• On Tuesday, the European Commission unveiled its “2030 Digital Compass: the European way for the Digital Decade”, which combines a vision for an “open and competitive single market”

• The “Digital Compass” will indicate key priorities in the Commission’s strategy: skills, infrastructure, and transformation of businesses and public services.

• The new strategy puts SMEs at the centre of the digital transformation, acknowledging their importance as Europe’s motor for innovation

Earlier this week, Ursula Von der Leyen’s cabinet released a landmark document for Europe’s digital future: the “2030 Digital Compass”. The new strategy for digital transformation focuses on the key areas of digital skills, infrastructure, and the transformation of businesses and public services. A particular emphasis is placed on the role of small and medium businesses: “SMEs have a central role in this transition, not only because they represent the bulk of the EU companies, but also because they are a critical source of innovation,”, the Digital Compass reads. As a representative of innovative digital frontrunners, DIGITAL SME welcomes the recognition that Europe’s innovative ICT industry will have a key role to play to manage the transition.

Concrete KPIs for European businesses until 2030

The document puts forward ambitious goals for European businesses until 2030. Concrete KPIs will be defined in a stakeholder consultation planned to take place throughout 2021. However, the document already sets out a few key points:

• 75% of European enterprises should take up cloud computing services, big data and Artificial Intelligence
• More than 90% of European SMEs reach at least a basic level of digital intensity
• Europe will grow the pipeline of its innovative scale ups and improve their access to finance, leading to doubling the number of unicorns in Europe.

Although Europe is home to many innovative companies and ideas, many of them do not manage to scale up. Linking the intention to support innovative companies to concrete goals can help to ensure that the “death valley” between research & development and market adoption will finally be successfully addressed. According to the “Digital Compass”, Europe is already bringing about as many start-ups as the US, but seems to lack a truly functioning single market for rapid growth and scaling up.

A network of 200 European Digital Innovation Hubs to catalyse digital transformation

Another pillar of support to SMEs will be the network of more than 200 Digital Innovation Hubs and industrial clusters. “More than 200 European Digital Innovation Hubs and industrial clusters across the EU should support digital transformation of both innovative and non-digital SMEs, and connect digital suppliers to local ecosystems. The objective is to achieve a high level of digital intensity”, the document reads. DIGITAL SME welcomes this announcement. “We have long stressed the importance of local ecosystems and business partnerships to support the digital transformation. We are happy that the European Commission stresses their importance in this document,” said President Dr Oliver Grün.

Measuring Europe’s success

As the Commission conducts a wider consultation process throughout the year to set up a “compass framework with specific targets and governance”, DIGITAL SME will be glad to contribute to the stakeholder forum and to provide feedback. Our input will focus on the monitoring system, milestones, and the means of achieving the Digital Compass’ ambitions. In our response to the 2030 Roadmap consultation, we stressed the importance of including long-term oriented criteria to measure Europe’s digital transformation.

If you are an innovative SME and would like to contribute to discussions about digital transformation in Europe, you can apply to join our Working Group Digitalisation. In this and other dedicated groups, DIGITAL SME’s members and trusted partners discuss and develop the Alliance’s position vis-á-vis the European institutions. They are also a place for networking and collaborating on European projects or other mutually beneficial initiatives like.

The workshop “AI-standardisation landscape & the role of Digital Innovation Hubs”, held on 18 February 2021, provided participants with an overview of Europe’s standardisation landscape in AI. A variety of actors are involved in standards-setting, and it can be difficult for SMEs to understand how they can keep up to date on standards development and get involved in the technical committees that set the standards. DIGITAL SME’s Focus Group on Artificial Intelligence brings together leading AI innovators in Europe, who will play a crucial role in supporting the uptake of AI-based technologies. In the new Digital Europe Programme, it will be the role of Digital Innovation Hubs (DIHs) to help support the uptake of future technologies such as AI among SMEs. However, DIHs will also support technology frontrunners, such as AI innovators. Via DIHs, SME networks, and direct involvement in standardisation organisations, these innovative AI companies can shape AI development in Europe.

