Speech: The app opportunity

European Commission

[Check Against Delivery]

Neelie KROES

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

The app opportunity

Launch of Eurapp Study on the European apps economy

Brussels, 13 February 2014

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Thank you very much.

This is a fantastic study, with a lot to teach us.

Here are three things I take from it.

First, the amazing scale of the European app economy is big and getting bigger. With 1.8 million jobs, rising to nearly 5 million by 2018. With revenues of 17.5 billion euros, rising to 63 billion. Yet just 5 years ago, it didn't exist at all.

The second is that this is one area of the digital economy where Europe really leads. Of the global revenue for consumer apps, EU developers raise 43%.

And the third is the huge variety on display. With many different business models , structures, and uses. From advertising to upfront payment to in-app purchase; from small independents to corporate in-house; from games to healthcare.

This sector is as diverse as it is innovative.

But for all that opportunity, the EU app economy is not without challenges.

The apps may be European; but the big platforms are not. The giants, so far, are American: Apple, Google, Facebook. Platforms on which most developers are, in practice, totally dependent. Which means that, in spite of our strength in development, our balance of trade is still negative. That's an area where Europe could still be stronger.

Plus many in the app economy find a serious skills shortage - it isn't easy enough to find people with the right talents.

From coding to business skills.

And there is also fragmentation. Between platforms - as systems do not interoperate. And between countries: as poor connectivity, roaming charges, and incompatible legal rules like copyright make it hard to sell your bright idea to a single, integrated market of 500 million.

With a jackpot like this on offer, we need to take those challenges very seriously. So here are three things we are doing.

First, boosting digital skills at all levels.

Because it's clear that coding is the new life skill, one that opens doors in so many areas, one that's in too short supply.

So how can we get those skills for the future? In many ways: through companies, through schools, and from the grassroots.

Our grand coalition for digital jobs is about working with the industry and other partners. And the declaration we made in Davos a few weeks ago could mean 250,000 new training courses, 100,000 new traineeships, thousands of new jobs.

By working with schools, in a new push to open up education and modernise it for the digital age. Building digital skills right into the connected classroom.

Plus getting more young people interested in digital careers - and showing they can be challenging and creative, rewarding and fun: for everyone.

I said this sector was diverse: but not quite. Of all that workforce, in fact, this study shows that only around one in ten are women. One in ten! It's time we stopped excluding half the population.

And by working from the grassroots. Last November, my young advisers organised the first-ever EU Code week - with over 300 events, reaching 10,000 people in 26 countries. That success shows loads of people out there dying to learn the vital life skill of programming - and plenty willing to teach it. This year's will be the 11th to the 17th of October: and I hope it is just as great a success.

Second: we can boost the environment for innovation, making Europe more startup-friendly. The Startup Manifesto has twenty-two ideas for how to do that: and we're already acting on them.

Plus, Horizon 2020 will be the EU's biggest ever programme for R&D, and the most ever focused on innovation. It now includes - for the first time ever - 10 million euros of funding to help startups flourish. In particular by improving app developers' access to talent.

And here's the third thing we need. All apps and all mobile devices rely on broadband networks. Yet, today, the framework for European telecoms is shattered and constrained. Meaning poor wireless connectivity, connections that can't easily cross borders, apps and services that are blocked or throttled by network operators, prohibitive surcharges to use your mobile abroad.

Today, these are already big issues, irritating to citizens and an obstacle to growth.

In tomorrow's world, where even cars are connected, where we rely on mobile apps even for our healthcare - resolving them will be absolutely critical.

All of these problems could be fixed with the rules for a Connected Continent. So I hope national telecoms ministers and MEPs can agree them very quickly.

This study is interesting in itself. But it leads to a bigger question, and a bigger vision. It's one that I spend a lot of time thinking about.

It's this. It's about the next generation, that of my grandchildren. What kind of life will they lead? How will they learn and play? How will they interact and transact, educate and entertain, shop and socialise? Find jobs, create them, carry them out? Meet friends and partners? What kind of places will they live in? What kind of places will they travel to? How will they stay in touch with distant friends and family? As they grow older, how will they be able to do so with dignity, respect and independence?

The answer to all these questions is digital. Digital tools and apps are an area of great growth and innovation. And this study shows that will only continue.

And these aren't just about one part of the economy - they're about every part of the economy, and every part of our lives. From better learning to better living. Creative coding can change everything we do; and a connected continent can underpin our competitiveness.

That's why I see so much of our future online. On a platform where the only limit is your imagination, the amazing innovative Internet. I hope that Europe can grab that opportunity — long into the future.