Business innovation, future technologies and services: Opportunities and challenges for businesses, users and regulators – PL 03 2012

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14 June 2012 | 17:15-19:00
Programme overview 2012


Key Participants

  • Bo Dahlbom, Sustainable Innovation
  • Thomas Edwall, Coordinator of the SAIL consortium
  • John Higgins, Digital Europe
  • Pedro Veiga, President of the Portuguese Foundation for National Scientific Computation


  • Patrik Fältström, Netnode


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This text is being provided in a rough draft format. Communication Access Realtime Translation (CART) is provided in order to facilitate communication accessibility and may not be a totally verbatim record of the proceedings.

>> OLA BERGSTROM: We will now jump right into the last session of today. This is business innovation, future technologies and services.

I’ll give the floor to Patrik Faltstrom from Netnode. I’ll see if the microphones are okay.

Patrik, the floor is now yours.

>> PATRIK FALTSTROM: We will, as the result of this session, we are going to start before we have microphones on the people. For some reason, probably my mistake, the previous session got one-half hours. We got one hour. But on top of that the previous session ran over time.

As I’m from Netnode and we are going to have the social event this evening, of course I want all of you to come. So I will not run over. I’ll tell you a bit more about that social event when – at end of this session.

So can people in the room please either sit down or leave, please?

So this session is about business innovation. So the previous one on privacy is something specifically connected to – we heard about the connection between privacy and cloud computing. That is something that we are going to come back with today. But we are going to concentrate and look at business innovation, specifically for Small and Medium Enterprises, which is something that is a bit new, compared to the traditional telco world.

So there are several things that are happening now in the world that we have identified. For example, that we do not have anymore, just the large Telcos and large companies. We have many, many small companies, and many of the successful, also global companies are pretty small.

Netnode, that I am coming from, we are 5 people, which is not so much. Some other of the well-known services that many people in the world are using are also very, very small, with not much staff and not much resources.

So small companies that act globally and also small companies that specialize in doing whatever they are doing, that implies that they are outsourcing more and more of their services. To some degree outsourcing is one way of using cloud computing and one interpretation of cloud computing.

But what we’re going to talk about today has to do with the challenges about – a bit of continuation of what the previous session was about. But let me read out what we agreed on in the discussion before this session.

Challenges for users, security and privacy when using new technologies. Can users trust that the new services work without leakages? Does Internet regulation have to change when new technology emerges and starts to replace the current backbone? And challenges and opportunities with regard to RFIDs and other topics.

In the panel I have four very, very good people that I look forward to listening to myself. I’ll try to turn this into a discussion where also all of you here in the room will participate.

So we have from the left, Bo Dahlbom from the Sustainable Innovation. Welcome.

Thomas Edwall from the SAIL consortium.

Then we have John Higgins, Digital Europe that we saw this morning. Welcome.

And the last person, Pedro Veiga, sorry for the pronunciation. My Portuguese is not what it could have been. Anyway, so I was thinking of starting by letting each one of you opening with some opening remarks before we start the discussion.

Anyone want to start? Should I start with you, Bo?

>> BO DAHLBOM: You can start with me. Two or three minutes?

>> PATRIK FALTSTROM: Something like that.

>> BO DAHLBOM: I accepted to participate in this panel, because I owe Patrik several services. So I’m just going to disappoint you a bit, because after having listened to the previous panel, I realized that I was totally out of place.

I have two worries in life: Global warming, and the fate, the economic fate of Europe. And everything I participate in I judge by these two worries. Does this help against global warming? Does it promote the economic fate, positive fate, of Europe or does it not?

Now, privacy I consider to be a nonissue. It has nothing to do with global warming and it may hinder us in developing Europe. We’re in a bad situation, people. You have to realize this. The world is going in the very wrong direction.

Now, I’m a technology optimist and I’m fascinated by Internet and information technology. I am fascinated by the way we work with information technology, namely by prototyping. Specification driven development is impossible. You prototype and then after a while you find out just like evolution does, does this work? Does it not work? And then you correct things. So you worry about the big issues, but the small issues you solve after a while.

Now, the theme of this panel, the cloud, for instance, cloud computing, what will it mean to small companies? I think cloud computing is wonderful, because cloud and Internet in general is sort of really the forerunner of globalisation. We’re turning this world into one world, one global community. And we have to work hard on making that global community work as well as possible. And – well, I’ll stop there. I think.

>> PATRIK FALTSTROM: Thank you very much. Thomas?

