Opinion of the Committee of the Regions — The importance of a more interconnected Europe, focusing on the potential of the ICT sector as a source of growth
Date: 2014-12-04
Institutions: European Committee of the Regions
Subjects: Internet, digitisation, economic growth, exchange of information, information technology, innovation, social development, sustainable development








C_2015019EN.01005901.xml










21.1.2015   


EN


Official Journal of the European Union


C 19/59





Opinion of the Committee of the Regions — The importance of a more interconnected Europe, focusing on the potential of the ICT sector as a source of growth
(2015/C 019/13)












Rapporteur



Anne KARJALAINEN (FI/PES), Member of Kerava City Council








I.   THE IMPORTANCE OF A MORE INTERCONNECTED EUROPE









1.


At the request of the Italian presidency of the EU Council, the Committee of the Regions is drawing up robust proposals on how an interconnected Europe can be the basis for harnessing the great potential offered by the ICT sector as a source of growth and new jobs, especially over the next five years.












2.


In the era of the new industrial revolution, Europe can use digitisation to drive social and economic growth in line with the Europe 2020 strategy. It is necessary to understand what type of service the client requires and know how to develop the relevant technology, and to realise that the customer does not want to buy just a product but rather productivity, job security and customer satisfaction. All this can be achieved by harnessing digitisation. The circular economy, digitisation and service design can be used to generate new, green jobs and revitalise traditional industry. According to Commission studies, by 2020 Europe could increase its GDP by 4 % by stimulating growth of the digital internal market, and public administration could cut its costs by 15-20 % by digitising public services (1). Even during a period of high unemployment the internet is creating five new jobs for every two that are lost. It has been estimated that joint EU measures under the digitisation strategy could create as many as 3,8 million new jobs over the long term across all economic sectors.












3.


However, Europe’s capacity to generate growth and create jobs through digitisation is not adequate in every respect. People’s ICT skills must be developed, since fully half of the population have low ICT skills or none at all. Since in a global environment services are developed using IT, it is important for Europe’s competitive position as a producer and developer of services to be improved. Businesses also operate in a challenging environment: no European ICT company is among the top ten ICT companies based on sales.





POLICY RECOMMENDATIONS: Key messages







—


Synergies between the different funding mechanisms and between the public and private sector need to be encouraged and well-planned so as to put in place high-quality and affordable infrastructure capable of supporting cloud computing, big data and high-speed broadband connections.










—


EU, national, regional and local authorities should make it a priority to provide people with the digital and entrepreneurial skills that enable them to make full use of new technologies, analyse big data, understand issues of cybersecurity, increase their employability and create new business opportunities.










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EU, national and subnational authorities should aim to establish a flexible regulatory framework that reduces the cost and facilitates the creation and operation of ICT-business while allowing easy access to financing and encouraging innovation, including evaluation and reward policies.










—


The key role and potential of local and regional authorities with respect to digital training of citizens, creation and management of digital infrastructure — often in cross-border or interregional collaboration — the innovation and entrepreneurial discovery process and implementation of eGovernment should be considered in all future legislation to complete the digital single market.




II.   POLICY RECOMMENDATIONS

THE COMMITTEE OF THE REGIONS








4.


has welcomed proposals for measures relating to the internal market for electronic communications that would promote dynamic and sustainable growth in all sectors of the economy and create jobs, also ensuring a high level of consumer protection. The key role and potential of local and regional authorities in the implementation of eGovernment should be considered in all future legislation to complete the digital single market;












5.


notes the crucial role of the flagship initiatives, including the Digital Agenda, as tools for growth. The flagship initiatives should serve as a lever to enhance policy coordination at all levels with a view to the Europe 2020 targets and should be used in the milestone documents. Local and regional authorities should also keep using the flagship initiatives as a reference framework, not only for their policy planning, but also when interacting with higher levels of government and other stakeholders. Moreover, LRAs (and public bodies such as libraries, hospitals, or schools) could play a greater role in publicising and using Horizon 2020 results;












6.


points out that economic growth and jobs cannot be achieved through partial optimisation: rather a holistic mindset, leadership and measures are needed. For example, local and regional authorities are better able to apply digitisation in their own activities if their budget practices and indicators require a good overall outcome and encourage cooperation between sectors. To allow new innovative administrative procedures to be developed, it is also important to maintain a balance between the role of public authorities and new innovative development. There have been positive experiences with experimental funding, used to preempt problems or to develop and trial new social innovations;












