Digital services are often confined to national borders and the plan would see some barriers removed

Greater balance needed in European regulationa says Lord Adair Turner

Although digital technology is part of everyday life and the internet is a goldmine of digital opportunities, EU people and companies run into many barriers, from geo-blocking or cross-border parcel delivery inefficiencies to unconnected e-services. Digital services too often remain confined to national borders. The EU wants to remove these obstacles and create a Digital Single Market.

Last week, the College of Commissioners had a first discussion on the strategy due in May and set out the main areas on which the EU focus its work.

1. Better access for consumers and businesses to digital goods and services

  • Facilitating cross-border e-commerce, especially for SMEs, with harmonised consumer and contract rules and with more efficient and affordable parcel delivery. Nowadays, only 15% of consumers shop online from another EU country, which is not surprising, if the delivery charge ends up higher than the actual price of the product.
  • Tackling geo-blocking: too many Europeans cannot use online services that are available in other EU countries, often without any justification; or they are rerouted to a local store with different prices.
  • Modernising copyrightlaw to ensure the right balance between the interests of creators and those of users or consumers. 
  • Simplifying VAT arrangements to boost the cross-border activities of businesses, especially SMEs. The cost and complexity of having to deal with foreign tax rules are a major problem for SMEs. The VAT-related costs due to different requirements are estimated at €80bn.

2. Shaping the environment for digital networks and services to flourish

  • All digital services, applications and content depend on high-speed internet and secure networks. To encourage investmentininfrastructure,the Commission will review the current telecoms and media rules to make them fit for new challenges, in particular relating to consumer uses (for example the increasing number of voice calls made over the internet) and new players in the field.
  • Improving co-ordination among member states is essential. Europe has witnessed significant delays in the roll-out of the latest 4G technology, as suitable spectrum was not available. Spectrum does not stop at national borders: a European approach to its management is needed to promote a genuine single market with pan-European services.
  • The growing importance of online platforms (search engines, social media, app stores, etc.) will be reviewed. This includes looking at how to strengthen trust in online services through more transparency, how to include them in the online value chain, and to facilitate the swiftremovalof illegal content.
  • Currently, 72% of internet users in Europe are concerned about using online services because they worry that they have to reveal too much personal data online. The swift adoption of the Data Protection Regulation is key to boosting trust.

3. Creating a European Digital Economy and Society with long-term growth potential

  • The EU manufacturing sector accounts for two million companies and 33 million jobs. The Commission wants to help all industrial sectors integrate new technologies and manage the transition to a smart industrial system (Industry4.0”).
  • Standards: ensuring interoperability for new technologies are essential for Europe’s competitiveness.
  • Industry and society should make the most of out of the data economy. Large amounts of data are produced every second, created by persons or generated by machines, such as sensors gathering climate information, satellite imagery, digital pictures and videos, purchase transaction records, or GPS signals. Big data is a goldmine, but it also raises important challenges, from ownership to data protection to standards.These need to be addressed to unlock its potential.
  • The same goes for cloudcomputing: the proportion of digital data stored in the cloud is projected to rise from 20% in 2013 to 40% in 2020. Although shared networks and resources can boost our economy, they also need the right framework to flourish and be used by more people, companies, organisations and public services across Europe.
  • Europeans should also be able to fully benefit from interoperable e-services, from e-government to e-health, and develop their digital skillsto seize the opportunities of the internet and boost their chances of getting a job.