President Barroso presented to the European Council on ways to boost innovation and competitiveness in Europe. He argued that innovation is key to competitiveness but that Europe lags the US and Asia in areas like university rankings, scientific talent, and private sector R&D. However, Europe has a strong scientific base. Barroso proposed boosting investment at national and EU levels in areas like education, research, and digital technologies. Specific initiatives discussed include the European Research Area and Horizon 2020 program. Barroso emphasized the need to complete the digital single market and harness opportunities in technologies like cloud computing and big data.

1. Innovating in the digital era:
putting Europe back on track
Presentation of J.M. Barroso,
President of the European Commission,
to the European Council of 24-25 October 2013

2. Innovation is key to our competitiveness
Global competitiveness index versus
innovation output indicator
6
FI
Global Competitiveness Index 2013-14
US
UK
NL
5,5
DE
SE
JP
DK
BE
AT
FR
5
LU
IE
EU
EE
ES
PL
LV
LT
4,5
CZ
IT
MT
PT
BG
RO
CY
HU
SI
HR
4
SK
EL
3,5
50
70
90
110
130
150
Innovation output in 2011
(EU in 2010 = 100)
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
Sources: European Commission, World Economic Forum
1

3. To lead globally, the EU needs…
World-class universities
Excellence in science
Number of universities in Top 100
(Shanghai index, 2013)
Number of Nobel Prize winning scientists
in the last 20 years (1994-2013)
60
120
50
100
40
80
30
60
20
40
10
20
0
0
US
EU
JP
CN
PhDs trained for industry
Share of researchers in the business sector
(% of total researchers, 2010)
100
US
EU
JP
CN
Better knowledge transfer
between academia & industry
Patent applications per million people
(2011)
250
80
200
60
150
40
100
20
50
0
0
US
JP
CN
EU
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
JP
US
EU
CN
Sources: Shangai/ARWU index, Nobel Prize Committee, OECD, European Commission
2

4. The EU has a strong scientific base
Scientific publications
in the last decade
Most cited publications
Number of scientific publications,
2000-2011
The 10% most cited 2008 publications,
over 2008-2011
6 000 000
60 000
5 000 000
50 000
4 000 000
40 000
3 000 000
30 000
2 000 000
20 000
1 000 000
10 000
0
0
EU
US
CN
JP
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
US
EU
CN
JP
Source: European Commission, Scopus data
3

5. A lot can be done
NATIONAL LEVEL
Country-specific recommendations
R&I and education systems
EU LEVEL
Framework
conditions
Europe 2020 strategy
Single market priorities
European Research Area
Public support
Private investment
Smart specialisation
Public-private partnerships
Horizon 2020 and COSME
Investment
Structural and Investment Funds
Access to finance
European Innovation
and Technology Institute
Cooperation
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
European Innovation Partnerships
Joint Technology Initiatives
4

6. Example 1: The European Research Area
Access to
top-level facilities
Efficient funding
through
competitive calls
Towards a single market
for knowledge:
Open,
merit-based
recruitment
better links between research,
education and innovation
Greater
gender balance
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
Increased circulation
of researchers and
grants in the EU
Open access to
publications
5

7. Example 2: The Horizon 2020 programme
Horizon 2020: more than € 70 billion
to invest in R&D, 2014-2020
Excellence
in science
Industrial
leadership
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
Societal
challenges
6

8. ICT plays a key role
Europe compared to the US: R&D spending,
ICT investment and productivity
Expenditure on R&D
as % of GDP (2011)
Private sector
Investment in ICT as % of
total investment (2011)
Labour productivity growth and
ICT contribution (2001-2011)
ICT Contribution
Public sector
%
%
3
Other
%
25
3
20
2
2
15
10
1
1
5
0
0
0
EU
US
EU
EU
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
US
US
EU
EU
US
US
Sources: European Commission, OECD, van Ark
7