>> THOMAS EDWALL: Okay. I would like to sort of start with an example. So if you imagine a Swedish municipality or SME or some other organisation that wants to rationalize their business, they want to rationalize it by using modern cloud service. For instance, storing salary records online with Google apps or something like that. Now, that is a fair thing.

However, as soon as they sort of upload that data to the cloud provider in this context, they lose control of how that data is going to be stored and handled.

And I mean with the fact that that – unless they are 100 percent sure about Google apps or any of the subcontractors in a sense are using and storing this data in accordance with the personal data act, they are basically breaking the law, that municipality, and they cannot use the service. How does that relate to sort of, as we see, people are born into the Internet Society today and they log out basically the day they die.

Well, cloud computing, it’s common, it’s used commonly already today. But it was actually quite a long time ago, since cloud computing was just one big data center at one big location in the U.S. Already today, like cloud providers would like to optimize the service and the delivery and come closer to the end-user. Basically, the data centers have spread already across multiple national borders.

Now, to me it’s quite obvious that the regulation as of today is a bit sort of bumped, and it’s not well adapted for that use case and that is already to date, with the current use of Internet.

In products like SAIL, we are sort of developing the future technology, the technologies for tomorrow. I think that basically you should, when you look at how to adopt the regulations of today’s Internet, you actually have to aim a bit higher. You have to look at what is coming, in fact, afterwards.

So, I don’t know, for the data information of today, why would national borders be that relevant? I think to youngsters of today, it’s actually the question of who you trust to store the data that is relevant, not in what sort of national, within what national borders that they run the business.

So maybe it’s time for change here. I don’t know. Maybe it’s – maybe the future legislation should be built-up on domain structures rather than national borders. Have the national borders play out the rules. And put that also into the context of what happens when enterprises start to buy top domain, what would that mean?

>> PATRIK FALTSTROM: So you talk about the globalisation that Bo was talking about. And also, if I understand you correctly, that you’re questioning whether we are moving from a situation where you and I trusted each other indirectly because we were in the same legislation, to a more direct trust relationship where we have to decide whether to trust each other or something like that.

>> THOMAS EDWALL: Yes. I mean, my main point is that I think the national borders become less and less relevant.



>> JOHN HIGGINS: I was thinking when you invited me to participate in this panel on innovation, I was thinking what influences me to form a view on innovation and business innovation? And I think there are three things. One is back in the 1990s I ran a dot com company that allowed musicians to play together on the Internet. And we were just finding out about new stuff all the time. It was really – it was really the cutting edge of doing new stuff, very scary. Since I’ve grown up, as those of you who are here this morning would have heard, now I’m the Director General of an association for tech companies, all well-known brand names who thrive on innovation, so that gives me a take on it. But I’m also a member of the governing body of a university in the UK. And that gives me a take on innovation.

So I was trying to think, well, what are the two, to me, what are the two things we ought to be talking about in innovation? I draw on from all of that stuff.

And the first is, I think, is to be very clear what we mean by “innovation.” I mean, and I like the concept that innovation is value from new stuff. And that value could be economic value or social value. But it’s not just new stuff for the sake of it. It’s about value from new stuff.

And then I thought the other thing I might, as it were tossed into the debate, is what can Governments do? Because I’ve seen in my role lots of different innovation policies over the years. And I divided that what Governments and public services particularly can do is what they are very good at, which is bring us problems. And what I mean is the sorts of problems you were referring to, Bo.

In my organisation, the trade association in the UK that I ran for a number of years, we came up with this idea of the idea called concept viability. And we invited the UK Government to bring us their problems. And then the tech industry would try to kick the tires on those, test out the solutions to those. And over a number of years we did over 100 of those, where they would bring problems like how do we tackle serious and organised crime, or a whole variety of problems. So Government brings you problems. And I think you picked out two big and important ones, to exercise this, and let’s be clear about what we mean by innovation. And I think it’s value from new stuff.

>> PATRIK FALTSTROM: Thank you very much. So microphone number one. Thank you. I confused the sound engineer by using a different microphone. Then I switched.

So Pedro Veiga, you’re from adademia and we heard new wording about the new top level domains. You were one of the innovators for TLD.

>> PEDRO VEIGA: I’m still responsible for the TLD. I decided to answer the questions, the things that we discussed by e-mail, telling three short stories about things that I’ve been involved with recently.

