• Innovation

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    Robert Madelin: We are at work to fix Europe’s innovation problems

    Europe can still be a rather bumpy landscape for innovators, although innovators should learn to market better their achievements, argues Robert Madelin, Senior Adviser for innovation within the European Commission and former Director General at DG Connec [read more]
    byThe Digital Post | 08/Jun/20165 min read
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    Europe can still be a rather bumpy landscape for innovators, although innovators should learn to market better their achievements, argues Robert Madelin, Senior Adviser for innovation within the European Commission and former Director General at DG Connect.

     

    The Digital Post: What are the major challenges facing the DSM strategy?

    Robert Madelin: The Strategy itself identifies several challenges under its 16 actions. It’s also clear that some of the changes brought in by the Strategy will imply winners and losers. The main political challenge is whether we are ready to accept this because we care enough about improving our society.

     

    TDP: Do you think the strategy is enough future-proof? new logo-small

    RM: We have entered the Fourth Industrial Revolution, a period where everything is changing and evolving so fast that it is difficult to grasp what’s next. Under these circumstances, the successful strategies should go to the basics. The Digital Single Market strategy is precisely future-proof in this sense, since nobody knows what the future is. Delivering infrastructure, capacity, industrial transformations, skills awareness, cyber security while investing enough in research into Quantum, Big Data and 5G: This is a good portfolio effort. But it’s impossible to avoid taking risks in a period of big change. The Digital Single Market Strategy take such risks and it is likely that some of its actions will fail.

     

    TDP: On 1st September 2015 you were appointed senior adviser for innovation within the European Commission. Jean-Claude Juncker tasked you with drafting a policy review on innovation in Europe. What can you tell about this report?

    RM: I think the missing piece is often the recognition that research is a component of European innovation and competitiveness. Let me put this in figures: less than one euro in five spent by European companies on innovation is poured into research. Moreover, in some areas we don’t have a positive conversation about innovation. At European level we don’t have a conversation at all. What we have, instead, is little pockets of reaction to disruptive innovation.

    This resistance to innovation may be legitimate or not, but it is difficult to act on it if we don’t have a proper debate. That’s why Europe can still be a rather bumpy landscape for innovators and that’s the problem we have to fix. The report should be released by the end of June.

     

    TDP: So are you saying that Europe is not a positive environment for innovators?

    RM: Let’s talk first about the environment in the world. In 2015 the communications firm Edelman carried out an extensive survey on innovation by interviewing tens of thousands people in a hundred countries.

    What came out is that two out of three respondents understand that innovation is good for growth and jobs, but only one out of three think that innovation is doing something good for the planet as well as for their communities and families.

    I believe this proves that innovators are marketing their intentions and achievements very poorly and that’s not true only in Europe. The same survey tells us that Europeans want innovation to primarily look at issues such as health, family, community, environment. The two things fit together.

    Everybody wants innovations, and wants innovation to benefit the areas they care about. Therefore, the vision underlying the European approach to innovation is right: ‘responsible innovation’ is a key concept within our research programme Horizon 2020. That’s the theory. As far as the execution is concerned, we are beginning to learn.

    Coming to your question, is the atmosphere positive for innovators? Not yet. Can it get better? Yes. Do we understand how to? I think so. Are we working on it? Yes.

     

    TDP: Let’s switch to the telecom sector. What do you think should be the priorities of the upcoming review of the telecom framework?

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    RM: The reason to have a telecoms framework is systemic empty competitive mechanisms in the market. Now we have to revisit how far that’s a problem. We’ve already narrowed enormously the number of markets to which the regime applies.

    The second question to ask is to what extent we need a framework. We still do because telecoms it’s a network industry. But how do we tune the framework to ensure the best possible supply of infrastructure? That’s a big problem that we haven’t fixed yet.

    Of course, everybody has different views on the best answer to this. My personal view, having been for five years Director General of DG CONNECT at the European Commission, is that the theory of the ladder of investment doesn’t reach to fiber to the home.

    If it doesn’t work, we need to apply another theory: Which means we might need to either invest more public money or structure differently the market in order to generate very high speed connectivity investment.

     

    This is part of a series of interviews held during the conference 
    "Digital Single Market: Bridging the Gap" organized by 
    the British Chamber of Commerce in Belgium.
    The event featured keynote speeches from Commissioner Oettinger
    Juhan Lepassaar and Robert Madelin (EPSC). 
    Other speakers included senior EU officials, parliamentarians, 
    trade bodies and business leaders who discussed the future challenges for 
    business in the areas of fintech, e-health and industry 4.0.

     

    Picture credits: Dennis Skley
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  • Digital Single Market

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    Brian Ager: Digital Single Market needs faster implementation

    The Digital Single Market strategy is a step in the right direction but the Commission must speed up its implementation, says Brian Ager, secretary-general of the European Roundtable of Industrialists. The Digital Post: What is your general opinion about [read more]
    byThe Digital Post | 20/May/20163 min read
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    The Digital Single Market strategy is a step in the right direction but the Commission must speed up its implementation, says Brian Ager, secretary-general of the European Roundtable of Industrialists.

    The Digital Post: What is your general opinion about the Digital Single Market Strategy?

