Possible initiatives to realise more of the potential of the digital singlemarket

• Author: Petropoulos, Georgios; Marcus, J. Scott; Yeung, Timothy
• Pages: 57-76

Contributio n to Growth : European Digital Single Market: Deliverin g economic benefi tsto citizens and busin esses

PE 631.04457

5. POSSIBLE INITIATIVESTO REALISE MORE OF THE POTENTIAL

OF THE DIGITAL SINGLE MARKET

KEY FINDINGS

We see opportunities for a num be r of furthe r i nter venti ons in the com ing le gisl ative t erm. T he y

fall in three categories: (1)re-think ing the ove rall ap proach to t he Digit al Single Market goi ng

forward, (2)rounding out a nd compl eting the measure s enacte d during the c urrent legislative

term, and (3)

launching new initiatives to foster the digitisation of European business,

governm ent and soci ety .

As far as a re -thinking of the ap proac h, we offe r the fol lowi ng refl ecti ons:

•For Single Market issues, a holistic view that integrates di gital a nd pre-di gital aspe cts

may be in order; however, promoting the adoption and innovation based on digital

technol ogy continue s to re quire a spe cial focus of its own.

•The ultimate goal is the achievement of a dynamic EU economy that delivers a high

standard of living to all, and that provides attractive prices and choices to consumers.

The Single Market, the competitiveness of the EU, and the productivity gains achieved

by digitisation are a means to achieving this end.

•Despite the growing difficulty in distinguishing between products and services, more

focus on Single Market gains relating to services is needed during the next legislative

term.

•A more integrated view across the EU’s full range of policy tools is needed, including

industri al, re gulatory , comp etition, and trade pol icy. H owever , we cannot c om p r om is e

the independence, the integrity and the credibility of regulatory and competition

policy.

We have provided a rough subjective assessment of how the candidate initiatives that we have

identified for the next legislative term differ from one another in terms of costs and benefits,

subsi diar ity c hallenge s, and mor e. We als o disti nguish b etwe en those that coul d b e act ed on

now, versus those where extensive study is needed to identify a way forward. The initiatives are:

•Publ ic fundi ng for AI and r oboti cs;

•Private funding for start-ups and scal e-ups;

•Corpor ate taxat ion;

•Training;

•Empl oyment and social prote ction;

•E-government;

•Network and information security;

•Cross-b order s ales of goods that require delivery;

•Re-think the structure of the EU audio-visual sector;

•Expand t he scop e of c onsume r prote cti on;

•Further improve access regulation;

•Lower c ross-border parcel delivery NPO prices;

•Liab ili ty and ne w tec hnologie s;

•Fake ne ws and inappro priate co ntent; and

•Dete cti ng coll usio n.

IPOL | Policy Department for Economic, Scientific and Quality of Life Policies

58PE 631.044

In considering possible initiatives to realise more of the potential of the digital single market, we

reflect first on the overall approach going forward to the Digital Single Market (Secti on5.1), then on

steps to round out or complete the measures enacted during thecurrent legislative term (Section

5.2), and finally on new initiatives to foster the digitisation of European business, government and

society (Section 5.3).In Section 5.4, we close with a comparative assessment of the candidate

meas ures that we have put forward.

5.1.The overall approach to the Digital Single Marketgoing forward

The pace of technological and market evolution in Europe has been rapid over the past five years. As

we approach the next legislative term, it is natural to consider to what extent the EU’s overall

approach to the DSM is ripe for re-thinking.

A 2018 Presidency discussion paper on theFuture of the Single Market (Counc il of the Europ ean

Union, 2018b, also 2018c) provides a useful starting point for this discussion, but it surely will not

represent the end of the discussion (nor was it intended to). If anything, the discussion paper

demonstrates that i t is easier to m ake broad pronouncements than it isto reduce them to practical

policy measures.

Perhaps the most useful proposition put forward in the discussion paper is that “there isno nee d for a

Digital Single Market but rather for a digitised Single Market.” They go on to float the idea of the

“appointment of a European Commission vice-president in charge of the Single Market inorder to

guarantee a cross-cutting approach.” (see also Li sbon Council , 201 8) In supp ort of this thought, we

would observe that referring to a Digital Single Market implies that there is a non-Digital Single

Market.Is this really the case today? All Single Market issues are to some degree digital, or ought to

be.

The boundaries of the Digital Single Market have never been altogether clear, but we have argued

throughout that two m ain thr eads are vi sib le in the acti ons undert aken i n the cur rent l egi slati ve t erm:

(1) improved realisationof the benefits of the Single Market, and (2) the fostering of further

digitisation in the EU.For the former, the suggestion that it is no longer he lpful t o think of a Digital

Single Market seems to be timely. For the latter, however, its very essence is the need to promote

innovati on b ased on digi tal te chnol ogies – as the discussion paper itse lf argues, it “will b e cr ucial to

address the EU productivity challenge by fully expl oiting the opportunities of the next digital tec h

wave”.

In other words,for Single Market issues , a more ho list ic view that int egrates digital and pre-

digital aspect s may be in order;however, promoting the adoption and innovation based on

digital technology continues to require a special focusof its own.

The Single Market has taken on symbolic significance for EU policymakers, but it should not be

viewe d as a goal in and of i tsel f; rather i t is a m eans to an e nd. The discussion pape r speaks of shifti n g

the focus to EU competitiveness, but this is likewise a means to an end. The ultimate goal is the

achie vem ent of a dynam ic EU e conom y that de live rs a hi gh st andard of l ivi ng to al l, and that pr ovide s

attractive prices and choices to consumers. The Single Market seeks to contribute to this goal by

means of scal e ec onomie s and reduce d transacti on costs . The focus on digi tisati on contri butes to th e

same goal by driving increases in productivity, thereby enhancing EU competitiveness that

contributes to EU exports.

The discussion papers (Counci l of the European Union, 2018b and 2018c)also reflect on the

disti ncti on be tween p roducts and servi ces , right ly noti ng that the y ar e inc reas ingly inte rtwined.