The first story is about use of cloud services inside the Portuguese research and education network. The University started years ago to build open repositories to put their scientific work. But small universities had a problem because they didn’t have the critical mass, they didn’t have the budget to go yet. And the research education network could decide to build cloud services for that. Some universities already had their repositories, but we decided to build the repositories on the cloud. So we are providing services for University. Now even the small ones, and they have cloud services and they have a lot of benefits for that. They have much lower costs. It’s a very reliable service. We have some economies concerns, power consumption, because we are concentrating the services in a well-managed data center. And they have permanent high speed connectivity, so that was an innovation for them to join the open access initiatives and the academia spring as we knew from another session.

The second story is about my specific University, the provision of services for students. A few years ago we were providing services for students, a repository of documents, electronic mail and so on, but three years ago we signed an agreement with Google. And now we provide services for students on the cloud. So this reduced the cost to the University. Students are happy. Of course, we discussed the privacy issues, where is the information of our students? And as those privacy issues are significant, the University still has services for Professors and staff. So the only thing we put on the cloud is services for students, the population that enters the University and after a few years they leave.

But the quality of the services is very good. Other universities are using the services from Microsoft and this is good.

This such story is something that I’ve been involved in, in an environment that is not my typical environment is SMEs. SMEs, according to the groups that have been involved, can benefit a lot of cloud services. Because many SMEs don’t have the technical capability of having an IT Department. Usually they outsource that to other other companies. But with services on the cloud, they can have easily their website, e-mail account, salary, they can access videoconferencing services, things that were not available in the past. But they have a lot of problems with the contracts, all the legal aspects of the contracts. SMEs sometimes are uncomfortable with that. They are concerned with standards.

For example, if they have services on the cloud, are those services – will they be able to change to another company, another cloud provider in two, three years from now?

And another problem is related to competition. Because in the past they could access a lot of small companies and all the cloud providers are usually the incumbent connected with big multinationals. And that’s a difficulty. So I’ll stop here.

>> PATRIK FALTSTROM: To get back to you, now you heard all the others here, and Thomas was talking about this globalisation. Is that – does it match your view of how globalisation works?

>> BO DAHLBOM: It matches my view. But he is much too conservative for me. It will move faster than he thinks. But to speak more concretely, but take my second worry about the economic future of Europe. We have to begin to learn much more quickly from the Americans and from the ease Asians of the importance of an open market, using Internet as a model, so to speak, for openness and for open trade.

I’ve been working with the telecom industry in Sweden now for 15 years or 20 years, I’m getting older. And the telecom operators of Europe, I mean, they tried to kill Internet from the very first in the early ’90s. And the model that Internet provided with the American companies sort of selling Internet to us in Europe was a much, much better model.

And I was especially interested in mobile services. We had an advance in Europe with our mobile phones in the late 1990s. And in Sweden in particular, or many other countries in Europe, we wanted to develop mobile services. I mean, there are two examples of how to develop mobile services. NTT TDocomo, in Japan and Apple in the United States. It’s a shame that we can’t do that in Europe. We have to learn to be much more sort of realize that the future lies in trade, in an open innovative society, where small companies find arenas, places where they can post their services, products, technology, and make it worldwide.

And that is what the cloud will do. The cloud operator, as long as they think American, will do this. I’m pretty sure of that. I mean, Apple is only one example. But, I mean, Microsoft and the others, they invite developers to do services for them.

We don’t do this in Europe.

>> PATRIK FALTSTROM: So let’s stay with innovation then. So we have a couple of successful companies that came up, for example, in the Stockholm area, like spotify and other, do they mean – would they come up just because they are using the American model and were they not using the European model?

>> BO DAHLBOM: Take Angry Birds. Nokia is dying, but Angry Birds is underlying because of Apple. Why didn’t we have something in Europe to make it possible for game developers like them? You could say the same about – well, spotify, we can develop technologies here because of Internet and the openness of Internet, as it is. But it ought to be possible for a United States of Europe to develop the sort of culture, the sort of innovative thinking that you have in the United States. And I’m just very sad that it hasn’t happened.

>> PATRIK FALTSTROM: John? Do you have a comment on this?

>> JOHN HIGGINS: Yes, I mean maybe it’s because I spent most of my time in the UK of late. I don’t really recognize a sort of – a Europe that is not naturally innovative and creative. I can see the structural barriers. I can see the lack of – I can see a fragmented market. It gives us a big disadvantage over – I worked enough in the States and Asia to know that – I don’t think it’s a cultural issue. I think it’s a fragmented market issue.

>> BO DAHLBOM: No. I agree. I misspoke then.

>> JOHN HIGGINS: Maybe I misunderstood.

>> BO DAHLBOM: There are so many hinders. So many obstacles.

>> JOHN HIGGINS: The fragmented market.