7.


advocates combining bottom-up measures with top-down strategic leadership. Local and regional players are a driving force in the development and application of digitisation. Local and regional decision-makers, workers and ordinary people are enabling resources, provided that they have the necessary knowledge and skills, as well as a positive attitude to digitisation. Local and regional players are responsible for securing these skills. The local and regional level should monitor itself to ensure that local and regional players do not become obstacles to their own development;












8.


points out that in a citizens’ Europe digitisation makes it possible for people to build networks and maintain contacts so that they can discuss, learn from each other, form shared opinions and bring their own hopes and objectives to bear on decision-making and the strengthening of a shared European identity. New jobs are based on markets, and markets will be created more easily if Europe has a strong digital identity and people want to use digitisation and indeed demand new digital solutions;












9.


points out that by changing working methods digitisation has inevitably rendered some jobs obsolete and this means that companies and the public sector must be able to enhance and deploy a well-educated workforce to create more added value. Digitisation also enables people to seek a livelihood based on micro-entrepreneurship. In addition, digitisation should be used to aspire to high-growth entrepreneurship, since it allows products and services to be created and delivered without time or locational constraints. Even operators in remote regions have the same opportunities to benefit from digitisation;












10.


emphasises that a growth strategy is needed at European Union and Member State level that takes account of the opportunities offered by a digital strategy to support the creation of better and more permanent jobs for young people in particular. Employability is not just the responsibility of the individual: all stakeholders — businesses, universities, schools and colleges, local authorities and young people — should be involved;












11.


notes that securing the supply of natural resources and reducing the carbon footprint are key aspects of sustainable development. Europe’s economic growth should thus be based on something other than increasing the production of consumer goods. Products and services that can be made and sold digitally can create growth with a lower burden on natural resources (2);












12.


calls on local and regional authorities to assess the scope for using ICT, information modelling and a PPP-based approach to enhance the lifecycle sustainability of publicly owned assets — particularly the built environment and buildings;












13.


notes that in addition to technology-based product development, it is important to focus on developing human-centric techniques, services and products, including user-centric design, co-creation and rapid piloting. The Committee supports the Connecting Europe Facility initiative, which can be used to develop new infrastructure for digital public services and to better match the problems of different regions with proposed solutions from different parts of Europe. These measures will ensure that digital products meet real market needs, including public sector needs, more promptly and effectively, and that the competitiveness of European products and businesses improves;












14.


recommends establishing whether the gap between ICT and ‘business activity’ could be bridged by managing information system services using Enterprise Architecture, i.e. not just information or operations management but a holistic approach. The key to the Enterprise Architecture model is to fit the desired information and technology environment in a well-managed systematic way to the strategic and operating needs of the core activity;












15.


notes to this effect that local and regional authorities have a key role in ensuring equal and affordable broadband access in areas where the market fails, and urges that digital development projects in rural and sparsely populated areas be recognised as services of general economic interest (3);












16.


points out that ICT can be used in innovation to address critical socioeconomic challenges, and proposes a new policy framework through which the European Union would encourage ICT-based business to move towards addressing major societal problems such as climate change, energy issues or ageing societies. Active and healthy ageing is one of the key European Innovation Partnerships, and digital services could be developed to support active ageing (‘digital active ageing’). Investing in digital services to promote the health and social integration of elderly people could make Europe a pioneer in this field, creating the foundation for a new global export market, while reducing the cost pressure linked to ageing;












17.


sees an opportunity to stimulate growth and employment by connecting digitisation with traditional strong European sectors such as tourism and culture in a new and innovative way. For instance, providers and users of services could come together through new innovative digital platforms and approaches. Local and regional operators can help providers of tourism and cultural services to find similar service providers in other parts of Europe so that they can network and jointly raise their profile using digital approaches. Consumers of tourism and culture can both use and produce content through crowd-sourcing. Public data repositories such as the digital resources of museums, archives and libraries can serve as sources of new tourism and cultural services;












18.


recommends that digitisation be promoted by adopting complementary business models which can be used for instance by social enterprises and third-sector operators to produce services not covered by the public sector and where the private sector does not yet see business opportunities;












19.


points to the finding that investment in ICT can contribute more to regional growth than other capital investment, and therefore recommends prioritising the completion of the Digital Single Market by 2015 and addressing the investment needs of telecoms infrastructure by making full use of the EU structural funds, facilitating the right mix of public and private investment, using other financing sources like the European Investment Bank and setting the right regulatory framework. Very densely populated regions could be supported by private investment in infrastructure, while other regions would need to access public funding to support their infrastructure;












