PayPal co-founder says regulators envy industry’s success in US: ‘There are no successful tech companies in Europe’
European regulators are clamping down on Silicon Valley companies because they are “jealous” of the success of the technology industry in the US, according to PayPal co-founder and investor Peter Thiel.
Speaking about the looming threat of regulation for these companies, Thiel said that the “threat is probably greater in Europe” and there are “good reasons and bad reasons”.
“The good reasons are these privacy concerns and the bad reasons are there are no successful tech companies in Europe and they are jealous of the US so they are punishing us,” he said at the Economic Club of New York on Thursday.
Europe has a history of clamping down on technology companies such as Facebook and Google for their data collection practices and is soon to introduce new guidelines under the new General Data Protection Regulation that will govern the way personal data is collected.
At the same time, Europe has produced successful technology companies, including Spotify, Skype and Asos – although none have the scale of Facebook, Apple or Google.
Thiel acknowledged that “privacy in a digital era deserves to be rethought” but said that “as a libertarian I always dislike regulation”.
Thiel also explained why as an investor he wasn’t particularly interested in artificial intelligence: because of its bad reputation.
“The thing that struck me is how uncharismatic AI is at the point. Basically, it’s going to take our jobs and, once it takes our jobs, at the singularity [the theoretical point at which superhuman artificial intelligence is created, triggering an unprecedented cascade of technological change] it’s just going to kill everybody. I’m not sure that dystopian view is necessarily correct but that’s actually what most people believe,” he said, adding that when considering investments he tends to ask whether technologies are good and how they are going to make the world better.
“The answers for things like AI are quite weak,” he said.
Cryptocurrencies, biotech and anything his PayPal co-founder Elon Musk is involved in are areas of investment that pique Thiel’s interest.
“I have known Elon for 18 years and you should never bet against Elon,” he said.
When Thiel first invested in Musk’s rocket company, SpaceX, he was sceptical that it would be able to build a reusable rocket. “I thought it was inconceivable that it could be done … and they have actually pulled it off,” he said.
The company to watch, he said, was Amazon, which has expanded into a broad range of industries, from infrastructure and logistics to retail and healthcare.
“Amazon is the most ferocious company in the US at this point. It’s probably the company you don’t want to be competing against,” he said. “I can’t think of any other company even close to Amazon.”
Thiel also explained why he felt Silicon Valley was losing its edge as the epicentre of the technology industry and that innovation would be more distributed across the country in the future. This was partly relating to the cost of living in the Bay Area, but also because of what he described as “lemming-like” behaviour of investors and an “almost totalitarian” ideology that is unwelcoming to conservatives and libertarians. This, he said, explained why he recently decided to move to Los Angeles.
“It’s striking how what had always been a very liberal place has become almost a one-party state,” he said. “When you have complete unanimity that tells you that political correctness may have gone a little bit too far.”
Thiel felt this acutely when he backed Donald Trump for president.
“I thought [supporting Trump] was one of the least contrarian things I did. Half the country supported him. But within the Silicon Valley context it was somehow the most contrarian thing and the least contrarian thing I’ve ever done.”