- Trump’s “America First” policies could push global partners to pursue digital sovereignty, reducing U.S. tech competitiveness
- Starlink is positioned to benefit as a solution for rural broadband expansion under Trump’s new administration
- Fierce Network editors went all-out analyzing what the incoming Trump administration could mean for telcos, cloud, AI and more
President-elect Donald Trump’s “America First” policies could have blowback that makes the US less competitive internationally, pushing trade partners to accelerate their digital sovereignty and making US companies less attractive as trading partners.
“He’s made a lot of bold statements, sometimes contradictory, about his technology policy and position,” said analyst Christian Renaud, global head of technology practice for MarketsandMarkets. Trump surrounded himself with technologists, which is encouraging. However, Trump’s America First policies could drive other nations to accelerate their digital sovereignties, seeking independence or non-US partners for data, cloud, AI and quantum strategies.
“Other countries have already started their own data sovereignty and AI sovereignty efforts, and one of the reasons they did that is for national security,” Renaud said. “AI is intertwined with defense technology — you can’t have that in the hands of a potential future adversary.”
The United States is coming to be seen as a less predictable and solid partner, Renaud said.
“The international climate is going to be more standoffish, and that’s going to harm the US technology sector in international business,” he said.
Increased focus on digital sovereignty could lead to balkaniziation of global technology infrastructure. And this growing balkanization could stifle research in emerging technologies such as artificial intelligence and quantum computing, which require international collaboration to flourish, Renaud said.
However, analyst Patrick Moorhead, founder, CEO and chief analyst of Moor Insights, has a different perspective. He doesn’t see a big impact from the new Trump administration over sovereignty. Every major country is already considering sovereignty, he noted. However, sovereignty is difficult with quantum and AI chips because those technologies require enormous investments. “China, with an almost unlimited budget, has not been able to replace Nvidia, AMD, Qualcomm, Intel, or Micron yet,” Moorhead said.
As for whether other countries will see the US as less reliable, Moorhead said: “If reliable means pushing the US around or doing bad deals, then yes,” Moorhead said.
Trump 2.0's likely tech focus
From a technology perspective, the new administration will primarily focus on AI, semiconductors, cloud and maybe quantum, Moorhead said.
In AI, “competition with China will be the first and foremost concern.” The second concern will be distributing power from current AI giants to smaller companies, Moorhead said.
Under Trump, we will likely see an AI Investment Act, similar to the existing CHIPS Act. “China is spending $1.4T on AI-related technologies. What about the US?” Moorhead said.
Trump may try to break up AI companies to increase innovation. “I don’t think, in general, Trump likes big tech,” Moorhead said.
In particular, Moorhead expects increased scrutiny of the so-called Magnificent 7 — Microsoft, Amazon, Meta, Apple, Alphabet, Nvidia and Tesla. “I think the new administration will look at the Mag7, determine if they are a threat to innovation balanced against the China threat, and go from there,” Moorhead said. “The administration doesn't want to be the one to tank the tech stock market.” Nvidia will be pressured to do more in the US; Google will be pressured over Gemini, and Amazon Web Services might see scrutiny for Titan.
In semiconductors, the Trump administration will threaten “giant tariffs” against TSMC and Samsung but will leverage these threats to induce those companies to invest more in the U.S., he said.
“As we saw in Trump #1, there were many threats made which brought parties to the table but didn't wholesale result in tariffs,” Moorhead said. Indeed, Trump said in an October conversation on the Joe Rogan podcast that other countries could avoid steep U.S. tariffs by locating plants here. “I say you don't have to pay the tariff. All you have to do is build your plant in the United States,” Trump said.
Drawing a BEAD with Starlink
Elon Musk’s Starlink is poised to be a big winner in Trump 2.0. The president-elect and Musk are each others’ champions (at least for now — Trump has dozens of enemies who were previously intimate advisors in his first term). Musk led Trump’s get-out-the-vote campaign, he appeared on stage at Trump campaign events, and Trump singled Musk out for praise during the President-elect’s acceptance speech.
Trump could promote Starllink as a solution for the last mile for rural broadband, Renaud said. “Using LEO (low earth orbit) satellites for the last mile for rural broadband is not the worst idea — other than having it in the hand of one company, as opposed to a whole bunch of rural telcos,” Renaud said.
Moorhead sees an opportunity to leverage Starlink to save a national broadband plan that he views as a failure.
The Biden administration’s broadband policies “didn’t go well,” Moorhead said. “Billions spent with little to show for it. I think we can all agree that we can do better. Starlink is an easy option to bolster broadband rural areas, and therefore, the company could benefit.”
He added, “I believe the Biden administration let its animosity for Elon Musk get in the way of embracing Starlink. The new administration does not hold that same animosity, obviously.”
As to whether one company can be trusted with broadband infrastructure, Moorhead said, “We should always be concerned of giving any company control over anything. Innovation and lowering cost is driven by having multiple vendors in the game. Whatever comes out of a broadband act should include multiple satellite and FWA vendors.”
He added: “Whatever we do in the future has to be better than what we have done in the past, which is virtually nothing.”
More on BEAD, Starlink, cloud, CHIPS and AI
My Fierce colleagues did a fantastic job rounding up the tech outlook for Trump 2.0 in the days following the election. Read their articles to dig deeper on the outlook under the new administration.
- What the Trump win could mean for the BEAD program
- What the Trump win means for telecom and broadband economics
- What the Trump win means for cloud policy
- What the Trump win could mean for CHIPS grants worth billions
- What the Trump win means for AI policy and regulation
- What the Trump win could mean for wireless and spectrum
- What the Trump win means for the FCC and telecom policy
Also, read more about sovereign clouds:
Read our reporting on what to expect from the Trump 2.0 administration here.