STRASBOURG — The European Commission’s grand plans this week were supposed to prepare the Continent for a glorious era where cars drive themselves, robots do the heavy lifting and humans relax by watching their favorite entertainment anytime, anywhere.
Instead the vision for a so-called digital single market is now cracked and smudged.
As reforms go, the Commission’s heralded plans were true to form: compromise and consolation prizes. Ambitions to expand internet access will rely on company cooperation rather than tackling vested interests. Measures to protect artists and publishers could give them a louder voice, but no guarantee of fair compensation. Tech giants like Google, Facebook and Skype will face more regulation as the Commission tries to save old, dying industries.
On Wednesday, European Commission Jean-Claude Juncker ushered in the measures during his State of the Union address in Strasbourg. Later, Vice President Andrus Ansip and Commissioner Günther Oettinger spelled out the details on how the Commission would try and fix Europe’s telecoms market and copyright rules.
“Ansip’s vision on the digital agenda in principle is correct, but he has to compromise so much. You notice that they fail to make decisions,” said Marietje Schaake, a Dutch Liberal member of the European Parliament. “Parliament will have a lot of work to do on these proposals.”
The ambition was to push Europe into the 21st century. The old world would be complemented by trucks that drive themselves through cities. Health scares could be spotted remotely by your doctor. Entertainment could be watched in real-time and crystal clear — in any EU country. And those providing the content would be paid fairly and protected from piracy. Beneath our feet and above our heads, networks would transmit photos of cats, videos of news reports, live streams of sporting events. These cables and wavelengths, called spectrum, would allow cars to drive themselves and personalize medicine.
Without a continent-wide common spectrum, Europe will struggle to compete on almost every technological level against a rising Asia and an established U.S. Without the copyright protections, the creative drive will lose its luster.
“We’re disappointed on the proposal, and it lacks ambition in terms of meeting the needs of the digital age,” said Siada El-Ramly, director general of EDiMA, a trade association for platforms.
However, all hope isn’t lost. The Council’s Slovak presidency is shifting gears on the digital single market and even expects a political agreement on spectrum by the year-end.
Plans to liberate telecoms infrastructure once controlled by old monopolies fell short of granting rival operators full access. Instead, national telecoms regulators would have the power to attract investors and encourage joint ventures.
In earlier drafts, the EU’s telecoms regulator would have had sharp teeth to order nations to release their spectrum for 5G internet access. It was de-fanged.
In late-stage proposals, the Commission was ready to play hardball with a “use it or lose it” strategy to force countries to free up the 700 MHz band. The final version offered a game of softball.
“The proposal stops short of achieving the full harmonization of spectrum management and indefinite spectrum licenses,” said Grégoire Verdeaux, Vodafone’s international policy director. “We encourage European institutions to be bold in seeking to resolve this issue.”
The Telecoms Framework Review, which is now called a code, pales compared to recent strides in the U.K. The country’s regulator this year forced the national broadband owner Openreach to grant rivals access to its network beneath streets of towns and cities.
The Continent’s internet infrastructure has piggybacked on the copper network created for traditional telephone calls. The old-fashioned wires can be upgraded using something called vectoring technology to speeds of 250 megabits per second by 2018, according to Deutsche Telekom. Rivals, including Vodafone, argue copper will never match the speeds or reliability of fiber optic cable.
“Effective access to ducts and poles of the significant market power operator, is essential and welcome. However, in many cases this will not be the single silver bullet to ensure effective competition,” said Aurélie Bladocha of telecoms lobbyist ECTA, which represents Vodafone and Iliad.
If the telecoms reform lacks muscle, then the copyright overhaul has a crooked spine. Most visibly, Google saw its news and YouTube businesses under fire over plans to help artists and publishers get more money.
While Google has a content recognition technology to cut piracy, plans to increase transparency are unlikely to give creative types little more than the right to moan via a dispute resolution mechanism.
So platforms that showcase people’s work still have the same financial exposure that they had earlier this week. For platforms, there’s more work to do, a higher cost to entry and more dialogue with artists who think they are underpaid. Yet for artists there’s no immediate financial windfall or movement towards the levels of remuneration that subscription services offer.
The Commission’s plan means that platforms with user uploaded content, like YouTube, which is supported by adverts, should not be able to operate outside normal licensing rules, according to John Phelan of music industry lobbyist IFPI.
“However, there is a lot more to do to make this a workable proposal,” he said.
The proposal would increase transparency and data sharing for artists and copyright holders, which, in theory, would help them get a fairer share of the revenues generated from online media.
While Google was broadly satisfied with this, it was unhappy with plans to introduce a new copyright law for the press and said publishers should try to work with technology companies instead of relying on “subsidies and onerous restrictions.”
The Commission gave publishers the right to negotiate with “news aggregators” that publish snippets of articles without permission. The proposal falls short of a so-called “link tax,” which many have wrongly claimed was the Commission’s plan.
“What happens in music now, will happen in press. We hope that, like in music, you have this streaming music, there will be business models by which people would read different type of articles and you can monetize this,” DG Connect Director General Roberto Viola said. “For a company, like Google, that doesn’t get a license to exploit the journalistic material, then it’s an infringement of copyright.”
Google and rival web browser Firefox, which is part of Mozilla, lambasted the new rights for news publishers online. Mozilla’s petition to influence copyright rules has attracted more than 30,000 signatures.
“The digital single market is intended to empower startups and creators in Europe, but the proposals would do just the opposite,” said Denelle Dixon-Thayer, Mozilla’s chief business and legal officer.
The proposed reforms would mean publishers will get less traffic from Google’s news service and searches, said Caroline Atkinson, Google’s vice president for global policy.
“It would hurt anyone who writes, reads or shares the news—including the many European startups working with the news sector to build sustainable business models online,” Atkinson said in a blog.
Commission officials suggested Wednesday that the reforms could be out-of-date within a few years because of the advancing pace of technology. That should be incentive enough for companies to collaborate in telecoms to deliver better infrastructure and for platforms to make deals with artists, it said.
“It is claimed that this directive is a ‘significant and historic step’ but to what? Hopefully it will not become a significant step towards the Balkanization of the internet as we know it with a future for consumers filled with geoblocking of content,” said David Taylor, a partner at lawfirm Hogan Lovells. “Ultimately [it will be] up to the Court of Justice of the European Union to try to answer the questions this directive raises.”
Laurens Cerulus and Joanna Plucinska contributed reporting.
This article was updated to add a detail about the Slovak presidency’s plans.