The Internet has transformed the modern economy, led to new technological developments, and given rise to digital trade. Internet-enabled companies are able to reach users and customers across the globe without a brick-and-mortar place of business, but non-tariff barriers — such as forced data localization, imbalanced copyright law, and various restrictions on user speech — can prevent startups from competing abroad.
In order to give policymakers a deeper understanding of the issues that startups encounter as they scale globally, on Friday July 16th, Engine hosted the first in a series of events exploring these barriers with startups and industry experts.
“The digital economy faces a number of rising barriers to digital trade that can deter access and inhibit innovation,” noted CCIA Policy Counsel Rachael Stelly to start the event. For Rishi Ranjan, the founder of AR/VR cloud computing startup GridRaster, these barriers take the form of restrictions on cross-border data transfers. Were the data-intensive company to run into data-localization measures as they look to expand, they would be faced with tough choices.
“[As a startup] there’s a lot of things that can go away. We have to be very innovative, and will have to really start choosing to keep local data or drop it if it might not be worth it price-wise for customers,” said Ranjan. “In the future, many more use cases will start becoming a reality. And at the moment, we are a smaller company and cannot handle [these issues].”
While policymakers certainly care about small businesses, Abby Vollmer, Director of Platform Policy at GitHub, pointed out that some policymakers may not even realize how legislation around user content, for example, affects more diverse platforms.
“A challenge for us — and smaller user generated content platforms — is that a lot of the policymakers that are trying to address certain issues that they are seeing are really thinking about a few, and often large, platforms. And so a lot of this legislation is designed with those particular examples in mind, and that can be really challenging for other platforms.”
It is critical that barriers to startup success are dismantled through sound policy, international organizations, and trade agreements so American startups can compete abroad. We hope that this panel was informative, and that you’ll join us for the next event in the Nuts & Bolts series on July 30th at 12 p.m. ET, where we’ll be diving deeper into the issues startups face as they host content around the world. Register today.