Rewatch the event:

Presentations Slides

• Slides by Dr. Lindsay Frost, Chief Standardisation Engineer at NEC Laboratories Europe, Board member of ETSI, ETSI OCG AI Chair, ETSI ISG CIM Chair
• Slides by Prof. Stelian Brad, Professor at Technical University of Cluj-Napoca & President of Cluj IT Cluster

Additional Resources and Links shared during the event

The Rolling Plan for ICT Standardisation 2021. https://ec.europa.eu/docsroom/documents/44998

ETSI page on education about standards:  www.etsi.org/standardization-education

A series of free webinars hosted by the University of Bath, on education and AI: https://cdt-art-ai.ac.uk/news/events/the-global-ai-standards-landscape-an-extended-seminar/

Funding regarding SDOs: https://www.standict.eu/

Disclaimer
This workshop is part of DIGITAL SME’s efforts to promote AI as a key technology for the competitiveness of Europe’s digital economy. Although Europe is considered a global leader in AI academic research and champion of a human-centric approach to AI, it lags behind the US and China when it comes to the industrial applications of its scientific achievements. To stop Europe from falling behind, DIGITAL SME has taken a leadership role in AI for SMEs, gathering more than 100 AI innovators in the Focus Group on Artificial Intelligence (a joint effort with the European Commission’s Joint Research Centre).

• On 20 January 2021, DIGITAL SME held a workshop titled “What does the new Data Governance Act mean for SMEs?” for members of the Focus Group on Artificial Intelligence (FG AI) and other invited AI-stakeholders.

• Malte Beyer-Katzenberger from DG CNECT explained the consequences of the Data Governance Act for innovative, AI-driven SMEs, telling participants that the legislation was designed to “protect your ideas”.

• Common European data spaces, data intermediaries,  data altruism, and other significant aspects included in the European Commission’s proposal have important consequences on small and medium businesses in the AI sector.

On 20 January 2021, DIGITAL SME held a live workshop titled “What does the new Data Governance Act mean for SMEs?” for members of the Focus Group on Artificial Intelligence (FG AI) and DIGITAL SME’s extended network. The event’s main topic was the Data Governance Act, a proposal for a regulation published by the European Commission last November.

While the workshop shed light on the European Commission’s strategy when it comes to data, important questions remain: What will the Data Governance Act (DGA) mean for small businesses on the ground? Access to data is a key hurdle for companies: How will the DGA and the Commission’s data strategy ensure this access?

The DGA aims to turn Europe into a leading data economy, especially for industrial data. For this purpose, the DGA wants to build a comprehensive European data-sharing framework. The DGA is part of a wider European Data Strategy, which will also include a Data Act, to be announced by the end of 2021. This framework aims to allow businesses and researchers to fully exploit data by lowering transaction costs linked to B2B and C2B data-sharing through data intermediaries. It provides a framework for the re-use of public sector data and promotes the concept of “data altruism”, i.e., allowing data use by individuals or companies for the common good. Finally, the DGA foresees the creation of an expert group, the ‘European Data Innovation Board’.

Malte Beyer-Katzenberger, Policy Officer at the European Commission’s DG CNECT, presented the DGA to an audience of AI-developing SMEs to better understand the EU’s overarching strategy for data. Participants were also able to ask questions about the proposal and bring their critical feedback to the attention of the European Commission.

Creating value and ensuring the availability of data through Common European Data Spaces

Common European data spaces are infrastructures designed to materialise data-sharing platforms: their main leverage will be the possibility of reusing data. The DGA will define an open ecosystem independent from big players in which increased involvement creates more value. Mr Beyer-Katzenberger highlighted that “the European Commission will play the role of catalyser of the relevant actors in these data spaces”, but he added that they will be “driven by the stakeholders that are part of them”.

The DGA also introduces the notion of data intermediaries which will allow companies to recourse to third parties offering and obtaining data-related services. These intermediaries will strengthen businesses sovereignty over their own data as “they will share data while maintaining their control and value”, as Mr Beyer-Katzenberger explained. At the same time, questions remain when it comes to the additional bureaucracy associated with this notion – may it hinder smaller players from developing new business ideas based on the collection of data sets?

Finally, Mr Beyer-Katzenberger elaborated on the concept of “data altruism”, where individuals or companies can give consent to share their data for the common good; voluntarily and free of charge. This can lead to an increase in the amount of data at the disposal of companies who need data to scale up and innovate.

DIGITAL SME will continue to champion SME voices in important digital legislation

A poll conducted during the session indicated that only 60% of participants had heard of the Data Governance Act prior to the workshop. Towards the end of the session, the poll showed that the sentiment regarding the projected effects of the DGA on participants’ businesses was neutral to positive.