    Brian Ager: We thought that it was an important first step to get everybody behind a common approach, and I believe it was a good move. I think it’s important to get an orientation, to get it out there and see what the reactions are.

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    TDP: Do you think this strategy is enough business-friendly? Can it provide a sufficient conducive investment climate that will help Europe catch up with other markets in the digital sector?

    BA: Only time will tell. To be fair, a few legislative proposals have been already presented. But for the rest, the Strategy is only a piece of paper that in itself is worthless: it’s what flows from that that will matter. It is now important that the Strategy is translated into a series of policy measures that are the right ones. Are they going to be implemented effectively? And are they going to be implemented in a coherent way across the whole of the Union? If you can tick those boxes, then you’re likely to see investment flow. But the Strategy in itself it doesn’t. Well, it is better to say that it will not automatically lead to investment.

    TDP: Do you think that the Strategy may lead to over-regulation?

    BA: I think it’s a possibility. But this must not happen, if we’re serious about digital economy, because if it does, then you strangle the digital potential of the whole continent. Another matter of concern is that the implementation is too slow.

    TDP: A number of observers from outside Europe pointed out that Europe is using a punitive approach towards US internet success stories or internet companies. Some are even talking about “digital protectionism”.

    BA: The Internet economy is global by definition: if you want to seize its opportunities you need to take a global approach for a global market. I can’t see how Europe could be protectionist, it wouldn’t work anyway.

    TDP: What do you think of the European Commission’s plan on Industry 4.0?

    BA: Our first reaction is that overall the plan is a good step in the right direction. But I can’t help but notice that it was presented almost one year since the digital single market strategy was unveiled. We need to speed up the entire process.

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    TDP: Many fear that Industry 4.0 will be a huge job killer.

    BA: I don’t think it’s so much doom and gloom. We feel clearly it will lead to some job losses, but it should also lead to the creation of other jobs, because you’re switching the economy from one type of activity to another. To be sure, the development of Industry 4.0 will lead to a switch from more low-skilled jobs to more high-skilled jobs. This change brings us to another crucial point, that is the responsiveness of the education systems. An extra effort is needed to drive our students towards math, technology and science-related studies, including math, physics, engineering and computer science. Today the industry complains that it’s missing half a million ICT engineers, software engineers, even mainstream engineering. The problem can be addressed only if we start working from the basic education. As far as the exiting work employment is concerned, we need to think very hard about vocational training, lifelong learning, re-skilling, because things are going to come along faster and faster.

     

    This is part of a series of interviews held during the conference 
    "Digital Single Market: Bridging the Gap" organized by 
    the British Chamber of Commerce in Belgium.
    The event featured keynote speeches from Commissioner Oettinger
    Juhan Lepassaar and Robert Madelin (EPSC). 
    Other speakers included senior EU officials, parliamentarians, 
    trade bodies and business leaders who discussed the future challenges for 
    business in the areas of fintech, e-health and industry 4.0.

     

    Picture credits: Matt

     

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  • Digital Single Market

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    Juhan Lepassaar: DSM Strategy, fears of over-regulation are unjustified

    The Digital Post spoke to Juhan Lepassaar, Head of Cabinet to Vice-President Ansip, about the latest progress of the Digital Single Market strategy.   The Digital Post: How is the implementation of the Digital Single Market (DSM) strategy progre [read more]
    byThe Digital Post | 11/May/20167 min read
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    The Digital Post spoke to Juhan Lepassaar, Head of Cabinet to Vice-President Ansip, about the latest progress of the Digital Single Market strategy.

     

    The Digital Post: How is the implementation of the Digital Single Market (DSM) strategy progressing?

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    Juhan Lepassaar: So far, we have adopted two key proposals on the harmonisation of digital contracts rules and on portability of digital content. In addition, in February the Commission presented legislation intended for greater coordination in the use of the 700 MHz band for mobile services. Last month, we also published a package on Industry 4.0 and e-government, containing a number of non-legislative actions that will help create the right environment to boost the digitalisation of the European industry.

    During the month of May, we are going to unveil our e-commerce package, which will include actions to tackle unjustified geo-blocking and other forms of online discrimination practices. We will also present a proposal for the review of the audiovisual media services directive and a communication on the role of online platforms. Before the summer break, we plan to move forward with the public-private partnership on cyber security.

    Then, the next big things are the review of the European telecoms framework in September or early October and the next steps of the modernisation of EU copyright rules. Finally, in autumn we will act on the free flow of data, we will table proposals on VAT for digital products and on corporate enforcement rules.

    TDP: According to a number of observers some proposals would actually mean more regulation on tech industry at the expense of their capability to innovate and invest. Are these fears justified?

    JL: We believe that these fears are unjustified. We do not want to undermine the way the digital economy operates. Our proposals are balanced: they allow enough flexibility without adding more regulatory burdens. Take the example of digital platforms. The commission has concluded that it wouldn’t be judicious to have a horizontal regulation on platforms because they are way too diversified. Hence, we are opting for a problem-driven approach.

    That is, once a problem is identified and clearly defined, we might act through regulation or opting for self-regulation initiatives. We’ve already applied this approach on the issue of hate speech on digital platforms. That doesn’t mean that existing rules on certain areas like platform content, transparency or the issue of the so-called value gap will not be further clarified within the DSM initiatives.

