Speech - A connected continent

European Commission

Neelie Kroes

Vice-President of the European Commission responsible for the Digital Agenda

A connected continent

HUBFORUM - Connecting Digital Influences /Paris

11 October 2013

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Today Europe needs growth.

And I know where to find it: it's right in this room.

Because digital helps us innovate, grow and create jobs. Digital tools, technology and talent.

The ICT sector itself is large, and growing.

But in fact this can help business in every sector innovate and improve, boost performance and productivity.

Europe can't afford to fall behind here. But we are.

The global giants of ICT are among the biggest companies in the world. Google, Apple, Facebook, Amazon.

You'll notice there are no Europeans in that list. That has serious implications for our economy. And by the way for our privacy.

Why not? Europe has a vibrant history of invention and discovery. From the text message to the GSM standard, WiFi to the World Wide Web, Skype and Angry Birds, to Linux and Drupal: all were born in Europe.

From France alone, Deezer, DailyMotion, Vente-Privée, Viadeo, Criteo, Jolicloud, and more, are startups showing we still have bright digital ideas.

But too often, even innovators who start in Europe don't stay in Europe.

And our global giants are falling fast. Even in areas where we were once strong.

This matters to our whole economy, and our digital future. It matters if we cannot capture the opportunities of tomorrow, or don't have bright ideas born and growing in Europe.

Supporting digital growth has long been the philosophy of our Digital Agenda for Europe.

And there is increasing recognition and agreement from politicians across Europe about this issue. Something which I welcome.

In two weeks, EU leaders will meet to discuss how to support this digital future. And here are some elements that will need to be part of that discussion.

For one thing we must support European entrepreneurs. As it stands, they don't have the recognition, the rules or the resources. Recognition that this is not just a valid career choice - but the key to our future. And I welcome that the French government is seeing the importance of venture capital - something all startups dearly need. It's time to start supporting those essential resources, not stand in their way.

The Startup Manifesto, written by our Startup Leaders' Club of successful entrepreneurs, now has over 5000 signatures. There's lots of great ideas in it. I hope you will sign up too - it's still online at StartupManifesto.eu.

I don't want us to be the US. We don't need to dig a new Silicon Valley over here, and we shouldn't try. But I do think we could learn from them, celebrate risk and support innovation.

For another thing, we need to support the digital ecosystem. By investing in key areas. Supporting European excellence in fields like electronics, new 5G technology, or the big data on which sectors from retail to transport are coming to rely. That's what we'll be doing through the EU's Horizon 2020 programme.

And by removing all the obstacles that stop online services working across borders.

Because European innovators don't have easy access to a single market. In the US, you can easily share, spread and sell your idea to a market of hundreds of millions. While in Europe you must deal with many different rules and standards, a fragmented tangle.

From payment systems, to cloud standards, to copyright and licensing, to how you identify yourself online.

Put those obstacles together, and it's often far harder to trade online than in the real world. Bring them down, and we are giving our economy a real chance.

But most of all, we absolutely need telecoms networks. The connectivity that underpins digital competitiveness.

Other parts of the world have far faster, better broadband. Fixed and wireless. The EU has just 6% of the world's 4G! Yet this is digital oxygen - online innovation can't survive without it. Broadband that is not just fast: but secure, high-quality and seamless.

We are a market of 500 million. But every citizen without fast broadband is a lost opportunity. Unable to enjoy the latest internet innovation or try out that great new gadget. A missed opportunity for themselves, and for the whole European digital ecosystem.

We won't get every European digital without a strong, healthy telecoms sector, one that benefits from the single market boost.

Today we don't have that. Operators find it hard to work between countries, to offer seamless connectivity and get economies of scale.

Mobile users face poor connections, blocked services, and unfair charges.

That has an impact on the whole digital economy, and beyond.

We must bring down the barriers that plague those networks. A modern, thriving telecoms sector cannot be built on roaming, excessive call charges or throttled services.

With fewer obstacles, fairer prices, and the economies of scale for innovation and investment. For broadband that doesn't stop at the border.

The Internet is changing many things.

And companies need to respond.

Sustainable revenue comes from solid business models. Not relying on the cash cows of the past, but adapting to the opportunities of the future - from interactive TV to healthcare at home. Innovative business models that monetise data and enable investment.

And of course our rules and regulations also need to respond to this revolution, too.

Many have pointed out that we need a level playing field to compete.

And I agree.

And that involves many issues. Issues like convergence, over-the-top services and taxation. Those are valid concerns; competition must be fair.

But here's the thing. We won't get where we want to go simply by levelling down. By making it harder for internet innovation to flourish in Europe. By standing between Europe's citizens and the online tools they love. By applying more burdensome regulation, when you could be ensuring the competitive markets where regulation can be lifted.

We won't get there just by new taxes or new restrictions on restructuring - neither for telecoms nor any other digital sector. But rather by supporting new business opportunities like the internet of things, cloud computing and big data. And allowing companies to adapt how they operate accordingly.

We will only get there with a healthy telecoms sector, able to invest and innovate. European champions who are stronger, fitter, more able to compete.

Without that, Europe will continue to be a digital follower. And there will never be a true level playing field.

Because you don't win a global race just by obstructing the opposition.

The news at Alcatel shows the cost of failing to adapt. The cost of not having a digitally competitive Europe. A cost borne by telecoms companies, digital companies, and the whole economy.

Action on telecoms networks is just the start of a journey. But the journey must start now.

The EU is about bringing down borders. It's time we did that for the online world, too, an open environment supporting the open Internet.

So let's build a vibrant European ecosystem. One where European ideas can grow, flourish, and spread. One where innovators start in Europe, and stay in Europe.

Let's ensure the connectivity to provide innovative services over fast networks.

Let's bring down barriers and invest in the future.

That is the issue EU leaders will be confronted with at the European Council in two weeks. They can take a big step forward for a connected, competitive continent. And I hope they will.