Commissioner Viviane Reding: Software and services: powering the European digital economy - Official launch of the Technology Platform NESSI (Networked European Software and Services Initiative)

September 8, 2005

Brussels, 7 September 2005

Ladies and gentlemen,

I am very pleased to join you for the launch of the NESSI Technology Platform. This is a fascinating area of industrial opportunity, in which Europe has not always been as strong as it should.

I welcome this initiative and in particular the industry’s commitment to cooperate on research and innovation in the strategic software, Grids and eServices sector for Europe.

I would like today to say why I see software and electronic services – for which NESSI aims to define a strategic research agenda - as a crucial part of how ICT will reinforce growth and jobs in Europe.

eServices: the next utility

Our sector (ICT and media) is experiencing many different forms of convergence; technological convergence, network convergence, content convergence. One further crucial area of convergence is the way that different and diverse platforms for delivering e-services are coming together.

I will illustrate the scale of the change with an analogy. In the 19th century, utility companies began supplying industry with electricity. By so doing firms were able to refit their factories with small, reliable and low maintenance electric motors and to discard the steam-engines that had up to then provided power. Electricity brought an essential service on demand and directly to the machines where the power was needed. The economic consequences for the economy in terms of productivity and growth were massive.

The emerging view is that we are about to witness a similar revolution. New smart e-services are coming along which will permit firms to harness the power of ICT without having to support the complicated steam engines of ICT systems in-house. The implications for firms of all sizes will be enormous, not least because the vast majority of ICT costs lie in maintaining and updating the systems.

A common platform for e-services: an economic dynamo

Today, software and services represent a substantial industry of €67 billion per year in the EU . The greatest economic impact of this industry, though, is in the way that all other industries depend upon it – not to mention the proper functioning of public services and administration. As we go more and more on line with the development of the Information Society, this dependency will increase.

In the coming years, however, it is expected that the focus of this industry will shift from supplying products (such as packaged software or code for embedded systems) to providing services. This will mean more performance for ICT users and more turnover for software and services suppliers.

This shift towards ‘e-services’ is a new wave of development of software and services that Europe cannot afford to miss out on. Software is the engine room of the information economy, and without a competitive European software and services industry we will find our other industrial sectors severely hampered.

The proposed common platform, if it creates a stable and secure basis for such services, will be an opportunity for innovative e-service providers to reinforce their position on the global services market and to give them a head start in this new phase of development.

We need to act now

Consider three structural changes in the ICT landscape that affect industry and society.

From products to services: The best placed firms will be those that move early to seize the market opportunities as they open up. Just as North America benefited most strongly from the Internet boom, we should prepare the way for developments in trusted e-services. Common architectures and approaches are needed if we want to be the earliest in the game.

Complexity: The information economy is fearsomely complex, built up of millions of computers, billions of records in databases and trillions of lines of software code. As our ICT systems become ever more complex we understand less and less how they really operate, making them less secure and vulnerable to malicious intent. Given that we now entrust vital aspects of our lives to software systems; quality and reliability is a social and economic prerequisite. In extreme cases, software faults can be catastrophic, costing human lives even. Such failures and vulnerability to cyber-criminals would undermine trust in the Information Society and the services that it delivers.

We need urgently, therefore, to master complexity, so as to ensure that the systems that run industrial and societal applications remain dependable.

Digital convergence: The convergence of technologies and the emergence of web and on-demand services, in parallel with the digitisation of traditional content (films, video, music) calls for powerful computational infrastructures, which facilitate storage and viewing on a range of devices. But we still lack crucial building blocks that make these services possible.

Each of these 3 trends are pressing on us now as broadband technology becomes universal and new applications and services and rich content become widespread. The time to act is upon us.

The Commission has proposed a basis for investing in this research, but some Member States seem reluctant to see Europe achieving the levels of investment that would put us alongside other global leaders such as the USA and Japan. You the industry must make special efforts to explain the importance of adequate resources for research and innovation, not just to the research ministers, but also to the prime ministers and the finance ministers.

I should make it clear, that my role and the role of my services is to facilitate these industry led actions. We are willing to support and to advise, but it is up to you to do the work and to make NESSI a success.

I would like to say that I am glad to hear of the commitment within NESSI to the principles of openness and transparency.

1) That the benefits of the initiative are open to SMEs that are striving to innovate.

2) That you are committed to open standards

I would like to stress also that NESSI should be orientated to the global game. Europe is not an island. I am happy to see that it is in the interest of Europe but should be aim to be open, competitive and world class.


I would like to conclude by confirming my belief that the shift to e-service is both a challenge and an opportunity for European software and service players.

This industry, your industry, (software, grids and service companies) has the opportunity and responsibility to act collectively to boost your influence in fora to define the technical pathways and standards that will shape the way in software and eServices.

That is why I welcome the proposed initiative which you call NESSI, to define a route forward for software reliability, services, security, and openness.

It indicates that industry (with the support of policy makers) can put Europe into a lead position on powering the digital economy.

The growing demand for more reliable software, Grids and eServices, and the technological and economic forces affecting the industry create a huge opportunity for new breakthroughs. Failure to seize this opportunity would mean that our industry and society could lose the critical capability to develop and deploy software and services, which is essential for creating the markets that sustain competitiveness and prosperity.

That industry is uniting around a common strategy, as you are doing in this Technology Platform, is a very positive sign. The NESSI Technology Platform should help you to capture this opportunity, and hence to reinforce growth and jobs in Europe. And that is to the benefit of all.

Item source: SPEECH/05/489 Date: 07/09/2005 Previous Item Back to Titles Print Item

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