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Digital for Europe Collaboration. Innovation. Transformation.
Foreword
Over the past year, the COVID-19 crisis has tested the • Our paper on eHealth shows how telemedicine can
resilience of our societies. Public services have been increase life expectancy and cut costs by almost
stretched to the limit to support citizens through this €50 billion.
pandemic. However, despite collective best efforts,
• We show how making cities smarter can create future
what started as a health crisis is now having multiple
proof, sustainable places that improve citizens’ lives
ramifications for our citizens, societies and economies.
and drive annual energy savings equivalent to one
We face a growing backlog in treatments of other
third of the energy needs of Denmark.
health conditions and a lockdown generation of
children missing out on education. Among businesses, • Our experience of rolling out Gigahubs in Ireland
according to the OECD, more than half of small and has demonstrated how digital can turbo-boost small
medium enterprises (SMEs) face severe losses in businesses and reinvigorate rural communities.
revenue, with one third fearing for their future, and Digitising just 10% of small businesses which are
some sectors are on the verge of collapse. With many currently not digitised in Europe could lead to a total
economies now in deep recessions, the impact of increase in turnover of up to €148 billion.
the virus and lockdowns will be felt for years, with • Investment in innovation, such as OpenRAN
increasing unemployment and lower levels of growth. technology, can ensure secure and resilient networks
and strengthen European supply chains, essential for
We all must now lean in to meet these challenges, to
critical infrastructure.
redress the imbalances and to close the gaps exposed,
or widened, by the pandemic. In doing so, we must • Most importantly, digital can deliver significant
also learn from this crisis. One such key learning is how climate benefits, helping Europe achieve its carbon
digital connectivity, services and tools transformed targets.
our daily lives and became a lifeline allowing people to • Finally, underpinning many of these opportunities is
work, learn, stay in touch with friends and family, access 5G, which is powering the digital industrial revolution.
remote healthcare and more. A review of 5G use cases conducted by IHS
Markit estimated that global rollout of 5G could
Going forward, this digital transformation in the way we
live will be essential to Europe’s recovery and growth, enable an approximate €11 trillion increase in global
building a more competitive, sustainable and inclusive cross-sector output by 2035.
society in the future. The European Commission The most important lesson from this pandemic is that
has highlighted that the cumulative additional we all need to work together. Industry, governments,
GDP contribution of new digital technologies policy makers and civil society must find better ways
could amount to €2.2 trillion in the EU by 2030. to collaborate in investing in Europe’s digital future,
In this report we go further, looking positive benefits to drive the 5G industrial revolution, to democratise
in terms of social, environmental and economic terms access to healthcare, to close the digital divide and to
and the essential enablers to address these challenges digitise SMEs.
in a manner that – for once – can help EU close its
investment gaps. And these gaps are not insignificant. Only if this is done can Europe establish the strong
The European Commission has highlighted that foundations we need to generate a digital dividend for
there is a gap of €125 billion per year to meet the current and future generations. In turn, this will enable
investment needs of the digital and green transition. Europe to recover faster from the crisis, creating jobs
Connectivity infrastructure alone amounts to €42 and growth opportunities and positioning Europe as a
billion of this gap. global leader.
Our series of Europe.Connected papers which
accompany this report identify how the digital
Joakim Reiter
transformation can be achieved in practice. For
example:
1 Digital for Europe. Collaboration. Innovation. Transformation
Important Notice
from Deloitte
This final report (the “Final Report”) has been prepared All copyright and other proprietary rights in the Final
by Deloitte LLP (“Deloitte”) for Vodafone Group in Report remain the property of Deloitte LLP and any
accordance with the contract with them dated 7 rights not expressly granted in these terms or in the
January 2021 (“the Contract”) and on the basis of the Contract are reserved.
scope and limitations set out below.
Any decision to invest, conduct business, enter or exit
The Final Report has been prepared solely for the the markets considered in the Final Report should be
purposes of examining the benefits and enablers of made solely on independent advice and no information
digital transformation, as set out in the Contract. It in the Final Report should be relied upon in any way
should not be used for any other purpose or in any by any third party. This Final Report and its contents
other context, and Deloitte accepts no responsibility for do not constitute financial or other professional
its use in either regard. advice, and specific advice should be sought about
your specific circumstances. In particular, the Final
The information contained in the Final Report has been Report does not constitute a recommendation or
obtained from Vodafone Group and third-party sources endorsement by Deloitte to invest or participate in,
that are clearly referenced in the appropriate sections exit, or otherwise use any of the markets or companies
of the Final Report. Deloitte has neither sought to referred to in it. To the fullest extent possible, both
corroborate this information nor to review Deloitte and Vodafone Group disclaim any liability
its overall reasonableness. Further, any results from arising out of the use (or non-use) of the Final Report
the analysis contained in the Final Report are reliant and its contents, including any action or decision taken
on the information available at the time of writing as a result of such use (or non-use).
the Final Report and should not be relied upon in
subsequent periods.
