The missing pieces in the European Digital Single Market puzzle
Where do we stand with the European Digital Single Market?
Two years ago, the European Commission’s VP Ansip proposed the Digital Single Market (DSM) strategy. The goal being to remove the obstacles within the European market to ensure a vibrant European digital market. At the time of its launch, I strongly welcomed its arrival and supported European Commission’s VP Ansip for his efforts.
Now, it is time to take stock. The European Commission adopted its own “mid term review” today, taking stock and looking forward.
Let me share with you some of my thoughts on where we stand.
We still fully endorse the objective of the DSM strategy. As many parts of the puzzle are moving forward in the legislative process, it is important to keep sight of the bigger picture. For CA Technologies, that is the European data economy and its benefits. As the Commission pointed out in its Communication on the topic, its value to the economy could increase to EUR 643 billion by 2020, representing 3.17% of the overall EU GDP.
To take stock of some emerging issues around the data economy, the Commission had launched a consultation that closed a couple of weeks ago. CA Technologies has provided input on various aspects of the data economy.
However, I want to focus on what I believe is a core piece of the puzzle in the data economy: the free flow of data. Data needs to be able to flow across Europe and beyond. This is the case both for personal and non-personal data.
When it relates to personal data, the EU’s General Data Protection puts forward as a principle that data should not be blocked to move within the EU. However, with non personal data – which is at the core of the data economy – there are still a wide range of requirements to localize data across the European Union. A DSM with a fragmented approach to data localization is setting itself up for failure.
There are rules that require organizations to store data locally instead of having the data to be stored in the most efficient location. Having to set up multiple data centers or hosting operations is costly, not just for CA but also our customers. More importantly, we believe that these requirements, and the confusion around it, will ultimately also impact SMEs, both from a supplier side as a consumer one. SMEs operating as suppliers won’t be able to provide the technical solutions in various markets as this would be a high costs and struggle with potential increased prices for hosting solutions. Ultimately, they also put the European Digital Single Market at a disadvantage.
As a SaaS based organization, scalable deployments allow for increased efficiencies. Having data flow cross border, within the EU and beyond, is a crucial aspect of our ability to efficiently service our customers while at the same time being able to control the cost to customers. o require localization would further drive up costs, thereby potentially injuring the end user companies’ ability to get the costs savings of the SaaS/cloud model of licensing/utilizing technology.
A harmonized approach, built on transparency. We support European Union action to put a Regulation on the table that puts forward a “fifth freedom of free flow of data”. This means that as a default principle, data needs to be able to flow across borders. Exceptions could be allowed, for example for public security. But the key is that such exceptions by Member States should be motivated and visible. A database keeping track of these would be good to insert more transparency in the system.
The EU could be a leader to the rest of the world, to demonstrate a way forward to unlock the benefits of the data economy. Now is the time to be bold.