A digital agenda in search of evidence

A digital agenda in search of evidence

Article Type: Guest editorial From: info, Volume 16, Issue 1

A digital agenda …

Since the beginning of 2008 the effects of the global financial crisis began to become evident in the European Union (EU). As a response to the crisis the European Commission launched a new strategy in 2010: the Europe 2020 strategy. This outlines Europe’s economic strategy from 2010 to 2020. Its purpose is primarily to implement appropriate policies to allow EU countries to exit the financial and economic crisis and to put into effect preparations for the next decade, in order for the EU to create a sustainable (digital) economy. As such, Europe 2020 is the successor of the Lisbon Strategy launched in 2000. In the Lisbon declaration of March 24 2000 the European Union gave itself “a new strategic goal for the next decade: to become the most competitive and dynamic knowledge-based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion.”2 Already, only a few years after it came into force, it has become clear that the Lisbon Strategy has been a failure (Tabellini and Wyplosz, 2004, 2006) to which European policy leaders were not able, or did not have the means and the knowledge, to react properly.

Coming in what will probably be remembered as the most difficult years for the European integration project since its inception, the Europe 2020 strategy includes seven Flagship Initiatives. One of these initiatives is the Digital Agenda for Europe (DAE). This sets out the key enabling role that the use of Information and Communication Technologies (ICTs) will need to play if Europe is to succeed in its ambitions for 2020. The main objective of the DAE is “to chart a course to maximise the social and economic potential of ICT, most notably the internet, a vital medium of economic and societal activity: for doing business, working, playing, communicating and expressing ourselves freely. Successful delivery of this agenda will spur innovation, economic growth and improvements in daily life for both citizens and businesses” (EC, 2010, p. 3).3

The European Commission introduced the Digital Agenda in 2010 to accelerate the deployment of advanced ICT in Europe. The Digital Agenda sets out the main policies for the ICT sector during this decade with numerous actions anticipated across several domains/initiatives: the digital single market; interoperability and standards; trust and security; fast and ultra-fast internet access; research and innovation; digital literacy, skills and inclusion; and ICT-enabled benefits for society, with the Commission leading in some areas and Member States in others. These seven pillars and actions aim to tackle Europe’s most crucial challenges: the fragmented digital economy, the lack of interoperability, the rise of cybercrime and the risk of low trust in networks, the lack of investment in networks, the lack of digital literacy skills, insufficient research and innovation efforts, and the many missed opportunities in addressing societal challenges.4 The DAE’s final objective is to design and deploy the necessary policies to exploit the economic and social potential of ICT, and the internet in particular. The entire policy is based on what the EC has characterised as a “virtuous circle of digital economy”, since everything is connected through ICT. In this virtuous circle there should be a common leverage effect coming from, to use the European Commission jargon, the creation of content and borderless services, the increase of service demand and the roll-out of networks. These three aspects and their mutual interaction will then contribute to solving the “crucial” challenges outlined earlier.

The EC uses benchmarking exercises in order to monitor the Member States’ progress towards the implementation of these actions. Every year the EC publishes scoreboards for each particular field and action that presents the progresses for each Member State (see http://ec.europa.eu/information_society/digital–-agenda/scoreboard/). Related documentation is also published.

… in search of evidence

The DAE was reviewed in 2012. While there was good progress in some key areas, slow progress was noticed in some others. In mid-2012 it was stated that progress towards achieving targets was broadly positive. In more depth, the DAE Scoreboard referred inter alia to an increase in regular internet usage amongst disadvantaged groups, and an increase in online buying, as criteria for progress while acknowledging that progress was too slow in other areas, such as roaming prices not falling fast enough. The EU believes that the severe financial crisis has slowed down the progress of some Member States in various fields, but keeps its faith in the DAE, stating that “full implementation of this updated Digital Agenda would increase European GDP over the next eight years by 5 per cent, or €1,500 per person, by increasing investment in ICT, improving eSkills levels in the labor force, enabling public sector innovation, and reforming the framework conditions for the internet economy.”5 Other commentators (Mansell, 2013) argued that the review was necessary as regarding the DAE we had not progressed that far, especially in terms of accountability where we might even have moved backwards. For Mansell one of the prerequisites for the success of the DAE is to ascertain how the DAE has failed to meet the demands of the various stakeholders and redirect policies when and where necessary (Idem, 2013).