2 Digital for Europe. Collaboration. Innovation. Transformation
Executive Summary
The pressing need to kick-start the COVID-19 recovery,
presents a once-in-a-generation opportunity to not 3.7% An increase in adoption
just rebuild the economy but to ‘build back better’. of Telemedicine of just
If successful, the benefits to Member States, their of five % points across the
citizens and their businesses could be transformative - EU could deliver a 3.7%
economically, socially and environmentally. reduction in the cost
1.7%
of patient care, a 1.7%
increase in citizens’
This paper, commissioned by Vodafone as a companion 3.6%
healthy life years and a
to its recent series of Europe.Connected papers,
3.6% fall in mortality.
explores a series of digital opportunities that will
help deliver on the EU’s ambition for Europe’s
During the COVID-19 crisis, digitalised
Digital Future and the European Green Deal. It
small businesses have identified new
examines the case for Member States to put digital
opportunities at more than
transformation at the heart of the recovery agenda, twice the rate of less
and illustrates how a ‘digital by design’ agenda could digitalised counterparts.
deliver benefits that include:
12,000 350,000
Enhanced quality of tonnes tonnes
life for citizens, including Extending the use of IoT technology across
improved welfare, health 50% of the EU’s largest farms could
and personal safety; reduce pesticide use by 12,000 tonnes and
fertiliser use by over 350,000 tonnes.
A more resilient society
built on high-skill jobs and
digital autonomy; Delivering these benefits is achievable but will require
a well-coordinated and strategic approach to policy
Long-term economic design and implementation. This approach will need to
growth driven by home- address several key issues:
grown innovation; Which digital opportunities to invest?
Lower resource What benefits to expect as a result?
consumption and The necessary conditions for these
environmental impact; and benefits to be realised?
How to ensure that the benefits are
A more equitable distributed equally and sustainably, and
society in which the therefore that the plans will indeed help
benefits are enjoyed by all. Member States to ‘build back better’?
3 Digital for Europe. Collaboration. Innovation. Transformation
Europe’s current level of digitalisation varies widely. These disparities limit the ability of the European
While disparities in levels of digitalisation have real market to realise the full potential of its combined
economic and social consequences in those markets economic scale, could lead to policy fragmentation and
with lower levels of adoption, the implications apply reduce innovation potential across the Union.
to the whole.
If returns on investments are to be maximised, it will
be essential that scale benefits afforded by size of
the European market are realised. That digital divides
Internet between and within Member States are reduced. This
Access: requires collaboration across Member States as well as
coordination between the public and private sectors,
In Denmark,
Sweden and the to help avoid fragmentation and realise the economies
Netherlands, 95% of citizens use the of scale and scope that will make digital investments
internet at least once a week, whilst economically sustainable in the long term.
in Bulgaria (33%) and Romania (28%),
over a quarter of citizens do not This paper identifies critical policy levers that need to
regularly go online. be in place to enable a digitally driven recovery:
Partnerships and collaboration
wihtin public and private sectors to
promote ‘digital by design’ across
Digital business and public administration, to
Skills: encourage non-personal data-sharing
Across the EU, 82% of young and to help lower barriers to digital
individuals (16-24) have basic digital adoption;
skills. Only 35% of those aged 55-74
and 30% of the retired and inactive Policy reform and harmonisation
possess basic digital skills.
to drive common approaches and
collective action to promote digital
adoption across the Digital Single
Market;
Digital
Business: Governments leading by example
Whilst six EU member states (Ireland, to accelerate digital adoption by
Finland, Belgium, Netherlands, implementing ‘digital by design’ stimulus
Denmark, Sweden) score more than packages and by developing digital
60 on the DESI for digitisation of
business and e-commerce, six score capabilities across all public services and
less than 30 (Bulgaria, Romania, administration.
Hungary, Poland, Greece, Latvia).
4 Digital for Europe. Collaboration. Innovation. TransformationThroughout, there must be a clear focus on investing
where returns will be greatest, and where strategic
investments can be transformational such as in Europe.Connected -
the regions, business sectors and social groups that are Recovery Papers
the furthest behind.
Beyond these critical enablers, there are additional
steps that governments can take to enhance economic
and social gains as Europe rebuilds. These will include
embedding digital for green to drive change across eHealth SMEs Smart
European value chains, in support of a sustainable Cities
recovery that starts to decouple economic growth from
a negative environmental impact. Investment in digital
skills and connectivity for a digital society will also
be essential to driving growth whilst ensuring that no
one is left behind.
Digital for OpenRan 5G
Green
Digital investment and policy reforms are
essential foundation stones for ensuring that
the recovery will be:
Rural 5G Submarine
Environmentally Corridors Cables
sustainable, by
innovating to drive emissions
reduction and enable a
circular economy;
Economically
sustainable,
by generating the
If digital-driven transformation is to provide a
competitiveness and
robust foundation for the future, policy makers will
economic returns that
need to address the underlying causes of existing
will limit the financial burden
digital divides. These divides go beyond access to
on future generations; and
connectivity. Current inequities in the distribution of
which drives growth and jobs,
digital skills and access to digitalised public services
creating a digital dividend for
and banking, could lead to an unequal distribution
future generations.
of the benefits of recovery. The opportunity to build
back better for all would be lost.
Socially
sustainable, Policy-makers will need to embed digital solutions
by addressing existing digital
to these inequities in their National Plans, if the
divides and building in
recovery and the broader benefits to society are
resilience by design.
to be enjoyed equitably across Member States’
economies and societies.
5 Digital for Europe. Collaboration. Innovation. TransformationIntroduction
Contents
Important notice from Deloitte..............................................................................................................................................................................
Executive summary........................................................................................................................................................................................................
The COVID-19 crisis and
the Role of Digital
Introduction......................................................................................................................................
The COVID-19 Crisis and the Role of Digital..........................................................................
COVID-19 has accelerated pre-existing digital trends............................................................................................................................
Digital adoption has provided resilience in the face of COVID-19..................................................................................................
COVID-19 has highlighted existing digital divides.....................................................................................................................................
