WASHINGTON, April 14, 2023 — As accelerating global digitalization exacerbates regulatory fragmentation, the public and private sectors are both crucial to strengthening consumer privacy and trust in digital infrastructure, according to experts at an Atlantic Council forum on Tuesday.
“The days of handling the internet as the all-democratizing force is behind us, and now there needs to be a real role for the government,” said Priya Vora, managing director of the Digital Impact Alliance.
The public sector’s challenge is to find effective solutions for all of the practical questions that arise alongside technological developments, Vora continued.
“How do you create a data protection authority with budget and staffing independence from the administration?” she asked. “How do you create redressal systems that are responsive, especially when you have a judicial system that’s very slow? How might you put online dispute resolution baked into your technology layers?”
The private sector should also play a role in the development and regulation of digital infrastructure, said Tim Murphy, chief administrative officer at MasterCard. “There’s things that are best in the public sector, but there’s things we can do better as well, and trying to advance the conversation about where private can make a constructive contribution in the context of a regulated market is something that is critical to our future.”
Building public trust is an essential step toward successful digital infrastructure development for both government entities and private tech companies, said Arturo Herrera Gutiérrez, global director for governance at the World Bank.
Many modern challenges call for “not only a technical solution, but they actually require an engagement strategy with the citizens,” Gutiérrez explained. “It’s not sufficient to bring what’s the best solution — it’s important to explain to them why the solution is good for them.”
‘Regulatory umbrella’ could fight digital fragmentation
Concerns about digital privacy and data security currently present some of the biggest barriers to public trust in emerging technologies. While acknowledging the United States as a hub for technological innovation, panelists pointed to the European Union as the global leader in data privacy protections.
“The whole next wave of innovation should really be about giving more tools of transparency and control to people,” Vora said.
MasterCard has implemented standards similar to the European Union’s General Data Protection Regulation around the world, Murphy said. “We need to be laser focused on highest global standards on privacy… even though it’s not required,” he said.
In addition to potentially harming user trust, the significant regulatory discrepancies between various countries and states contributes to digital fragmentation — which disrupts global businesses, restricts cross-border data flow and limits user choice.
“We need to be very careful and thoughtful about the kind of world we’re creating in terms of digital fragmentation,” Murphy said.
“A sort of regulatory umbrella — not to stifle innovation, but to have some basic agreed-to rules of the road — is incredibly important,” agreed Josh Lipsky, senior director of the Atlantic Council’s GeoEconomics Center.
Vora noted that these regulatory challenges will only become more complicated as digital globalization increases. The rapid headway of generative artificial intelligence technologies will likely “put all of this on steroids,” she added.
Murphy called for public and private sector stakeholders to come together and thoughtfully consider how to best regulate rapidly evolving technologies such as artificial intelligence.
“Anyone who tells you they’ve got the answers on how to navigate generative AI and so on is selling something, and that really needs our careful attention,” he said.