As a key part of the Digital Single Market strategy, the European Commission has published the annual Europe's Digital Progress Report (EDPR), which monitors progress in digital policies in the Member States. The report benchmarks developments in connectivity, digital skills, use of internet by citizens and by business, digital public services, and investment in research, development and innovation in ICT.

The EDPR country profiles combine the quantitative data from the Digital Economy and Society Index (DESI)published in March 2017 – highlighting countries' policy initiative, identifying specific challenges and offering possible solutions together with examples of best practices.

The analysis shows that overall, the EU is making steady progress – up 3 percentage points compared to 2015. To make the most of the Digital Single Market and given fast technological change and progress of the EU's main trading partners, many Member States should step up efforts. In most areas, disparities between the top performing countries – Denmark, Finland, Sweden and the Netherlands, Luxembourg, Belgium, the United Kingdom, Ireland and Estonia – and bottom ones – Romania, Bulgaria, Greece, Italy, Croatia, Poland, Cyprus, Hungary and Slovakia – are large. However, more upward convergence is needed to make the Digital Single Market work better. The largest relative progress was achieved by Slovakia, Slovenia, Luxembourg, Ireland, the Czech Republic, Italy, Cyprus and Denmark.

National policy responses and implementation vary. Twenty of the EU countries have national digital strategies or digital agendas in place. Austria, Germany and Slovenia and the United Kingdom launched strategies in 2016 or 2017.

Connectivity

All Member States have national broadband plans. Coverage of fast broadband (technologies providing at least 30 Mbps) continued to increase in 2016 and reached 76% of homes. Despite a persistent gap with urban areas, fast broadband is catching up in rural areas, covering 40% of homes in 2016 compared with just 30 % a year before. Most Member States use the European Investment and Structural Funds— notably the European Regional Development Fund (ERDF) and the European Agricultural Fund for Rural Development— for a total programmed amount of over € 6 billion by 2020 to address the gap in rural and other underserved areas. Poland and Italy for example plan to invest more than € 1 billion of ERDF each. In addition, the European Fund for Strategic Investments has already triggered around € 3.2 billion of investment on broadband projects and a new Connecting Europe Broadband Fund is in preparation. Moreover, 16 Member States have implemented the Broadband Cost Reduction Directive (Directive 2014/61/EU) – another 11 countries partially – which includes measures to reduce the cost of deploying high-speed communication networks.

The EDPR includes also reports on telecom market and regulatory developments in each Member State, looking at the respective competitive environment, the measures taken to facilitate network deployment, as well as consumer issues including roaming and net neutrality.

Best practice: Net4All - a private-public partnership in the region Emilia-Romagna in Italy and winner of the European Broadband Awards 2016, aims to bring ultrafast broadband to industrial zones in a digitally disadvantaged area. The project has already brought ultra-fast broadband to 12 industrial areas and 90 enterprises with planned interventions for additional 20 areas and 150 enterprises.

Digital skills

Around 170 million people or 44% of adult Europeans have low or no digital skills. Lack of need or interest and insufficient skills are the top reasons for not getting internet at home. Although most jobs currently require basic level of digital skills, 26 million workers or 11% of the EU's labour force in 2016 still had no digital skills (down from 13% in 2015). A number of Member States have adopted digital skills strategies and action plans aimed at enhancing digital literacy and skills or are in the process of doing so. Ireland, Latvia and the Netherlands are examples of 'early movers' in this respect. Hungary and Portugal are among those having launched dedicated strategies more recently. Most Member States have digital strategies for education.

Best practice: The Broad Alliance on Digital Skills in Poland brings together both public institutions and private sector who jointly act to increase digital skills through training. The alliance is supported by 61 institutions and businesses among others Google, Microsoft, Intel, Orange and Cisco.

Integration of digital by business

Only a fifth of companies in the EU is highly digitised and the situation varies across countries. While half of companies in Denmark are highly digitised in Bulgaria it is only one in ten. Most Member States have identified the uptake of digitisation by industry as a priority. The adopted strategies typically address challenges for small and medium businesses (SMEs) to transform the opportunities of eCommerce into competitive advantage as well as specific digitisation plans for industry (Industry 4.0). In some cases for example Denmark, Ireland, Malta and Sweden support for startups or scaleups are particularly significant policy initiatives.

Best practice: The new Einstein Center Digital Future  in Berlin, Germany, has been conceived as an inter-university nucleus for research on the digitisation of society. The aim is to foster innovative, cutting-edge interdisciplinary research, and to provide training for young scholars.

Digital public services

In 2016 more than half of the population who needed to submit forms to a public authority did it online. However, the situation is different in the Member States where Estonia is the top performer, followed by Finland, the Netherlands and Denmark. Romania, Hungary and Croatia lag behind. Around half of the EU Member States have some eGovernment strategy in place.  

Best practice: In Slovenia eInvoices became mandatory in all transactions with the public administration in January 2015. According to the Slovenian Public Payment Administration, 4 million eInvoices were received and 500.000 eInvoices were issued in transactions involving the public administration during 2016. Total savings of the public sector were estimated to exceed € 2 million in 2016. Additional savings were also made by the business sector. The Latvian State Chancellery has developed a mobile app, called "Football", to promote public participation and improve customer service. Users can give feedback, record problems, make suggestions and rate the performance and the service quality of the public. The app is being adapted and generalised by the European Commission (DIGIT), in order to be reused by public administrations in all Member States to collect feedback on their public services. It will be launched by the end of May.

Research and innovation in ICT

In the area of research and innovation in ICT, in Europe - in 2014 – the ICT sector drove about 16% of business' expenditure in R&D (BERD). The services segment of the ICT sector generates 91% of total ICT value added and is responsible for 62 % of ICT BERD; on the contrary, ICT manufacturing represents 9% of ICT value added but is responsible for 38 % of total ICT BERD. Finally, ICT R&D intensity amounted to 5 % in 2014 in the EU, markedly behind the US and Japan (12.3% and 11% respectively).

Horizontal chapters

The EDPR report also includes a set of horizontal chapters that enable cross-country comparison and benchmarking in connectivity, skills, use of the internet, industry digitisation, eGovernment, ICT R&D and innovation investment and use of H2020 by Member States.

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