Enablers of Digital Transformation
Building Back Better: Benefits and
Building Back Better: Benefits and Enablers of Digital Transformation......................
Post COVID-19 recovery - The European response.................................................................................................................................
Benefits of using digital to build back better................................................................................................................................................
Enhanced quality of living, including improved welfare, health and personal safety........................................................
A more resilient society and economy built on high skill jobs and digital autonomy......................................................
Long term economic growth driven by home-grown innovation..................................................................................................
Lower resource consumption and environmental impact..................................................................................................................
A more equitable society...........................................................................................................................................................................................
Critical enablers to deliver digital benefits..................................................................................................
deliver digital benefits
Critical enablers to
Policy reform......................................................................................................................................................................................................................
Governments leading by example.......................................................................................................................................................................
Partnerships and collaboration...............................................................................................................................................................................
Extension and proliferation of digital skills......................................................................................................................................................
Embedding Digital for Green as an enabler....................................................................................................................................................
Connectivity for a digital society............................................................................................................................................................................
Conclusion.........................................................................................................................................
Conclusion
6 Digital for Europe. Collaboration. Innovation. TransformationIntroduction
Letter from Joakim
Introduction
The global crisis brought about by the COVID-19 The objective of this report is to highlight the
pandemic is unprecedented in modern times. essential role of digital as a primary pillar of the
The COVID-19 crisis and
Europe, as with other parts of the world, has recovery; it also highlights where collaboration
the Role of Digital
suffered severe impacts to its public health, will be required, and the historic inequities
society and economy. Digital technology and that will need to be addressed to limit the risk
connectivity have offered respite from some of of an unbalanced recovery. If authorities and
the worst effects, allowing citizens to adapt their businesses do not partner and collaborate to
lives in order to cope with the disruption and prevent fragmentation, this once-in-a-generation
enabling key sectors, such as healthcare and opportunity to build back better could be lost.
education, to reconfigure rapidly to counter the
impact of the virus. The report identifies a range of opportunities for
digital investment and reforms, the benefits that
European policymakers have stepped up to can be expected, and the key enablers that will
Enablers of Digital Transformation
Building Back Better: Benefits and
coordinate a stimulus package to support the need to be in place in order to ensure long-term
response to, and recovery from, COVID-19. The social and economic returns that are shared
Executive Summary
objectives of the package are clearly forward across European society. The report is set out
looking, not only supporting the return to normal across three sections:
but delivering a better future for Europeans
based on green and digital foundations - ‘building • The first section describes the role of digital in
back better’. providing COVID-19 resilience, and its potential
role in driving recovery;
The threats to achieving these goals have also
been exposed by the crisis. Prevailing social and • The second section identifies a series of
economic inequality have meant that the burden opportunities for digital investment and the
of the crisis has not been borne evenly. This benefits that they can be expected to deliver;
poses a serious risk that sections of European and
society could be left behind as the rest of society
deliver digital benefits
Critical enablers to
recovers. • The final section provides an overview of the
enablers that will need to be in place in order
Meeting the recovery challenge requires for benefits to be realised.
an ambitious response that will need to be
shaped by extensive collaboration between all This report accompanies the recent Europe.
stakeholders to the recovery – governments, Connected series of papers published by
infrastructure owners, digital innovators, skills Vodafone Group These papers explore key
developers and citizens. This collaboration will opportunities for digital investment and reform
be required in order to maximise the impact of and are referenced throughout this report.
Introduction
investments and reforms, and to avoid imbalance
in the distribution of the benefits from recovery.
Conclusion
7 Digital for Europe. Collaboration. Innovation. TransformationIntroduction
The COVID-19 Crisis
Digital trends
and the Role of Digital
The COVID-19 crisis and
The COVID-19 crisis represents a defining point in the role of technology and the EU’s
the Role of Digital
moment for the EU. The impact on European technological autonomy.
families has in many cases been devastating.
Even for citizens who have not lost loved COVID-19 has accelerated
ones, the broader impact on their jobs and the
education of children has been immensely pre-existing digital trends
challenging. The digitalisation of European economies and
society was already in progress prior to the crisis.
Whilst Europe has weathered numerous The long-term potential benefits of investment
economic storms over the past hundred years, in digitalisation were understood, and progress
Enablers of Digital Transformation
Building Back Better: Benefits and
the COVID-19 crisis has brought about perhaps towards the acceleration of digitalisation was
the greatest economic shock that the European already tracked by the Digital Economy and
Providing resilience
Union as an institution has faced. The crisis has Society Index (DESI).
placed unprecedented pressure on healthcare
systems, generated deep and broad disruption However digital investments and adoption were
to businesses large and small, and amplified often uncoordinated and the most progress
existing disparities in resources and skills that had been made by Member States with the
have the scope to expand social and economic greatest resources and historic investment
inequalities. The COVID-19 crisis has also in infrastructure. This variation in progress
coincided with increasingly urgent environmental was reflected across the DESI dimensions as
sustainability challenges, as well as an inflexion illustrated below.
deliver digital benefits
DESI 2020
80 Digital Public Critical enablers to
Services
70
60 Integration of
Digital Technology
50
40 Use of Internet
Services
30
Digital divides
20 Human Capital
10
0 Connectivity
FN SW DN NL MT IR EE BL LU ES DE AT LT EU FR SI CZ LV PT HR HU SK PL CY IT RO GR BU
Source: https://ec.europa.eu/digital-single-market/en/digital-economy-and-society-index-desi
Conclusion
8 Digital for Europe. Collaboration. Innovation. TransformationIntroduction
Digital trends
As outlined in Deloitte’s forthcoming report for
DESI Categories Vodafone, ‘Digitalisation – an opportunity for
Europe’, there is a strong link between digital
Connectivity – Focusing on transformation and economic performance; if all
the roll-out of the very high EU countries were to reach a score of 90 on DESI,
capacity fixed and mobile EU GDP could increase by 2.5% per annum, 7.5
networks that are key to million extra jobs could be created, and there would
The COVID-19 crisis and
enabling the widespread use be significant economic convergence between
the Role of Digital
and development of digital Member States. Moreover, achieving the ’90 for
technologies. 27’ target would place Europe in a leading
position in digital development globally.
