In big about-face, tech industry doing its best to get Trump’s ear
For the past year, the tech industry shunned Donald Trump, and he shamed it. Now, the president-elect and the $2.9 trillion sector find themselves thrust into a shotgun marriage.
“Much of the business is in a wait-and-see mode,” says Meg Whitman, CEO of Hewlett Packard Enterprise, one of the largest tech companies in the world and a Hillary Clinton supporter. “We adapt and make the most of the situation.”
Many in tech supported Clinton, and they expected her to win. With Trump as president-elect, they are hastily revising plans.
One difficulty: Trump has no discernible tech plan nor has he openly courted tech executives. For those in Silicon Valley and beyond, he is the great unknown, and his potential Cabinet is creating fears of restrictions on skilled immigrant workers, weakened cybersecurity, punishing tariffs on products made in China and unrelenting pressure to bring manufacturing jobs to the U.S.
“Most of the planning ( by tech companies) had been done under the assumption that Hillary would win,” says Deven Parekh, managing director at Insight Venture Partners. “There was a big transition team for her ready to go, which included technologyrelated issues.”
It has made for an uneasy climate, but tech executives and trade associations say they’ve accepted the election results and want to work with Team Trump.
Gary Shapiro, CEO of the Consumer Technology Association, voted for Clinton after supporting Republican candidates in the last four presidential elections. He welcomes working with the Trump administration but doesn’t know what to expect.
“We reached out to Trump and Clinton, and we didn’t get a response from him. Am I concerned? Of course I’m concerned,” says Shapiro, whose trade organization represents more than 2,200 companies, including Amazon, Uber and Apple.
“The people he reached out to
were not in tech, but in flyover territory,” Shapiro says.
Still, there is overlap between Silicon Valley and Trump’s transition team, with its ties to real estate, venture funding and other businesses. A main connector? Peter Thiel. The influential venture capitalist and Facebook board member donated $1.25 million to Trump’s campaign. He was a delegate for Trump and spoke at the Republican National Convention.
Thiel doesn’t have a formal role during the transition but has spent nearly two weeks advising the Trump team.
The investor isn’t the valley’s only link to Trump, but he appears to be its strongest one. Joe Lonsdale, founding partner at 8VC, a Silicon Valley-based tech investment fund, has his own connections to the Trump camp as well as strong ties to House Speaker Paul Ryan (R-Wis.).
A Trump spokesperson was unavailable for comment.
Driving tech executives to find a receptive ear in the Trump administration is a platform that was generally unfriendly to the tech industry. Trump’s populist message of restrictive immigration, manufacturing in America, privacy and hard-line stance on trade agreements is of paramount concern.
Conversely, his views on reduced taxation and regulation could benefit an industry with which he is a stranger.
“Absent a tech plan, we need to look at his stances on immigration, taxation and privacy and extrapolate how it applies to tech,” says Lee Tien, senior staff attorney for the Electronic Frontier Foundation. “That’s a risky proposition.”
Along his improbable journey, Trump has blasted Amazon for not paying enough taxes and a surrogate of his skewered Facebook CEO Mark Zuckerberg for perceived anti-Trump comments.
Apple, in particular, could be in the crosshairs of a Trump administration. Over the past year, Trump has chastised Apple and other hardware makers to build more products in the U.S. instead of China. As a candidate, he demanded a boycott of Apple when it didn’t cave to the FBI’s request to hack the iPhone of one of the San Bernardino, Calif., shooters.
Or, as has been the case with Trump the candidate vs. Trump the president-elect, was it just posturing in a pre-emptive negotiating tactic?
Trump said Apple CEO Tim Cook and Microsoft co-founder Bill Gates called him after his
election but declined to say what they talked about, according to a meeting he had with The New
York Times last week. The underlying contempt for elitism, as personified by West Coast-based companies with high-intellect founders and socially conscious CEOs, was articulated by White House chief strategist Steve Bannon in an interview with The Hollywood Reporter.
“The globalists gutted the American working class and created a middle class in Asia. The issue now is about Americans looking to not get (expletive) over. If we deliver,” Bannon said. “That’s what the Democrats missed. They were talking to these people with companies with a $9 billion market cap employing nine people. It’s not reality. They lost sight of what the world is about.”
The thinly-veiled swipe at unicorns offers another layer of uncertainty in Silicon Valley, tech pockets throughout the U.S. and the Beltway.
“He’s spent a lot of time on Twitter but hasn’t said much about tech during the campaign,” says Rep. Suzan DelBene, DWash., a former Microsoft executive. “We need a conversation about tech and government’s use of tech. It won’t happen without input from the tech community.”
DelBene, who has worked closely with Rep. Darrell Issa, RCalif., another tech alumnus, is hopeful the new administration does not derail progress on bipartisan tech issues such as privacy and the Internet of Things.
The concern is palpable from an industry that has felt the wrath of Trump’s tweets and unpredictability..
ITI CEO Dean Garfield, whose organization represents more than 60 tech companies, including Apple, Microsoft and Facebook, is optimistic about Trump’s vow to invest up to $1 trillion into infrastructure. It could be a boon for Internet of Things devices such as sensors for roadways that enable driverless cars to interact and communicate.
A much-rumored bipartisan infrastructure plan that could bring jobs to the Rust Belt might involve tech companies, Garfield and Shapiro say.
Last year, Speaker Ryan supported an infrastructure plan by Sen. Charles Schumer (D-N.Y.) in which hundreds of billions of dollars would be raised through a one-time “repatriation” of profits from big companies’ overseas earnings in exchange for lower tax rates.