Stunned tech sector ponders future under Trump

November 27, 2016 by Rob Lever
Close to 150 tech icons—including founders of Apple, Wikipedia and Reddit—penned an open letter in July 2016 warning a Donald Trump presidency would be a "disaster for innovation"

After disbelief, anger and grief, the US tech sector is looking to come to grips with the presidency of a man described by many of its leading lights as a "disaster" for innovation.

The major US technology companies, almost uniformly opposed to Donald Trump's candidacy, saw huge stock declines in the wake of November 8, but most have now rebounded to near their pre-election levels.

Some observers are saying it makes little difference who is in the White House, and others argue Trump is unlikely to carry out the promises—and threats—he made during a bitter campaign.

Trump sent shivers through Silicon Valley during his election bid by pledging to squeeze trade from China, clamp down on immigration which is critical to many tech firms, and even warning that online giant Amazon could have "a huge antitrust problem" if he were elected.

Close to 150 tech icons—including founders of Apple, Wikipedia and Reddit—penned an open letter in July warning the Republican nominee would be a "disaster for innovation."

Gene Munster, analyst on the tech sector at Piper Jaffray, said the initial beating in tech shares had created a "rare opportunity to buy the fear."

But in a research note last week Munster argued that "the tech industry is in more control of its own destiny than Donald Trump and will work through these problems."

The analyst said an antitrust probe of Amazon was unlikely, nor does he expect major changes on skilled immigration under Trump.

Any tariffs on electronics or components could potentially impact firms like Apple, but would be spread equally over manufacturers because they all rely on imports, Munster noted.

'Smart businesspeople'

In the meantime, any negative impact could be offset by Trump's pledge to lower taxes on capital repatriated from overseas, which could be a boon for Apple, Google and others and encourage investment in the US, analysts noted.

Some are concerned that a Republican administration may seek to roll back so-called "net neutrality" that prohibits broadband firms from playing favorites

The tech sector holds the lion's share of an estimated $2.5 trillion held by US firms overseas.

"There could be a lot of money that is repatriated by tech companies," said Bob O'Donnell, analyst and consultant at Technalysis Research in Silicon Valley.

"If they could use it for job creation, that could be interesting."

More broadly, O'Donnell said the tech sector may get "a fresh look at the kinds of services and technologies that people want to invest in" under Trump.

For example, a major push on infrastructure investment "could be a big opportunity" to integrate "smart" technology for services such as transportation.

While tech leaders "did a lot of soul searching" after the election, O'Donnell said that "they are smart businesspeople and they realize they have to work in this new environment."

A new tack

Although Trump has said little about his agenda for the sector, O'Donnell noted that "tech is a huge part of the economy and you can't ignore it; but things that might be viewed as special privileges might be taken away."

Some are concerned that a Republican administration may seek to roll back so-called "net neutrality" that prohibits broadband firms from playing favorites, which could mean difficulties for online video operators like Netflix and Amazon.

Many tech leaders have had to take a new tack after an emotional campaign that featured ugly rhetoric on both sides.

Tech leaders clashed with Trump during the campaign on issues ranging from law enforcement surveillance to immigration to gay rights.

Facebook chief executive Mark Zuckerberg brushed off the US election by telling a tech conference that "most progress... is made by private citizens"

Apple chief executive Tim Cook said in a memo to staff that the company's "North Star hasn't changed" and that "the only way to move forward is to move forward together," according to the Wall Street Journal.

Facebook founder Mark Zuckerberg brushed off the vote by telling a tech conference that "most progress... is made by private citizens," and that "it would not be right to say (the election of Trump) changes the fundamental arc of technology or progress over time."

'That's us now'

Others were less diplomatic.

Box founder Aaron Levie tweeted after the election, "You know those times where we watch other countries and are like "oh man you guys are crazy". Shit that's us now."

Tech investor Anil Dash wrote on Twitter: "I am not moving to Canada, not surprised by white supremacists & misogynists, and not afraid of Donald Trump. We have got to get to work."

Charlie O'Donnell at the investment firm Brooklyn Bridge Ventures said it's not time to panic.

"If you felt good about what you were doing at your company yesterday, you should feel good about it today," he said in a blog.

But he also said the election offers a lesson that "we need to start caring about a much wider tent of people than we have been."

Meanwhile Dex Torricke-Barton, a former Facebook and Google executive, quit his job at SpaceX to work for social causes after news of the Trump election.

"As an immigrant and the son of a refugee, and as someone dedicated to advancing the interests of humanity, I don't want to watch while the world slips backwards," Torricke-Barton said on Facebook.

"So I'm choosing to go and make whatever contribution I can—no matter how small—toward making the change we need: standing up for openness, compassion and sound global leadership."

Explore further: Tinder world swiped for Clinton—except Russia

Related Stories

After election rupture, CEOs seek unity for staff, customers

November 15, 2016

Apple CEO Tim Cook is telling his employees to "keep moving forward." Facebook CEO Mark Zuckerberg is saying "progress does not move in a straight line." T-Mobile's CEO John Legere tweeted "let's see what an out of the box, ...

Peter Thiel wins with bet against Silicon Valley

November 10, 2016

The improbable triumph of Donald Trump is a victory for tech sector investor Peter Thiel, who unabashedly backed the Republican candidate despite overwhelming opposition from his Silicon Valley peers.