Human capital – Reflecting
that digital skills are the The lockdowns that have characterised many
backbone of the digital governments’ response to the COVID-19 crisis,
society and key to ensuring helped flatten the curve of COVID-19 cases and
that citizens benefit from the have provided a stimulus to the digitalisation of
socioeconomic benefits of economic and social activity. This has resulted in
Enablers of Digital Transformation
Building Back Better: Benefits and
digital transformation. an acceleration of the pre-existing trends and the
creation of new trends that can now be expected to
Providing resilience
Use of internet services – persist in the longer term.
Tracking the use of internet
services to understand how Following the implementation of restrictions
citizens are using digital expecting people to stay at, and work from, home
tools and benefitting from as much as possible, network operators reported
digitalisation. a substantial increase in internet traffic, to
as much as 50% above pre-COVID-19 levels.
Integration of digital Underlying this rise in traffic are some marked
technology – Measuring increases in the use of a range of digital services
the extent of the adoption and applications:
by private enterprise
of advanced digital
deliver digital benefits
technologies, such as AI For example,
Critical enablers to
and cloud, which enhance Deloitte’s 2020 Digital Consumer
productivity, efficiency and Trends survey found that:
open up new economic
opportunities
Digital public services –
40 % of respondents did
more shopping online
during lockdown,
Capturing the use
governments make of
14% of people had more remote
Digital divides
digital public services, such medical appointments
as eHealth, that can make
½3
government more efficient
increased their use of video
and help drive economic
streaming services.
recovery.
Conclusion
9 Digital for Europe. Collaboration. Innovation. TransformationIntroduction
Digital trends
Businesses are also looking more to digital and their ability to work, educate and entertain
services. For example, in recent surveys of themselves at home, and to businesses and
Small and Medium Sized Enterprises (SMEs), their ability to continue to trade.
77% stated they had increased their
usage of some form of digital tool and Whilst the economic shock of COVID-19
51% indicated that they had increased has been pervasive, digitalised companies
online interaction with their clients. have tended to fare better. A recent study
The COVID-19 crisis and
According to Deloitte’s 2021 TMT Predictions by Vodafone and Deloitte found that the
the Role of Digital
Report, businesses are also turning to cloud most ‘digitalised’ SMEs identified new
services, with cloud traffic rising by 100% opportunities as a result of COVID-19
during the first quarter of 2020 and at more than twice the rate of their least
cloud spend growing consistently faster digitalised counterparts. Another recent study
than non-cloud IT spend. Moving forward, found that SMEs using digital tools were 3.8
the European Commission sees cloud times more likely to target new customers
computing as ‘fundamental for a genuine and 3.5 times more likely to launch new
and competitive single market for data products. In general, eCommerce has been a
and services’ and essential for an innovative critical enabler of business resilience, allowing
Enablers of Digital Transformation
Building Back Better: Benefits and
economy. enterprises large and small to continue to
operate and engage with their customers.
Providing resilience
These dynamics driven by COVID-19-have
accelerated momentum towards a digital Employees have also had to adjust to new
Europe by creating an urgent need for people, ways of working, and evidence collected by
businesses, and governments to digitalise faster the EU’s Joint Research Centre demonstrates
and further. how employees in high skilled professions
have been able to adapt readily to remote
However, the impact of these trends has varied working. Likewise public services, in particular
significantly between Member States. For education and healthcare, have had to undergo
example, a 2019 DESI report on Digital Public rapid, sometimes overnight, digitalisation in
Services, found that whilst 18% of EU citizens order to continue operating. For example,
had used online health and care services, 65% of European clinicians stated that their
this was much higher for some countries organisation had increased adoption of
deliver digital benefits
(e.g. Estonia, Finland, and Denmark) than for digital technologies to support operations
Critical enablers to
others (Malta, Germany, Hungary, and Cyprus). and patient access.
Even before COVID-19, there was work to be
done to ensure the equitable distribution of the COVID-19 has highlighted
benefits from digital investment.
existing digital divides
Digital adoption has The COVID-19 crisis has highlighted the
critical role that digital connectivity plays in
provided resilience in the enabling communication and social cohesion,
face of COVID-19
Digital divides
and – beyond connectivity – in providing the
The need to accelerate and level-up progress data-driven insights and applications that
towards a digital society has been amplified have enabled public services and business to
by the COVID-19 crisis; digital adoption has continue to function.
been a key contributor towards societal and
Conclusion
economic resilience. This applies to citizens
10 Digital for Europe. Collaboration. Innovation. TransformationIntroduction
Digital trends
Notwithstanding the positive impact that digital There is also divergence at the Member State
technologies have had on the resilience of level, national coverage of very high capacity
European economies and society, the crisis has networks ranges from over 90% in Malta,
also exposed some important divides that affect Denmark and Luxembourg while Greece,
the adoption and exploitation of digital. These Cyprus and Austria have coverage of less
divides will need to be addressed if digital is to be than 20%. In this context, Europe is expected
at the heart of Europe’s endeavour to build back to continue to lag the US and China in terms
The COVID-19 crisis and
from COVID-19 in an equitable and cohesive way. of 5G adoption; by 2025 the GSMA expects
the Role of Digital
just 34% of European mobile connections
to use 5G networks, compared to 48% in
Digital deficits counteracting North America and 47% in China.
