As Big Tech companies grow in money, power, and influence, leaders from Washington to Silicon Valley, and on the political right and left, have focused on how to clear a path for challengers, startups, and new entrants — collectively, “Little Tech.” A new report from Asad Ramzanali, the Vanderbilt Policy Accelerator’s (VPA) director of AI and technology policy, outlines an affirmative policy agenda centered on actions that federal and state policymakers can take to reduce the dominance of Big Tech and enable a flourishing Little Tech sector.
“A thriving Little Tech sector is vital for the future of American innovation,” said Ramzanali. “There is an assumption that government inaction is the best policy to support Little Tech. Instead, policymakers at the federal and state level can enact policies that enable increased entrepreneurship, easier startup formation, and fairer competition.”
The report builds on an 17-person cross-ideological roundtable hosted by VPA, bringing together policy experts from conservative and progressive organizations, academics, and Little Tech companies and venture capital firms. It outlines an agenda of discrete policies that can be advanced by federal and state policymakers to support Little Tech, focusing on policies that garner broad support from tech policy experts from the right, left, and Little Tech firms and investors. The agenda includes:
- Enacting legislation to combat anticompetitive practices of Big Tech: Multiple bipartisan bills that modernize competition laws would reduce Big Tech’s ability to abuse market dominance in ways that limit Little Tech by prohibiting dominant platforms from operating across business lines that create conflicts of interest; prohibiting dominant platforms from self-preferencing their own products over competitors; and requiring portability and interoperability to enable users to more easily switch providers. State legislatures have also begun considering bills to modernize state antitrust laws.
- Assertively enforcing antitrust laws: Many on-going cases against Big Tech companies, and ones that could be filed, have the potential to limit the harms of Big Tech in hindering competition. The Justice Department and the Federal Trade Commission, along with state attorneys general, should continue arguing and bringing such cases.
- Building compute infrastructure to support AI innovators: To support academic researchers, government users, and Little Tech startups, federal and state policymakers should fully build out AI compute and data resources, like the National AI Research Resource federal pilot, Empire AI in New York, and CalCompute in California.
- Encouraging open-source software and maximally opening AI infrastructure. The Trump Administration’s AI Action Plan recommends several steps to encourage open-source and open-weight innovation that the executive branch should continue, and federal and state lawmakers should avoid policies that discourage open-source and open-weight models through policies that don’t consider the differences between closed-weight models and open-weight ones.
- Using procurement policies to encourage competition and reduce lock-in: By instituting policies that support competition and limit incumbent lock-in for commercial enterprise systems, the government can strengthen its own flexibility and resilience while simultaneously improving conditions for smaller companies who hope to compete for government contracts.
- Banning noncompete agreements and enacting freedom-to-create laws: Research shows that noncompetes, which are clauses in employment contracts that limit employees from working for or starting a competitor to their employer, have their intended effect of reducing individuals leaving firms to start companies competing with their employer. Similarly, enacting freedom-to-create laws would prohibit employers from assuming intellectual property rights of an employee’s invention if it was created outside of work hours and without work equipment.
Read the full report here or learn more on VPA’s Substack.
About the VPA
The Vanderbilt Policy Accelerator for Political Economy and Regulation (VPA) focuses on cutting-edge topics in political economy and regulation to swiftly bring research, education, and policy proposals from infancy to maturity. To learn more about our work, visit vu.edu/vpa.