August 6, 2021

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, 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.

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Media Cache: In Slovakia, News Outlets Take Cue From Cable

PARIS — The newspaper industry is in trouble; cable television, despite the same challenges, is thriving. Could newspapers learn something from the cable guys?

In tiny Slovakia, publishers want to find out. Borrowing the cable TV business model, in which a single monthly payment brings mainstream networks, news channels and nutty talk show hosts into people’s living rooms, they are bundling their Web sites to create a more diverse offering.

For €2.90, or $4.20, a month, starting in May, users will get full access to the Web sites of the two leading broadsheets, SME and Pravda. Also included will be the sites of business and sports newspapers, magazines, a TV network, online video portals and a media news service. Until now, the sites have mostly been free.

The project aims to help Slovak newspapers deal with the same problem faced by their counterparts all over the world: how to generate more revenue from the Internet as print circulation and advertising dwindle.

When one of the Slovak papers, SME, tried to erect a pay wall on its own a few years ago — something that a growing number of newspapers are doing elsewhere — it failed miserably. Only a few dozen readers signed up.

“With one newspaper, it’s very hard to make a package that is worth paying for,” said Tomas Bella, chief executive of Piano Media, the company based in Bratislava, Slovakia, that is running the new system. “All the research showed that people were at least three times more likely to pay for a single platform like this, compared with individual sites.”

To try to make users’ experience even more like cable television, he said, Piano Media is in talks with Internet providers about letting consumers pay for service with monthly Internet access bills.

Mr. Bella said the goal was to turn 5 percent to 15 percent of the four million Internet users in Slovakia into paying customers within four years. For its work, Piano Media will keep 30 percent of the revenue and distribute the rest to the participating sites on the basis of the amount of time users spend on them.

The papers will not necessarily put all of their content behind the pay wall. At SME, for example, the commentary section will be restricted to paying customers, but much of the general news will remain free.

“We are a small newspaper in a small Central European country, so we do not have that much unique content,” said Matus Kostolny, the editor of SME.

Yet the small size of Slovakia could work to Piano Media’s advantage, he added. Once the pay wall goes up, Slovak readers will have limited alternatives for news on the Web. The only major holdouts are two tabloid papers and a TV network. And there is no Slovak version of Google News, which gathers free snippets of news from other Web sites in larger markets.

Mr. Bella said he wanted to expand the format to other countries, with the Czech Republic, Denmark and the Netherlands under consideration. Like Slovakia, these are relatively small, linguistically insulated countries with a limited number of media outlets.

Could the model work in larger markets? Herding together a comparable number of online publishers in vast media markets like the United States or Britain would surely be impossible. There, big newspapers have tended to set up pay walls on their own, sometimes citing competitive concerns or anti-cartel regulations as reasons for not joining with competitors.

True, there are other one-stop digital payment platforms, including Apple’s App Store, Google One Pass and, in the United States, a company called Journalism Online. In France, newspapers are developing a “digital kiosk” to offer paid access to a number of publications from a single portal. Yet under all of these systems, consumers still have to pay separately for access to participating publications’ sites.

The Piano Media concept is more like the unfettered Web that users have come to expect. Once behind the pay wall, consumers will not have to jump over additional barriers when they click from site to site. “If it works, we will keep our readers and get some money, too,” Mr. Kostolny said.

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