Digital’s contribution to COVID-19
resilience Digital skills and access to training are critical
if opportunities arising from the availability of
Digital Digital
digital infrastructure are to be maximised; a
Deficits Positives lack of digital skills in the workforce prevents
companies from finding the talent and
Enablers of Digital Transformation
Building Back Better: Benefits and
experience needed to embrace digital. In this
Communication
and cohesion context, the European Commission’s DESI
Providing resilience
Capacity and analysis found that a majority of European
availability Enabled remote businesses report difficulties in hiring
education
IT specialists, and that this is a constraint
Uneven on overall digital transformation. Without
digital skills Enabled remote
working support, SMEs - which are generally in greater
need of digitalising also less likely to be able
to provide the training required to advance
digital skills.
The compelling need for high quality, high As illustrated by the DESI, there are also
resilience network technologies is better disparities in the extent and distribution of
understood than ever; so, too, is the need for skills between Member States. While Finland,
deliver digital benefits
innovation across the value chain to develop Sweden, Denmark and the Netherlands,
Critical enablers to
new applications to leverage these technologies. score highest on the index, Bulgaria, Greece
However, the crisis has also highlighted the and Romania trail substantially, both in terms
social and economic challenges presented of overall score and progress since 2015.
by inequitable historic investment in digital The shortage of digital skills is most
infrastructure and skills. acute in countries such as Romania and
Czechia, where 80% of enterprises recruiting
On the infrastructure side, while many urban IT specialists reported challenges in filling
areas already benefit from next generation fibre vacancies. Europe must modernise and
and 5G networks, many of Europe’s rural and accelerate eEducation and training systems.
Digital divides
remote areas still suffer from patchy coverage This means better connectivity for schools
and lower network speeds. Of households in and digital skills training on a lifelong learning
rural areas, 10% are not covered by any fixed basis to enable workers to better adapt
network and 41% are not covered by any to change.
Conclusion
NGA technology.
11 Digital for Europe. Collaboration. Innovation. TransformationDeloitte
Response
from
Introduction
European
Notice
Building Back Better:
Joakim
Benefits and Enablers of
digital
from
Digital Transformation
Why
Letter
The COVID-19 crisis and
the Role of Digital
Post COVID-19 recovery - The European response
Summary
As the EU emerges from the COVID-19 crisis, Europe is standing up to this challenge and
Well-being
it faces a once-in-a-generation opportunity is investing huge sums to recover from
Executive
to rebuild and has also set out the ambition the COVID-19 crisis and to accelerate
to use the recovery to reshape the economy. sustainable digital transformation. This
With strong foundations, technology can be comprises long-term budget plans combined
Enablers of Digital Transformation
democratised in every quarter of society – for with NextGenerationEU, the €750 billion
Building Back Better: Benefits and
businesses, public administrations and citizens. temporary recovery instrument that provides
The Commission has highlighted its key immediate economic support to Member States
priorities in this respect: in their recovery from COVID-19 and funding for
Introduction
Resilience
initiatives to improve European resilience. The
• Comprehensive high-quality connectivity for largest component of NextGenerationEU is the
all European citizens and businesses; €672.5 billion Recovery and Resilience Facility.
• Support for the development of digital skills In recognition of the importance of digital to
for all; Europe’s recovery, and to support the EU’s
transition to a climate neutral economy, the
• Strengthening Europe’s digital capabilities and EU President has set out her ambition for
growth
Europe’s Digital Decade. This ambition is
Introduction
readiness for next generation technologies;
reflected in the EU’s target for 20% of Recovery
Economic
deliver digital benefits
• Twinning the digital and green transformations, and Resilience plans to be directed at
Critical enablers to
in particular in terms of energy, resource fostering the digital transition, and 37% to
efficiency, mobility and circular economy; and drive green investments and reforms.
• Developing public services and administration The Digital and Green Deal funding packages
fit for the future. pledged by the EU are focused on:
Sustainability
Introduction
In order to deliver the benefit of digital • Pulling through together by protecting lives
transformation, Europe will need to ensure and livelihoods, improving healthcare, and by
progress in all areas of digitalisation according creating high-skilled jobs that pay; and
to their potential. Connectivity is of course
essential, but skills development, digitalisation • Propelling Europe forward, specifically
of businesses and government, and policy through the EU Green Deal aim to make
reform will also be required. Digital reform and the EU climate-neutral by 2050, and the
Conclusion
investments will need to build-in resilience NextGenerationEU lighthouse investments in
and environmental, economic and social projects with the biggest ‘green’ impact.
Introduction
Equality
sustainability from the outset.
12 Digital for Europe. Collaboration. Innovation. TransformationDeloitte
Response
from
Introduction
European
Notice
Benefits of using digital to build back better
Joakim
The Eurostat Quality of Life Metrics, illustrated how investments in digital generates these
digital
above, highlight a series of factors that contribute benefits, providing examples of how this works
towards citizens’ quality of life: in practice, and identifying the enablers that
from
need to be in place in order for these benefits
Why
Letter
In the remainder of this section, each of these to be realised.