9. The digital economy: sizeable potential…
ICT in the EU: number of jobs, value generated
and ICT capital in 2000 and 2010
EU in 2000 (index = 100)
EU in 2010
250
200
150
100
50
0
1
Employment of ICT
specialists in the EU
2
Gross value added
of ICT sector
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
3
ICT capital
(hardware, software
and telecoms equipment)
Sources: European Commission, The Conference Board
8

10. … in a rapidly changing landscape
Number of world-leading firms in ICT
("leading innovators") by region and activity in 2012
Layer I: element providers
TOTAL ICT
Layer II : network operators
(telecom, computer and
(computer hardware,
(fixed line
electronic equipment such & mobile telecoms)
electronic office and telecoms Ericsson or
as Alcatel,
equipment, semiconductors) Nokia)
Layer III: platform, content,
application
(computer services, internet
and software)
World
381
228
22
131
EU
62
23
11
28
US
199
117
2
80
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
Sources: European Commission, Bruegel
9

11. The EU must compete to keep its ranking
Indicators for digital investment, revenue and uptake
EU (or proxy)
North America (or proxy)
Asia/Pacific (or proxy)
80%
70%
60%
50%
40%
30%
20%
10%
0%
-10%
Growth in ICT spending
(2010-16)
Growth in ICT
spending
(2010-2016)
Fibre take-up (2012)
Change in revenue
of ICT firms in Top 50
(2008-2012)
4G take-up (2013)
High-speed
fibre line take-up
(% population)
4G take-up
(% of global take-up)
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
Web 2.0 patent applications
(2008-12)
Web 2.0 patent
applications (as %
global, 2008-2012)
Sources: IDATE, Fortune Global 500, COCOM, OECD, European Commission
10

12. Fragmentation is a particular challenge
Kiruna
Why should a Swedish citizen visiting
Copenhagen pay 45 times more to send
an email with a smartphone to nearby Malmö…
… than to send one from Malmö to Kiruna in
north Sweden, which is 1400 km away?
Malmö
Copenhagen
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
11

13. New technologies - new opportunities
Cloud computing
Big Data
Exabytes
35 000
30 000
10-20% cost reduction
for most organisations
400 000 new SMEs by 2016
Close to € 1 000 billion for EU GDP
over 2015-2020
25 000
20 000
15 000
10 000
5 000
0
2005
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
Volume of data created globally
expected to double every 2 years
2010
2015
2020
Sources: IDC, F. Etro, Mc Kinsey
12

14. Zoom 1: a dynamic telecommunications sector
Increased
competition,
better choices
and fairer prices
Framework to
invest in quality
and high-speed
networks
Greater trust,
reliability and
interoperability
for users
More competitive
ICT sector, with
greater economies
of scale
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
13

15. Zoom 2: helping citizens and firms to go online
Level of computer skills in the EU
(% of individuals aged 16-74, 2012)
Share of EU SMEs and large
enterprises selling online
SMEs
Medium
level
40
No skills
Low
level
35
% of enterprises
High
level
Large enterprises
30
25
20
15
10
5
0
2010
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
2011
2012
Source: European Commission
14

16. Zoom 3: leading by example
DK: mandatory e-invoicing
reduced related administrative
costs by 80%
EU / BE: EU "e-prior" freely reusable
e-procurement tool, now used by BE
- annual savings of € 9.5 million
EE: more than 90% of banking
transactions, tax declarations and
establishments of firms online
ES: electronic healthcare
record and integrated
information systems for health
in most regions
LT: e-procurement for almost
90% of total public procurement
SI: opening up education
initiative with 32 000
digitally-trained teachers
PT: e-procurement generated
18% price reductions on
hospitals' procurement contracts
AT: cadastre prices reduced by 97%
(open data) leading to 7 000%
increase in data sold to SMEs
Presentation of J.M. Barroso to the European Council, 24-25 October 2013
Source: European Commission
15