Digital goods and services have become an integral component to international trade. According to the U.S. International Trade Commission, digital trade added up to 2.4 million U.S. jobs and $710 billion per year to U.S. GDP. However, under the guise of promoting domestic innovation, national security, and privacy protections, countries are increasingly adopting discriminatory policies that disadvantage U.S. technology companies in particular and pose significant barriers to cross-border delivery of Internet services.
This matters because the growth of U.S. technology firms — and the success of U.S. small businesses that use these firms to reach global audiences — depends on access to markets where digital barriers are on the rise. It also matters because U.S. firms are in fierce competition with foreign firms for access to over 3.7 billion Internet users across the world. One key data point shows the changing global dynamic: in 2014, nine out of the top ten global Internet companies were made in the United States. Today, only six of those leading brands are U.S.-based.
On Wednesday, CCIA submitted comments to the Office of the United States Trade Representative in preparation for the 2018 National Trade Estimates Report (NTE). The NTE is a tool used by USTR to compile and identify barriers to trade around the world. Our comments identified six prominent barriers to digital trade: (1) data and infrastructure localization mandates, (2) filtering and blocking, (3) inappropriate legal liability for online intermediaries, (4) imbalanced copyright and link taxes, (5) “backdoor” access to secure technologies, and (6) undue restrictions on “over-the-top” services including rich interaction applications.