Moving towards Splinternet

It will probably take some time before the significance of todays CJEU ruling in Schrems II case will become apparent. With the court invalidating the Privacy Shield and stipulating requirements for the Standard Contractual Clauses that are very hard to fulfil for US companies (in its ruling, the court has already more or less concluded that the US doesn’t fulfil them) there seem to be 3 basic options:

1. The Commission will simply ignore the ruling and it will be business as usual
2. The platform companies will push for fundamental reforms of the US surveillance system (as Schrems seems to hope)
3. We will see a further splintering of the internet with US platforms moving parts of their operations to Europe and separating them from the rest of their operations.

It seems to me that the third option is the most interesting here, because it would increase Europe’s regulatory leverage over the digital space. This would of course come at the cost a further splintering of the Internet as a truly global communications platform (although we need to be carefull here not to conflate the dominant platform intermediaries with “the Internet” as such). This sprintering fits into a bigger pattern that is already well underway and may fundamentally undermine the US hegemony in the online environment. Over on stratechery Ben Thompson describes this pattern in the context of the discussion about the US possibly banning TikTok:

First, if it becomes generally acceptable for nation-states to block apps, Facebook is one of the biggest losers. Currently the service is dominant almost everywhere but China, which means it has a lot more to lose the more splintered the Internet becomes. This is something for the U.S. to think about more broadly: the dominance of U.S. Internet companies all around the world is a real strategic advantage, and banning TikTok may win a battle and lose a war.