Over the last decade, the digital economy has contributed more to growth in the United States than in Europe or France. The French economy faces the challenge of investing in network infrastructure and regaining competitiveness to revitalize its digital industry.
Europe's digital industry is lagging behind
Despite Europe's stated ambitions, the digital industry has contracted over the last decade in much of Europe.
This is particularly true in France, where she is about to play second fiddle. The main reasons for this dropout are opposing labour market management policies, a wide divergence in costs and company margins between countries, and an insufficient and inappropriate policy of financial support for start-ups. Only Germany has been able to remain fairly competitive and preserve its digital industry in the face of Chinese competition.
In the NRI (Networked Readiness Index, World Economic Forum), which measures each country's propensity to take advantage of the opportunities offered by ICTs, France ranks 20th, behind the United Kingdom (15th) and Germany (13th). The share of the digital economy in GDP is 4.7% in France and 7.3% in the USA. The contribution of digital technology to growth (in % of the average annual growth rate) is 26% in France, and 37% in the US. Compared with the US performance, France is not benefiting enough from the value and job creation that this technology and services sector would allow: the gap is estimated at nearly 100,000 jobs in France to reach the US level as a percentage of GDP.
Why not enjoy unlimited reading of UP'? Subscribe from €1.90 per week.
Yet the example of the Internet has shown how an innovation can have very serious consequences for a country's economy. A recent McKinsey law firm evaluates the contribution of the Internet to the French economy. The added value of the "Internet sector" is estimated at 72 billion euros in 2010, or 3.7 % of GDP, and is estimated to have contributed about a quarter of its growth. This contribution has been 10 % over the last fifteen years and 20 % over the 2005-2011 period. In 2015, according to forecasts, the value added of the sector should be 129 billion euros (or 5.5% of GDP). In 2010, the Internet sector accounted for 1.15 million direct, indirect and induced jobs, including nearly 700,000 direct jobs. Over the last 15 years, the Internet has led to the net creation of 700,000 jobs, i.e. a quarter of total net job creation. The majority of digital jobs created in France are in SMEs. To this direct contribution must be added the indirect effects of the Web (e.g. purchases made in physical distribution networks, but facilitated by prior online research). They are estimated at 28 billion euros in 2011.
This performance has had no effect on the policies implemented for digital.
France: a mixed state of affairs
France will not be able to maintain its position as an economic power if it does not make a major effort to catch up in digital technology. Investing in its various dimensions (information systems, broadband infrastructure, new technologies, e-administration, education, etc.) is a sine qua non for restoring competitiveness, creating wealth and jobs and, finally, reducing public deficits. Beyond the technologies themselves, digital is also about activities and uses. According to the FIFG, more than two-thirds of new uses are acquired in France by people outside their work. The turnover of e-commerce was 31 billion euros in 2010 and it grew by 24 % in one year. Every day, the French send out 500,000 "tweets". Facebook is growing strongly among young people and also in the 55-65 age group. Out of the half a billion Facebook accounts that exist in the world, twenty million are in France. While technology is an essential and necessary component of digital technology, it is not limited to it: it has penetrated our daily lives and, with social networks, life in society. It has gradually transformed our relationship to space and time, and even our way of thinking and acting.
This development and diversification has been supported by a flow of innovations from various economic sectors (manufacturers, publishers, service providers, consultants, etc.) located mainly in the United States and currently migrating to India and China. After promising beginnings, France has withdrawn from most of them: there are no longer any major IT manufacturers in France and only a few software publishers have global or European scale.
And yet, multiple financial organizations have been created, armed arms assuming the role of state investor in telecommunications and digital. These organisations were to "support innovation and growth of SMEs, sharing risks with them at key stages of their life cycle". There are billions of potential billions to be invested, but their procedures are cumbersome, too long, not adapted to the temporality of innovations and the extreme agility of innovative project leaders, particularly in start-ups.