    We aim to simplify the environment for tech industry in Europe. This is what we do by harmonising rules in different areas. For example, one clear set of rules for consumer protection in the EU, rather than a patchwork of 28 different national regimes, makes it easier for businesses to grow across borders. In the end, this is actually about less rules and better regulation.

    TDP:What are the key elements or the strategy to fix the EU-US digital divide?

    JL: First, reducing the regulatory fragmentation. That is the key issue that differentiates the European market from the US. Second: access to finance for our tech industry. We have set out an agenda, which will reduce fragmentation and bring down the barriers for businesses opening to them a market of 500 millions customers.

    TDP:Businesses in the United Kingdom and other countries are concerned about the cross-border tax system. How the Commission intends to modernise the VAT for digital products?

    JL: There is a difference if a business has to deal with 28 taxation authorities or only one. What we want to ensure is that, especially small and medium size businesses when they do business across the borders will only deal with their own tax authority and the rest is taken care of by tax authorities between member states. The commission in its digital single market strategy has already highlighted the fact that in the area of e-commerce we need a taxation threshold to protect the smallest businesses. We will act upon this with our proposals that are forthcoming in December.

    TDP: The upcoming revision of EU telecoms framework will revolve around the usual dilemma, more deregulation versus more competition. How do you strike that balance?

    juhan_lepassaar

    JL: That’s a good question. Telecoms operators are right when they say they face regulatory burdens that new players do not. It is our job to determine whether we can reduce the regulatory burden to all and whether there are still any areas where we need to make sure that all the players that provide same services also abide by the same rules. I think the answer is a bit of both approaches.

    TDP: What are the plans of the commission with respect to industry 4.0?

    JL: The plan that the Commission published last month includes issues like standardisation and interoperability as well as measures to boost Cloud Computing and Big Data technologies in Europe. The proposal is also designed to help digital public services to inter-connect with each other across borders so that businesses, if they want to do business across the borders, can do it easily without having to submit the same information to different public authorities.

    The plan also links up to the forthcoming initiatives on the free flow of data. It is also very important that the revision of the telecoms framework touch upon the issue of spectrum, which is a commodity increasingly needed by the industry for the internet of things or self-driving cars for example. All in all, Industry 4.0 relates to all DSM initiatives.

     

    This is the first of a series of interviews held during the conference 
    "Digital Single Market: Bridging the Gap" organized by 
    the British Chamber of Commerce in Belgium.
    The event featured keynote speeches from Commissioner Oettinger and Robert Madelin (EPSC). 
    Other speakers included senior EU officials, parliamentarians, 
    trade bodies and business leaders who discussed the future challenges for 
    business in the areas of fintech, e-health and industry 4.0.

     

     

    Picture credits: Metropolitan Transportation Authority
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  • Telecoms

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    EU and the 700 MHz: Open up that band now

    If we do not open up this band in Europe as soon as possible we will not be able to get the benefits from 5G. Europe lagged and lag behind regarding 4G but took the lead of 3G. Now we need to take back the lead. One of the most usual and most misused [read more]
    byGunnar Hökmark | 20/Apr/20165 min read
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    If we do not open up this band in Europe as soon as possible we will not be able to get the benefits from 5G. Europe lagged and lag behind regarding 4G but took the lead of 3G. Now we need to take back the lead.

    One of the most usual and most misused phrasings is that we are living in changing times. Times are always changing. New technologies, new products, new services, new threats and new achievements. The really big change would be if the change stopped.
     
    Sometimes changing times is used in a way to create fascination towards the development, making us believe that now we need to do something that is so extraordinary that we need to think at least twice instead of acting now, or instead of letting the society as such adopt to the change.
     
    But for our decision taking it is better to say that the change has already taken place. Now it is only a matter of if we want to catch up with it. This is very much the reality of the digital economy and the digital agenda. The changes has already taken place and now it is up to us if we are to adopt to them in a way that they will serve us, give us a competitive lead and global leaders. The reality is here, we don’t need to think about the changes as magic or mysterious future developments.
     
    Regarding telecom and digitalisation, it is already here. We do not only have a digital sector and a digital economy. Our societies and economies are based on the digital technologies and services that have emerged for decades.
     
    3G was modernisation of telecom. 4G was creating digital services out of telecom. 5G is the full modernisation, industrialisation and transformation of economies and societies in the world. And it is not futuristic. It is happening now in the timeline that is relevant for us.
     
    In 2017 Verizon tells us they will be the first in the world. It might be more of 4,5 G but still. South Korea plans to roll it out as early as 2017 as well, with full availability 2020.
    In China they will have 500 million users of 4G by the end of this year and their plans for 5G is following the pattern of the others. In Stockholm and in Tallinn we will se early launches aiming for full scale 2020. It is not more fare away than it is happening now and it will transform economies.
     
    We lagged and lag behind regarding 4G but took the lead of 3G. That’s why we got the global champions in the telecom sector and the Americans in the next phase in the digital sector. Now we need to take back the lead.
     
