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Europe should forget Google and investigate its own shortcomings

  • Author:Max Lin
  • Release on:2016-11-28

Imagine if, over the next 60 days, the European Commission staged a series of press conferences and bombarded journalists with a battery of announcements of pocket-sized investigations into the condition of the continent’s technology industry.

One investigation might delve into the rate at which PhDs are granted to students of science, technology, engineering and mathematics subjects at Europe’s 20 leading universities. This might contain an appendix showing the percentage of Nobel Prizes given to people born and resident in Europe over the past 100 years.

Another inquiry might examine the state of science education in high schools across the EU and how this compares to countries such as China, Singapore, Israel, India and the US. An appendix of this report might summarise the number of European high school students and college graduates that have elected to study in, or emigrate to, the US.

Other lawyers and social scientists on the vast EU payroll might be dispatched to the patent filing libraries to see how the rate of European invention in critical fields has kept track with what has occurred in China and the US since 1990. Then, assuming there are still lawyers available — not an insurmountable challenge in Brussels — another taxpayer-financed squadron could be sent to examine why the rate of formation of technology companies in Europe trails that in other countries.

Instead, the commission has chosen to launch a new investigation into one of its bête-noires — Google. This new witch-hunt, seeking to uncover skulduggery and anti-competitive practices in the way that Google has licensed its Android operating system, is in addition to a separate Commission probe into the company’s search business. Add to this the EU probes into the privacy policies and tax payments of US technology companies, and the chief executives of Amazon, Apple, Facebook, Google, Netflix and Qualcomm — six of the greatest businesses built over the past 30 years — must be thinking that, within Europe, no success goes unpunished.

This same sentiment seems to be spreading to European boardrooms. Recently, the founders of Spotify, the Stockholm-based music-streaming service that has been engaged in a tooth-and-nail fight with some of the largest US technology companies, did the unthinkable. They voiced a distinctly American viewpoint by castigating Swedish politicians for the conditions they have to battle in their homeland. These included the acute housing shortage in Stockholm, the manner in which gains from stock options are taxed and the shortcomings of technical education — particularly for girls and young women. Little wonder that they threatened to move much of their company — lock, stock and smoked herring — to more hospitable climes.

The commission might find some solace in an odd place — its own investigation of Microsoft which started in 2000 and extended for more than a decade. The accusations against Microsoft were every bit as pointed as the charges now levelled at Google. Yet consider what’s happened since. The EU filed its charges against the leader of the personal computer industry before Facebook, Instagram, WhatsApp, Snapchat or Skype were even formed and at a time that Google was barely a year old. However, the inventiveness of these companies that had a much greater effect on Microsoft’s apparent ironclad lock on the technology industry than any set of mandarins infusing legal charges with a political marinade.

The commission should examine one other fact. Over the past five years the eight most valuable technology companies developed in Europe have assembled a combined market value of around $32bn. That’s not a figure to be sneezed at any more than the admirable young European technology entrepreneurs who, despite all odds, are more inclined to take a risk than members of their parents’ generation. But EU legislators should be wondering why Europe’s eight most valuable companies are only worth about 10 per cent of Facebook or 6 per cent of Google.

There’s nothing new about this strain of anti-Americanism running rampant in Brussels. Some of its intellectual roots stretch back 50 years to Jean-Jacques Servan-Schreiber, the French publisher and journalist, who tried to galvanise Europeans into countering the threat from across the Atlantic with the publication, in 1967, of The American Challenge. Its echoes can be heard in this week’s press conferences in Brussels. Forget the fact that American ingenuity and daring has brought to hundreds of millions of Europeans phones cheaper and more powerful than the supercomputers of the 1970s, thousands of films and TV shows that can be streamed at the touch of a button, free text-messaging services, books that are delivered overnight and thousands of comfortable cars that can be summoned at a moment’s notice.

Rather than pointing across the Atlantic and seeking scapegoats, the Commissioners who have just launched another fusillade against one of their favourite American bogeymen may want to start a series of investigations into Europe’s own shortcomings. This may be a more fruitful exercise than reigniting the spent flames of the 1960s.

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