Towards a competitive European Internet industry

Towards a competitive European Internet industry: A socio-economic analysis of the European Internet industry and the Future Internet Public-Private Partnership

Stijn Hoorens
Dieter Elixmann
Jonathan Cave
Man Sze Li
Gabriella Cattaneo
Copyright Date: 2012
Published by: RAND Corporation
Pages: 170
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  • Book Info
    Towards a competitive European Internet industry
    Book Description:

    This report analyses challenges and opportunities for the EU Internet industry and estimates the impact of investing in a Future Internet PPP. It finds that there is enormous economic potential for Europe, but only if some tough choices are made.

    eISBN: 978-0-8330-7952-7
    Subjects: Technology, History

Table of Contents

  1. Front Matter
    (pp. i-ii)
  2. Preface
    (pp. iii-iv)
  3. Table of Contents
    (pp. v-vi)
  4. Table of figures
    (pp. vii-viii)
  5. Table of tables
    (pp. ix-x)
  6. List of abbreviations
    (pp. xi-xiv)
  7. Executive summary
    (pp. xv-xxvi)
  8. Acknowledgements
    (pp. 1-1)
  9. CHAPTER 1 Introduction and study design
    (pp. 2-12)

    While various dates have been offered for the “birth” of the Internet, 1982 stands out as the year that the concept of a worldwide network of fully interconnected TCP/IP networks called the Internet was introduced (Handley, 2006). But it would be at least another decade before the invention of packet switching and the standardisation of Internet Protocol led to the introduction of the World Wide Web and allowed the Internet to start transforming economies and societies.

    Today, the Internet has fundamentally changed the way we stay in touch with our friends and relatives, purchase products and services, and entertain ourselves....

  10. CHAPTER 2 The European Internet Industry: key features that characterise its future
    (pp. 13-46)

    This chapter characterises the key conditions that the European Internet industry (EUII) faces at present, and which will be important in the future. “Key conditions” include the main drivers and barriers impacting the industry’s development and growth, including technology and market trends.

    In Section 2.1 we analyse the EUII structure and the profile of its main players. Section 2.2 investigates Internet demand dynamics in Europe, and analyses the business and consumer demand of Internet technologies and services. Sections 2.3 and 2.4 review the main technology and business trends driving market change and Internet infrastructures evolution. Finally, Section 2.5 assesses the...

  11. CHAPTER 3 Three future scenarios for the European Internet industry
    (pp. 47-56)

    The future development of the European Internet industry is subject to a range of uncertainties. Some are beyond the influence of policy makers, firms or other stakeholders. Other uncertainties may not be resolved until after critical decisions are taken, meaning that important actions will be determined by imperfect, and possibly conflicting, expectations by the key players.

    In order to assess the potential economic and societal contributions of the Internet industry and to shed light on the potential impacts of current PPP activities and their successors, it is necessary to incorporate these uncertainties into the analysis. We do this by means...

  12. CHAPTER 4 The future contribution of the European Internet industry under the three scenarios
    (pp. 57-72)

    The economic and societal contributions of the Future Internet have been sketched in many existing studies (e.g. Blackman et al., 2010; Cave et al., 2009; Dean and Zwillenberg, 2011; Pélissié du Rausas et al., 2011). In this chapter we analyse the future societal and economic contributions of the European Internet industry. We focus on the following elements: the size of the Internet economy and market, diffusion of Internet-driven innovation by sector, contributions to employment, education and skills, returns for SMEs, and the impact on business models. Since these contributions will depend on the various uncertainties underpinning the future Internet industry,...

  13. CHAPTER 5 The macroeconomic impact of a Future Internet PPP and its potential successor
    (pp. 73-88)

    While Chapter 4 focused on the Internet industry and its likely economic and societal contributions, this Chapter concentrates on the Future Internet Public Private Partnership (FI PPP) and the possible successor (henceforth FI PPP+). The following sections aim to quantify the potential mid- and long-term impacts of FI PPP and FI PPP+ on the EU 27 economies.

    The approach we followed resembles that used to empirically assess the effects of a specific autonomous change in a particular part of the economy on the economy at large. This could include the impact of a governmental program on GDP, on employment, etc....

  14. CHAPTER 6 The European Internet industry and Future Internet PPP in a global context
    (pp. 89-96)

    Previous chapters addressed the future contribution of the Internet industry to the European economy and society and the potential impact of a Future Internet PPP. What does this mean for the position of the European Internet industry in the global context?

    In this chapter we analyse Europe’s competitiveness in the context of the global Internet industry and in particular vis-à-vis the US, Japan, China, and India. We illustrate that, according to recent studies, there are differences in the contribution of the Internet to economic growth in different countries. Although some EU countries are frontrunners, American companies dominate the global Internet...

  15. CHAPTER 7 Barriers to the competitiveness of the European Internet industry
    (pp. 97-120)

    The benefits of Future Internet development are potentially limited by barriers to Europe’s competitiveness. We use Michael Porter’s71 definition of “external” competitiveness in terms of, for example, productivity, which “allows a nation to support high wages, a strong currency, and attractive returns to capital—and with them a high standard of living.” (Porter et al., 2006). This perspective is reflected in the annual European Competitiveness Report (European Commission 2011d), which acknowledges that:

    “A competitive economy (…) raises living standards sustainably and provides access to jobs for people who want to work. At the roots of competitiveness are the institutional and...

  16. CHAPTER 8 Recommendations
    (pp. 121-124)

    Chapter 7 discusses various barriers to the competitiveness of the European Internet industry organised into three meta-layers. It also identifies 20 actions for reducing the adverse impacts of the barriers and four main groups of actors for taking the actions (European Commission, Member States, European Parliament and the private sector).

    This chapter sets out our policy recommendations, based on the above analysis. These recommendations correspond to seven high-priority actions selected from those identified in Chapter 7. The prioritisation was based on a range of considerations, including feedback from experts in the field and complementarity to/alignment with the expected outputs from...

    (pp. 125-142)