EU – Baltic States, Innovations, Internet, Modern EU, Technology

Digital revolution is already marching through the EU member states; and the telecom innovations are driving the process. In the member states, the new sustainable growth strategies include additional efforts towards digital innovations’ implementation. 

Therefore, key objectives of the EU states are “green policies” which facilitate creation of sustainable industrial base through the use of digital technologies, while reducing transport pollution, providing more efficient homes and smarter working facilities.

Digital services and technologies are widely used in the EU states: these technologies are becoming even more intense through, for example, new 5G-based networking which can “re-configure” the work of data-centers and telecom-networks. Only in this way the ICT-users will have trust, security and transparency in the telecom operations.  

More in: https://www.etno.eu/news/all-news.html

European digital economy is lagging behind…

Digital technology and services systems operating in Europe, with only a handful of exceptions, resides outside EU states. According to the Forbes “Digital 100” ranking of top 100 public companies shaping the global digital economy, only 17 are from Europe; besides, only one in the top 20 global providers reside in Europe.

As the Report-2020 confirms, in addition to the direct economic benefits, a particular challenge for the EU states is to develop digital services in a way that adequately responds to the socio-economic, environmental and trust issues adequate to modern use by consumers, businesses, national and EU-wide governing bodies. (Report, p.7). According to some date, investment into digital sector in advanced ICT providers is double the European’s share. 

Modern telecom innovation is driving digital facilities and increases application opportunities. As long as the EU states are working on new and sustainable growth models, the EU institutions shall provide recommendations on the latest and most important innovations in progress: digital communications.

More in the Politico’s summary: https://www.etno.eu/library/reports/90-state-of-digi-2020.html 

Investing in the EU’s digital agenda is quite low too: according to the European Telecommunications Network Operators’ Association, ETNO the investment into the sector reached EUR48.6bn in 2018, with ETNO companies deploying 70.5% of the total network investment in Europe (EUR 34.4bn, fixed and mobile). 

ETNO companies have the highest proportion of revenues dedicated to investment among global peers situated in Japan, the US and South-Korea. 

However, investment per capita in Europe remains lower than those of such global peers, with Europe investing around EUR 89 per person, as opposed to global peers’ average at EUR 177 per person.

European markets remain fragmented, with 47 main MNOs in Europe, as opposed to 7 in the USA, and 3 in South-Korea and Japan respectively. Europeans use and spend less in connectivity services as compared to their global peers.

Telecom service revenues have been about EUR 165 bn for the past 5 years; mobile and fixed revenues accordingly were at the level of EUR 14.9 and EUR 21.5 in 2019. This means that European telecom markets have to make significant efforts in more efficient network investment: e.g. many EU states are having only 1-3 examples of network sharing agreements.

ETNO: working on perspectives

As the above mentioned Forbes Digital 100 Index revealed, of the 17 Europe-based companies only 11 are either telecoms operators or telecoms equipment vendors, and more than half of them are ETNO members. The estimate for the value added of ETNO’s footprint is EUR 136.9 billion, which captures indirect contribution to society and economy in terms of tax, rewarding employment, shareholder value and others. Besides, investment in digital training is on the rise: the EU companies are delivering 33 hours per employee of skills training in 2019, up from 30 hours before, and with some member states delivering close to 80 hours per year.

However, the new 5G networks’ prices imposed by national providers are actually different: some European telecom operators are being charged up to 14 times higher than the main global peers. Fiber roll-out is increasing across the EU states, with 41 million households directly reached by fiber in 2019, up from 34 in the previous year.

The estimate for the value added of ETNO’s footprint is EUR136.9 billion, which captures indirect contribution to society and economy in terms of tax, rewarding employment, shareholder value and others.

Increase in the consumers demand data-driven services is connected to increase in energy demand; in the telecoms sector such demand grows at about 5% per year. European telecom companies are radically changing the way they work: by 2019, almost 50% of the energy used by ETNO companies came from renewable resources. This reflects positively on the green performance of the sector, which in 2019 reduced its overall emissions by 8.5% with respect to the previous year with a corresponding reduction of carbon intensity: in fact, the CO2 emission targets by leading ETNO companies are overall more ambitious than those indicated in the EU ‘green deal”.

“Digital corporate effect” is increasing too: e.g. revenues in the locally-tailored telecom-cloud services in the B2B rank are becoming positive with growing and intense competition; similarly, IoT growth is going to continue, with telecoms empowering a diverse range of industrial sectors (the EU is expected to reach 740 million active IoT connections by 2026).

On the consumer’s side, telecom operators are increasingly competing with OTT video services: by 2024 revenues of the operators’ own OTT services are projected to reach EUR5.5bn/year, up from EUR1.8bn/year today.

Service and data-based innovation is also improving with artificial intelligence, AI being increasingly improved to make telecoms network more responsive to customer needs and more efficient, including from the energy consumption viewpoint. 

Full “State of Digital Communication Report” (consisting of 41 pages) in: https://www.etno.eu//downloads/reports/etno%20state%20of%20digital%20communications%20report%202020.pdf