While it is probably too early for an overall assessment of the Digital Agenda and its implementation at European and Member State levels, it is nevertheless appropriate to examine this major initiative from the perspective of the impact of economic trends, including the financial crisis, and other issues that may jeopardise the achievement of policy priorities and objectives. There should be a critical evaluation of whether the recognised “importance of ICT for growth in modern economies” (Liikanen, 2005: 373) firstly holds true for Europe, and secondly, whether it is adequately complemented by enabling, stimulating and facilitating policies.

Such research is by no means new and has already been carried out in respect of the eEurope and i2010 programmes. For example, in “The Network Society: from Knowledge to Policy” (edited by Manuel Castells and Gustavo Cardoso, 2005) scholars and policy makers shed light on the achievementss and shortcomings of European information society policies. Their insights indicate that “technology is a necessary, albeit not sufficient condition for the emergence of a new form of social organisation based on networking, that is on the diffusion of networking in all realms of activity on the basis of digital communication networks” (Castells, 2005, p. 3). We thus need more than technology to make the information society work. Effective policies, as well as investment from industry, are necessary. We also need to take into account that the information society, digital economy or network society is a global one. This renders policy making – already complex given the structure of the EU – and the forecast of probable effects even more difficult. Policy-making, moreover, needs to start out by de-mystifying the information society, and to be informed by actual evidence (Idem, 2005).

Besides the necessity for data on how ICT drives growth in society, some commentators have actually already expressed concerns that some of the goals set by the EU strategy towards the development of the European Information Society might be problematic, and in contradiction with values that are at the core of EU integration projects. Such concerns have now been revamped by the ambitious agenda set by the DAE initiatives. Verdegem (2010), reflecting on the relationship between digital and social inclusion, stresses the risk that there might be new social divides not yet foreseen by policy makers but brought about by the implementation of digital policies, and insists on the need for continuous critical assessment of the theoretical frameworks that could help shed light on the subject. For him, when “it comes to the measurement and monitoring of digital skills and/or social and cultural capital, it is clear that a single method approach may be not sufficient at all” (Verdegem, 2010, p. 141).

More fundamentally, in 2003 Pauwels and Burgelman questioned the very essence and underlying rationale of the European Information Society Project. They questioned themselves and their readers on what sort of Information Society Europe wants: one based on integration and cultural diversity or one bending to the oligopolistic tendencies of the market. They outlined, moreover, the discrepancies between the emphasis on creating a plethora of competing distribution channels and the overrated demands of users and consumers. Pauwels and Burgelman remark that there is in this respect an over-emphasis on infrastructure, to the detriment of content. Finally, they insisted that the specificity of the EU machinery’s policy making processes creates significant obstacles to the attainment of coherent and efficient policy responses to the political, economic and social challenges which Europe has to face. Indeed, Pauwels and Burgelman maintain that most “technical” information society issues can be observed in European Member States and most other countries around the globe. What makes information society policies particularly difficult to develop and implement – leaving aside their over-focus on infrastructure – is the “European Union” itself.

“In fact, the main issues at stake are the same in other industrialized countries, but it is the context of Europe that makes them unique. This uniqueness lies in the fact that though Europe is a market, it lacks the necessary homogeneity to behave like a real market for communication services; it is also a political unity, without most of the ‘normal’, bottom-up political legitimacy such a unity requires. It is this tension between the local and the global reality that makes a pan-European communication policy so problematic, much more than the technical problems.” (Pauwels and Burgelman, 2003, p. 80)

Mansell (2008) insists that it is necessary to approach “ICT” in policy discussions more thoughtfully and, in a more recent contribution which discusses copyright infringement online, she remarks how there are clear signs in society of “change in the perceptions of appropriate online social an cultural norms and moral behaviour, in internet users’ experience and skills, in the demand for digital products, … ., in the supply structure of the creative industries and in the levels of awareness of the risk of liability associated with infringing, file sharing activity” (Mansell and Steinmueller, 2013, p. 4). This would signal a gap between legal and user perspectives that should be considered by European legislators and policy makers when specifying such ambitious political goals without a clearly defined methodology setting out how to measure the impact and monitor progress.

