FTI Consulting News Bytes – 17 July 2026

FTI Consulting News Bytes

From drones and data centres to the cost of sovereignty and the case against virtual romance, we’ve seen it all in tech news this week. Recent economic analysis found that Europe and the US would need an extra $23.6tn over the next 25 years to end their reliance on China in critical industries such as manufacturing and technology. Lawmakers in the United Kingdom are looking to set boundaries for technology use, planning a default overnight social media curfew for young people aged 16 and 17. To the East, the Chinese government has announced efforts to police virtual romance, in part because it wants people to stop dating machines and start having babies. While AI companionship declines, demand for other technology is on the rise—a big increase in Europe military investment means a heightened focus on drones. Elsewhere, a New York state ban on data centre construction sheds light on the broader struggle to regulate the AI industry, as countries around the world grapple with concerns over rising electric bills and environmental risks coupled with a desire to stimulate local economies and foster their own tech sectors. And finally, a very happy 20th birthday to Twitter/X. 

This week’s news

The cost of cutting out China 

Europe and the US would need to invest an extra $23.6tn over the next 25 years to end their reliance on China in critical industries such as manufacturing and technology, according to economic analysis cited by the Financial Times.  The mammoth investment required to replicate Chinese resources and materials currently relied on by advanced economies highlights the scale of the challenge facing western governments as they look to reduce Chinese dominance over strategic supply chains. In practice, even with massive investment the west could not decouple from China in the short run because of Beijing’s stranglehold over many critical industrial materials, experts say. China is projected to supply more than 60% of the world’s refined lithium and cobalt, essential for the transition to cleaner energy sources and roughly 80% of battery-grade graphite and rare earth elements by 2035, according to an assessment by the International Energy Agency.

Teens in trouble: UK social media ban 

According to Reuters, just one month after it announced plans to introduce a sweeping ban on social media for young people under the age of 16, the government said this week it also planned a default overnight curfew for young people aged 16 and 17. Older teenagers in Britain will ‌have to switch the settings on social media apps to be able to use them after midnight under new safeguarding rules planned by the government. The curbs underline global concerns among parents and policymakers about safeguarding young people from the harmful effects of social media on their mental and physical health. Online safety minister Kanishka Narayan said tech companies would be legally required to implement the curfew.

No love matches for Chinese chatbots 

The Wall Street Journal says regulators in China have found unexpected common ground with their counterparts in California and New York: Humans need to stop falling in love with chatbots. While in America lawmakers have nudged AI companies to add mental health guardrails, Beijing is taking a heavier hand. It is policing virtual romance, in part because it wants people to stop dating machines and start having babies. This week China enacted rules forbidding chatbots designed for companionship from encouraging emotional reliance. The regulations also ban virtual relationships with minors and require companies to alert a person’s emergency contact if they detect an emotional crisis. The rules hit two of China’s biggest tech companies, Alibaba and TikTok parent ByteDance, which both recently informed users that some chatbot features would be disabled by Wednesday. China’s population shrank in 2025 for the fourth straight year, to 1.405 billion and its birthrate fell to a record low—experts hope the elimination of AI partners will remove barriers to having kids. 

Drone demand taking flight in Europe

European military investment is increasingly converging around one technology that is seen as central to the continent’s future security: drones. According to CNBC, a flurry of announcements over the past two weeks shows just how quickly demand is accelerating. NATO unveiled a new drone initiative, the UK earmarked billions of pounds for drones and counter-drone systems, Germany moved to procure 50,000 drones for Ukraine, and defence tech startup Helsing secured an $18 billion valuation. The developments reflect a broader shift in military planning, with drones and autonomous systems moving from niche battlefield tools to a core part of modern warfare as software increasingly defines the battlefield. The growing use of drones and other autonomous systems comes as deal volumes more than doubled year on year, according to McKinsey and European defence tech funding rose from around 200 million euros in 2021 to 2.6 billion euros in 2025.

Data centre drama: New York moratorium imposed

No large data centres can be built in New York for up to a year as the state creates rules to protect the environment and its energy grid from the power-hungry facilities fuelling artificial intelligence, writes the Associated Press. Governor Kathy Hochul signed an executive order on Tuesday imposing the country’s first statewide moratorium on hyperscale data centres, which house thousands of computer servers and require massive amounts of energy and a steady supply of water to keep cool. The move sheds light on the raging debate over how to regulate the AI industry, as countries around the world grapple with concerns over rising electric bills and environmental risks coupled with a desire to stimulate local economies and foster their own tech sectors. US President Donald Trump has warned states not to slap regulations on the AI industry, echoing tech companies in arguing such moves hamper job growth and cede ground to China in a race to lead in the rapidly growing field.

Top Tweets of the Week

• Financial Times: Payments start-up Stripe and private equity group Advent International have launched a joint bid to acquire New York-listed PayPal in a deal that would value the company at about $53bn.
• Satya Nadella, CEO of Microsoft: An important piece from Demis. We need more of this kind of thinking. A good reminder that the goal is a frontier ecosystem that promotes innovation and choice, while avoiding any one model drop that breaks the world!
• Reuters Tech News: Musk’s xAI sues Grok user over sexualized ‘deepfakes.’

Number of the week

20 The number of years Twitter (X) has graced us with memes, movements, and hot takes. The New York Times recalls how on July 15, 2006, a new era of provocative hot takes, kneejerk reactions and random thoughts on social media ushered itself in with the public debut of Twitter.