>> BO DAHLBOM: And the fact that the major companies are so conservative. The telecom operator, the automotive industry, the energy companies. Now I’m working with energy efficiency, and the picture is exactly the same. Each major energy company wants to have their in-house developed services. They want to own them and control them. They don’t want to give away their data. And if we are using regulation in Europe, we should use regulation to open up those structures.

>> PATRIK FALTSTROM: does that match what you’re working on?

>> THOMAS EDWALL: Not at all. I don’t agree with –

>> BO DAHLBOM: Well, you’re one of the big ones.

>> THOMAS EDWALL: I’m representing the European research community and all the good work that has been done in the framework of programmes about innovation and new technology, and so on. And I would say that there is certainly a good environment in Europe when it comes to creating innovative companies, as such.

In the same thing, for instance, we have 25 organisations represented. Some of them are big giants, like Ericsson that I’m employed by, Nokia, and we have the operators with us. Of course the operators want to protect their business, sure I understand that. At the same time, they are in this project in order to find out okay, what is coming? How do I have to change in order to adapt to the reality? So I wouldn’t say that they are that conservative. At least not on the research aspects. They cannot be, because they would kill themselves.

>> PATRIK FALTSTROM: Pedro, do you think they are too conservative?

>> PEDRO VEIGA: Yes. And I was taking notes and I put “fragmented market” again.

because I think that’s a significant barrier. For example, in Portugal, we pay tolls on highways. And we have a system for electronic control of toll payments. But when we were crossing the border to Spain, it was not operational. We wanted to have an agreement, but the Spanish colleagues were trying to impose their technology. So we are too fragmented. It’s impossible to find the agreements.

The GSN model that we have been talking, it’s a good example when we cooperate and we have a large market and we have big success, but we have a fragmented Europe and this is a problem.

>> PATRIK FALTSTROM: We have a question from the audience.

>> AUDIENCE: I’m working as an e-Activist.

>> PATRIK FALTSTROM: It’s on. Just increase the volume.

>> AUDIENCE: I want to go back to the introduction. I really appreciate the climate issue that you are putting it up. We had this UN Conference on sustainable development plus 10. And I also want to see Internet as a tool for change. Rio plus 20. If you are going to use it and develop tools to use it, you have to know what kind of change that you want and what needs are there. So we talked in the workshop about open data, and we thought what data to get to the public, how do we know?

We should also think about what do we know, what do we want – what kind of change do we want in this society? And choose the data from that. And so I think we should look at it as a bit of a tool and have a direction, also.

And as I also said in that workshop, I think it’s very important to work with the issue of trustworthiness and transparency in the information process. So you can trust the information you are getting.

>> PATRIK FALTSTROM: Similar to the first statement that Thomas was talking about.

Another person in the audience, please present yourself.

>> AUDIENCE: Yes. Hello. My name is Elfa. I work for the Media Commission in Iceland. I’m really – I want to take up this point that you have been talking about. You know, that Internet is so important and you know how do you foster new companies? And when you are Nokia maybe going down, you have like Angry Birds coming up and things like that, and that made me think about this concept of networking economy. And that for these things to happen, you need to have these clusters. You know, you have like big companies that – and you have innovation and you have new companies coming up because they have been working for maybe Ericsson and Nokia and so forth.

And this also makes me wonder. Is maybe the reason why we are talking about that is because Europe is fragmented? We don’t have like 320 million people and a silicon valley in the same sense as the U.S. Has. Could you elaborate a bit on that?


>> BO DAHLBOM: I hope that I and I guess that most people in this building now sort of share with me the belief that Internet is the most fantastic thing that has ever happened. And it’s a pity it was an American invention and not a European.

But, with Internet, Internet has really changed the world. Internet has driven globalisation, made it possible, and at a tremendous speed. And what we should do in Europe is that we should learn more quickly than we have in the past how to live with Internet, how to turn Europe into an Internet Europe. And I think that we have been much too slow. It’s been going on. We had 20 years, and we are really just lagging behind both the United States and east Asia.

I think that your picture is correct. I mean, it’s big companies networking with clusters, giving away their – part of this information, sharing, taking in, building innovative arenas. That is the way Internet works. It’s – but it’s not – it’s happening too much, much too little in this part of the world. Even if you look at Government, and if you look to a fantastic country like my own Sweden, you have Government authorities, agencies, sitting on their information because they make a pittance of money on it. All the maps, all the data of towns and of various Government agencies, it’s, it’s public sector information. It’s protected by public sector entrepreneurs, who are making a few millions from this data. It’s a disaster and it goes on all over Europe.

