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European Commission Releases Digital Single Market Strategy: The Good and The Bad

The European Commission has today released its new Digital Single Market Strategy. The objectives of the strategy sit within the wider political context: helping to restore a limp European economy to growth, whilst maintaining an effective welfare state and public services. Will this strategy help to deliver the kind of dynamic social market economy Europeans demand?

Vice-President of the European Commission Andrus Ansip has rightly set out an ambitious vision of a Digital Single Market. For those who believe in an enabling set of rules that will take society forward now is the time to step forward to support this vision. The alternative — a set of rules that fragment regulation along member state lines and reverse digital progress — is not a viable option.

There are two notable things about the strategy. Firstly, the strategy straddles two competing visions of economic policy: one that is deregulatory, simplifying and enabling and a second that is re-regulatory, constraining and with a greater role for the state. This tug-of-war between these two will be played out in Brussels and European capitals over the next few years with nothing yet decided.

Secondly, these differing visions are supported by different groups of European member states with Germany and France in one corner and the more market-oriented Scandinavians and Baltic countries, the British, Irish, Dutch and Luxembourgers in the other.

It is clear that embracing the Internet is one of the keys to the modernisation of Europe’s industrial and social fabric. This is therefore the right strategy. Several measures in the draft strategy will promote growth by enabling citizens and companies to better use the Internet to further digital skills, improve e-government and ensure that data can flow freely around the EU. These are excellent steps that bring information to those seeking it and productivity gains for businesses and governments across a truly ‘single’ market.

However there are also measures that threaten to undermine the stated goal of the Digital Single Market to grow Europe’s economy, replacing it with a re-regulation agenda. The most obvious example is the intention to assess whether to regulate platforms. This is ill-conceived given that businesses from newspapers to ecommerce sites to cars are, or are becoming, digital platforms. Platform regulation would hit European platform companies hardest given this the home market; a Chinese platform company won’t face the same rules thus helping it to accelerate its domestic and international growth. It is also not clear who platform regulation might be designed to help, apart from competitors that is.

The strategy also floats the idea of a new “duty of care” for intermediaries to proactively monitor, judge and remove user or third-party content on networks and hosting platforms. Existing measures to respond to problems online strike a balance between freedom of speech, commercial freedom and controlling infringing material. Extending a ‘duty of care’ could severely affect these freedoms. The last European Commission consulted widely on this and concluded that there were no grounds to open the E-Commerce Directive, preferring to explore improving notice and takedown procedures.  So where does this come from? The law enforcement community is pushing hard for increased monitoring by intermediaries. This will need to be investigated very carefully to avoid upsetting the balance between freedom of speech, an open economy and the removal of concerning material.

Revisions of the copyright, audiovisual and telecommunications rules should recognise the speed of technological change and resist calls to apply old rules to new services. Smart regulation for the Internet-era should look at whether there are any bottlenecks before deciding what rules might apply, particularly in the domain of the sharing economy.

The Digital Single Market strategy is one of the most valuable tools European policymakers have to boost growth, continue the provision of public services and foster social progress. Let’s make sure those who wish to enable the future win the day.

European Union

DisCo is dedicated to examining technology and policy at a global scale.  Developments in the European Union play a considerable role in shaping both European and global technology markets.  EU regulations related to copyright, competition, privacy, innovation, and trade all affect the international development of technology and tech markets.