    This is what the discussion on the 700MHz band is about. If we do not open up this band in Europe as soon as possible we will not be able to get the benefits from 5G regarding automotive industry, road and traffic management, manufacturing industries, energy and power sector, agriculture or health care. We need the coverage and the reach of the 700 MHz band if we are to be successful with 5G in these and other areas. That’s the decision we need to take. If we want to take the lead. That should be an easy decision.

     

    Picture credit: phys.org
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  • Innovation

    DE1

    Helping Europe to master digital

    The European Commission's strategy for “digitizing” industry that was unveiled today is a good step in the right direction. The digital industry will play its part but we need a business and policy environment that maximises our chances to take advant [read more]
    byJohn Higgins | 19/Apr/20166 min read
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    The European Commission’s strategy for “digitizing” industry that was unveiled today is a good step in the right direction. The digital industry will play its part but we need a business and policy environment that maximises our chances to take advantage of this opportunity.

    In the build-up to last May’s unveiling of the Digital Single Market (DSM) strategy DIGITALEUROPE urged the European Commission to focus its efforts on preparing Europe’s economy for the digital transformation. This week’s package of initiatives does just that.

    We are getting to the meat of the DSM, and not a minute too soon. Last month at our Masters of Digital event the final panel discussion involved speakers from agriculture, auto manufacturing and financial services, talking about how digital technology is already redefining their industries.

    Just three years ago discussions about how drones and automated tractors can improve farmers’ efficiency, how 3D-printed car parts can help build cars tailored to local market conditions, or how a phone could replace a bank card would have sounded like science fiction. It involves science but it’s not fiction.

    These are a few examples of how the digital transformation is already underway.

    The technology package of initiatives unveiled today correctly identifies some of the core elements of the digital transformation.

    And contrary to what some feared, it isn’t a rush to regulate. Instead, there are some pragmatic suggestions how Europe should make better use of the technologies on offer. Innovation in the areas of high-performance computing and cloud needs to be encouraged in an inclusive way.

    The proposed “innovation hubs” are an excellent idea. To be truly effective they will need to be embraced by Europe’s business community. We’ve seen really great examples of this in some of Europe’s leading cities.

    The focus on developing digital skills is also to be welcomed. It is important to ramp up efforts to ensure Europe has the digital skills we need to make the most of the digital opportunities. I would add that policy makers and educators themselves need training to appreciate the impact of new technologies.

    The inclusive approach seen in the cloud initiative is also evident in the approach to ICT standardisation laid out by the Commission, with its emphasis on collaboration between public and private sectors. We have a unique opportunity to master digital for the benefit of all Europeans.

    The digital industry will play its part but we need a business and policy environment that maximises our chances to take advantage of this opportunity. This week’s announcements by the Commission are a good step in the right direction.

    DIGITALEUROPE wants two things for Europe; first, for us to get the best from digital – to have strong productive economies, efficient public services and citizens enjoying digital technologies as part of their daily lives.

    And second we want Europe to be a great place for the digital sector – including DIGITALEUROPE’s members – to thrive and grow. Put simply – ours is a vision of a Europe that has mastered digital.

    We see around us everyday the great promise that digital technology offers. We watch the transformation of great European businesses. We hear about new tech, and tech-driven businesses growing and thriving, and we see the increasing attractiveness of many European cities and regions to investors.

    But are we doing enough to harness the potential of digital technologies?

    DIGITALEUROPE measures the DSM elements against a set of principles we think are pre-requisites to achieving our vision – the masters of digital vision. They include the following:

    – Does the initiative take us towards a single market fit for the digital age? Does it break down national silos?

    – Will it encourage innovation and entrepreneurship?

    – Is the initiative simply shielding the status quo from change? For example, by protecting an incumbent industry or national icon, or trying to protect jobs threatened by technological progress or just new fair competition?

    – Are new rules really needed or could existing rules be used more effectively? And if they are needed have the policymakers designed them in the least burdensome, and most straightforward way possible?

    – Does the initiative recognise the global nature of digital? If so will it encourage European companies and citizens to want access to products, services and customers from around the globe? And will it allow European businesses to take advantage of a global approach to standards?

    – Finally, and most important of all, will the DSM encourage economic growth and the creation of good quality European jobs?

    This week’s announcements appear to uphold these principles. The emphasis on collaboration with industry that runs through all the separate elements of the technology package bodes well for Europe’s on-going digital transformation, and its ability to boost growth and create jobs in the digital age.

     

    Picture credits: Lukas Budimaier
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  • Data Economy

    Privacy

    Julie Brill: Why the EU-U.S. Privacy Shield will work

    The Digital Post speaks with FTC Commissioner Julie Brill about the new 'Safe Harbour', the implications of the EU privacy reform, and privacy issues arising from the boom of the Internet of Thing.   The Digital Post: The European Union and the U [read more]
    byThe Digital Post | 19/Feb/20169 min read
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    The Digital Post speaks with FTC Commissioner Julie Brill about the new ‘Safe Harbour’, the implications of the EU privacy reform, and privacy issues arising from the boom of the Internet of Thing.

     

    The Digital Post: The European Union and the United States of America have reached an agreement on a new Safe Harbour data treaty. What are in your view the main achievements of the deal? What would have been the concrete risks if an agreement weren’t signed?