How to become more competitive
It is imperative to implement in the nation's major systems (education, health, justice, etc.) a policy that is at once resolute, progressive and governed.
In 2008, the French government created the France Numérique 2012 Plan, which was intended to provide universal access to broadband Internet as well as the transition to digital terrestrial television, broadband and very high-speed mobile broadband. It was intended to develop the production and supply of digital content, increase and diversify digital uses and services in companies, administrations and individuals... What is the status of this roadmap four years later?
Last November, the State also set up a new entity dedicated to new technologies: the Digital Observatory whose mission is to provide "statistical and economic information enabling the weight and impact of digital technology in the economy to be assessed" to individuals, companies and public authorities.
To fight against disinformation and to favour analyses that decipher the news, join the circle of UP' subscribers.
But this is still totally insufficient. Private organisations, think-tanks, have looked into solutions to strengthen France's competitiveness with some very judicious ideas:
Generalise and promote the use of digital workspaces (DWSPs) in all cycles of education; unlock the supply of digital textbooks, by creating digital textbooks for all levels of education.
digital catalysts"; publishing on the Web the educational content of the digital workspaces of major French universities, as the best "digital catalysts" do; publishing on the Web the educational content of the digital workspaces of major French universities, as the best "digital catalysts" do; publishing on the Web the educational content of the digital workspaces of major French universities, as the best "digital catalysts" do; publishing on the Web the educational content of the digital workspaces of major French universities, as the best "digital catalysts" do; publishing on the Web the educational content of the digital workspaces of major French universities, as the best "digital catalysts" do; publishing on the Web the educational content of the digital workspaces of major French universities, as the best "digital catalysts" do; publishing on the Web the educational content of the digital workspaces of major French universities, as the best "digital catalysts" do; publishing on the Web the educational content of the digital workspaces of major French universities, as the best "digital catalysts" do.
In the judicial system, introduce, following the example of the UDRP (Uniform Domain Name Dispute Resolution Policy), an online arbitration system (or more generally, any alternative dispute resolution method: conciliation, mediation).
Review the entire governance process for the digital component of "Investments in the Future" by strengthening the strategic and scientific objectives of the National Digital Council (CNN) set up by the President of the Republic on 27 April. The CNN was responsible for guiding and monitoring the effects of the "Investments for the Future" in digital technology. It was also to initiate an "industrial plan for digital technology" which would be updated every year. This plan was to specify strategic objectives, immediate priorities and the means to be implemented in view of the competitive situation. The aim is to support the development of fundamental and competitive applications ("killing applications"), to strengthen the industrial production potential, and to pool R&D efforts.
This plan should prioritise the sectors of open source software, 3D software, video games, telemedicine, the Internet of Things, nanosciences, nanotechnologies and their applications, as they are likely to bring immediate efficiency, growth and employment. This is not the case today because if we take the example of The Institute for Digital LifeThis project was presented to the ANR's AAP for the creation of Technological Research Institutes (IRTs), but was not approved by the "Investments for the Future" commission. However, this project remains a major challenge for the digital sector. Cap Digital which is the initiator, will nevertheless continue its design with all the academic and industrial partners and a hundred or so SMEs, with the aim of making this project a reality before the end of the year.
(Source: Institut Montaigne 2011 Report: http://fr.wikipedia.org/wiki/Institut_Montaigne)
Even more than a sector of economic hyper-growth, digital content and services are driving a process of radical economic and social transformation. In work, commerce, communication, education, information, health, leisure... there is a digital "before" and a digital "after". Innovation cycles are extremely rapid: innovation and business creation play a central role.
By leveraging its strengths - the excellence of R&D, existing projects and platforms, the creativity and dynamism of SMEs, the ability to create jobs, the commitment of industrial groups mobilized around Open innovation - France aims to regain positions in the global game. To do so, it must move beyond traditional models of innovation, which are too linear and unsuited to the imperatives of speed, flexibility and internationalization imposed by constantly changing markets.