EU POLICY FOR THE E-ECONOMY: EUROPE IN THE E-ECONOMY: CHALLENGES FOR EU ENTERPRISES AND POLICIES
Section snippets
MACROECONOMIC ASPECTS: DIGITISING THE ENTIRE ECONOMIC FABRIC
Under different names (“new economy”, Internet economy”, “networked economy”, “knowledge-based economy”), the “e-economy” has been the subject of intense debate among experts and policymakers on both sides of the Atlantic. Central to the discussions are the root causes of the “long boom” which characterized the exceptional performance of the US economy in the Nineties, as well as that of other fast movers among OECD countries (Canada, Australia) and EU Member States (Sweden, Finland, Denmark,
DRIVING THE E-ECONOMY: THE ROLE OF ICT INDUSTRIES
Relative to its share of GDP, the ICT industry has contributed more than any other sector of similar size to overall GDP growth. This has been the case not only in the US, but also in many EU Member States (e.g. Sweden, Finland, Ireland, the Netherlands).1
MICROECONOMIC ASPECTS: IMPACT OF THE E-ECONOMY AT SECTOR AND COMPANY LEVEL
While the debate continues on the true impact of ICTs on the macroeconomic performance of economies, changes at microeconomic level are far better documented. We have now a good understanding of how ICTs and e-business are impacting companies and sectors.
NEW BUSINESS MODELS
Most importantly, the e-economy has been accompanied by the emergence of a wealth of new business models. Such business model innovation has been favoured in the US by the depth of risk capital and market-based financing. Both have allowed testing promising companies, in real market conditions, at an unprecedented rate. Many of these business models have failed, others however have stood the test of time.
At the cutting edge of such business models, “virtual enterprises” are emerging in many
EMERGING COMPETITION CHALLENGES
E-marketplaces are a specific aspect of “collaborative e-business.” Several thousand exchanges of various kinds were launched over the past two years, a large number of them in the EU. Some of these marketplaces are sector-specific addressing the needs of an industry, others are horizontal. Some are company-centric, others are “neutral” marketplaces set up by third party operators or technology providers. Some are extensions of existing trading platforms, others are entirely new initiatives.
M-BUSINESS: EUROPE’s OPPORTUNITY
Mobility is adding a specific new dimension to the e-economy. The e-economy will be mobile in Europe. This represents a strategic opportunity: mobile communications have been an outstanding success in the EU, impacting not only the ICT sector, but also user industries. Penetration rates for GSM (67% today, 85% expected in 2003) put Europe well ahead of the US in that sector of the e-economy. On the supply side, telecoms and mobile represent, despite the recent slowdown, the fastest growing
CONCLUSION
The e-economy presents Europe with unprecedented challenges. Compounding these challenges, recent market evolutions make it even more essential for entrepreneurs and for government policy-makers to “get to grips” with the e-economy, understand its workings, and ensure that European companies “goi digital” and fully benefit from the e-economy.
However, with challenges come opportunities. Indeed there are encouraging signs that Europe is not only rapidly catching up with the US in e-business, but
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