    Julie Brill: The main achievement of Privacy Shield is that it provides strong privacy protections for European consumers and creates a framework for more parties to engage in active supervision and stronger enforcement cooperation.  With respect to commercial data practices, Privacy Shield will provide stronger privacy protections than Safe Harbor did – through beefed up onward transfer requirements, and in other ways.

    Privacy Shield will also establish more active supervision of the program in practice, so that the Department of Commerce, the European Commission, European data protection authorities (DPAs), and the FTC can detect and address any issues that come up. Privacy Shield will also provide a well-defined process for consumers to complain about the data practices of Privacy Shield companies.

    The FTC will remain committed to giving priority to complaint referrals from DPAs, and there will be a better process in place for following up on these complaints.  And even in the absence of referrals from DPAs, the FTC will continue to aggressively look for violations of the Privacy Shield principles.

    Finally, in the area of national security, the United States agreed to take the unprecedented step of designating an ombudsperson to take complaints about surveillance activities that relate to Privacy Shield.  This is in addition to the significant reforms that Congress and President Obama have made to surveillance practices in the past few years.

    The risks if Privacy Shield hadn’t been agreed upon would have been that consumers and businesses would have continued in the limbo in which we currently exist, where some mechanisms to transfer personal data from the EU to the U.S. are still allowed, but they are expensive, opaque, and much more difficult for the FTC to enforce.

    Of course, Privacy Shield still has many steps to take before it receives approval.  If it were not approved, then companies – particularly small and medium enterprises – would lose out because of the time and resources that they have to put into alternative arrangements for data transfers.

    But consumers also would lose out because they would have far less transparency into which companies are handling their data, the rules governing data transfers, and where to go to complain if they believe their rights are not being respected.

     

    TDP: According to some observers, the new agreement won’t be sufficient to meet the concerns of the European Court of Justice. What is your opinion?

    JB:  It’s important to remember that the CJEU’s Schrems decision did not address national security surveillance practices in the United States. Rather, the case was based on the court’s concern that the European Commission’s adequacy decision in the year 2000 did not address U.S. privacy protections relating to national security surveillance.

    It is hard to say how the CJEU would have assessed a full, accurate record concerning surveillance practices and privacy protections in the United States, had those facts been before the court.  In any event, the U.S. has enacted significant reforms since the Schrems case was referred to the CJEU, and the U.S. is making further commitments through Privacy Shield.

    On the whole, I believe these protections meet the CJEU’s standard of “essential equivalence to the EU legal order”, but we will have to wait to see if Privacy Shield is challenged to know whether the CJEU agrees.

     

    TDP: Is the GDPR going to widen the chasm between EU and US regulatory approaches to data protection? How the FTC is working on this issue?

    JB:  The GDPR incorporates several provisions that either appeared first in the United States or are by now very familiar to companies and enforcers in the U.S.  Examples include a focus on reasonable data security through a continuing process of risk assessment and mitigation, a general security breach notification requirement, heightened protections for children, privacy by design, and a recognition that deidentification can reduce privacy and security risks.

    There are some differences between the European and U.S. versions of these provisions, but overall they show how developments in the U.S. can influence the direction that Europe takes.

    On the other hand, some provisions of the GDPR move further away from the U.S. approach.  A prime example is the GDPR’s right to be forgotten article, which extends to all data controllers.  This expansion is a sharp contrast to the very targeted and specific provisions of U.S. law that help individuals keep some information about themselves obscure.

    Companies and regulators on both sides of the Atlantic need to start working out answers to the many questions that the GDPR raises.  That’s one reason that I think it’s so important for us to move beyond the issues surrounding mechanisms for data transfers that have dominated the discussion for the past several months.

    With the announcement of an agreement on Privacy Shield in the past several weeks, I hope we now can begin to discuss the GDPR and issues like big data and the Internet of Things in a more sustained and meaningful way.

     

    TDP: The FTC has been focusing on privacy issues related to the booming sectors of Internet of Things and Big Data. What are the risks? How regulators should deal with this very sensitive issue?

    JB:  There are important roles for enforcement, policy development, and business and consumer guidance in the Internet of Things and Big Data ecosystems.  On the policy and guidance front, the FTC has been taking a close look at the potential benefits and risks of the Internet of Things and big data.

    We have hosted public workshops, taken public comments, and written key  reports on the broad range of technical and economic concerns that arise from having many more connected devices, huge volumes of personal data, and rapidly improving analytics.

    We heard a lot about the exciting possibilities to solve problems in health care, transportation, the environment, education, and other areas; but we also learned about significant risks.  Security is a huge challenge with the Internet of Things.

    Not only are many devices being offered by companies that do not have long track records with data security, but these devices are also being used in ways that collect highly sensitive information and create physical risks to consumers.

    With respect to big data, we found that there is a potential for unfairness or discrimination to enter through biases in data collection and analysis.  Some of these issues could get companies into trouble under fair lending, credit reporting, or other laws.  Other issues arise in settings that these laws do not cover, but companies still need to be aware of them because they may be deceptive or unfair.