The COVID-19 crisis and
benefits is described in further detail, identifying
the Role of Digital
Summary
Enhanced
A more resilient
quality of Long term A more
society and Lower resource
Well-being
living, including economic equitable
economy built consumption and
improved growth driven society in which
on high skill environmental
Executive
welfare, health by home-grown the benefits are
jobs and digital impact
and personal innovation enjoyed by all
autonomy
safety
Enablers of Digital Transformation
Building Back Better: Benefits and
Enhanced quality of living, including improved welfare,
health and personal safety
Introduction
Resilience
Background
Investment in digital technologies can make • extend the duration of the healthy life
material improvements in EU citizens’ quality years across which those improvements
of life. Digital investment, and policy reforms to can be enjoyed;
support wider adoption can:
• and help reduce current inequities in the
• contribute to absolute improvements in societal and geographic distribution of high
growth
quality of life; quality of life measures.
Introduction
Economic
deliver digital benefits
Critical enablers to
Eurostat Quality of Life Metrics
Sustainability
Introduction
Environment Governance Safety Social relationships Health
Material living Housing Employment Time-use Education
conditions conditions
Conclusion
Introduction
Equality
13 Digital for Europe. Collaboration. Innovation. TransformationDeloitte
Response
from
Introduction
European
Notice
Benefits realisation
Joakim
The Eurostat Quality of Life Metrics,
digital
illustrated above, highlight a series of
factors that contribute towards citizens’ Telemedicine
from
quality of life. Digitally enabled telemedicine allows
Why
Letter
patients and healthcare professionals
The COVID-19 crisis and
The use of digital technologies in the to connect remotely, improving
the Role of Digital
healthcare sector is a particularly powerful access to care.
contributor to quality-of-life improvements. Digital communications and remote
For example, eHealth innovations such
Summary
monitoring of patients also frees-up
as in health monitoring ‘wearables’ healthcare professionals’ time, allowing
Well-being
and telemedicine applications are them to dedicate more time to high
expected to improve the healthy life priority cases.
Executive
years enjoyed by European citizens by
providing early warning of emerging health
issues and easier access to healthcare Automation of
monitoring and
Enablers of Digital Transformation
Building Back Better: Benefits and
professionals.
non-patient facing work
Material living conditions and employment The use of connected devices and AI
prospects can also be enhanced. The
Introduction
to drive automation, can increase the
Resilience
digitalisation of small businesses is expected time healthcare professionals dedicate
to enhance the economic sustainability of to patients and improve health
communities beyond urban centres, creating outcomes by better predicting health
wider high-skill employment opportunities, events, for example in patients with
and improving the distribution of higher cardiovascular disease.
living conditions as a result.
Secure and trusted
growth
Beyond health, employment, and time-
health data
Introduction
use enhancements, IoT-based smart city
technologies can improve citizens’ welfare collection and
analysis Economic
deliver digital benefits
and safety in urban environments and can
Critical enablers to
drive meaningful reductions in emissions Increasing the use of mobile apps,
and natural resource consumption. connected devices and wearables,
increases the amount of data available
Benefits case studies to healthcare professionals, researchers,
public organisations and businesses.
Some key case studies that illustrate how
Sustainability
Introduction
digital investments can be expected to Leveraging this data via appropriate data
generate material improvements in EU policy frameworks and partnerships, is
citizens’ quality of life are shown below. key to delivering better treatments and
innovation in healthcare.
Conclusion
Introduction
Equality
14 Digital for Europe. Collaboration. Innovation. TransformationDeloitte
Response
from
Introduction
European
Notice
In the longer term, healthier citizens living better Enablers
quality lives generates sustainable economic value. By
To realise the full scale of quality of life
Joakim
enabling citizens to remain active for longer periods
benefits available from digital applications
of their lives, the burden of an aging population on
digital
such as those outlined here, support is
healthcare systems is reduced. However, the quality of
from
needed for those seeking to develop and
life improvements enabled by digital go well beyond
Why
implement these digital applications.
Letter
health outcomes:
The COVID-19 crisis and
the Role of Digital
Partnerships and collaboration across a
range of stakeholders and industries will
Employment: also be essential, and these will need to
Rural regeneration
Summary
be underpinned by data frameworks that
The benefits of digitalising SMEs (as enable sharing of data and insights, while
Well-being
explored further in the following section) maintaining privacy protection.
will be important in ensuring economic
Executive
sustainability and resilience, particularly in Policymakers also have an opportunity to
communities outside of urban centres. act as leaders and role models in digital
Enabling businesses to digitalise and thrive in adoption, accelerating and incentivising
Enablers of Digital Transformation
Building Back Better: Benefits and
traditionally less connected areas, provides adoption by applying a ‘digital-first’
the opportunities and support to livelihoods mindset in which the default first choice
that are required to improve quality of life in option is to apply digital solutions to
Introduction
existing and challenges that affect
Resilience
these areas.
citizens’ quality of life.
Safety:
Safer environment
Digital services connecting security systems Digital technologies and
and transport can help reduce crime and the applications across a wide
occurrence of accidents. variety of sectors including
health, transport, education
growth
Emergency service response times can also
and public services have
Introduction
be shortened, and responders provided
the scope to generate
faster, better quality information, to help
Economic
deliver digital benefits
material and sustainable
Critical enablers to
ensure better health outcomes.
improvements in European
citizens’ quality of life.
