Five tech issues to watch in 2017

Silicon Valley and Washington are gearing up for an important year on tech policy.

President-elect Donald Trump and a GOP Congress are taking power and could revisit a number of controversial regulations, with net neutrality high on that list.

2016 was also breakout year for a number of new technologies, including self-driving cars and artificial intelligence, and lawmakers will be eyeing those developments closely.

Here are five tech issues to watch in 2017.

 

Immigration

Silicon Valley had high hopes for comprehensive immigration reform in the coming year, with the tech-backed lobbying group FWD.us pushing for action.

But those hopes were dashed with Trump’s election. The president-elect vowed to build a wall on the Mexican border and floated a ban on Muslims entering the U.S.

Tech groups have long pushed for policies that would make it easier for companies to attract workers. Now they find themselves on the defensive and are looking for any areas where they can work with the president-elect.

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“There might be a little bit more playing defense, going forward, than playing offense,” Derrick Seaver, executive vice president of the San Jose Silicon Valley Chamber of Commerce, said after the election.

One key issue for Silicon Valley has been reform of H1-B visas that allow companies to bring high-skilled workers to the U.S.

Trump’s views on that issue have been inconsistent. In his book “Great Again,” Trump said he didn’t want to crack down on those visas but instead suggested raising the fees tech employers pay. Other times, he’s claimed those visas fill jobs that could go to American workers.

During Trump’s meeting with leaders from major tech companies in December, he seemed amenable to Silicon Valley’s position on H1-B reform.

According to Recode, when Microsoft CEO Satya Nadella raised the issue of high-skilled employee visas and immigration to help the industry, Trump responded, “Let’s fix that,” and asked, “What can I do to make it better?”

 

Self-driving cars

Autonomous vehicles are already being tested by many companies on public roads as the technology quickly evolves.

The Obama administration has largely taken a hands-off approach to regulating self-driving cars, an approach industry can expect Trump to maintain.

So far, neither Trump nor his pick for Transportation secretary, Elaine Chao, has signaled their plans for addressing autonomous vehicles. But with Trump vowing to roll back regulations generally, tough new rules are unlikely.

President Obama’s Department of Transportation issued a series of guidelines in September to help guide the industry as it builds the cars and tests them. And the feds also offered $65 million in grants to help communities prepare for the new technology.

The federal guidelines came after industry pressure for federal insight. Carmakers and tech groups fear that a patchwork of conflicting state-by-state laws could hamper their growth.

Mark Rosekind, administrator of the National Highway Traffic Safety Administration, told Congress in a hearing last month that the agency was working to craft a uniform federal regulatory framework, though he estimated that a full rollout of self-driving cars was decades away.

Industry is also weary of any new mandates, but has welcomed Chao’s nomination, believing she’ll make any new guidelines voluntary.

Lawmakers have also taken a cautious approach.

In 2015, Sens. Ed Markey (D-Mass.) and Richard Blumenthal (D-Conn.) introduced the spy car act aimed at stopping car hacks, but Congress has mostly stayed on the sidelines.

Proponents of self-driving technology see their biggest challenges at the state level, where Uber has already run afoul of California regulators with its autonomous vehicles.

The company put a halt to its autonomous car program in San Francisco last week after state regulators threatened legal action against the company for not getting the proper permits for the 16 vehicles in the test. The next day, Uber announced that it would be moving its test program to Arizona.

Both industry and state regulators are gearing up for a new round of fights.

 

Net neutrality

The Federal Communications Commission’s controversial net neutrality rules are likely in the crosshairs of the incoming Trump administration.

Trump’s FCC transition team has been packed with vocal critics of net neutrality, which require internet service providers to treat all traffic equally. And Republicans have long vowed to scale back the rules.

The rules were a centerpiece of Obama’s tech agenda and sparked a long fight between broadband providers and internet companies like Google and Facebook.

The net neutrality measures were approved in a close 3-2 FCC vote and survived a court challenge. But with FCC Chairman Tom Wheeler leaving in January and power on the commission shifting to Republicans, that fight will heat up again.

Republican Commissioners Ajit Pai and Mike O’Rielly have voiced their intentions to scale back the rules. Pai is also seen as the likely successor to Wheeler as the agency’s chief.

But it’s unclear exactly how far they’ll go in revising the rules. Some have called for gutting the rules entirely, while others have called for reworking specific portions, like the Title II provisions.

Lawmakers are also keen to play a part in the fight. Congressional aides told Bloomberg BNA in December that Sen. John Thune (R-S.D.) is interested in drafting legislation to cut back on some portions of net neutrality.

 

Artificial intelligence and automation

In December, White House put out a long-awaited report on the future of artificial intelligence and automation.

Overall, the report touted AI technology as an overall benefit to the economy, but also warned that the technology could lead to economic inequality by replacing jobs in many fields.

It laid out a number of policy recommendations for the next administration to help counteract any economic shocks from innovations in artificial intelligence.

The recommendations are likely to be popular with Democrats and less so with Republicans, with calls to strengthen the social safety net and raise wages. They are unlikely to be taken up by the incoming GOP-controlled Congress.

Trump vowed on the campaign trail to renegotiate trade deals to protect American jobs, but it’s unclear what his views are on automation and its threat of job losses. Some economists say that automation and technological development could have a greater impact on employment than trade and immigration.

Trump’s pick for secretary of Labor, Andy Puzder, has been an outspoken proponent of automating some jobs in his own business. Puzder is the CEO of the fast-food company that includes chains Carl’s Jr. and Hardee’s.

The next administration could face some tough questions as industry’s use of automation and artificial intelligence grows.

Labor groups have already blasted Puzder and can be expected to closely watch his stance on automation.

 

Bitcoin

In 2016, blockchain and bitcoin quietly expanded their foothold in financial technology.

Bitcoin is a digital currency experiencing a boom, with a market capitalization of roughly $15 billion. Blockchain systems are the online ledgers that track related transactions.

Blockchain companies have an ambitious agenda for the year ahead. Blockchain firm Ripple has already announced plans to allow cross-border payments between major banks at expedited speeds and reduced costs.

Companies and the financial industry are taking notice.

In a November Wall Street Journal op-ed, IBM CEO Ginni Rometty wrote that blockchain systems could create $100 billion in savings annually.

Major companies like Toyota and Visa are also exploring and building their own blockchain systems.

Lawmakers are slowly turning a watchful eye to the technologies, which have been largely untouched by Congress.

In September, Reps. Jared Polis (D-Colo.) and Mick Mulvaney (R-S.C.) announced the creation of a blockchain caucus that would focus on emerging digital currency technologies.

Trump will also have some prominent Bitcoin enthusiasts in his circle, including Mulvaney.

In December, Trump selected Mulvaney to head the Office of Budget and Management.

Silicon Valley executive Peter Thiel, a prominent Trump supporter and member of the transition team, has also been outspoken in support of bitcoin. His venture capital group, Founders Fund, has invested in bitcoin startup Bitpay.

Polis hasn’t made any concrete plans for introducing bitcoin legislation, but with Republicans in control of Congress, it’s likely the caucus’s main efforts will be focused on educating lawmakers about the technology in the coming year.