    Enforcement also plays an important role in the FTC’s approach.  We have already brought enforcement actions relating to privacy and security violations with IoT devices.  We have the authority to stop unfair or deceptive practices – whether or not they involve new technologies and business practices – and we will use it in appropriate cases.

    Picture Credits: g4ll4is
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  • Digital Single Market

    d-1

    Regions and cities to boost the Digital Single Market

    The Digital Single Market is not about bits-and-bytes, not about technologies, not about virtual media. It is about the people, it is about the citizens, it is about the jobs, quality of life and civic participation. Therefore it is important to look into [read more]
    byMarkku Markkula | 11/Feb/20167 min read
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    The Digital Single Market is not about bits-and-bytes, not about technologies, not about virtual media. It is about the people, it is about the citizens, it is about the jobs, quality of life and civic participation. Therefore it is important to look into the role of regions and cities in making the Digital Single Market work for Europe.

    Our task is to boost digital skills, learning across society and the creation of innovative start-ups. We need to ensure digital literacy and skills for citizens, workers and jobseekers. This also includes the need to imbed digital technologies in education in order to prepare the future generations. We are looking forward to the European Commission’s New Skills Agenda 2016, which promises the promotion of life-long investment in people.

    Not only is it enough to have local and regional authorities involved, we must engage our citizens and business to co-create and develop regions and cities together with all stakeholders, if we want to be successful and create thriving entrepreneurial ecosystems in our regions. Public sector, universities, schools, and the private sector all have to actively participate.

    The main task of the European Committee of the Regions is to create a “bridge” between the policies and actions. In Europe, we need to connect to digital world in our everyday life in schools, universities, civic organisations and companies. Broadband connectivity in all regions, including remote and rural areas, is a prerequisite for this. The European Commission should report regularly on progress made in overcoming the digital divide, particularly at regional and local level.

    Poor profitability means that in the rural areas there is often no market-driven development of high-speed broadband networks, so that the support options at European and national level need to be consistently further developed.

    We need to engage cities and regions to invest in digitalisation and broadband connectivity and to use different financing including innovative public procurement and other funds. Here partnering is key to create growth and boost European economies.

    In addition, we must continue to promote synergies between different programmes and financing instruments like EU structural funds and Horizon 2020 and European Fund for Strategic Investments (EFSI), and promote European multi-financing and integrated European funding in order to support cities and regions to reap the full benefits from the Digital Single Market. Cross-border, transnational and inter-regional cooperation are also crucial to exchange the best practices between regions.

    Entrepreneurship is one of the strongest drivers of growth and job creation. Digital and web entrepreneurship in particular have the potential to boost the economic recovery of Europe. Cities and regions can create a favourable climate for innovations through their interaction with citizens, universities, civic society and local businesses. They have a pivotal role in creating a friendly environment for public and private investments and necessary conditions for the strong startup ecosystems.

    In my own city, Espoo, I have participated in the creation of several initiatives to promote innovation and entrepreneurship, such as Aalto University, Startup Sauna, Urban Mill, and the Espoo Innovation Garden.

    Investing in entrepreneurial culture and entrepreneurship education is an investment in the future. We have to make sure that promising entrepreneurs can obtain the funding they need to start a business. We have to cut down the regulatory burden our entrepreneurs face. We have to support start-ups that are ready to grow and internationalise, and we should also equip entrepreneurs with the necessary skills to successfully start and run a business.

    The CoR is promoting entrepreneurship in Europe’s regions via the European Entrepreneurial Region (EER) awards, created in 2009. EER regions provide us with living examples that illustrate what regions and cities can do to promote entrepreneurship education.

    One of the very first EER winners was Kerry County in South-Western coast of Ireland. The County has focused on the early stages of educating future entrepreneurs via Junior Entrepreneur Programme, which introduces entrepreneurship in schools for pupils from 8 to 12 years. The programme has been so successful that it was adopted nation-wide, with 10.000 pupils participating in 2015.

    Along with digital divide, we should address the question of innovation divide in Europe. Particularly in rural regions, the public sector is a driver for change and a key player in raising local awareness. There should be a focus on innovation in the public sector itself, as well as on rethinking management processes in public institutions. This will enable these regions to catch up.

    Commissioner Carlos Moedas highlighted in the CoR plenary session the new role of cities as the new global powerhouses for progress and societal innovation. Cities create favourable conditions for urban innovation – the synergic interaction between universities, civic society, local and international businesses as well as citizens. This is why we must renew the Urban Agenda to include the Digital Single Market, entrepreneurial spirit and human smart city initiatives.

     

    Picture credits: Danka & Peter
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  • Telecoms

    truth

    Are telecom regulators against the Digital Single Market?

    European Commission’s plans to overhaul the telecoms rules across the bloc are most likely to encounter the hostility of a powerful, yet unsuspicious ‘lobby’: national regulators. An opinion issued in mid-December by Berec, the Body of European Reg [read more]
    byFrancesco Molica | 29/Jan/20165 min read
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    European Commission’s plans to overhaul the telecoms rules across the bloc are most likely to encounter the hostility of a powerful, yet unsuspicious ‘lobby’: national regulators.

    An opinion issued in mid-December by Berec, the Body of European Regulators for Electronic Communications, appears to anticipate a confrontation with Brussels.