>> PATRIK FALTSTROM: So what I hear, I see that more people want to say something, so I hear both fragmentation and the ability to work together in clusters and actually share the workload of innovation. But I heard a bit that we need sort of, thanks to the Internet, we need to change the way we operate and become more efficient and not try to just implement existing old business models on – with – on top of whatever other tools – whatever IT tools we have. So, s it sort of – we should change the way we’re living thanks to the Internet, if you’re doing it optimally. Is that what you’re saying?

>> BO DAHLBOM: I don’t want to take the whole – but we have to experiment. I agree with some of the things you said, but I mean finding out what direction to move in, finding out what data to put out there, I think that’s impossible. We have to open up. Let data out there. Give people – liberate people to access, open access. Then we will find out what data was good and what data was not so good.


>> PEDRO: And I also read that the Internet is a dimension for innovation that is never used. This is surprising, because when we look at fields of Internet penetration in different European countries, we are very well. But we are not achieving to turn that into business.

Concerning fragmentation that all of us agreed, for example, roaming, for example, when I can – when I came here, I turned off data roaming. It’s so expensive because it’s difficult to provide European wide services because, for example, of the barriers of the roaming costs. It’s expensive. But that can be found in situations.

>> JOHN HIGGINS: I find this a very interesting discussion. And to see if I can pick up a couple points, one about the place of the clusters point to some extent.

And some years ago, in the UK, somebody was asked to do a piece of research on the University/industry interface. And it turned into quite a significant piece of work about how did you get economic value out of the money that you put into research. One of the key conclusions of it was that you have to – there has to be some mechanisms to pull the innovation into industry. And so when they sort of looked back as it were into the old days, then the way that that was pulled through, it was in the big research institutions that were part of Xerox park in the States or BT at a big lab in the UK. So I think you’re absolutely right, that if you’re going to get economic value out of research, you’ve got to have something that fills the gap between the University research and the exploitation. And I think clusters and clustering around big companies is a way of doing that.

And I just wanted to make one other point about how the Internet started. If ever you’re in Washington and you’ve got a bit of spare time, go around the museums. It’s a fascinating history about how computing and the Internet started. And basically, with the U.S. Military, after the war. And if it hadn’t been for the vast amounts of money that the US said these computers are good military things, I think we will put money into it, and so DARPAnet and the investment into computers started. So maybe that was the problem of the day, the Americans thought we need to focus on the problems of the day, military might.

>> PATRIK FALTSTROM: So if we try to go back to the responsibility and given that we have the fragmentation, is that making sort of the responsibilities and is it harder for SMEs to act in this environment than ordinary organisations? Is there a difference? You’re shaking your head, Bo?

>> BO DAHLBOM: I think it’s the other way around. I started a small business myself, and if you start a small business, you can really take social responsibility, because it’s only up to you what you decide to do. I said no to many proposals from former students and colleagues of all kinds of sort of murky Web service, where you pay in some sort of indirect way and you make money by skimming, basically. I’ve said no to those, because I feel more socially responsible.

Big corporations are more difficult. They have greater difficulties with social responsibility. So, it’s – I think that’s one of the good things with small companies.

>> PATRIK FALTSTROM: Even regarding trust relationship between two organisations, it’s easier to understand whether you are going to trust a smaller company for hosting your data or something.

>> BO DAHLBOM: I think so, yeah.

>> PATRIK FALTSTROM: It’s easier to do. Transparency, it’s easier to understand what they are doing and what will happen to the risk calculation.

>> JOHN HIGGINS: That didn’t use to be the case. I know some years ago, it was the case that people preferred to go to big browns on the Internet, because they trusted the brown identity and you don’t know who is who on the Internet.

So, if anything, the Internet shopping market favored the well-known brands even more than the high street.

>> PATRIK FALTSTROM: We have another person in the audience, please. I think it’s on.

>> AUDIENCE: Okay. I’m Carlos Romero from the Dupla’ Ministry of Industry of the Spanish Government. This morning we talked about policy in terms of Intellectual Property. Now, I want to intervene also to talking in terms of open access to public sector information. And in this issue I agree completely with Bo, Bo Dahlbom. I think this is very important and we are making big efforts to try to convince our ministers or our ministries or organisations or public enterprise to open this really valuable information to the private sector. Because we think that sometimes with this information, people could make really great business. And this is really a pity that the public sector information is sometimes really enclosed, and really for no one knows the reasons, and, well, we have to. This a really big challenge.

