In the weeks leading to his victory in Tuesday’s election, President-elect Donald Trump reportedly heard from Apple Inc. CEO Tim Cook and Alphabet Inc. CEO Sundar Pichai, while Amazon.com Inc. CEO Jeff Bezos scotched a Washington Post presidential endorsement for Vice President Kamala Harris.
The chieftains of Big Tech appeared to foresee a second Trump term that could yield unpredictable times. It was the Trump Administration that launched antitrust probes into Google, Amazon, Apple and Facebook parent Meta Platforms Inc. in June 2019 amid strained relations between the then-president and figures such as Bezos and Meta CEO Mark Zuckerberg.
Apple and Qualcomm Inc. are particularly eager to know Trump’s plans around China, where they glean about 20% of their annual revenue. Trump has threated heavy tariffs on goods coming from that country, a policy that could disrupt both companies’ revenue, and inflame a trade war leading to higher prices for computer equipment and parts.
“It remains to be seen what will happen, but Trump’s proposed tariffs on China’s imports would affect the supply chain of AI hardware like chips,” Ryan Doser, vice president of inbound marketing at Empathy First Media, said in an email. “I also think this would cause more turmoil in the Taiwan situation.”
As uncertainty mounts over Trump’s plans for the nation, IT leaders could rein in spending, some economists warn, potentially blunting an expected 5.8% increase in IT spending next year — twice that of GDP growth — based on projections from TBM Council.
The good news for tech is that most of its major players posted strong earnings in the most recent quarter as AI spending accelerates. What is more, a Forbes analysis of the past 75 years on election cycles suggest a Trump win will have minimal impact on financial market performance in the medium and short term. Market returns are most dependent on economic and inflation trends, the latter of which is controlled by the Federal Reserve.
The wild card is Trump’s nebulous tech policy that merely addresses deregulation and innovation, which could soon lead to the ouster of Federal Trade Commission Chair Lina Khan, an antitrust champion and foe of mega-mergers who is a fierce critic of Big Tech and AI’s outsize impact.
AI policy remains a mystery while Trump closely scrutinizes the CHIPS and Science Act, which includes $39 billion that Biden said will remake American semiconductor manufacturing and lessen reliance on China. The president-elect supports cryptocurrency, and slapping tariffs on anything from China, including electric vehicles and chips. He has also wavered on electric vehicles despite support from Tesla Inc. CEO Elon Musk, who is lined up as a government efficiency expert on Team Trump.
The expansion of AI use and innovation — predicted by Box Inc. CEO Aaron Levie under a new administration — has enormous implications for energy consumption. Because Trump’s energy policies focus on fossil fuels and drilling in the U.S., this could “drive cheaper energy prices in the short term for AI usage, but long term have detrimental impacts on climate change,” Doser warned.
Wedbush Securities analyst Dan Ives expects AI initiatives to ramp up in the U.S., deregulation to take hold despite the 2019 antitrust action, leading to plenty of big M&A deals, and Tesla will prosper.
“Tesla has the scale and scope that is unmatched in the EV industry and this dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players (BYD, Nio, etc.) from flooding the US market over the coming years,” Ives wrote in a note Wednesday.
AI’s fate in large part will likely be linked to the whims of Trump and other around him, one tech exec says.
“It’s all about which tech execs are surrounding [Trump] and how their views will influence his decisions,” Douglas Davila-Pestana, chief technology officer of AI startup LegalMente AI, said in an email. “Elon Musk, who is now heading [Department of Government Efficiency], strongly believes in AI innovation but not unconstrained AI development. David Sacks, tech investor, also believes in making sure the U.S. is the top innovator in AI and that there should be alternatives to the politically-biased large language models (LLMs) such as those from Google Gemini. And even supporters like Palmer Luckey, founder of defense contractor Anduril Industries, may influence Trump’s views of AI in the military as part of a defense readiness strategy.”
“All things considered, you will see rapid developments in AI under Trump, versus a more slow, bureaucratic approach that only favors a few big AI players,” Davila-Pestana added.
Tech experts said Trump’s to-do list should prioritize reversing the loss of U.S. techno-economic power to China, as well as develop an economic agenda that accelerates digital transformation across public and private sectors.
“The administration should focus on creating a pro-innovation regulatory environment that supports AI adoption, collaborating with Congress to pass a light-touch regulatory framework for consumer data protection, and enacting legislation that preempts state efforts to create a patchwork of digital policies that hamper interstate commerce, such as on digital taxation, content regulation and children’s online safety,” Daniel Castro, vice president of the Information Technology and Innovation Foundation, said in a statement.
President Joe Biden made it clear through pro-regulation figures like FTC Chair Lina Khan and Jonathan Kanter, who leads the anti-trust division of the Justice Department, that he believed Big Tech is too big. Biden also issued an AI executive order and memo that urged its importance to national security while preserving an individual’s privacy.
With Trump, cybersecurity too finds itself in a strange spot.
On Monday, U.S. cybersecurity agency director Jen Easterly said her department saw no evidence of any activity that could directly impact the outcome of the election, despite a surge in disinformation.
Trump’s administration did not make progress on persistent problems, including cybercrime, during his first term. Cybercrime continued to grow, in fact in 2019, according to the Federal Bureau of Investigation that logged a record number of complaints and economic losses. It only got worse in 2020 with the pandemic.
Meanwhile, social media platforms such as X, Google’s YouTube, Spotify and podcasts popular among young men were major influencers of information that dwarfed the traditional media.
As for crypto, it had a significant impact on Republicans regaining control of the Senate. Car dealer Bernie Moreno, a blockchain entrepreneur, unseated incumbent Sen. Sherrod Brown, D-Ohio, with more than $40 million in funding from crypto firms Coinbase, Ripple Labs, and others.
Only 7% of Americans have used crypto, according to a 2023 survey from the Federal Reserve.