    The Commission has made a top priority to “break down national silos” in the sector’s regulation with the aim of building a genuine single market for telecoms.

    Berec’s opinion is keen to stress that any such achievement “will always be the product of 28 competitive and well-regulated national markets”. While the executive president Jean-Claude Juncker recently proclaimed that he wants “to see pan-continental telecoms networks”, regulators respond that “physical networks are and will remain national.”

    No need to be a telecom expert to guess that the two institutions may have diverging views. This is nothing new. Disagreements of this sort adumbrate a struggle of power that has been playing out for some time.

    Telecom regulators stood firmly against several attempts by former digital commissioner Neelie Kroes to exert more control over their domestic decisions.

    Now they fear that the upcoming reform might curtail their sway in national markets while increasing the Commission’s competences in what is meant to be a fresh shift of power.

    Little wonder that Berec’s opinion appears to air scepticism at the idea championed by Brussels that the current rules governing the sector need a robust modernization as well as more harmonization.

    By contrast, the organization is vocal in praising the existing legislation – although admitting improvements are required – precisely because it leaves regulators enough room for manoeuvre, namely the “ability to address the particularities of their national markets”.

    Greater EU harmonisation should happen only where it makes sense, while preserving national differences, Berec argues. Thankfully, the Commission believes that a fair chunk of those differences are leading to overregulation or regulatory uncertainty that might hinder investment at a time Europe needs to accelerate the rollout of digital networks so as to compete with the rest of the world.

    The mobile sector is a textbook case. Ensuring greater consistency in radio spectrum policies at EU level – a measure the Commission has announced to be part of the reform – will generate mobile network cost savings, as well as additional benefits associated with improved coverage, capacity and network performance, observers say unanimously.

    And yet Berec does not appear to share this idea. To the contrary: It says that “top-down harmonization” might result “in inefficient use of” radio spectrum, “hampering rather than supporting innovation”.

    The Commission is expected to unveil its proposal for the review of the EU’s regulatory framework for electronic communications as early as this spring.

    These rules addressing the regulation of service provision, access, interconnection, users’ contractual rights and users’ privacy were last revised in 2007-2009. The reform constitutes one of the 16 strategic actions of the Digital Single Market strategy unveiled with great fanfare in May last year.

    Berec’s opinions are not binding but must be taken in “utmost account” by the European Commission, according to the EU law, meaning they cannot be simply neglected, not least because telecoms regulators are often tasked with implementing the bloc’s rules.

    It is worth noting that in the past years some regulators chose to ignore Brussels’ decisions or even the implementation of pieces of European legislation.

    At the same time Berec voiced strong criticism at a bunch of key Commission’s proposals. For instance, it objected to a wide spectrum of measures put forward under the “Connected Continent” package, which was also designed to accelerate the building of a single telecom market.

    That is why the European Commission should strengthen the dialogue with regulators before putting out the new legislation so as to minimize their influent opposition (in the past they lamented that they have been not consulted).

    The fact is that further integration in the sector’s regulation is key for the future prosperity of the bloc and is a stepping stone towards a digital single market. Berec ought to come to terms with this basic truth even this means a loss of powers for the national regulators.

     

    Photo credit: Jesse Loughborough
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  • Innovation

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    Open Innovation 2.0 enables Europeans to deliver the highest and most innovative results

    In order for the Digital Single Market to live up to its full potential, we need to open up and re-think old models, and thoroughly change our mind-set. An excellent example of such a forward-thinking, inclusive and transformative tool is the model of ope [read more]
    byEva Paunova | 21/Dec/20153 min read
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    In order for the Digital Single Market to live up to its full potential, we need to open up and re-think old models, and thoroughly change our mind-set. An excellent example of such a forward-thinking, inclusive and transformative tool is the model of open innovation.

    Working for the benefit of citizens and businesses has always been the EU’s driving philosophy and nothing makes a stronger case for that than our efforts towards the completion of the EU’s Digital Single Market (DSM).

    We are proud to have laid the groundwork for the timely and successful implementation of the European Commission’s DSM Strategy, a key project expected to add an estimated 500 billion euro to the European economy and provide a substantial boost to job creation.

    In order for the DSM to live up to its full potential, we need holistic introduction and support processes that involve all stakeholders equally.

    We need to open up and re-think old models, and thoroughly change our mind-set. An excellent example of such a forward-thinking, inclusive and transformative tool is the model of open innovation.

    Open Innovation 2.0 (OI2) is a new paradigm based on principles of integrated collaboration, co-creation of shared value, cultivation of innovative ecosystems, unleashing exponential technologies, and extraordinarily rapid adoption. I see the DSM the same way – a collaborative space for consumers, NGOs, the public and the private sectors to all benefit from.

    OI2 is revolutionary in that it allows citizens to have an active role in the innovation process – to work together with industry, academia and the public sector to come up with new ideas and stretch the boundaries of technology and societal behaviour to create new markets, products and services.

    All of this happens accessibly and in real time, including prototyping and experimentation to determine each idea’s potential for upscaling, thereby transforming consumers into co-creators.

    Such an open and transparent ecosystem, however, also poses its own challenges around the assessment and protection of intellectual capital and the establishment of trust and cooperation.

