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European Commission

[Check Against Delivery]

Neelie KROES

Vice-President of the European Commission responsible for the Digital Agenda

A transatlantic digital single market?

Lisbon Council

Washington DC, 19 September 2014

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Today I want to talk about the relations between EU and US. About what opportunities new technology brings for that relationship. And about how we can share and work together to bring digital benefits to each other – and to the whole world.

For any long-term relationship, it's tempting to focus on the difficulties and disputes rather than what binds you together.

The relations between the EU and US are a case in point. Those relations are longstanding and vital, but we often find ourselves focusing on the differences and divisions, not the on opportunities.

I am a great friend and fan of this alliance. But we need to take account of how the world is transforming: a change that affects each of us and our relationship.

Especially when you look at technological advances and the development of the Internet economy.

For any new technology, it's easier to spot the threats than the opportunities. My approach is not to ignore those issues; still less to dismiss them. My approach is to understand and learn from them, in all their subtlety and complexity. And figure out what we can do – together - to make the threats benign and the opportunities beneficial.

I am an optimist on these issues. I see the positive side – because only then can we seize the great opportunities of digital. But I know not everyone does. And we need to engage with and talk to the sceptics, not ignore them.

Recent revelations about mass surveillance and recent examples of Internet fraud, hacking and cybercrime have been deeply shocking: to many in Europe: and to many in the USA too.

Shock is a natural reaction; so is outrage. But I look at it slightly more positively and pragmatically.

Really this was a wake-up call. Those recent events woke people up to the reality and the risk. It underlined what some have known for ages: we must strengthen our defences. And that is what I am pushing for Europe to do.

Because the real risk is a loss of confidence in the Internet. We cannot allow poor planning – or bad sentiment – to endanger the huge economic and social benefits that flow from digital technologies and services

Take America's dominance in new tech. It's true that many of the big names and big platforms are from America – Apple, Google, Amazon, Facebook. But Europe also offers many startup hubs – and with them, success stories - Skype, Spotify, Swiftkey, Rovio and more.

In fact many ICT innovations used across the world came from Europe. From Marconi's radio and Meucci's telephone; from the CD to the standards for GSM, WiFi, Bluetooth and more.

Meanwhile European companies like SAP and BMW are embracing and innovating for digital change.

I don’t see American leadership as a threat; this is not a competition; at least not one with losers. Wherever they come from, Europeans benefit from those innovations; millions use and enjoy them every day. And we can also learn from how America works and how it innovates.

For me it starts with the mindset that is prepared to take a risk. That's something I really saw in Silicon Valley.

Hundreds of years ago, the first Europeans left home to sail west.They weren't afraid to take a risk, to leave their comfort zone, to break out somewhere new. That risk paid off. Now we need to learn that lesson back in Europe.

If we are serious about nurturing innovation and innovators: Europeans need to realise that it's OK to fail. It's not shameful, it's not a stigma, it's not a black spot on your career.

Quite the opposite: it is absolutely needed. You simply cannot innovate without taking a risk. So if you never failed – you probably weren't ever trying.

That lesson is just one of many things we can share and learn from each other.

And let's remember what the internet can do on the global stage. It is a powerful platform to promote freedom and democracy.

Bloggers in Egypt; activists in Azerbaijan; those challenging a Twitter ban in Turkey.

Over the years, I have met all those people, and been inspired by them all. They are people fighting for freedom; and their weapon is the Internet, most amazing engine for spreading ideas ever invented.

These are not just European values; they are American too. When those same settlers left Europe, they were not afraid to change; but equally they did not abandon their vital values. And today, together Europe and the US are the world's natural home of freedom and democracy. Together we can ensure that helps the world.

The fact is: fundamentally the EU and US share many values. The differences between us show – not how far apart we are – but how much we can learn from each other to promote those values. How much we have to gain by trade and exchange; of products, people, ideas.

25 years ago, a network, first devised for the US military, benefited from protocols developed by a British scientist working in Switzerland. Today, the Internet is now used by 3 billion people across the world, the platform for billions of dollars of trade.

