Media Cache: E.U.’s Internet Scoreboard Doesn’t Tell the Story

PARIS — Remember the Lisbon Strategy? That was the European Union’s grand plan, set out in March 2000, to make the bloc “the most competitive and dynamic knowledge-based economy in the world” within a decade.

Well, 2010 came and went, and Europe didn’t look much more competitive or dynamic than it had a decade earlier.

So what did E.U. leaders do next? They drafted a new 10-year plan. The resulting Digital Agenda for Europe, adopted last year, contains 101 “actions” aimed at improving high-technology competitiveness.

To demonstrate that it really means business this time, the European Commission published a “scoreboard” last week to measure progress toward the 2020 goals.

The results so far? “Eleven actions have been completed (two ahead of schedule), six actions due to be delivered last year are delayed and the other 84 are largely on track,” the commission said.

Among other things, the completed actions include “setting out technical specifications for telematic applications for rail passenger service,” which has something to do with making it easier to buy tickets for cross-border train travel. The Union has also completed the action of agreeing to “support the continuation of the Internet Governance Forum beyond 2010.”

This is surely worth a high-five in Brussels. Yet politicians in national capitals seem increasingly preoccupied with the idea that their countries are falling behind the United States and China, among others.

Last autumn, Prime Minister David Cameron of Britain lamented the fact that there was no equivalent to Silicon Valley in his country and proposed measures to encourage high-technology entrepreneurship.

President Nicolas Sarkozy of France summoned global leaders of the technology industry to Paris last month for a forum on the future of the Internet, in connection with the Group of 8 summit meeting. He then alienated some of them with calls for greater governmental oversight of the Internet, prompting sneers that he just didn’t “get” digital technology.

In fact, Europe is not the technological laggard it is sometimes portrayed as being. Broadband should be available to all Europeans by 2013, the commission says; that is seven years ahead of a comparable U.S. goal. Internet use is rising across Europe, and more Europeans are shopping online, the commission’s scoreboard shows.

Yet Europe does trail in one very obvious way. It has produced no global Internet companies to rival the likes of Google, Facebook or Twitter.

The scoreboard suggests one possible reason for this. Europe invests considerably less than other industrialized countries in research and development of information technology, it says.

Another reason may be the sluggish development of cross-border e-commerce within the European Union, which has dampened hopes for the development of the Union’s “single market.” The scoreboard shows that fewer than 9 percent of Europeans bought something from an online retailer based outside their country last year. That is far short of the commission’s goal of 20 percent by 2015.

Without a functioning single market, it is difficult for European Internet companies to achieve significant scale. To do so, they would effectively have to create 27 local companies — one for each E.U. country. Few European start-ups have access to the necessary investment or expertise.

What often happens instead is that European Internet companies sell out to a foreign owner once they reach a certain size. Last week, for example, the U.S. technology company IAC/InterActive, which owns Match.com, agreed to buy Meetic, a European online dating site with which it already had a partnership. Last month, Twitter agreed to buy TweetDeck of Britain.

Deals like those may encourage would-be European technology entrepreneurs to give it a try. Yet until Europe creates homegrown Internet giants, politicians and the public may feel that they are losing the Internet game — no matter what the scoreboard shows.

Article source: http://www.nytimes.com/2011/06/06/technology/06cache.html?partner=rss&emc=rss