Brussels, 30 September 2020

Open letter from European DIGITAL SME Alliance

Dear President Michel, dear Members of the European Council,

The current COVID-19 crisis has jumpstarted a wave of digitalisation which can go two ways for Europe: the way of sustainable, integrated digital transformation of our economy, or the path of turning non-digital enterprises into minimally skilled end-users of ICT products and services.

As a European association representing more than 20,000 small and medium-sized enterprises in the ICT sector from across Europe, DIGITAL SME would like to emphasise the importance of sustainable digitalisation to manage the current challenges and to support the digital and green (twin) transitions. Sustainable digitalisation refers to the process of digitalising the economy in a long-lasting, green, and organic way by building on Europe’s key strength: innovative SMEs and their business ecosystems. In the long term, the goal of sustainable digitalisation is to strengthen European digital sovereignty.

On 1-2 October 2020, you will discuss Europe’s digital policy at the next European Summit in Brussels. Achieving digital sovereignty necessitates decisive action by EU and national policymakers in the key areas outlined in our campaign and position paper on Sustainable Digitalisation.

SMEs should be able to benefit from an open, competitive environment that will allow them to drive the digital and green transitions. But how do we unleash this competitive environment that brings about innovation? At DIGITAL SME, we propose to align actions along three pillars of a sustainable digital transformation:

1) Sustainable B2B digitalisation: Building on long-term B2B relationships rather than closed “off-the-shelf” solutions which lead to dependency.

2) Green(er) technologies and a circular economy: A digital sector that saves resources, increases efficiency, and builds the sustainable economy of the future.

3) An innovation-enabling policy- and regulatory framework: A holistic approach to rule-making that supports innovation and openness.

These three aspects of sustainable digitalisation go hand in hand and will support Europe’s twin transitions. For instance, digital companies can provide the know-how to non-digital companies that will help them move towards Internet of Things (IoT) or other “smart” digital business models, which can help to save resources. Open source software and hardware that is unlocked for third-party applications can help to extend the life cycle of products and increase innovation and competitiveness on the market. A smart policy and regulatory framework that builds on openness and interoperability can move our economy from the traditional “production-consumption-disposal” model to green and circular business models.

Thus, EU leaders need to approach the digital transformation from a holistic point of view, keeping in mind those three angles, and aligning actions accordingly. This means that, for instance:

• The MFF and the Next Generation EU budget should incentivise long-term innovation and digitalisation efforts rather than the purchase of closed off-the-shelf solutions.

• Policy and regulation should promote openness, interoperability, and a level playing field for SMEs vis-à-vis dominant players to reverse the trend of locked-in, proprietary business models that inhibit market opportunities and innovation.

We hope that our position paper can serve as input to shaping the EU’s digital transformation in a sustainable manner and would be happy to discuss these topics with you further in a personal conversation.

Yours sincerely,

Dr Oliver Grün

President of European DIGITAL SME Alliance