In terms of clusters, this is a more maybe big reflection. Each country is promoting technological clusters. Why not really big European clusters? I think this is a question that – I cannot understand. I cannot understand why this question has not been promoted by the European Union or the Governments. It’s a question of fragmentation again.

>> PATRIK FALTSTROM: We have a second person in the back there.

>> AUDIENCE: Yes, B. Rakingham here. I would like to argue with you, Bo. I have a much more positive view on the possibilities of Europe and more negative about the U.S.

>> BO DAHLBOM: Good.

>> AUDIENCE: In terms of monopolies, you must agree that companies like Google, Microsoft, Apple and so forth, they are not sharing. They are trying to collect and keep closely to their heart in order to make more money, which is the opposite of being open.

In terms of legislation, I think every company who has tried to make business with the US finds that it’s very difficult. Because they have a much more complicated legal situation than we are used to.

In terms of Internet, to get back to the real point, it’s quite clear for more research that Europe or at least many countries in Europe are far ahead of the U.S. in terms of Internet coverage, penetration, so forth. So I would like to say that the real problem for us is of course that we are 27 different nations, and so forth. But also that we need some legislation to make it simpler to keep developing a company. Once you started, got the idea, you’re not there. You need to have possibilities to get investment money and to keep on and don’t have to sell it to one of these US monopolies.

Thank you.

>> PATRIK FALTSTROM: So you’re saying that you’re surprised, given the terminology from the States, you’re surprised how successful we have been able to be, given that we are 27 countries.

>> AUDIENCE: But still we have to accept that the U.S. has quite an enormous monopoly in the IT world for historical and economical reasons. That is not going to change.

>> PATRIK FALTSTROM: We have remote participation.

>> MODERATOR: A question from Edward in the Ukrainian hub. Proposal to conference, it should be noted that in Europe there are many services that use the Internet in their work. For example, the scientific network. We need to develop this area. This may be the same innovation as Google in the U.S. Who knows.

Maybe that is to rephrase, better than eating our own dog food.

That was the question. Should we be better than eating our own dog food?

>> PATRIK FALTSTROM: Anyone wants to reflect on that? Anyone in the audience wants to reflect on that? John?

>> JOHN HIGGINS: How can you not agree, really. I mean, yes, of course. We should be taking better advantage of the tool that is called the Internet. I mean, it is a tool. And when you see it used, like sort of cloud is really just an extension of it. But when you see it well used, it does what technology has always done, which is make things more efficient, quicker, on the whole better. But, you know, generally, they are efficient tools and the Internet is a good efficient tool. We should encourage people to look at opportunities, to use it, to improve their effectiveness and efficiency in all walks of our business in society.

>> PATRIK FALTSTROM: Was there a follow-up?

>> PEDRO VEIGA: I’d like to come to the issue of high level penetration that the Internet is in Europe. And the problem is that it’s not going into business. For example, there are areas where maybe a big industry could come up. For example, in Europe we have the problem of aging of the population. It could be natural that a lot of services related to health could come up with Internet, and that is not happening. We have the fragmented market and this is –

>> PATRIK FALTSTROM: And on top of that, what Bo says, not only fragmented on a country basis, but also each company wants to innovate themselves. Each Government wants to innovate themselves.

>> PEDRO VEIGA: Yes. Of that fragmentation.

>> PATRIK FALTSTROM: Anyone else?

>> JOHN HIGGINS: Maybe again maybe I misunderstood you. But I think a lot of companies, particularly in the tech sector, but also in the pharmaceutical sector as well, do practice open innovation. They realize it’s cheaper to do it. The pharmaceutical companies are particularly good at doing this. They throw out the problem to the community and then they raise an ecosystem that solves problems. And lots of big tech companies are doing that. I think they are more open than the countries.

>> BO DAHLSTROM: Yes, I agree, John. It’s just that it’s been happening too closely.

I’ve been following very closely Astra Seneca in the early 1990s. Around 1994 they realized that they made all of their money from one medicine, basically, Losec. And they were worrying about how would they be able to come up with the next medicine. And what we told them when we talked to them was that you don’t have to come up with it yourself. You can let someone else come up with it, but you’ve got to invest in intelligence to find out where you should put your money so that you buy the right small company. They didn’t do this, and now they are in a bad way. Now they’re doing it. Now they’re doing exactly this. But they used up billions and billions of dollars to try to invent themselves the next medicine. And I’m just complaining about – we’re moving too slowly. And that would be okay, if the case was that – I mean, we’re doing pretty well, at least in northern Europe we’re doing fine. In southern Europe you have some problems right now, but I’ll get over them, too.

