Analogue to digital…the conversion

Two MEPs discuss the digital economy.

Alyn Smith

European society has been transformed by the introduction and expansion of digital technologies. The advantages are clear: the stark fact is that, in general, the more e-business applications a company uses, the higher its turnover per employee - regardless of industry or company size. Nonetheless, the question remains: how how can we, as European policymakers, ensure that the digital economy reaches its true potential?

It is becoming apparent that, to boost digital technology uptake in the EU, it is not enough merely to increase awareness of new technologies. While there must be continuing promotion of developments in the industry, it should be accompanied by supporting measures. These must address skills-gaps; must level out affordability disparities; and provide training and support where necessary.

While these would undoubtedly constitute steps in the right direction, there is more that we can do not only to augment growth in the digital sector, but to promote growth in other sectors. The digital economy has proved to be hugely beneficial for EU industries: increasing the efficiency and competitiveness of most companies; improving accessibility and communication; eliminating geographical barriers and enhancing quality of life. It is vital that we continue to build on this.

There is much potential still to be exploited. The EU is heavily reliant on imports for a great percentage of its digital equipment. Through greater investment in research and innovation, the EU can take a lead in the manufacture of goods, therefore creating skilled jobs and simultaneously reducing our reliance on imports. To achieve this end, the EU needs to promote relevant industries across the single market and to provide education and training where required. The i2010 initiative, launched in 2005 as a framework for addressing the main challenges and developments in the information society, promises to continue to support and promote research and development in this sector.

EU policymakers must move European businesses from their present position of awareness and early adoption of digital technologies to a level where e-business is an integral part of how business is done. More emphasis should be placed on helping companies find digital solutions that are appropriate and specific to them. This sort of focus would encourage the attitude that technological advances are an opportunity to create business advantages, rather than a threat. In my constituency, Scotland, the potential for small business and rural communities to increase economic growth through adopting an e-business approach is vast.

A key priority for the EU is access to broadband. Incredibly, in 2005, only 44% of Scottish businesses had broadband, although 78% of those without it expressed a wish to upgrade. Europe’s outer reaches, where the internet and other digital equipment could really make a difference to quality of life and to available job opportunities, need to be the focus of additional development. The opportunity to change the quality of life of many people is there, if only we choose to take it.

We, in Scotland, have begun to see real benefits from the opportunities of digital technology. The University of the Highlands and Islands has created a federal, collegiate university, dispersed across ten main campuses and a network of outreach learning resource centres. Students attend lectures by web-cam and video link and join in tutorials on-line. This example should be followed across the EU to make education a feasible possibility for all who wish to study.

But the EU must address certain issues prior to any future efforts on this front. There must be a co-ordinated approach to the creation of legislation, regulations or policies in this area. If fragmented, the EU could discover considerable problems in terms of unequal access, education and development. We cannot afford to miss the digital boom, we must be at the forefront of e-business, e-education and e-access for all. To fail to meet this challenge is to accept cultural and industrial decline in Europe.

• Scottish National Party MEP Alyn Smith is a substitute member of the Parliament’s industry, research and energy committee for the Greens/European Free Alliance.

Ruth Hieronymi

Since the launch of the Lisbon Agenda in 2000 and the i2010 strategy in 2005, the information and communication technology (ICT) sector has been in the limelight of EU policymaking. The significance of the ICT sector for the EU’s economy is overwhelming, as it is responsible for a quarter of growth in EU gross domestic product and 40% of productivity growth. One of the most important areas within i2010 concerns the creation and delivery of information and content. Information, since freedom of information is at the heart of European democracy; content, since the creative sector of Europe and its growing cultural industries have an increasing impact on the digital economy.

An open and competitive internal market for information society services needs deregulation, where feasible, and future-proofed approaches. But due to their relevance for democratic and social structures of society, both cultural and media services are at the same time cultural and economic services and therefore require sector-specific regulation.

To maximise the growth of the EU digital economy and media services, the European Parliament has pushed for the audiovisual media services directive (AVMS), which is going to enter into force by the end of 2007 and is going to replace the current ‘TV without frontiers’ directive.

The AVMS directive covers traditional broadcasting services on the basis of fixed programme schedules in analogue or digital technology (linear services) and additionally, new on-demand TV-like services (non-linear services). With this scope, the AVMS directive creates, for the first time, an internal market for non-linear AVMS on the basis of the country of origin principle. As the definition of AVMS is technology-neutral, this is a future-proofed regulation for content.

The new directive provides a two-step approach to the regulation of linear and non-linear AVMS, depending on the level of control the user can exercise over the service. For the first time in an EU-directive, member states will encourage co- and self-regulatory regimes at national level, especially for non-linear AVMS services, in order to facilitate a new deregulatory approach for internet-based media services.

To summarise: the clarification of the scope for AVMS, independent of the technology of transmission, the expansion of the country of origin principle and the encouragement of co- and self-regulation are the new principles which strengthen the digital economy and take into account the cultural characteristics of these services.

With the new AVMS directive, media content is going to be able to circulate freely within the EU. But in the following areas, which support free circulation, an updating of the EU approach and/or regulation is required to be of benefit to the European digital content market:

• A balanced approach for a frequency management system, that is flexible enough to enhance the creation of new business models, but takes into account the role of frequencies for freedom of information.

• Interoperability is crucial for the development of a digital interactive content industry. The European Parliament supports the use of real open standards guaranteeing interoperability.

• Media literacy skills need to be strengthened among European citizens to increase citizens’ trust in the new digital environment. Media literacy will support citizens’ ability to participate fully in the information society and will safeguard them - especially children and minors - against harmful content.

• The European creative sector is a source of high quality content. Its digitalisation and availability on-line will broaden access for European citizens to film in all its diversity, and will encourage a wider circulation of European works.

• Copyright management, especially for cross-border online content, needs to be adjusted to the digital environment.

• A future-proofed digital rights management needs both to safeguard cultural diversity and to give users easy access to digital content.

Europe’s digital economy is gathering speed, but adequate action and guidelines need to be put into practice urgently, especially in the fields of spectrum and copyright management and interoperability.

• German centre-right MEP Ruth Hieronymi is a member of the Parliament’s culture and education committee.

Two MEPs discuss the digital economy.