20.


welcomes the European Commission’s Connected Communities initiative, which is designed to give municipalities, the members of local broadband partnerships and operators guidelines on how to obtain funding and develop tailored business models for providing high-speed broadband to their community. The Committee would encourage local and regional players to make use of new EU broadband funding and support;












21.


believes that deploying accessible high-speed networks and bringing down their cost will create jobs for European businesses, boost the development of modern services, promote e-commerce and provide business opportunities in the spheres of IoT (internet of things) and M2M (machine-to-machine) technologies. The Committee is concerned about the trend whereby next-generation technology (cloud computing, 3D-printing, e-health, e-government, smart cities, entertainment services, telepresence, big data, in-car internet, etc.) is demanding even greater bandwidth and seamless service across Europe and the business models developed to introduce this technology are creating unsustainable cost pressures for local and regional authorities. It is important for the total cost structure of broadband projects to take account not just of start-up costs but also of future costs that will be incurred as a result of rapid technological development;












22.


points out that the European Innovation Partnership (EIP) on Smart Cities and Communities (4) is a platform that effectively promotes digitisation-based sustainable growth. To work properly, product development and testing platforms also require a well-functioning innovation and business ecosystem. Cooperation between interconnected smart cities enables local and regional operators as effectively as possible to promote the scaling-up of solutions produced in companies and thus boost companies’ competitiveness in a global business environment;












23.


recommends that when devising a smart specialisation strategy (RIS3), the regions draw on digitisation in their chosen specialisation strategy in order to create more added value and thus faster growth in the region. The Committee encourages LRAs to create innovative and entrepreneurial discovery processes and governance mechanisms to optimise synergies between different public and private funding mechanisms, to orchestrate synergies among different regional and local project portfolios and to create a focus on building European Partnerships through Horizon 2020, INTERREG, macro-regions, etc.;












24.


urges the Commission to take action to ensure that regions receive clear guidelines on how to implement RIS3 strategies through multifunded, large-scale ‘mega endeavours’ and project portfolios that are organised by orchestrating synergistic cooperation rather than managing individual projects. Digital project management tools and virtual working environments will be key to this development in working culture;












25.


notes that it has previously endorsed the view that ‘Instruments for the connection between the Research, Innovation and the Smart Specialisation Strategies shall be implemented both in Horizon 2020 and the Structural Funds in order to create objective indicators for the stairway of excellence and building the ERA’ (5). Indicators developed could be adapted to assess the benefits of research projects carried out with public funding. Evaluation should focus on outcomes and impacts such as benefit to local and regional authorities, new business opportunities and job creation, improving the design, functionality, usability and efficiency of service production, the overall quality of products and services or the contribution to innovation systems generally;












26.


has emphasised in previous opinions the active use of innovative public procurement and simplification of procedures, and encourages local and regional administrators to apply these principles with a view to accelerating the expansion of digital approaches;












27.


notes the importance for the functioning of the internal market and competitiveness of the digital economy of bringing together contributors to the value network — content creators, marketing players, distribution channels, e-commerce, software firms, telecoms operators and finance providers, and research and innovation, education and IPR specialists — to find digital solutions. The Committee recommends that local and regional players be more involved in putting together and orchestrating Europe-wide and interregional value networks;












28.


notes that growth and new jobs can be boosted by opening up knowledge, processes, public spaces and innovation produced as a by-product of publicly funded R & D projects. For example, by making public spaces with online access and equipment available for an individually agreed fee, municipalities can support micro-entrepreneurs and mobilise different population groups;












29.


notes that according to Commission studies, open access to data from the public sector and publicly funded entities boosts economic growth and creates new business opportunities, including for small businesses, regardless of their location. Open public data helps to improve the conditions for a functional digital internal market where consumers can be offered easy, safe and flexible access to legal digital content and services (6);












30.


points out that the technology needed to open up public data is already advanced, but that at local and regional level this technology may not necessarily be well enough mastered and there may not be the tools required to find information available for re-use (7). Meta-data is an important aspect of information re-use and publishing meta-data in a standardised format would in particular enhance the cross-border transfer, accessibility and commercialisation of knowledge;












31.


