European media and technology leaders urged national governments on Wednesday to “wake up,” saying they needed to overhaul regulations for the digital era or risk falling further behind in a sector critical to generating sorely needed economic growth.
“Change, fueled by the Internet and convergence, is happening at lightning speed, and sadly, we have to admit that Europe is not leading the change, but undergoing it,” a group of industry executives, academics and others wrote in a report for Neelie Kroes, European commissioner for telecommunications and digital media.
At a time when much of Europe is preoccupied with the euro crisis, the report sounded some familiar themes, transposed from the real world of money to the virtual one of digital media: Europe is falling behind, and a fragmented political landscape is preventing it from addressing its challenges.
The report says different national policies in areas ranging from data protection to taxation continue to hamper the development of cross-border sales of digital media, long after much of continental Europe embraced passport-free travel.
Without the development of a single European media market, the report says, European companies will struggle to achieve the economies of scale necessary to become world-beaters. Indeed, the Internet in Europe is dominated by American giants like Google, eBay, Amazon and Facebook, a fact that grates on policy makers in many continental capitals.
The authors compare the growth of Netflix, an American video-on-demand service, with Spotify, a music streaming company that was founded in Sweden. While both companies are growing internationally, Spotify is still available in only 11 of 27 E.U. countries.
“We all know that we don’t have leaders in technology companies; you know that Americans are dominating the market — and good for them, they come from a big market and grew their business — but that doesn’t mean we can be happy with that,” said Christian van Thillo, chief executive of De Persgroep, a Belgian media concern.
Mr. van Thillo served as chairman of the group, called the E.U. Media Futures Forum, which also included representatives of Axel Springer, the publishing group, Google, France Télécom and WPP Group, as well as government officials and university professors.
The move to enlist the support of industry executives and others from outside politics was an implicit acknowledgment that the European Union’s previous initiatives to develop its digital economy have fallen short.
In 2000, policy makers adopted the Lisbon Agenda, which aimed to make the Union “the most competitive and dynamic knowledge-based economy in the world.” When that did not happen, the agenda was rolled over into the current “Europe 2020” strategy.
The panel made specific recommendations in certain areas, calling for the promotion of a Europe-wide system to handle so-called micropayments for digital media content, and for greater investment in faster fixed-line and mobile broadband networks. Other proposals were quirkier, including a call for the creation of a journalism prize that would be “as prestigious as the Pulitzer Prize is in the U.S.”
While the media forum was convened by Ms. Kroes last year, its report was not officially endorsed by her. Indeed, in some areas, the recommendations ran counter to European Commission proposals; on digital privacy, for example, E.U. officials have called for tougher regulation; the report says “new business models” that provide consumers with transparency and choice will be sufficient.
The commission is moving to overhaul copyright law, an area on which the report acknowledged that there was no consensus. Some panel members wanted copyright laws to be updated, in order to make it easier to license music and other digital content, while others said this was not needed.
Ms. Kroes, at a news conference, sided with the former party. To say that existing copyright laws are working, she said, “would be a fairy tale, and we don’t believe in fairy tales — anyhow, not in our business lives.”
Even as the commission tries to advance on subjects like these, national governments are sometimes heading in different directions.
France, for example, implemented a tough crackdown on digital media piracy under former President Nicolas Sarkozy, including the threat of disconnecting repeat offenders from the Internet. But his successor, François Hollande, pledged during the election campaign that he would soften this approach.
Meanwhile, Britain appears to be going in the other direction, with regulators this week detailing plans for a similar anti-piracy plan that also includes possible suspensions of Internet access.