Environment:
Digital investments will
Cleaner environment
underpin quality of life
Digital technologies will be instrumental in benefits across almost every
delivering the green transition (see Lower aspect of Member States’
Sustainability
Introduction
energy and resource consumption), which Recovery and Resilience
will result in quality-of-life gains under the Plans.
environmental measure.
For example, in cities where air pollution is a
threat to health, more efficient smart mobility
and environmental monitoring technologies
can help reduce emissions.
Conclusion
Introduction
Equality
15 Digital for Europe. Collaboration. Innovation. TransformationDeloitte
Response
from
Introduction
European
Notice
A more resilient society and economy built
on high-skill jobs and digital autonomy
Joakim
digital
Background
from
The development and expansion of digital amongst the most immediate beneficiaries of a
Why
capabilities will continue to be a key driver of more highly skilled workforce.
Letter
The COVID-19 crisis and
social and economic resilience as Europe builds
the Role of Digital
back from COVID-19. However, the pandemic The digitalisation of SMEs has been shown to
has exposed some key resilience challenges and deliver greater performance through access to
pervasive societal and economic divisions that larger markets via digital channels, optimised
Summary
need to be addressed. Long-term resilience will revenue flows from better customer and
Well-being
also require EU Member States to work together revenue management, as well as reduced costs
to develop the EU’s digital autonomy, built on a due to greater efficiency in operations. Better
Executive
highly skilled workforce and EU-led innovation in performance, enabled by digital, improves
the next generation of digital technologies. the resilience of Europe’s SME community;
improvements in economic opportunities,
Enablers of Digital Transformation
Building Back Better: Benefits and
Benefits realisation productivity and sustainability are also enjoyed
more widely due to the higher proportion of
In order to truly build back better, policymakers
SMEs outside the urban centres.
will need to build resilience by focusing on
Introduction
investments that provide enhanced digital skills
Resilience
and capabilities, as well as a more equitable More widely, the development of deeper and
distribution of the benefits and opportunities. wider digital skills across the European workforce
Small and medium-sized enterprises will be will help safeguard European competitiveness
and digital autonomy.
growth
Introduction
Economic
deliver digital benefits
Critical enablers to
Sustainability
Introduction
Conclusion
Introduction
Equality
16 Digital for Europe. Collaboration. Innovation. TransformationDeloitte
Response
from
Introduction
European
Notice
Benefits case studies
The ways in which digital investments can help enhance resilience and autonomy at the individual,
Joakim
organisational, national and international levels, are illustrated below.
Why digital
from
Individual – skills
Letter
The COVID-19 crisis and
According to the DESI, in 2019 more than 40% of the European population
the Role of Digital
lacked the basic digital skills required to enable them to participate fully in the
digitalisation of society. Investment in these foundational digital skills will be an
essential driver of digital adoption and will help mitigate the risk of enduring
Summary
digital divides excluding parts of society from the benefits of broader
Well-being
investment in digital infrastructure.
Beyond basic participation in society, investment in digital skills also
Executive
provides new opportunities for employment, enabling the benefits of digital
transformation to be shared across the whole of the workforce. This prevents
large sections of the workforce from being left behind and enhances the
Enablers of Digital Transformation
Building Back Better: Benefits and
ability of businesses large and small to develop and exploit their own digital
capabilities and opportunities.
Introduction
Organisational – capacity and use of digital tools
Resilience
Increasing digital capabilities at the organisational level creates new economic
value, opportunities for growth and expansion, increased efficiency and creates
jobs. The impact may be particularly high among SMEs, which have historically
lagged larger businesses in leveraging digital tools and which therefore, have
the most to gain from catching-up.
Industry/national – digital ecosystems
growth
Developing digital ecosystems at industrywide and national levels, built on
Introduction
supportive policy and investment, creates opportunities for individuals and
businesses and improves international competitiveness and autonomy in the Economic
deliver digital benefits
Critical enablers to
global digital market
By investing in digital infrastructure and skills across national economies,
Member States can generate and retain a greater proportion of global digital
value chains, rather than transferring this value outside the EU. Europe can also
retain greater control over the development of new technologies and networks
on which critical digital infrastructure will be built.
Sustainability
Introduction
International – resilient connectivity
Investments in European submarine cables will help deliver better digital
connectivity, including lower latency on which new use cases in manufacturing,
healthcare and entertainment will rely. It will also enable the development of
European data centres to compete with other global data hosting hubs.
Conclusion
Introduction
Equality
17 Digital for Europe. Collaboration. Innovation. TransformationDeloitte
Response
from
Introduction
European
Notice
Enablers
Policymakers will need to collaborate with Further, support to the development of new
Joakim
technology companies and SME leaders to technologies that offer high quality, lower cost
digital
help ensure that SME capabilities are aligned connectivity, such as OpenRAN, has the potential
from
to emerging digital technologies, so that these improve the business case for wider mobile
Why
businesses are not left behind. This could take infrastructure deployment, as well as to create a
Letter
The COVID-19 crisis and
the form of access to R&D facilities or digital more resilient network equipment supply chain,
the Role of Digital
community hubs, including advisory support, for economic growth and jobs in digital sectors with
SMEs to learn about and experiment with digital global export potential.
technologies, as well as financial support for
Summary
them to upskill and develop digital capabilities.
