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info@epicproject.eu www.epicproject.eu

EU Digital Single Market & new data protection laws: opportunities & impact

Erich Prem, eutema

www.epicproject.eu

EPIC - Objectives

An EU project to improve cooperation in ICT research and innovation between the EU and Australia, New Zealand, and Singapore at the policy and research levels.

events with industry and research

policy dialogueshort-term exchange

and research preparation visits

Develop a strategy for cooperation (policy dialogues, research

capabilities, previous projects)

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EPIC Partnership

EU

• eutema

AU

• Intersect

• RMIT

SG

• I2R

• NUS

NZ

• Callaghan

• Uni Canterbury

RTDI strategist, 2 universities, 1 research institute, 1 innovation intermediary, 1 computing association

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The European Union

• One of the largest markets in the world• 2016 EU 2nd largest

market after China

• Excellent S&T base

• Digital Single Market

• Rapid digitization of all industries – backed by RTDI policies

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European Initiatives on Digitizing Industry

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The European Union

• A rich and diverse science and technology base

• Long tradition / centuries of research and science history

• A multiculturalresearch environment

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The EU‘s ICT RTDI Strengths

ICT RTDI topics

• Industry 4.0

• Smart Cities

• ICT in Transport

• Energy Efficiency

• Future Internet

• Cybersecurity

• …

Specific EU strengths

• Electronics and microelectronics• Power electronics, mixed signal

• Industrial control systems• Cyber physical systems• Embedded systems

• Communication technology• Mobile systems• Language technologies

• …

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Changing regulatory framework

• Regulation showstopper or enabler of innovation

• Anticipation of regulatory changes is crucial for staying in business and for innovation (BM)

• Europe’s regulatory environment for ICT businesses is about to change significantly:• Trade negotiations EU-AU• Brexit• DSM• GDPRD

Impact of these changes for innovation and ICT research – including for 3rd countries – for ICT RTDI cooperation

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The Digital Single Market

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DSM: Example

• Will enable consumers to access their online content services when they travel in the EU the same way they access them at home.

• Valid for all providers offering paid services (VoD, online TV, music, games; option for free services

• Online content service providers (e.g. Netflix, Spotify) verify country by payment details, internet contract, IP

• In force: early in 2018

When a French consumer subscribes to Canal+ film and series online services, the user will be able to access films and series available in France when he or she goes on holidays to Croatia or for a business trip to Denmark.

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DSM: areas of action and objectives

• harmonised EU rules for purchases of digital content

• parcel delivery: national laws for traders based on key EU rights for sales of tangible goods

• elimination of unjustified geoblocking

• portability of content, cross-border access, certainty for cross-border use (research, data mining)

• electronic VAT register & payment, VAT threshold, home country controls, removing 3rd country exemptions

Improve access

• telecoms and media

• online platforms: transparency, use of information, relation to suppliers, moving between platforms, tackling illegal content

• security and personal data

Business environment

• data economy: free flow of data principle (except personal data)

• standards

• skills and e-government

Growth and jobs

Since 2015, 35 legislative proposals and policy initiatives. Political agreement partially achieved with MS.

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DSM 2017: mid-term assessment May 2017

• Practical elimination of roaming charges including data -> new usage patterns, 3-6x increase in mobile data usage since June 2017; data roaming from 15% to 31%

• Cross-border portability of online content form early 2018 (e.g. subscriptions)• Not yet: elimination of unjustified geoblocking

• Boosting connectivity (high-quality 700 MHz band for wireless broadband in all MS)

• Connecting Europe Broadband Fund• WiFi4EU initiative: free connectivity for up to 8000 local communities • GDPR and ePrivacy

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DSM: further action

• EU Data Economy• cross-border free flow of non-personal data (currently restrictions possible and

existing)• accessibility and re-use of publicly funded data (e.g. public transport, utilities);

ownership of non-personal data

• Cybersecurity• EU Agency for Network and Information Security• Standards, certification, labelling (especially for connected objects)

