Bringing Europe Into The 21st Century - Digital Agenda Focus Areas At A Glance
The composition of the Digital Market as it is today

In an attempt to establish a truly integrated Digital Market in Europe, the European Commission identified three main areas of action within its Digital Agenda framework. This strategy would help the EU catch up with the United States in the area of online business and would create a more harmonised European market for online goods and services. Our author Bálint Sedlmayr looks more closely at the recently proposed key areas of the Digital Agenda and at the need to implement effective changes to create a flourishing digital society and economy in the near future.

On 25th of March, the European Commission announced the three main areas of action for its Digital Agenda, which had been originally launched in May of 2010 as part of the seven key initiatives of the Europe 2020 programme. As we have seen before, the EU is among world leaders in digitalising its economy and despite previous focus on addressing ineqalities between members states, significant differences remain across the board. The first five years of the Digital Agenda focused more on debates and roundtables than on concrete action, but it seems that the Commission will soon start to take a course of more purposeful action.

The new document released last Wednesday names three key areas of action to help Europe "benefit fully from the digital age” and ”do away with all those fences and walls that block us online” in the words of Andrus Ansip, Vice-President for the Digital Single Market. The three areas identified are:

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

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

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

Together with the detailed areas of action, the Commission also published a factsheet that sheds light on the most urgent matters the Digital Single Market would solve.

Internet - the steam engine of our time

It has been said that a very good indication of the most important area in the EU at a given time is that appointed to the German Commissioner. While in the second Barroso commission Günther Oettinger - German Commissioner since 2010  - was assigned to deal with Energy issues, he has since been appointed Commissioner for Digital Economy and Society, a clear indication of the importance of the position. In fact, he is now supported by fellow Commissioner Andrus Ansip, while before 2014 the very hands-on Neelie Kroes was at the helm of the original one position. 

The importance of a comprehensive Digital Agenda has been highlighted by many leading European politicians and there was an Intergroup established in the European Parliament to ”advance the development of smarter, more relevant EU policies that promote fundamental rights, prosperity, learning and participation”. MEP Julia Reda, one of the members of the Intergroup, has emphasized that in our times the Digital Agenda affects all citizens and policies in the EU, and therefore it is mandatory to consider digital issues across legislative areas and party lines. Other members of the Intergroup have shared this view on the importance of the topic: Michał Boni of the European People’s Party emphasised that European development needs serious digital drivers “to avoid drift in Europe”, and Marietje Schaake from ALDE has stressed that Europe needs an ambitious Digital Agenda to become “the smartest and most connected continent”.

However, the new detailed proposal from the European Commission will have many different issues to deal with across the three main courses of action identified. There is a huge divide among the member states’ different capabilities and legislations, and it remains to be seen the type of obstacles standing in the way of cohesion and harmonisation.

"Geo-blocking" - the flagship issue of the Digital Agenda

Probably because it is an everyday issue that most EU citizens can grasp easily, the most talked-about point of the Digital Agenda is the so-called “geo-blocking” problem. In many cases, citizens of one member state cannot use online services available in other member states, which is clearly against the principles of the EU’s Single Market. Although this situation has no place in the 21st century, improving this will not be an easy task due to the different copyright rules in place across Europe.

One similar issue has been the Commission’s struggle against roaming charges within the EU. Although roaming costs have significantly decreased in the last few years, success has been relative and the initial set date for abolishing charges (December 2015) could be pushed back to 2018. Still, it is plain to see that the EU intends to become one digital entity in the future, where communication across borders is not hampered by unnecessary extra charges or even blocked services.

Catching up with the United States

It is clear that currently the EU is lagging behind the US in terms of harvesting the unlimited potential of conducting business online. American online business giants eBay and Amazon, are still to be seriously challenged by any European company; no wonder that 67% of all online services conducted in Europe are made via US-based companies compared to the marginal 4% conducted across the borders of the EU member states, as the infographic shows. 

Looking ahead, the EU would try and break American dominance on the online market, on a variety of fronts: besides solving the geo-blocking problem, it would simplify VAT arrangements, help to reduce delivery costs and modernise copyright laws in an attempt to broaden the scope of EU online trade of goods. The Commission estimates this improvement alone could save €11.7 billion each year.

A vision of a flourishing Digital Society and Economy

The action plan released last week paints an idyllic picture of the future of the European Digital Economy, but as we have seen before, such action plans are rarely implemented smoothly. The EU will have to deal with the ever problematic question of harmonisation in an environment highly impregnated with business interests. It is obvious that it will take an enormous effort to create a digitally integrated Europe, but this effort is absolutely necessary seeing that the Digital Economy will most definitely play a highly important role if we are to achieve the competitiveness objectives of the Europe 2020 project. As Commissioner Oettinger has explained:

Europe cannot be at the forefront of the digital revolution with a patchwork of 28 different rules for telecommunications services, copyright, IT security and data protection. We need a European market, which allows new business models to flourish, start-ups to grow and the industry to take advantage of the internet of things.”

And what can we, as average citizens of the EU, do about this? Mr. Oettinger has an answer for this question also: “people have to invest too – in their IT-skills, be it in their job or their leisure time”. It remains to be seen how the theory and practice pan out together. 

Edited by: Casandra Bordeianu