Well-being
Providing policy support and public funding Policy support and reform are
to help reduce fixed and mobile network key to encouraging the uptake
Executive
deployment costs, will also help enable roll-out of and development of digital
next generation infrastructure to rural areas that capabilities. Collaboration
would otherwise remain relatively unconnected, between governments and private
Enablers of Digital Transformation
Building Back Better: Benefits and
and in which smaller businesses tend to make companies is also an important
up the majority of employment opportunities. enabler. For example, initiatives
Voucher schemes that support connectivity like digital hubs can provide
a community for individuals
Introduction
as well as innovation funding, such as those
Resilience
envisaged in the European Digital Innovation and businesses to support skill
Hubs under the Digital Europe Programme, development, and investment
will help provide this stimulus. Beyond financial incentives such as voucher
support to network deployment, this will also schemes and R&D tax credits for
depend on reforms to address legacy policy SMEs encourage this further.
barriers that have tended to increase the cost and
practical challenge of infrastructure deployment.
growth
Introduction
The extended network deployments on which
this more resilient society and economy will Economic
deliver digital benefits
Critical enablers to
depend, will require partnerships between
network operators and between EU, national
and local authorities. Support for key strategic
investments and policy reforms, to reduce
the cost of deployment, will incentivise and
accelerate infrastructure development and the
Sustainability
Introduction
realisation of associated social and economic
benefits.
Conclusion
Introduction
Equality
18 Digital for Europe. Collaboration. Innovation. TransformationDeloitte
Response
from
Introduction
European
Notice
Long-term economic
growth driven by
Joakim
Agriculture
home-grown innovation
digital
Digital technologies,
from
Background driven by connectivity
Why
and real-time data analysis, will
Digital investments, particularly in critical
Letter
The COVID-19 crisis and
allow agricultural producers to
forward-looking infrastructure such as 5G,
the Role of Digital
use resources such as water more
have the potential to transform the European
efficiently, reduce costs of inputs
economic landscape and kick start a new
such as fertiliser by applying
wave of digital innovation across a wide range
Summary
precision agriculture or monitor crops
of industries.
and livestock better. This has the
Well-being
potential to improve yields, lower
Benefits realisation
costs and improve the sustainability
Executive
A review of 5G use cases, conducted by IHS of agricultural practices, including
Markit, estimated that the global rollout of helping to restore biodiversity
5G could enable a €10 trillion increase in
Enablers of Digital Transformation
For example, by being able to
Building Back Better: Benefits and
global cross-sector output by 2035. A key
automate irrigation and better
driver of this growth is expected to be the
monitor crops and livestock. This has
impact of 5G-enabled use cases on sectoral
the potential to improve yields, lower
Introduction
productivity and the value created by use
Resilience
costs and improve the sustainability of
cases as diverse as industrial automation,
agricultural practices.
smart cities, autonomous vehicles, smart
agriculture, remote health monitoring and
smart grids. Health
Connectivity within care
Benefits case studies settings, such as hospitals,
as well as outside, may transform
Promotion of these new drivers of economic the way that patients are monitored,
growth
growth will be key to the long-term recovery
Introduction
and resources allocated. In addition,
of Europe from the COVID-19 pandemic and Augmented Reality (AR) and robotics
will need to reflect wide-reaching digital Economic
deliver digital benefits
will improve procedures and surgeries.
Critical enablers to
strategies across a host of areas. 5G enabled The result is an improvement in the
growth drivers include: quality of care through innovation and
optimisation.
Sustainability
Introduction
Conclusion
Introduction
Equality
19 Digital for Europe. Collaboration. Innovation. TransformationDeloitte
Response
from
Introduction
European
Notice
Enablers
Many of these applications will rely on
Joakim
Transport fast, reliable and low latency connectivity,
digital
infrastructure potentially delivered via managed private
from
Improving mobile broadband networks (MPNs) and mobile edge
Why
connectivity, and particularly 5G computing (MECs), which allow networks to
Letter
The COVID-19 crisis and
networks, along European road and be adapted and optimised for specialised
the Role of Digital
rail travel corridors can enable new purposes.
mobility technologies such as connected
autonomous vehicles. This will drive a The realisation of benefits from these growth
Summary
range of benefits from greater efficiency, drivers will be dependent on coherent
safety, and capacity of existing transport 5G national plans and on harmonised 5G
Well-being
infrastructure. enabling policies across EU members states.
Facilitation of cross-value chain partnerships,
Executive
Improved connectivity along transport
and frameworks to support the sharing of
routes will generate broader benefits
non-personal data will also be essential.
for the surrounding areas, potentially
Enablers of Digital Transformation
Building Back Better: Benefits and
attracting additional investment and
European investment in innovation around
leading to agglomeration benefits outside
open-architecture network technologies,
established urban and industrial centres.
such as OpenRAN is also expected to drive
Introduction
Resilience
innovation in mobile network services, and
Manufacturing could also help bolster the capability and
and industry autonomy of Europe’s digital ecosystems.
5G and other related digital
technologies, such as IoT and AI, have
the potential to transform industry
through greater productivity and As global demand for new
efficiency. Connected machines will digital technologies increases,
growth
allow tasks to be automated and enable so too does the value of
Introduction
reconfigurations of production-lines, at becoming an international
price. Mixed reality devices and computer leader in 5G. The innovation, Economic
deliver digital benefits
Critical enablers to
vision also aid quality assurance. productivity benefits and
Moreover, the increased level of data from sustained international
production processes will enable greater competitiveness in a critical
levels of optimisation. growth sector will help sustain
long-term economic growth.
Entertainment
Sustainability
Introduction
5G will enable new media and
immersive technologies, such as in-car
entertainment and holographic displays.
These are expected to scale quickly, with
the potential to generate more than
$67bn annually by 2028.
Conclusion
Introduction
Equality
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