• Online Platforms• Address unfair contractual clauses and trading practices• Many diverse topics: competition, illegal content, counterfeit good, hate speech…

• investments in digital skills and infrastructure

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GDPR: new data protection regime in EU• Improved data protection for

citizens

• Reaction to new technologies, platforms and business models

• Very broad definition of personal data (identifiable natural person), e.g. location, IP address, cookies

• Hefty fines: up to € 20 m or 4% of global gross revenue (whichever higher)

Clear rules for giving consent, access to data

Right to portability (platforms)

Strict rules for companies to inform about

breaches

Special rules for profiling: right to

explanation (information)

Right to be forgotten

Forthcoming: ePrivacy regulation for digital marketingMay further revolutionize adtech industry (e.g. prior consent for cookies)

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GDPR: Right to be forgotten

• Already in place, now newly regulated

• Upon request and if no longer needed for reasons for which collected, data must be erased.

• Has severe implications for IT systems, e.g. Google search

• Needs further clarification as it wouldin current form not allow suppression or do-not-contact lists.

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GDPR: Profiling and discrimination• Profiling: automated processing to evaluate certain personal aspects

• Anti-discrimination deeply rooted in European legal system

• Also in GDPR preamble: “implement appropriate measures that prevents discriminatory effects…”

• In particular related to special, sensitive, data, e.g. racial or ethnic origin, political opinions, religious or philosophical beliefs, or trade-union membership, …genetic data, biometric data for identification, health, sex life, sexual orientation…

• Minimal interpretation: algorithms must not use such direct variables• But of course: geography + income implies race in some regions

• Maximal interpretation: postal code (or not?); large datasets->less obvious correlations (predict health status)

• Risk averse algorithms: uncertainty bias (Goodman 2016)

• Human understandable algorithms required.

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GDPR: Automated decisions and profiling• Art. 22 and Art. 13-14: …information about

automated decision making…

• The data subject shall have the right not to be subject to a decision based solely on automated processing, including profiling, which produces legal effects concerning him or her or similarly significantly affects him or her.

• … the right to meaningful information about the logic involved…

• Implications very unclear• Perhaps more a right to be informed, right to

explanation of system functionality

• …will require court decisions and perhaps further research in AI

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GDPR and innovation

• Sectors most affected: e-Health, online marketing (Goldfarb & Tucker 11)

• New positioning of Europe as a kind of save haven for personal data• Could become a USP as neither US nor Asia has this kind or level of protection

• Biggest challenge: utilizing big data potential while preserving privacy• Anonymization, big data with little (personal) data• Little data approach a challenge for innovation (as precise use not fully known)• Selective deletion of data• PAML: privacy aware machine learning

• Challenge for business models targeted to sell data or advertising• Expectation: purely advertising-based business models will be less effective in the

future

• Market for PET – privacy enhancing technologies • For customers and businesses; but will depend on precise legal frame and practice

• Challenge for process innovation using 3rd party services

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Promising areas for ICT RTDI

Giving consent Anonymization

Forgetting Explaining

Ethical profiling

New services and standards

New business model: shift towards paid services

Impact on innovation?

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EPIC Focus Topics

Artificial Intelligence

IoT, wearables, I4.0

Digital Economy / Digital

Disruption

Next Generation Internet

Cyber Security ICT in TransportSpatial

Intelligence

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Summary

Important point in time for thinking about IT innovation and Europe:

• Major changes of the EU digital environment: DSM, GDPR, ePrivacy

• New European Framework Programme for Research (FP9)

• Brexit

• Planned EU-Australian Trade Negotiations: will include DSM & GDPR

A whole range of opportunities for collaboration!

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Contact

DDr. Erich Prem

eutema GmbH

www.eutema.com

prem at eutema.com

EPIC project

www.epicproject.eu

info at epicproject.eu