Hearts & Minds: Are big tech companies becoming more powerful than nation states?

The admission from Peter Kyle, Britain’s new technology secretary, could not be franker. “I’m very acutely aware that I can’t sit here in my office in Whitehall and instruct that world to do what I want it to do as secretaries of state have been able to do in the past,” he said in The Times. “I’m probably the first secretary of state that is dealing with companies which are outspending our entire British state when it comes to investment in innovation. So, let’s just act with a bit of sense of humility. We are having to apply a sense of statecraft to working with companies that we’ve in the past reserved for dealing with other states.”

Global big tech, in effect the ‘Magnificent Seven’ of Apple, Microsoft, Nvidia, Alphabet, Amazon, Meta and Tesla, is now so large and powerful that countries like Britain, as opposed to the US and China, must treat them in the same way they would a nation state. Diplomacy or something akin to it, is replacing the threat of new legislation as a means of influencing developments, governments must work with, not against them if they wish to have any say in how AI for instance plays out in future.

This has implications for CEOs and comms, seeing both sides coming together rather than remaining apart. Anyone who has studied the language of foreign relations knows it is softer and more opaque. It’s less obvious, so the real meaning often lies between the lines, in what is not being said. Similarly, in encounters a raised eyebrow or warmth of a handshake can carry more meaning than actual words. Things rarely happen quickly, they tend to be carefully choreographed, nuanced and drawn out.

Tech chiefs can expect to be invited to join government bodies. It’s occurring already, so the new body advising on the government’s industrial strategy is chaired by a big tech UK head. Other companies should treat their big tech brethren as ambassadors, emissaries with access to the higher reaches of government.

Likewise, whereas previously laws were readily threatened and applied, now, said Kyle, they will be “reflexive, responsive and agile” designed to give the innovation an easier landing, while regulation is adapted over time.

It means listening politely, perhaps not firing off an instant quote and waiting for behind-the-scenes and in-the-margin discussions. That increased gliding and gladhanding will have other repercussions. CEOs and their teams should brace themselves. Ferrero Rocher towers await.

Chris Blackhurst is one of the UK’s foremost business journalists. He was previously Editor of The Independent and City Editor of the Evening Standard.