DIGITAL SME would like to thank Mr Beyer-Katzenberger for his presentation and all participants for sharing their feedback and questions. We will continue to bring together stakeholders to discuss digital legislation in the field of AI and beyond to make sure it is fit for SMEs.

The governance framework proposed by the DGA can have important consequences for innovative companies in AI or data intelligence services – and DIGITAL SME wants to ensure that the dialogue between the EU-level and the affected SMEs is established from the start.

Our Working Groups are the place-to-be to network and discuss policy and how it impacts your business—and you can join them! Go to digitalsme.eu/working-groups to learn more and apply.

P.S. Did you miss the event? Click here to see an exclusive recording and the slides for this webinar!

• The European Commission has today published two pieces of legislation that will update the rules for digital companies in Europe: a Digital Services and a Digital Markets Act.

• In a nutshell, the Digital Services Act (DSA) focuses on illegal content, while the Digital Markets Act (DMA) promises to tackle the dominance of large gatekeeper platforms like Google, Apple, Facebook, Amazon and Microsoft (GAFAM)

• DIGITAL SME welcomes these new rules as they support a more competitive and open market environment for upcoming digital companies.

Today, the European Commission has published its long-awaited rules for digital services and digital markets. One of them, the Digital Markets Act, defines “do’s and don’ts” to address imbalances in digital markets. “Large gatekeeper platforms are dominant across different fields, e.g. search and browser, app stores and operating systems, or social media and instant messaging. Their dominance allows them to attract ever-more users and collect more data about customers, which confirms their dominance even more. We are happy that the European Commission is taking bold steps to bring back fairness to digital markets”, said DIGITAL SME President Dr Oliver Grün in a first statement.

Addressing market imbalances

Power imbalances and the practice of limiting access to newcomers is not new in digital markets. In the 2000s, the so-called “browser wars” served as a first indicator of what was to come. In 2009, DIGITAL SME backed the Commission on its antitrust investigation against Microsoft for tying Explorer to Windows. Similarly, in 2016, DIGITAL SME spoke out against the dominant position of Google’s Playstore on Android phones. “In both cases, we decided to speak up because we believe that Europe needs an open and competitive digital ecosystem that enables innovation”, said President Grün. However, the approach to tackle these issues with competition law has not been a full success. As Commissioner Breton told POLITICO Pro Morning Tech today: “We have tried in the past to address gatekeeper issues through competition cases. But these cases took years to instruct.”

With the Digital Markets Act, regulators will have the option to address certain unfair practices of large gatekeeper platforms. “We welcome that the European Commission proposes targeted legislation rather than a one-size-fits-all type of legislation. The majority of problems are caused by a handful of players, and therefore, a targeted approach is the right way to go”, remarked President Grün.

New rules for new challenges?

The second document published today is the Digital Services Act. The DSA will focus more on the “wild west” nature of the internet, i.e. illegal goods and content. Rampant disinformation, election interference on social media, and the sale of faulty goods are just a few examples of challenges the Act aims to tackle.

In an effort to harmonise the rules of how goods and services are bought and sold online in Europe, the DSA will upgrade the 20-year-old e-commerce Directive, which regulated the distribution of content online while limiting the liability of internet service providers and intermediaries like large platforms. This limited liability enabled the success of many business models like YouTube or Facebook which live off third-party content that is not moderated in real-time.

The Digital Services Act now attempts to curb some of the negative effects of limited liability while upholding the general principle. At the same time, it aims to create harmonised rules across Europe, e.g. for notice-and-action mechanisms. “We are happy that also in the DSA, the Commission refrained from taking a one-size-fits-all approach,” said President Grün after a first analysis of the document.

Stricter rules will apply to platforms with at least 45 million users: they will have to collaborate with regulators and fulfil data access requirements for researchers. Further, the DSA includes Know-Your-Customer obligations, a Good Samaritan principle and a new enforcement mechanism. And here comes the stick: Companies that don’t comply with the legislation could be fined up to six per cent of their annual revenue.

Stay abreast of everything DMA/DSA!

If you’d like to know more about the DMA and the DSA, you can read the European Commission’s official press release here. You can find our detailed position paper on the Digital Services Act here. Also, stay tuned for a debate about the impact of the DMA on SMEs, which we will organise in January 2021! To keep up with all our updates, you can subscribe to our newsletter and mailing lists here!