But as a whole Europe is facing two severe problems.

Global warming and the growth of the economy in the future. How do we, our role in the world, will we be able – I mean, what shall we live on in this part of the world?


>> PEDRO VEIGA: One question I have frequently to myself is this the fault of our education system that is not training people to be innovative? They learn a lot of scientific and technical things, but is that enough to be innovative? This is a question for Michael and the audience.

>> PATRIK FALTSTROM: We have been able to talk about Europe. We have a dialogue. We have talked about Internet, but I would like to go back to governance. Given that we have this problem of wealth, we can have remote participation, but just a second. After that, can we go around and talk about what recommendations you would like to give to whoever, is it Governments? Who should change and what should they do to solve this? How do we get out of this? But remote participation first, please.

>> MODERATOR: Okay. Question from you. Is fragmentation good or bad? It exists everywhere elsewhere in the world as well, initially in the tech area. How can we speed up the fragmentation, regulation or market forces?

>> PATRIK FALTSTROM: So this goes into the question of whether fragmentation is bad. If that’s bad, then that is something that we should solve it.

We will start from the other end, Pedro. What recommendation would you give to whoever, if you can choose?

>> PEDRO VEIGA: I prefer to wait a little more.



>> THOMAS EDWALL: I think it’s much more relevant who you do your business with, and who you do your innovative development with, rather than in what country. Because obviously the globalisation takes you into a situation where it doesn’t matter. It can be scattered over the whole globe. So there has to be legislations that support that kind of innovative thinking, that you don’t have to care about the location. It’s in Maine or whatever border that you –

>> PATRIK FALTSTROM: So change of legislation. But also, is it also that companies, it’s your recommendation also to smaller companies, for example, to not be so conservative and only work with the people in your own area, to also try to look out?

>> THOMAS EDWALL: I wouldn’t like to – I would like to put it in a different angle. We have focused on innovative technical companies, but also there can be innovative businesses in other areas. I don’t know, barber shops, or whatever. But they have to use IT, too, in the daily operations in order to develop their innovative business. And then they hit a lot of concern, because the boundaries between what is their private life and what is their professional live blurs.

For instance, if barber has a new customer, which he starts talking about, yes, we’re friends, let’s get friends on Facebook. Good. Now I have your contact details in my phone and Facebook accounts and so on. And that grows them when the business grows, and eventually he has a customer register on his Google/Facebook/whatever kind of account.

And well, great. But what he is not aware of, that barber, is that he is infringing the personal data act with that. He is doing something illegal. What can we do or what can a legislature do in order to support a more pragmatic enterprise climate for those kinds of SMEs?

>> PATRIK FALTSTROM: And also for specific IT companies. That is your point.

>> THOMAS EDWALL: Exactly.

>> JOHN HIGGINS: I do think it depends on, as it were, the exam question that we’re trying to answer. So if we say well, how can we make Europeans more innovative? And therefore create more value from new stuff? I mean, clearly, there are a range of answers. But let’s just pick one, even, which has already come out. Which is get public sector to bring both its problems and its data to the community. I spoke at the European Commission conference on open data in Posna a couple months ago, and I was really staggered by the appetite of people to get hold of public sector data in a usable form, because there are real opportunities, real business opportunities, and real social benefit that comes from innovative people analyzing data in new ways that helps people make more informed choices.

So going back to my point, it brings you problems and gives you data.

>> BO DAHLBOM: I think that fragmentation is both good and bad, of course. Europe is fragmented in the sense that we are different and we are – and therefore have different ideas and different opinions of things. I think that is good. I mean, that – that’s sort of those differences are good.

But it’s also fragmented in that we don’t like each other, that we hate our neighbor, that we go to war. I mean, we have been spending the last thousand years warring each other. And all – as lately as a few years ago. I mean, so it’s – but if we could get this Europe to be sort of a community of communicating, and Internet is a wonderful tool for that, then of course this Europe could be strong. But at the same time, the future is not in Europe. The future is in the world.

So we have to be much more global than we are. And the problem with the European project is that the European project has by necessity worked very hard in bringing this Europe together while forgetting the rest of the world. We should have Turkey among our friends. We should be working much more closely with Turkey than we are doing. Why aren’t we doing this? Because the damn Europeans, I mean, they just worry about how Germany and France and so on can coexist. So we’re facing such enormous challenges. We’re happy up here in Scandinavia. We’re not part of the Euro and we are not really part of Europe, too, in a sense. So we do our business with China and Russia and the United States and Africa and we say Europe, take care of yourself. No. I don’t mean this. But soon it will come to that unless we get our act together.

