This year, the European Commission announced a series of digital transformation plans, aimed at accelerating the pursuit of the digital age and comprehensively enhancing competitiveness in the digital economy. Since the end of March, EU countries have successively used digital means to prevent and control the new crown pneumonia epidemic. The survey shows that digital transformation will become an important direction to promote the economic recovery of the EU.
In the first wave of digital innovation, the EU did not perform well
During the new crown pneumonia epidemic, the Internet in European countries was generally under pressure due to the increase in online consumption of videos and games. In March of this year, many online video service providers such as Netflix, Youtu, and Disney had to lower the video bitrate in Europe, reducing the video resolution from "HD" to "SD" to alleviate the network overload problem. Sevada Sahaki, a student of the Faculty of Applied Physics at the Free University of Brussels, Belgium, said: “When we use video conferencing software in class, we often have problems such as picture freezes, unsynchronized audio and video, and the teacher’s facial expressions are not clear. The effect is greatly reduced."
The European Commission’s commissioner in charge of internal market Thierry Breton called on online video broadcasting platforms to release bandwidth to ensure key services such as telemedicine and online education.
Communication equipment in European countries is generally old. Luigi Gambardella, chairman of the China-Europe Digital Association, said that although the EU has basically achieved full network coverage, the deployment of optical fiber and 5G networks is still lagging behind, and the backward communication infrastructure hinders the process of digital transformation in Europe. OECD survey results show that in 2019, in France, Switzerland, the Netherlands, Poland and other countries, the proportion of fixed broadband users with fiber to the home was less than 20%, Germany and Belgium were only 3.6% and 0.98%, respectively, and South Korea and Japan were respectively. As much as 81.7% and 79%. Gambardeira said that the proportion of broadband access users in rural areas in Europe is lower than that in cities. At the same time, because of the high cost of optical fiber access in low-density areas, many users are not willing to change old copper cable access to optical fiber. Fiber coverage is low. The high cost of 5G network construction, slow spectrum auctions, and heavy financial pressure on operators are also factors restricting Europe's improvement of digital infrastructure.
In the past 10 years, the development of information technology has given the digital economy a strong development potential. However, the EU's performance in the digital economy is not impressive. According to data provided by the World Bank, in 2019, the EU's total economy accounted for approximately 15.77% of the world's total economy. However, European digital companies account for less than 4% of the total market value of global digital companies. According to statistics from the Bruegel Institute, a well-known European think tank, as of September 2019, the United States has 194 "unicorn" companies, while the EU has only 47. In 2018, only 4 of the top 100 global artificial intelligence startups were from Europe.
Reuters reported that the EU recognized that in the first wave of digital innovation, especially in consumer markets such as social media, online shopping and smartphones, the EU lags behind competitors such as the United States and Asian countries. The EU hopes to use the large amount of industrial data held by Germany's Siemens and France's Alstom to push Europe to the forefront of the next wave of innovation.
Facing the contradiction between regulation and sharing, the EU has many challenges to establish a single digital market
The EU has high concerns about personal data privacy, monopoly rules, and data security. In recent years, the European Union has successively issued a number of documents such as the General Data Protection Regulation, the EU Regulation on the Free Circulation of Non-Personal Data, and the EU Cyber Security Act to strengthen data security management. This year, the draft of the Digital Service Law will be proposed to further regulate Data supervision. However, strengthening data supervision may technically restrict the effective use of data by local companies, thereby hindering the digitization of related industries. For example, the General Data Protection Regulation has strengthened supervision over sensitive data areas such as medical records, autonomous driving, and facial recognition, making it more difficult for artificial intelligence companies to collect data.
It is precisely because the development of technologies involving the collection and processing of personal information must comply with the General Data Protection Regulations, until the end of March, EU countries began to use digital means to prevent and control the epidemic. German News Television stated that when Asian countries use 5G, big data and other technologies to prevent and control the epidemic, Europe is clearly behind. At present, many health data of EU countries have not yet been developed. Some European media have called for public departments, researchers and companies in EU countries to share data essential for tracking and treatment while ensuring data security.
At the same time, the EU member states have different data usage and regulatory policies. The EU needs to do a lot of coordination before it is possible to introduce a unified digital epidemic prevention and control method at the EU level. The lack of coordination between member states and European research institutions, and some companies refuse to accept access to their data, also hinders the consolidation of data from different sources.
European digital companies generally lack the capital needed to scale up. According to the analysis of the "European CEO" website, 40% of venture capital in Europe comes from the public sector, and investment is becoming cautious. The digital skills of European citizens also need to be improved. According to a survey conducted by the European Vocational Training and Development Center, more than 70% of the adult labor force in EU member states needs to master basic information and communication technology to be competent for the job. This makes it difficult for people to conduct remote teaching, remote office work, and online shopping for daily necessities during the epidemic.
Initiate an investment of 4 billion to 6 billion euros to seek greater voice in related fields
In recent years, the European Union has introduced a number of bills to accelerate the process of digital transformation. In May 2015, the European Commission announced a detailed plan for the "digital single market" strategy. Since February this year, the European Commission has announced a series of digital transformation plans, including a master plan to guide Europe on how to adapt to the digital age, and the "European Data Strategy", "Artificial Intelligence White Paper", "Europe's New Industrial Strategy" and so on. The EU hopes to increase the Internet speed of all EU homes to at least 100 megabits per second by 2025, and to ensure faster Internet speeds for enterprises, schools, hospitals, and other public institutions; to achieve the basic Internet knowledge penetration rate of EU residents from the current Increase from 57% to 70%; train at least 500,000 experts in the field of information technology.
The President of the European Commission Von der Lein said that the European Union plans to initiate an investment of 4 billion to 6 billion euros in the EU data space and cloud infrastructure. According to the "European Data Strategy", the European Union plans to establish a unified data market, unlock unused data, enable data to flow within the European Union, and realize the sharing of industry, academic, government and other departments. The British "Financial Times" reported that the European Commission also stated that the dominant technology companies will have to open up their massive data to smaller competitors. This will break the monopoly of technology giants such as Amazon and Google.
Gambardeira believes that these measures are designed to enable all parties to reach a consensus as soon as possible, "to achieve coordination and cooperation throughout the EU, which is conducive to the establishment of a single digital market, so that the EU has a greater international voice in related fields."
In the past three years, the EU has spent 1.5 billion euros in artificial intelligence research and innovation. The European Union proposed in the "Artificial Intelligence White Paper" that in the next 10 years, 20 billion euros will be invested annually in the research and development and application of artificial intelligence technology.
According to a survey released by the "Digital Europe" Association, 90% of the surveyed companies support large-scale digital transformation as a major stimulus to promote economic recovery. The Financial Times quoted an EU official as saying that the new crown pneumonia epidemic has made people realize the importance of timely access to high-quality data. For example, when the development of vaccines was accelerated, people realized that they needed to rely on a broader database. The EU should readjust its priorities and the working methods of different agencies to adapt to the rapidly changing situation.
An internal document of the European Council shows that the EU should "thoroughly analyze the relevant experience gained from the new crown pneumonia epidemic" and formulate future policies and measures in the digital field, especially in the fields of digital education, e-government, and data sharing. Some analysts say that the EU will redefine and expand its digital sovereignty after the epidemic, and establish a digital space based on rules and standards. Digital companies that dominate the industry, especially American companies, will face stricter supervision.
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