Digital Economy's Rapid Growth Brings Alarming Risks
The digital economy's rapid growth has brought significant benefits but also alarming risks. AI, dominant tech companies, and inadequate risk management threaten systemic crises, as highlighted by recent attacks and breaches. Governments worldwide grapple with regulating these challenges effectively.
AI, while offering immense potential, exacerbates existing risks and introduces new ones like 'AI hallucinations' and misinformation. Meanwhile, dominant digital economy companies, often referred to as the 'Big Five' - Alphabet, Amazon, Apple, Meta, and Microsoft - keep profits while shifting risks onto society. This power concentration and lack of accountability could lead to a systemic digital crisis, similar to the 2008 financial crisis due to high interconnection and complexity.
Warning signs are evident, such as the WannaCry and NotPetya malware attacks, and major data breaches like Equifax and Marks & Spencer. Yet, these are not adequately addressed. The 'move-fast-and-break-things' ethos in the digital economy further undermines redundancy and increases complexity. Governments struggle to distinguish between valuable and socially damaging digital technologies, often only regulating after damage is done. The EU's recent Digital Services Act (DSA) and Digital Markets Act (DMA) are steps towards mitigating these risks, but more action is needed.
The digital economy's current approaches to risk and innovation are inadequate. A massive society-wide crisis may be necessary to prompt significant action on digital security risks. Stakeholders must work together to address these challenges proactively, ensuring the digital economy's benefits are shared while its risks are mitigated effectively.