The Commission, for its part, while deploying in its policy making a dubious system of consultation with stakeholders and relevant expert groups, asks for a sustained level of commitment at both EU and Member State levels, and for a major contribution by other stakeholders if the DAE is to be a success, referring mainly to the open method of coordination and the name and shame pressures on less virtuous Member States and stakeholders.

Set-up of the special issue

This brief introduction should lay the ground for an understanding of the importance of the topic at the 2013 EuroCPR conference, i.e. “A Digital Agenda in search of evidence”, and the relevance of its timing.

The twenty seventh EuroCPR Conference focused on the evidence(s) that is (are) necessary to produce if Europe wants to avoid another major failure in its policy outcomes. A failure that, given the tragic socio economic conjuncture currently being experienced by the European Union, could probably be irremediable for the European integration project itself.

Contributions to the EuroCPR2013 Conference responded well to the challenge laid down in the call for papers and were indeed useful in launching a lively discussion and reflection on the DEA.

After blind peer-review a total of six papers was selected for inclusion in this special issue. The papers span various disciplines and cover the range of themes discussed at the conference. The themes that were discussed from a legal, economic, political science and/or communication science angle were: enabling broadband, investments and outputs of innovation, consumers and enforcement of copyright, access and demand, interoperability and competition, and online trade and policy making in the digital era.

We begin this special issue with two legally oriented papers. These reflect upon the EU legal framework and assess the Commission’s initiative to examine measures that promote access to interoperability information under the DAE, and upon the empirical evidence for the impact of the adoption of copper access regulation on fibre and ultrafast broadband. The following two papers are more focused on methodologies and tools. They deal with the digitisation index to determine the progress achieved by the EU. and with a methodology for estimating public R&D expenditures on ICTs in the EU. The fifth paper questions the correctness of one of the main assumptions of the European Information Society and the DAE - the idea that if more bandwidth is deployed, it will be used by citizens and subcribers.

The sixth and last paper provides us with a “foreign” perspective and deals with the future of broadband in Africa.

The first paper, by Inge Graef and Peggy Valcke, seeks to analyse in more depth the European Commission’s initiative that aimed to study the feasibility of measures that would lead significant market players to license their interoperability information under the Digital Agenda. In this paper, the significance of the abuse of dominance regime, as well as the electronic communications framework to ensure access to interoperability information in the ICT sector, is studied by means of an analysis of legislation and case law. Against the background of these two existing regulatory regimes, the proposals that the Commission made in its Staff Working Document are assessed.

The paper focuses on the Microsoft case to demonstrate that the abuse of dominance regime under European competition law is ineffective in remedying interoperability issues in a structural way. The authors call for a new regulatory framework to be established in which the adoption of soft law measures appears to be the preferred option. This contribution is interesting as it places the Commission’s initiative to examine measures promoting access to interoperability information under the Digital Agenda into its broader regulatory context, and hence contributes to the discussion on possible ways to ensure interoperability in the ICT sector.

The second paper, by François Jeanjean, provides empirical evidence of the impact of the copper access regulation on the adoption of fibre and ultra-fast broadband from a dynamic perspective. It does so by investigating the impact of copper access regulation on the adoption of household broadband for different technologies (xDSL on copper infrastructure, FTTx on fibre infrastructure and cable modem). The paper provides a forecast of the penetration rate of broadband access for each of these technologies. The approach is empirical, as it uses a dataset covering 15 European countries. The dynamic of the adoption path is modelled by a logistic function. Copper access regulation is measured by two variables: copper access charge and copper wholesale access share, ie. the ratio of copper wholesale access provided by the incumbent to alternative operators out of the total number of copper accesses. The author shows that copper access regulation has a negative impact on fibre and cable modem adoption. The practical implications are that an increase in copper access charges or a reduction in wholesale copper access shares could help to achieve the objectives of the digital agenda for Europe.

