Silicon Valley's most feared EU regulator says no to breaking up big tech

For a couple of years now, skeptical politicians across the western world have been wondering whether US tech giants are getting too big for their own good. It's sparked the question as to whether companies such as Facebook , which owns a bunch of competing messaging services as well as Instagram, should be broken up.

But ask one of Silicon Valley's most feared regulators, Margrethe Vestager of the European Competition Commission, and she'd say no. Vestager has handed out multibillion dollar antitrust fines to pretty much every tech titan the US has produced in the last 20 years, but that doesn't mean she wants to see them torn apart.

From her perspective, the only good reason to break up a company would be if it could be shown that this was the only possible solution to its illegal behavior, she explained while speaking at Web Summit in Lisbon on Thursday. "We don't have a case like that right now," she said. "I will never exclude that that could happen, but so far we don't have a problem that big."

The second problem with breaking up big tech, she said, is that "the people advocating it don't have a model of how to do this." There would be a huge risk that it would fail to solve whatever the problem was that had provoked it. Her own line of thinking is that it would be better to apply special responsibilities to companies that are the leaders in their markets, tasking them with upholding competition within those markets.

Vestager and Europe more widely have shouldered the burden of trying to regulate big tech for a while now, but the tables are turning as US politicians and even tech execs discuss regulation in ever more serious terms. The renewed interest and engagement with regulation from the US is "very welcome," said Vestager.

For her, the biggest threat big tech poses right now is that it risks consuming all the opportunities that will allow innovation to flourish elsewhere. "Part of my mission is that we build trust in technology, by making sure that we can reach for the potential," she said. "But we can also do something to control the dark sides."

There's perhaps no bigger dark side than the Cambridge Analytica scandal that hit Facebook last year and left it lingering under something of a dark cloud. In the scandal's wake, Vestager is keen to see the company say less and do more.

"I of course listen very, very closely when Mark Zuckerberg gives evidence," she said. "He's an amazing creator of an amazing company and if he himself put action behind his words we would see change rapidly, and that would be very welcome." She's not the CEO of Facebook, she said, so it's not up to her, but she thinks the time for action has arrived.

When it comes to the question of whether Facebook should host political ads, Vestager is unsure on why the established framework for regulating political advertising can't be implemented online. "Democracy is supposed to take place in the open," she said. Microtargeting people with personalized ads (which she described as "privatized de facto manipulation") prevents the ads from being fact-checked and contradicted, and stops different opinions from being offered up in their place.

"The first priority will always be humans -- that technology should serve us," said Vestager, summarizing in a sentence her attitude toward applying competition law. Her approach is always to take the long view and focus on how European consumers and users of technology are likely to be impacted by anticompetitive challenges.

A clear, unwavering vision for regulation

But the penalties she's applied to US tech companies have led President Donald Trump to suggest that her decisions are fueled by a hatred of America. She consistently rejects this notion and is unyielding in her convictions. Meanwhile, some of the world's richest and most powerful men seethe over their inability to intimidate her. As well as being a target for Trump, Apple CEO Tim Cook called her decision to fine Apple for not paying enough tax in Europe "political crap."

Vestager's ability to not be deterred in the face of criticism stemmed from a lesson she learned from her father, she said on Thursday. "When people contradict you and disagree with you, that is not a mistake or an error or bad. This is the way the world is, so you should be able to stand there and do what you find to be the right thing."

Vestager has had a hand in investigating almost every US tech giant out there, and they're all different, she said. If she's seen one consistent change among all of them over the past few years while she's been competition commissioner, it's that they all have bigger ambitions now. 

There are new Google services being launched, there's Apple's streaming service, there's Facebook's Libra. "This also shows me that we have reached a phase where competition law enforcement can only do part of the job," she said. Taking Facebook's Libra cryptocurrency plans as an example, she points out that the rest of the European Commission will also have questions for the company -- questions about money laundering, about terrorism funding, about financial stability.

Even with the help of her fellow commissioners, Vestager is bound to be at the forefront of asking questions about new technologies. She already has a clear framework for doing so. "At the bottom line of all of this is that we may have new technology, but we do not have new values," she said. Dignity, integrity, humanity, equality -- that's the same."