>> PEDRO VEIGA: I was taking some notes. Innovation, we have different dimensions. We have the technical innovation and I believe in that area we in Europe are performing rather well.

Concerning business innovation and the marketing, we are lagging behind. We are not so proactive, at least compared with American companies. We have a lot of problems, the fragmentation of the market is responsible for that because companies have to limit to their specific markets.

In organisational innovation, in some places, and I’m not familiar with the legal framework in every country, but in some some environment and legislations in some countries are posting limitations to companies. A company, when it needs to go to another market, has a lot of legal difficulties in going to different markets and so on.

And just yesterday ICANN announced the applicant for the new gTLDs, and they have been looking to the least of course, the syndicator is only one. Most of the proposals or many of the proposals, I don’t know, more than 50 percent, come from American companies. And this maybe shows that we are lagging behind, although I have several doubts about –

>> PATRIK FALTSTROM: Maybe it’s the other way around.

>> PEDRO VEIGA: Maybe. And just to finalize, the education. I suppose the educational system should train people to be more innovative.

>> PATRIK FALTSTROM: Some more comments? Bo?

>> BO DAHLBOM: Well, I listened to the panel before, and I was very impressed by the intelligence and the knowledge and the wisdom of that panel. But I was also a bit worried, because I mean we have too many Government officials in Europe, basically, and I guess this is a forum for these sorts of people. So, I am really sort of – I try not to be offensive. But, I mean, we’re paying 25 percent tax on everything that we buy from each other. I mean, there are a few exceptions. In America, typically they pay 6 percent tax on everything that they buy from each other. Where do you think they trade more? In America or Europe? Trade is the future. That’s what brings wealth and ideas and innovations and competitions. It all comes under trade. We should get rid of our officials, some of our officials, and lower the taxes. Then there will be innovation.

>> JOHN HIGGINS: Cooperating more between the countries, so we don’t have to invent legislation individually in each country. You just talked about the country, doing it in-house?

>> BO DAHLBOM: We are forming the United States of Europe these very years. It’s going on. Some of us are not on the boat exactly, but we will be there. There is no alternative. It’s got to be a United States of Europe. And the the United States of Europe will be run from Brussels, or somewhere in the vicinity of Brussels. Now, we don’t want a big Brussels. We have to be careful. I mean, if you turn that into the sort of bureaucracy that would come naturally from this process, it will be bigger than Sweden.

>> PATRIK FALTSTROM: And one of the questions that we talked about was regarding small and medium enterprise, too. And with this, when you talk about Brussels, we talked earlier about whether people can trust smaller companies more than larger ones. The comment was interesting that we might see a change there. But how is it for small companies to get their voice heard in brussels?

>> BO DAHLBOM: Impossible.

>> JOHN HIGGINS: I disagree. I think it’s interesting, I find having just moved to Brussels, that actually the engagement of officials certainly with representative bodies is reasonable straightforward. And I think there is really an appetite. If you’re an SME, it’s like you have a big budget saying I’m an SME.

>> BO DAHLBOM: But what is it worth?

>> JOHN HIGGINS: You get your voice heard. You have a chance to get your voice heard.

>> BO DAHLBOM: Where I’m working at what we call – it’s a center for energy efficiencies, it’s sustainable innovations. It’s a new body. It’s not a research institute, it’s an applied project institute. We live off the taxpayers money, too, I’m not kidding myself here. But we have a simple idea that when we get financed a project from some energy agent or European Union or a relatively big project, we invite small enterprises to sell their product services to this project.

So we pay them. And for some of these companies, we do the first business deal. But it’s a business deal. It’s nothing else. I think that is very – we sort of are faking what the Americans can do, because there they are interested in consuming things, so it’s relatively easier to make your first business deal.

>> PATRIK FALTSTROM: So we should not give up yet, right?


>> PATRIK FALTSTROM: With that, a quarter past six. Thank you for you in the panel and thank you to the audience for being here.


And let me remind you, those of you who said that you were coming to the social event, please come. Be there at 7 o’clock. They will start to have guided tours of the museum. And a quarter to 8 I would like to see everyone there.

Thank you.

>> OLA BERGSTROM: For those of you who would like to listen to the Queen of Sweden giving a speech, please be on time. Because it will be difficult to enter the room if you’re late. So thank you very much.

Information on the buses to the dinner. There is a bus leaving at 6:26, number 69, from just outside on the Vassa Gatta.