The third paper, by Raul Katz, Pantelis Koutroumpis and Fernando Callorda, attempts to rely on the digitisation index to determine the progress achieved by the European union in the implementation of the Digital Agenda for Europe. The paper is ambitious in the sense that it seeks to apply an index that was originally developed by the Booz & Co management consulting firm to measure the development of digitisation in a given country in the wider European Union context. The hypothesis put forward by the authors is that while the implementation of the Digital Agenda for Europe might be tackled in an overarching continental manner, the variations of digitisation in each Member State might call for a more differentiated approach. What the authors highlight in their analysis are significant gaps in the digitisation of European countries, not only in terms of uneven development, but also in terms of lags in the area of infrastructure investment and digital technology usage. The authors claim that it is important to address these gaps in order to generate economic payback.

The fourth paper, by Juraj Staník, aims at creating a methodology for estimating public Research and Development (R&D) expenditure on Information and Communication Technologies (ICT) in the European Union (EU). The author also applies the methodology of Business Expenditure on R&D (BERD) data across all sectors and estimates ICT BERD for each one of them. He then assesses the evolution of this expenditure in the context of the Digital Agenda for Europe (DAE) and its specific target to double it by 2020. In order to do so the author assumes that the share of public ICT R&D expenditure compared to total public R&D expenditure is similar to the share of ICT R&D labour costs. This estimate is based on government budget appropriations or outlays on R&D (GBAORD). The methodology used is considered the only way to measure public ICT R&D expenditure in the EU. Applying this methodology, Staník discovers that EU public ICT R&D expenditure grew steadily over the period 2004-2011, reaching €6.9 billion in 2011. He also estimates that the total EU ICT BERD in 2010 amounted to €15.8 billion. Moreover, substantial ICT BERD can also be found in non-ICT sectors. The methodology also shows that the EU is on track to double its public ICT R&D expenditure, but it has to accelerate its private ICT R&D expenditure growth.

The fifth paper, by Scott Marcus and Dieter Elixmann, addresses the issue of demand for broadband access and the specific role that bandwidth plays in this context. It assesses the available empirical evidence regarding the dynamics of bandwidth consumption in different countries and discusses the implications for public policy regarding the deployment of ultra-fast broadband infrastructures, in particular with regard to the Digital Agenda for Europe (DAE). The paper suggests that one of the core assumptions of the European Information Society and the DAE - the idea that the more bandwidth that is built the more it will be used- might prove to be inaccurate. The approach adopted uses publicly available empirical data in order to identify patterns in the development of broadband demand in previous years as well as current demand in specific countries. We contrast these findings with information on the roll-out of broadband infrastructures in these countries. The authors reach the interesting conclusion that the relationship between the availability of fast broadband and the use of bandwidth by consumers appears to be richer and more complex than many have assumed. The availability of fast broadband does not in itself appear to determine the level of use. This suggests that a more balanced approach between supply side and demand side measures could be warranted and raises complex questions about the nature of consumer demand for broadband, posing, as they put it, “troubling questions” about public policy to promote the roll-out of ultrafast broadband.

The final paper in this special issue does not deal with the DAE, it being concerned with information society policies in Africa. We would like to stress the importance of these and other contributions concerning policy and ICT in countries around the globe. Far too often we adhere to a predominantly European perspective on information society policies, while lessons from abroad (The US, Asia, Africa, …) confront us with global trends, interesting “out-of-the-box” insights, and lessons learned. While not dealing directly with the Digital Agenda for Europe, the final paper is of interest to this INFO Special Edition as the data used and the lessons learned in Africa might turn out to be useful examples for some countries in Europe, where we may experience a rapid take-over of one technology by another.