That's what we got through the open exchange of ideas. Now that same spirit can help us make the most of that network.

Ultimately what we share is greater than what divides us. We should not forget that. Working together can make us all stronger.

The internet succeeds because it is open. That is what makes it the natural home of innovation, the new frontier of freedom. As Vint Cerf put it, this is one of the most powerful amplifiers of speech ever invented, a global megaphone for otherwise feeble voices. The more open we are; the more we will benefit. Within the EU, and within the US; but also between the two continents.

That is partly about removing barriers to trade, and opening up markets at all levels. That is what TTIP – the transatlantic trade and investment partnership – is all about. And that will need to have a strong digital component.

But it's not just about removing trade barriers and tariffs.

We can work together in so many areas to enjoy this digital boost; constructively collaborating to make this platform work across the Atlantic. That is my dream – a transatlantic digital single market.

Here's just a few ideas for where to start.

First people and businesses need online transactions to be safe and trustworthy. Whether you are signing a contract, or filing your tax return: it's often easier online. But you don't want to be hacked or impersonated.

Those online services need to provide both confidence and convenience. In the EU, new rules make that possible: so you can use eIdentification across borders; to prove you are who you say you are, and make the most of Europe's online services.

I know the US is working in this area too.

But work together and we could expand those benefits even more – even towards mutual recognition of eIdentification. And open up a transatlantic market of online services for hundreds of millions.

Second example: as more and more of our economy goes online, protecting those networks and systems becomes essential policy. And as threats and outright attacks grow in number, we need to protect ourselves.

In Europe we are planning to do that through an EU Directive, to boost security and resilience; I know the US is preparing legislation too. Once again: if we cooperate and compare approaches, we could enhance the online economy, empower citizens, engender their trust. We already have a joint working group on these issues – now it's time to reinforce and operationalise that work.

In fact these are just a couple of ideas. Indeed we have been working hard in many areas to make the EU a digital single market. After I leave- the subsequent team of Commissioners have made clear they will be working very hard at it too. From making it easier for telcos to operate across borders, in open competitive markets: to getting rid of the roaming surcharges that get in the way of holidays and business trips.

Those are all good ideas – too good to keep to ourselves. We should take all those ideas for a digital single market – and consider whether they, too, could be transatlantic. That is the real way to spread this digital boost.

And finally, we can work together to ensure the digital boost reaches the whole world – with an internet that is governed for the world.

That is why we are working with the US to maintain freedom and openness online; and preserve a global, unified network. Not abandoning the current open system for governance, the so-called "multi-stakeholder" system – that would be a mistake.

But rather, by modernising it, ensuring it is inclusive and credible enough. So that other, less liberal parts of the world do not simply walk away, seek to impose their own controls, and fragment the network. That is why I welcome the US announcement to globalise key functions for how the Internet is run.

And as the system of governance becomes more global, we must also have credible and efficient accountability. With mechanisms to ensure diverse interests are properly taken into account, preserving the legitimacy of the system. That is something where Europe and the United States need to work closely together.

In 1989, two walls came down. First the Berlin Wall, heralding the fall the Iron Curtain that split Europe. Many countries to the east have now been transformed, from tyranny and oppression to freedom and openness; they now enjoy democracy, stability, peace and prosperity.

In the same year, a second wall came down, in Geneva, when the world wide web was invented; a common language to spread ideas across the globe; an open platform for freedom and democracy.

Today, we are still feeling the consequences and echoes of those events. In places like Ukraine. That's a place where you see people longing for the freedom and prosperity we too often take for granted. But we should not take them for granted. Not ever.

The EU is all about bringing down barriers: barriers to movement, to trade, to opportunity. And that needs to continue.

The evidence shows that – within the EU alone – a digital single market could be worth 4% of GDP; that's on average an extra 1500 dollars a year pocket of each of our half a billion citizens. Make that digital single market transatlantic – and the benefits are there to see: for innovation, for prosperity, for freedom.

Thank you.

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