Dear Reader,

After several whirlwind months on the international stage, May has brought a glimmer of hope that tensions may finally begin to ease. To be sure, there is still no clear resolution to the wars in West Asia, and the global economy remains under strain from high energy costs and persistent supply shocks. Even so, astute analysts argue that military options on the American side appear to have run their course, and this state of affairs could create space for renewed diplomatic progress.

Another significant development here–both for the current war, and the larger ‘tech cold war’ that has loomed over world affairs lately–was the anticlimactic character of the much-anticipated Trump-Xi Summit. As widely reported, the meeting concluded without either major agreements or a renewed escalation of hostilities. In fact, recent comments suggesting that Trump may be softening his stance on Taiwan point to a more conciliatory American posture and a possible retreat from plans for direct economic confrontation with China. A move in this direction could spell trouble for Silicon Valley’s AI giants, which have increasingly come to justify their exorbitant power in geopolitical terms. Indeed, even Anthropic–usually touted as the ‘more enlightened’ player in the field–put out a panicked paper in recent days that urgently called for aggressive measures to counter China’s tech industry.

While these forces may continue to pressure the American state to advance its interests in the geopolitical arena, the summit suggested that China is currently in a stronger position to shape the terms of the relationship between the two superpowers. If this dynamic persists, it could open the global technology industry to new paths of development beyond the reach of constant American oversight and policing.

Perhaps partly in response to these gathering headwinds, the past month has also seen several leaders of the AI boom signal that they may go public in the near future. The list includes many of the industry’s biggest names–SpaceX, OpenAI, and Anthropic–with projected valuations soaring into the trillions, potentially making these the largest IPOs in history. Critics, however, have argued that such moves could reflect a deeply cynical strategy. Given the industry’s lack of sustained profitability, its enormous operating costs, and the continuing opacity surrounding the actual performance of many of these firms, going public may offer early investors an opportunity to cash in on the hype and exit before the bubble bursts.

In keeping with this broader trajectory, a report earlier this year suggested that major indexes such as the S&P 500 were reconsidering rules around consistent profitability in order to accommodate the inclusion of emerging AI firms. Such a shift could prove highly consequential: admission into these indexes would compel large passive investment funds to purchase shares in these companies automatically. In effect, ordinary Americans–through their pensions, retirement accounts, and savings–could find themselves with a direct material stake in the fortunes of the AI industry.

At a moment when public sentiment toward the technology has grown increasingly skeptical, the IPO route may therefore serve as a way of holding the public hostage to narratives of AI’s supposedly epoch-defining importance.

The one silver lining to these otherwise shameless maneuvers is that they can only happen once. Once these companies become public, they will enter an entirely different regime of scrutiny and evaluation, one in which it may finally become possible to look past the mystifications and take a clear measure of where we are with the economics of artificial intelligence.

Speaking of public disapproval, the past month also marked a further shift in the legal Overton window around platform accountability. Multiple lawsuits were launched in the United States by families alleging that OpenAI’s ChatGPT directly contributed to serious harm, ranging from medical advice that allegedly led to an overdose to failures to flag criminal intent. With recent studies suggesting that existing AI models do exhibit tendencies toward such behavior, these companies may find it increasingly difficult to deny responsibility.

At the same time, the landmark ruling in New Mexico holding Meta liable for the harmful effects of its platform design choices appears to have opened the door to a broader wave of litigation. This month, YouTube, Snap, TikTok, and Meta all chose to settle a case brought by a school district in Kentucky, which accused them of damaging students’ mental health and cognitive development. Reports suggest that nearly 1,200 similar lawsuits are now moving through the pipeline, filed by school districts across the country. Moreover, the impulse toward this kind of litigation is beginning to spread beyond the United States. In Milan, a parents’ association has brought a case against Meta and TikTok, alleging that the platforms promote design features harmful to young people’s emotional well-being and psychological development.

The initial success of such efforts, and the barrage that has followed, clearly has these social media companies on the back foot. To continue to pay compensation would not be sustainable for very long, and there is an opportunity here for regulators to step in and enforce new guidelines for the design of platforms and algorithms. Such a development would be a substantive and durable intervention that could make a huge difference in repairing the digital public sphere. Still, even without such a comprehensive shift, it is clear that the legal environment is shifting, and social media companies can no longer count on the impunity they have long enjoyed.

Finally, the past month also saw an important convergence of voices from the Global South expressing a clear determination to play a much larger role in AI and digital governance. This was evident both at the BRICS Ministers of Foreign Affairs and International Relations meeting in New Delhi and at the Africa Forward Summit in Nairobi. In both forums, a broad consensus emerged that countries in the Global South must ensure they play an active role in shaping both the emerging technological paradigm and the regulatory order developing around it.

These countries already engage with these technologies at every level of the value chain, from the vast and often invisible networks of data labor that underpin AI systems to the rapid adoption of these tools across an expanding range of sectors. Indeed, recent studies suggest that, unlike in the West, where skepticism toward AI is steadily growing, many parts of Asia and Africa continue to exhibit high levels of public enthusiasm and consumer adoption. As a result, these societies may well be the first to experience the most far-reaching social and economic transformations brought about by this technology.

It is clearly with this reality in mind that political leaders and policymakers have come to recognize the urgency of acting decisively within today’s AI governance landscape. It is promising to see the extent to which discourses of ‘digital sovereignty’ and associated forms of critical knowledge have become widespread. At the same time, the concentrations of power within these industries are historically unprecedented, and reclaiming meaningful control from these forces will not be easy. One can only hope that these different countries in the South are also making a resolve to rediscover their bonds of solidarity.

The Datasyn Team

The Sins & Synergies Lounge

Start with Ed Zitron’s latest installment of ‘What If We’re in an AI Bubble?’, an incisive analysis bringing together the many facts of the speculative economics underpinning the AI boom, from hyperscaler debt and stranded GPUs to the fragile financial engineering holding the industry together.

Also read the Balanced Economy Project’s latest paper that makes a critical connection of a speculative strategy in which Big Finance and its highly financialised proxy Big Tech seek to expand profitability by manufacturing a market and then extracting returns while externalising costs.

Tune into this urgent conversation with the organizers of RightsCon following the abrupt cancellation of the summit in Zambia after pressure to restrict Taiwanese participation.

Also put on your radar Ghost in the Machine, an upcoming documentary by Valerie Veatch that traces the untold origins of artificial intelligence through the lens of power, politics, and ideology rather than technological inevitability.

Don’s miss this critical conversation with Emily M. Bender, co-author of the landmark “stochastic parrots” paper and The AI Con, as she unpacks why fluency is not the same as understanding and what is at stake when we mistake convincing AI output for meaning, expertise, or care.

Finally, read Rest of World’s excellent reporting on AI sovereignty in Africa, which examines how governments across the continent are navigating the pressures of Big Tech infrastructure investment while attempting to retain autonomy over data, compute, and digital futures.