This final paper, written by Christoph Stork, Enrico Calandro and Ranmalee Gamage, deals with the Future of Broadband in Africa, and aims to answer whether fibre to the home and other fixed internet access still has a role to play in Africa beyond a few urban elites, and what business models are likely to be successful in the African context. The paper uses data from nationally representative ICT household surveys conducted in 12 African countries in 2012. The authors use primary household and individual data that provides a better understanding of internet access and use in Africa. An analysis of internet access prices for ADSL and prepaid and post-paid mobile broadband is used to assess broadband business strategies across 12 African countries. This data is complemented by OECD broadband pricing methodology and data. In addition to the OECD basket methodology, own baskets were defined to capture the complexity of African products, and to draw out the different business models for fixed and mobile broadband. The paper demonstrates that if fixed internet is provided as an uncapped service at an affordable price, it has a chance of at least co-existing with mobile broadband in Africa. The availability of fixed internet is rapidly diminishing where it is offered as a capped service, rather than at prices comparable to mobile broadband. The paper also demonstrates that fixed-line telecommunication companies would be well advised to focus on data only before mobile operators do, if they are not to lose out once again. The paper provides policymakers and regulators with the evidence required for an informed ICT policy and regulation, recommending business strategies that could be pursued by operators in order to improve broadband sector performance.

Luciano Morganti, Karen Donders

Notes

1. Professor Luciano Morganti (mailto:luciano.morganti@vub.ac.be) and Professor Karen Donders (mailto:Karen.Donders@vub.ac.be) are with iMinds/Digital Society/SMIT, Vrije Universiteit Brussel, Brussels, Belgium

2. European Council, 2000.

3. COM/2010/0245 final.

4. COM/2010/0245 final, 5-6.

5. European Commission, 2012.

References

Castells, M. (2005), “The network society: from knowledge to policy”, in Castells, M. and Cardoso, G. (Eds), The Network Society: from Knowledge to Policy, Johns Hopkins Centre for Transnational Relations, Washington, DC, pp. 3–22

European Commission (2010), Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: A Digital Agenda for Europe, COM/2010/0245 final

European Commission (2012), Press Release, available at: http://europa.eu/rapid/press-release_IP-12-1389_en.htm, accessed 10/8/2013 (18 December 2012)

European Council (2000), Presidency Conclusions – Lisbon European Council – 23 and 24 March 2000, available at: http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/00100-r1.en0.htm, (accessed 10 August 2013)

Liikanen, E. (2005), “Policies of transition to the network society in Europe”, in Castells, M. and Cardoso, G. (Eds), The Network Society: from Knowledge to Policy, Johns Hopkins Centre for Transnational Relations, Washington, DC, pp. 373–380

Mansell, R. (2008), “The life and times of the information society: a critical review”, paper presented at the Fifth Anniversary Conference of the Department of Media and Communication, Media, Communication & Humanity, London School of Economics and Political Sciences

Mansell, R. (2013), “The European digital agenda: for whom?”, paper presented at EuroCPR2013, Brussels

Mansell, R. and Steinmueller, W.E. (2013), “Copyright infringement online: the case of the Digital Economy Act judicial review in the United Kingdom”, New Media and Society, January, p. 13

Pauwels, C. and Burgelman, J.-C. (2003), “Policy challenges to the creation of a European Information Society: a critical analysis”, in Servaes, J. (Ed.), The European Information Society – A Reality Check, NewMedia Intellect, Bristol

Tabellini, G. and Wyplosz, C. (2004), “Réformes structurelles et coordination en Europe”, Report to the Prime Minister of France, La Documentation Française

Tabellini, G. and Wyplosz, C. (2006), “Supply-side reforms in Europe: can the Lisbon strategy be repaired?”, Swedish Economic Policy Review, Vol. 13 No. 1, pp. 101–156

Verdegem, P. (2010), “Information Society Policies 2.0. A critical analysis of the potential and pitfalls of social computing & informatics in the light of e-inclusion”, TripleC, Vol. 8 No. 2, pp. 139–142