with parts of the Global South. Whether Europe is prepared to contemplate such a radical shift, however, remains uncertain.
On the question of regulating Big Tech, this month has also seen renewed tensions between the Brazilian government and global social media barons. The government recently announced a set of decrees that would make digital platforms liable for unlawful content generated by their users. These measures were swiftly met with strong legal challenges and public criticism, much of it backed by major technology companies.
Indeed, after a previous attempt to extend liability for the spread of fake news was defeated under pressure from intensive lobbying, policymakers have this time gone further in seeking to defend their position and consolidate support for the proposed legislation.
It may well be that — as happened last year — if the tech giants are unsuccessful, this may graduate from a domestic regulatory dispute to a geo-political issue, with Trump threatening to leverage tariffs and other sanctions to ensure a more pliant economic landscape for American companies to exploit. However, such forms of bullying have only rallied more support to the cause of digital sovereignty, and with America’s faltering authority on the world stage, it will be interesting to see how much acquiescence such maneuvers are still able to secure.
Finally, in more historic news from this month, June saw the passage of ILO Convention 193 — the International Labour Organization’s Convention on Decent Work in the Platform Economy. Of course, the final text represents a compromise, with a number of concessions made to employers — e.g on minimum wages, gendered inequalities, the right to explanation. Nonetheless it is a significant and hard-won achievement. It breaks new ground on issues such as worker classification, the right to benefits, and algorithmic management, among others, establishing a minimum floor in binding international law that can be leveraged in national contexts and help catalyse the next phase of organising and struggle.
The negotiations went on until the eleventh hour, with several moments in which it appeared that no final agreement would be reached. Yet the resilience of the workers’ delegates ultimately prevailed, with notable support from a broad coalition of national representatives across the Global South. In this regard, the African Union member states played a leading role, in a striking display of solidarity that should inspire us all.
In this and forthcoming issues, we will continue to provide analysis and commentary on the scope and wider ramifications of the Convention. For now, however, it is worth pausing to recognise the brave struggles of thousands of platform workers across the world, whose determination and indomitable spirit in recent years has made this outcome possible.
The Sins & Synergies Lounge
Start with the Balanced Economy Project’s timely critique of the EU’s new Cloud and AI Development Act, which argues that digital sovereignty cannot be achieved by simply building more data centres. Using Ireland as a cautionary tale, it shows how AI infrastructure can entrench corporate concentration, public subsidy, and environmental costs unless questions of ownership, governance, and interoperability are placed at the centre of policy.
Also read 7amleh’s latest report on Meta’s suppression of Palestinian content, which documents the persistence of platform bias and content moderation failures amid ongoing violence and offers crucial evidence of how digital infrastructures continue to shape political visibility and erasure.
Listen to this critical episode of the Counter Power podcast for a conversation on the rise of the new tech empires, the political power of Silicon Valley’s billionaires, and the growing resistance to their influence around the world.
For a more reflective read, explore the latest installment of the Digital Tribulations series from the Institute of Network Cultures, which meditates on the many meanings and contexts attached to the developments in digital sovereignty in Latin America.
Tune into this critical episode of the Tech Policy Press Podcast, discussing a recent investigation by Investigate Europe, which shows that a confidentiality clause inserted into an EU regulation after industry lobbying allows companies to keep site-level data center energy and water use out of public view.
Don’t miss this powerful account of how women ride-share platform workers transform shared experiences of care and emotional labor into collective forms of organization and resistance.
Finally, listen to Data & Society’s The Craft of Science with AI, a fascinating conversation on why scientific practice cannot be reduced to automation — foregrounding the role of evidence, judgment, and human expertise in an age increasingly captivated by AI solutions.