Trump doesn't rule out 'amended' Obamacare: WSJ

November 11, 2016

US President-elect Donald Trump has said he will consider an "amended" version of Barack Obama's signature health care law—a sign of a shift in position after repeatedly vowing on the campaign trail that he would repeal ...

Recommended for you

Floodplain forests under threat

March 19, 2019

A team from the Institute of Forest Sciences at the University of Freiburg shows that the extraction of ground water for industry and households is increasingly damaging floodplain forests in Europe given the increasing intensity ...

Scientists discover common blueprint for protein antibiotics

March 19, 2019

A discovery by researchers at the Los Angeles Biomedical Research Institute (LA BioMed) has uncovered a common blueprint for proteins that have antimicrobial properties. This finding opens the door to design and development ...

Nanoscale Lamb wave-driven motors in nonliquid environments

March 19, 2019

Light driven movement is challenging in nonliquid environments as micro-sized objects can experience strong dry adhesion to contact surfaces and resist movement. In a recent study, Jinsheng Lu and co-workers at the College ...

9 comments

Adjust slider to filter visible comments by rank

Display comments: newest first

NIPSZX
2.8 / 5 (8) Nov 28, 2016
The news outlets on TV that claim that Trump is a disaster to innovation were the same big media fake news outlets that claimed the market would go down after Trump was elected. They have been totally wrong over and over again for the last 8 years. Any predictive news broadcasted by the big media is wrong 99.9% of the time when looking back on the predictive results. These news outlets and their business sections have been wrong for tens of years. The TV and internet are havens of false predictions. You can google stock market crash and see the false predictions pile up and be wrong over and over again.
aksdad
1 / 5 (3) Dec 04, 2016
I'm glad the article mentioned Trump's plan to drastically reduce the corporate income tax rate from the highest in the world to something that makes us more competitive. That alone should improve innovation (and stimulate job growth) by enticing companies to locate here.

And so-called Net Neutrality? They can't get rid of it fast enough. Contrary to the simplistic and backward logic of tech industry people who can be remarkably uneducated about market economics, the new rules adopted by the FCC stifle innovation. When the companies who took the risks and built the infrastructure aren't allowed to set prices for high bandwidth users, they're less likely to take more risks to improve the technology. Netflix might have to pay and charge more? So sad. I'd love for someone to explain how Netflix and Amazon Prime video is improving people's lives. It's entertainment. That's all.
ForFreeMinds
1 / 5 (6) Dec 04, 2016
"The major US technology companies, almost uniformly opposed to Donald Trump ..."

These would be the tech companies that either work with the government, buy favors from politicians, or are headed by liberals. There is a large segment of tech companies and workers, who recognize that freedom from the government, is what allowed our tech sector to grow and actually create the tech sector that's improved our prosperity, in spite of government.
gkam
1.7 / 5 (6) Dec 04, 2016
aks, we are already the lowest-taxed industrial civilization on Earth. That is why the wealth and income and opportunity disparity is as high as it is.

Conservatism and the greed it fosters is killing our Democracy.
Benni
1.7 / 5 (6) Dec 04, 2016
aks, we are already the lowest-taxed industrial civilization on Earth. That is why the wealth and income and opportunity disparity is as high as it is.

Conservatism and the greed it fosters is killing our Democracy.


........still on your self righteous crusade aren't you? You probably think Trump should have gone on a name calling binge against the newly elected leader of Taiwan when she phoned & congratulated him last week......the COLLECTIVE bastions continue to expose themselves.

By the way, do you understand why I feel so free to dress down you & your COLLECTIVE cohorts on this site? It's simple in case you still haven't figured it out........I wasn't dumb enough to tell them where I live.
TheGhostofOtto1923
3 / 5 (6) Dec 04, 2016
aks, we are already the lowest-taxed industrial civilization on Earth. That is why the wealth and income and opportunity disparity is as high as it is.

Conservatism and the greed it fosters is killing our Democracy
Trouble is, once people learn that a person is a lying cheating psychopath who is only here to make up facts and lie about himself, nobody believes a word he says.
gkam
1 / 5 (5) Dec 04, 2016
"I wasn't dumb enough to tell them where I live"
------------------------------------------
Afraid of "them"? Really?

Go hide, benni. It is in your poor character to attack and cower. It is the very basis of conservatism, along with selfishness and fear.

Conservatives own Trump. He is their invention. They are solely responsible for the coming damage.

Conservatives have not even paid for their Bush Wars yet. Will the Trump Wars be nuclear?
Benni
1.8 / 5 (5) Dec 04, 2016
"I wasn't dumb enough to tell them where I live"
------------------------------------------
Afraid of "them"? Really?

Go hide, benni. It is in your poor character to attack and cower. It is the very basis of conservatism, along with selfishness and fear.

Conservatives have not even paid for their Bush Wars yet. Will the Trump Wars be nuclear?


OK geek, let's peruse the landscape a bit here. I located the county in which you live, blue. Judging from your selective name calling proclivities in light of the color of your county it's a safe bet your neighbors voted blue. Of course you had to make a STATEMENT, you didn't want to be unpopular with your neighbors & putting up with them dumping trash in your front yard because you were so naive as to tell the world where you live.....yeah, smart, real smart trading off anonymity in lieu of popularity with the neighbors.

gkam
1 / 5 (4) Dec 04, 2016
"dumping trash in your front yard "
-----------------------------

We must live in different neighborhoods, benni.

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.