Creating a digital single economy

The creation of a digital single economy is a central policy area for the European Commission which wants to use it to foster innovation and economic growth. 

02/02/2016, news

It wants to improve access to digital goods and services and create the conditions for digital networks and services to prosper. The European Parliament adopted its resolution on the Digital Single Market on 19th January while also expressing concern about differing national approaches in regulating the internet and online businesses.

According to MEPs the strategy for the digital single market should help to foster innovation and cut red tape for start-ups, but also ensure consumer choice and protection. A fully implemented digital single market could boost the EU’s gross domestic product with 415 to 500 billion euros every year according to a study commissioned by the parliament and is therefore a priority for the European Commission. 

However in order to increase competitiveness and make the most of a digital market, a number of issues will need to be resolved, such as updating the rules for copyright and simplifying the VAT rules. In addition there are issues with data protection and impact of new online platforms and consumption patterns. MEPs want Europe to seize the opportunities opened up by new technologies, such as big data, cloud computing, the internet of things or 3d printing and to have an innovation friendly policy towards online platforms.

The telecoms legislative package, which has already been approved forms an essential part of the strategy for a digital single market and includes putting an end to roaming charges by 2017 and guarantees net neutrality.

The 16 digital single market initiatives  announced by the European Commission last May to boost the digital economy and innovation must be tabled without delay, MEPs insist.

“We have ensured that this report on the digitisation of the EU economy, society and public administration determines legislative and non-legislative action to benefit consumers and to preserve Europe’s competitive social market economies” said Internal Market Committee co-rapporteur Evelyne Gebhardt.

“Europe has already missed two waves of innovation. First social networks, the sharing economy. If we don’t want to miss the next wave, we have to look at the internet of things, big data and machine to machine communication. They can radically transform our economy and our legislation needs to reflect that” said Industry Committee co-rapporteur Kaja Kallas.

MEPs want proposals by the commission to:

  • end unjustified geo-blocking practices, so as to improve EU consumers' access to goods and services. MEPs welcome the proposal on cross-border portability of online content services “as a first step” in this direction
  • ensure equivalent and future-proof consumer protection, regardless of whether digital content is purchased online or offline
  • find innovative solutions on cross-border parcel delivery to improve services and lower costs
  • remove barriers to SMEs, start-ups and scale-ups and seize the opportunities based on new ICT technologies, such as Big Data, cloud computing, the Internet of Things or 3D-printing; an innovation-friendly policy towards online platforms (e.g. search engines, app stores) that facilitates market entry should be maintained and
  • review the ePrivacy directive to ensure consistency of its provisions with the new EU data protection rules

Given that Only 1.7% of EU enterprises are making full use of advanced digital technologies and only 14% of SMEs are using the internet as a sales channel Parliament is concerned about the differing national approaches so far taken by EU member states to regulating the internet and the sharing economy, which offers new business models for selling goods and services online.