Digital Agenda

Neelie Kroes, Commissioner for the Digital Agenda

In particular, she has put stimulating the growth of high-tech small-and medium-sized enterprises (SMEs) high up on her agenda.

It’s a sad and familiar story: Europe may be able to hold its own as far as the creation and survival rates of SMEs and start-ups are concerned, but it lags when it comes to developing them into larger companies. Kroes plans to tackle the issue, putting more effort into creating a single market for information and communication technologies (ICT), simplifying access to funding and promoting more open models of innovation.

“Europe has not produced any new major world-leading company in the last 20 years,” in areas such as ICT, Kroes told Science|Business in written responses to questions. “The situation has to be reversed.”

Kroes is hard at work drawing up a European Digital Agenda to address this, and to boost the contribution of information and communications technologies to sustainable and smart growth in Europe. The commissioner said the main areas will be:

• unleashing the full power of high-tech ICT research and innovation in Europe so that the EU can lead the way in emerging markets, such as health technologies and greener transport

• fostering interoperable technology standards to create open platforms as a springboard for innovation

• stimulating the roll-out and take-up of high-speed broadband networks in order to speed up the rate of innovation in the EU economy

• actively promoting the digital Single Market.

At the same time, the European Commission is fleshing out ideas for a European Innovation Act, to add fresh impetus for economic growth. Innovation strategy falls primarily to the new commissioner for research and innovation, Maire Geoghegan-Quinn, who is keen to broaden matters beyond industrial innovation, as had been the case in the previous commission. As such, she is heading a new cross-cutting committee on innovation in order to pull together ideas from several directorates-general.

Kroes - a member of this committee - has three things she wants to see in the Innovation Act to drive the Digital Agenda:

• Strengthen, coordinate better, and pool investment in research and innovation

• Stimulate growth of high tech SMEs, notably in fields like ICT

• Ensure that ICT plays its role as an engine for innovation and growth across the economy.

A recent report, “Memo to the New Digital Agenda Commissioner” from the Brussels-based think tank Bruegel highlights once again how the lack of a single market for ICT and lagging ICT research and development is hampering progress in Europe.

To deal with this, the report says the Digital Agenda Commissioner should concentrate more on emerging ICT products and services, which would allow new markets to replace old ones or force them to adapt. In order to support R&D and innovation better, the report calls for more public support to be given through tailored programmes to high-risk innovative projects conceived by new ICT companies.

When asked to what extent she agreed with these suggestions, Commissioner Kroes replied, “By and large, I would agree. More effort is needed to build a single market for ICTs and to increase investment in R&D.”

The Bruegel report goes on to point out that ICT is largely responsible for the European Union’s lagging growth performance relative to the US. In Kroes’s opinion, “The Bruegel report is probably painting too dark a picture...there is great potential for EU ICTs, so let’s focus on opportunities and not indulge in looking at a past picture of deficiency.”

In defence of the support given so far to SMEs, Kroes points out that in Framework Programme 6 and in the first four years of Framework Programme 7, about 5,000 ICT organisations across industry and academia have been supported, and 2,000 of those are SMEs.

“With these figures, we cannot say that SMEs are neglected in ICT in the Framework Programme and the Competitiveness and Innovation Framework Programme,” Kroes said. “But of course we can, and should do better.”

The digital agenda commissioner emphasised the need not only to attract more SMEs into European research and development, but also to ensure that the R&D and innovation done in these projects will allow these companies to grow. Kroes acknowledged that there are barriers to achieving this, not least a fragmented EU marketplace.

“The fragmentation of the European market - private and public- for innovative products and services is one of the main factors behind low investment and slow development of SMEs,” Kroes said. “The framework conditions for standardisation and intellectual property right regimes need to be adapted to new realities.”

In order to achieve more growth, Kroes also aims to simplify access to funding. “We should radically simplify our funding programmes at EU and national level to make sure that SMEs and new players take full advantage of public support,” she said. In addition, the commissioner underlined the need for Europe to promote, “New, more flexible and more open models of innovation,” where SMEs can drive technological progress and capitalise on the size of the EU market.