    OI2 enables Europeans to deliver the highest and most innovative results by leveraging all the talent and resources of the community. And as supporters of OI2 like to say ‘innovation can be a discipline practiced by many, rather than an art mastered by few’.

    We need to combine and double down on our efforts in order to strengthen stakeholders’ trust in a modern, future-proof and sustainable framework for Digital Europe; to uphold the rights of all online consumers and introduce policies that support entrepreneurship and innovation.

    The Digital Single Market is a machine made up of many different parts, with innovation at its core. It wouldn’t work at full speed if some or any of these parts were not working harmoniously with each other. It will also not work if innovation is not protected and incentivised. It is the responsibility of all of us to make sure it does.

     

    This contribution was originally published in the Open Innovation Newsletter (special December 2015 edition) of European Commission’s Directorate General for Communications Networks, Content & Technology.

     

    Photo Credit: Daniel Foster
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  • Startup Economy

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    Debunking a start-up myth: It’s (not) all about the money

    Despite what many people may think, there is no real lack in capital supply for Europeans interested in launching their own start-ups in the digital domain. The rise of (digital) technology start-ups is a global phenomenon, with extensive start-up ecosys [read more]
    byDanny Goderis | 14/Sep/201558 min read
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    Despite what many people may think, there is no real lack in capital supply for Europeans interested in launching their own start-ups in the digital domain.

    The rise of (digital) technology start-ups is a global phenomenon, with extensive start-up ecosystems – such as the one in Silicon Valley – being replicated all over the world. Like any other region, Europe is highly interested in reaping the economic and societal benefits of a flourishing start-up economy.

    In a recent speech, Neelie Kroes (the former Commissioner for Europe’s Digital Agenda) stated for instance that two out of three (!) new jobs in Ireland are created by start-ups in the first five years of existence.

    Not all is rosy, though. Critics often say that it remains hard for European start-ups to get access to the proper financial means to kickstart their businesses.

    But is that really the case?

    It’s definitely not their biggest problem. Despite what many people may think, there is no real lack in capital supply for Europeans interested in launching their own start-ups in the digital domain.

    Virtually each region has done a good job in developing the appropriate funding mechanisms to support start-ups’ launch activities. In other words: it’s not (all) about the money. As a matter of fact, three bigger threats to European start-ups’ longer-term growth can be discerned – culture, regulation and mindset.

    A first issue is Europe’s fragmented market – not so much from a geographical perspective, but rather from a cultural one. Indeed, in spite of all good intentions, it remains difficult for European start-ups to sell their products across ‘cultural’ borders. The use of different languages is one obstacle, of course, but divergent social aspirations and cultural values are equally important barriers.

    For example, selling a solution for personalized online advertising might be perfectly acceptable in one region because of the advantages it brings (instead of being spammed, one only gets to see those ads that are in line with his/her interests), but it may fail completely in cultures where this is perceived as a direct assault on people’s privacy.

    Intra-European legal and regulatory barriers present additional obstacles. A concrete example is the burden that accompanies the launch of pan-European digital health solutions, with each European country having issued its own regulations related to the development, sale, usage and reimbursement of products and services in the digital health realm.

    And finally, there’s mindset. Contrary to the US, where everything is big and aimed towards rapid international expansion, European start-ups typically have a more ‘provincial’ mindset. In today’s global, digital economy, though, that’s a major shortcoming. In order to really succeed, start-ups should have international ambitions right from the start.

    As we observed already, none of those barriers exist in the US – making this geographical and cultural region a single, big ‘unified’ market with more than 320 million consumers.

    Both its scale and transparency make it an easier target to introduce products and grow. A bit ironically perhaps, even conquering the rest of the European market is typically easier if done from the US…

    So, how can we address those challenges? I see three important lines of action, in which European policy makers have a major role to play:

     

    From a regulatory perspective, measures should be taken to further unify the European market – so that its full potential of more than 500 million consumers and potential investors can be tapped.

    Streamlining regulation in domains such as digital health, for instance, would already open up a wide range of growth opportunities for potentially hundreds of European start-ups.

    Obviously, this would not help us overcome the cultural boundaries overnight; but to that end, instruments are already in place, such as the European Network of Living Labs (ENoLL), to help companies investigate how people will respond to new products and features – before the actual market launch.

     

    To foster the pan-European growth of start-ups and overcome the provincial mindset, a number of good initiatives have already been taken as well.

    One concrete example is the creation of EIT Digital, which helps European start-ups accelerate their growth – o.a. by finding European and worldwide customers for their products and solutions, or by helping them raise funds.

     

    And finally, when it boils down to securing first customers, Europe should investigate the concept of ‘innovative procurement’– a best practice that has already been widely adopted by the UK and US administrations. It requires government bodies and local branches of big multinationals to allocate a certain percentage of their public procurement activities to innovative start-ups.

    As such, start-ups can more easily get the necessary credentials and references to continue growing their businesses. According to certain estimates, public procurement is worth €2,000 billion to the EU economy – so dedicating even 1% of that amount to innovative procurement still equals €20 billion per year to support the European start-up ecosystem.

    But also for that, a cultural and regulatory shift is required…

     

     

    photo credit: Shumona Sharna
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