Europeans Get Real About Putting America’s Most Competitive Companies Out of Business

July 2, 2024

French antitrust authorities, after a dawn raid last year on Nvidia’s offices, is set to follow up with a big new antitrust lawsuit against this U.S. chipmaker. Nvidia is the manufacturer of graphic processing unit chips – GPUs – that have the massive computing power that enable increasingly robust artificial intelligence. French authorities have let it be known it will charge Nvidia for anti-competitive practices in this space.

• This follows on the heels of the European Union’s ruling that Meta did not go far enough to comply with the new Digital Markets Act. In response to that new law, Meta offered European Facebook users a “pay or consent” model in which consumers would agree to having their personal data monetized by companies seeking to post ads on their newsfeeds, and keep the service for free, or pay a little in order to restrict these uses of their data. The EU demands that Meta instead allow users to opt out a service that uses less of their personal data but is otherwise equivalent to the personalized ad-based service.

In other words, Facebook is being told by Europe to offer a free service with no way for the company to support it.

• Apple was also recently accused of failing to comply with European law for not allowing app developers to steer customers to alternate platforms. In other words, Apple is being told to provide a platform for competitors – and pay for the free advertising.

• Microsoft was hit for offering its Teams collaboration video and chat software on its Microsoft 365 platform and for offering a free, one-year trial for that service. In other words, Microsoft is a moral monster for packaging a new product with other products and for trying to entice consumers to adopt it.

Europe has long expressed its protectionist sentiment by using antitrust law to ding American companies. But this campaign is becoming decidedly more deadly. Under Europe’s new law, these companies can be hit for the equivalent of 10 percent of their worldwide revenues for an infraction. A second infraction would hit them with a 20 percent fine of their worldwide revenues. Even for a tech giant, fines of those magnitudes could quickly amount to the death penalty.

The impetus behind these uses of antitrust enforcement to aggressively injure America’s most competitive technology companies seems to spring from a belief that there is no European equivalent to Apple, Amazon, Google, Microsoft, and Nvidia, because of dirty practices that stifle European ingenuity. In truth, Europe’s problems are intrinsic. European society, especially France, is hierarchical, traditionalist, and overregulated, a toxic business environment that smothers innovation. I’ve seen many young people from Europe, especially France, fleeing to these shores to escape that stultifying environment.

If Europe continues to rigorously enforce these measures, we might well see American companies opting out of the European market altogether rather than go bankrupt. If that happens, don’t expect to see a flourishing new European tech Renaissance. Expect to see, instead, domination of Europe by China and its national champions.