notes that the amount of information available on the internet is increasing apace. Use of ‘big data’, or large amounts of information, is expected to generate new business opportunities and jobs in the next few years, but such data is only just starting to be used in the public sector, for instance in healthcare, transport or employment services. Huge potential remains to be tapped from the integration of open data and big data, and public and private data repositories. European Union legislation should be framed in such a way as to allow the appropriate application of big data without violating individual data protection rights;












32.


advocates making the EU’s internet environment the safest in the world and recommends that Europe present itself on the global market as a safe and stable business environment with a good telecommunications infrastructure, based on which it could attract knowledge-intensive companies to invest and expand their activities in regions of Europe. Network breakdowns, attacks and crime should be contained as much as possible, since they harm a company’s image, reduce labour productivity and damage the knowledge that is vital to businesses;












33.


advocates the building of technological platforms in Europe and clarification as to whether for cybersecurity reasons a more restricted internet network needs to be developed alongside the current internet, which would give a competitive advantage to trust-based business, cloud-computing services and research. The European Union could also steer beneficiaries of EU funding towards these platforms and thus facilitate the commercial success of new solutions;












34.


points out that it is critically important for security requirements at every level to be met in order to ensure optimum levels of privacy and protection of personal data and prevent unauthorised tracking of any kind of personal information and profiling using that information, including shopping preferences, medical status, health records, etc. Privacy protection should also be looked at in terms of how data from different files can be automatically merged to create highly personal profiles of individuals (8);












35.


is aware that digitisation — including Massive Open Online Courses (MOOCs) — is bringing about the same kind of change in higher education that has already transformed for instance the media business environment. Higher education in Europe risks falling behind other parts of the world that are investing in ICT-based strategies to modernise education. On the other hand, local and regional players can also use digitisation to modernise the education sector in collaboration with universities. This would improve conditions for European operators to succeed in a growing global education market and would also provide an opportunity to create new jobs in the higher education sector. Universities that have embraced digitisation can more credibly modernise other sectors in their own region, based on the Knowledge Triangle principle (education, research and innovation), and thus help companies to create new jobs and the public sector to develop eGovernment and e-services;












36.


sees as positive the efforts in partnership with industry, through the Grand Coalition for Digital Jobs (9), to promote the necessary skills for ICT practitioners. Both organisations and individuals increasingly frequently need to adapt — learn new skills, and learn more — in order to keep pace with developments. This makes it all the more necessary for businesses and public administration to develop innovative ways of safeguarding skills availability in the future. Lack of the right knowledge and skills is regarded as the greatest obstacle to this. The digital skills of unemployed people in particular should be improved and people with a vocational or university qualification should be given the opportunity to learn e-commerce skills. The Committee of the Regions supports initiatives to develop European web entrepreneurship;












37.


has endorsed the Commission’s proposal to use the new educational programmes Erasmus+ and Horizon 2020 to support education providers in developing new business and educational models and launch activities to test innovative teaching methods, curriculum development and skills assessment (10). The Committee encourages local and regional players to make the educational establishments that they maintain and fund into environments for developing, testing and piloting new digital learning approaches (living labs);












38.


points out that lifelong learning takes place at every stage of life, including outside the formal education system. Open technologies and internet courses allow all individuals to learn, anywhere, anytime, through any device, and with the support of anyone. This also makes it possible to develop citizens’ ICT and data protection skills. Local and regional players should ensure that media literacy is developed systematically at all levels, from early education through to study leading to a vocational or academic qualification. For instance, standards and certification for accrediting digital skills could be improved and used as incentives in Europe;












39.


welcomes the e-Learning portal launched by the Commission, and the Erasmus+ funding earmarked for it. In future, open learning resources produced for a single shared portal and for example the key findings of EU-funded R & D projects would enhance European knowledge and competitiveness.





Brussels, 4 December 2014.


The President of the Committee of the Regions

Michel LEBRUN




(1)  Europe’s Digital Challenge — European Commission contribution to the European Council of 24—25 October 2013 http://ec.europa.eu/europe2020/pdf/20131010_en.pdf

(2)  CdR 626/2012.

(3)  CdR 5960/2013.

(4)  http://ec.europa.eu/eip/smartcities/about-partnership/how-do-i-get-involved/index_en.htm

(5)  CdR 2414/2012.

(6)  CdR 626/2012.

(7)  CdR 626/2012.

(8)  CdR 626/2012.

(9)  Multi-stakeholder partnership to tackle the lack of digital skills in Europe and the unfilled ICT-related vacancies. https://ec.europa.eu/digital-agenda/en/grand-coalition-digital-jobs

(10)  CdR 6183/2013.