The years 2016 and 2017 will
determine whether Europe creates a digital roadmap to support competitiveness
and growth, or slips into digital mediocrity.
The centrepiece of this
agenda will be the Digital Single Market, which is one of the priorities of the
European Commission as led by Jean-Claude Juncker. But the broader question is
whether Europe dares to embrace accelerating technological change or fights a
rear-guard action by overly focusing on data privacy and protecting national
industries and ICT champions.
Creating a Digital Single
Market could add €340 billion to the EU economy per year, according to
estimates from the European Parliament. The opportunities are plentiful. Today,
only 15% of online shopping in Europe takes place across borders. The various
EU member countries still differ greatly in terms of digital infrastructure,
business environment, regulation and skill levels.
choice, new industries
If barriers to
cross-border business came down, consumers would benefit from greater choice
and the quality of products and services should improve. Intensified
competition would force European companies to speed up their digitalisation and
transformation efforts, which, in turn, would help them grow. Europe’s
innovative start-ups, which now frequently decamp to the larger US market to
reach scale, would enjoy more growth opportunities at home. New industries
could develop and expand. Cloud computing, for example, has the potential to reach
€174 billion per year in Europe by 2020.
Removing barriers to
cross-border digital business will not in itself be enough. Digital content and
services will only flow more freely across borders if differences in consumer
protection, copyright laws and VAT systems are evened out.
Over €80 billion will have
to be invested to build fast broadband networks across Europe. Much of this
will have to come from the private sector, which will require stable and
forward-looking regulation. Massive efforts will be needed to train the
engineers, programmers and innovators needed for the digital economy.