EUROPEAN COMMISSION

Brussels, 2.7.2024

COM(2024) 260 final

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS

State of the Digital Decade 2024

Table of content

1. Introduction: delivering the Digital Decade    

2. EU established as the global policy innovator    

3. A stronger EU digital industrial basis accelerating progress in the Digital Decade    

4. State of the Digital Decade: Progress in 2024    

4.1 A wake-up call    

4.1.1. Progress towards a competitive, sovereign and resilient EU based on technological leadership    

4.1.2. Progress towards the protection and empowerment of EU people and society    

4.1.3 Leveraging digital transformation for a smart greening    

4.2 The strategic Digital Decade national roadmaps and their role in achieving the EU’s ambition    

4.3 Recommendations on the way forward    

5. International dimension    

6. Conclusions    

1. Introduction: delivering the Digital Decade 

This Communication contains the 2024 State of the Digital Decade report. It examines digital policy developments since the 2023 report 1 and presents the EU’s progress towards achieving the agreed objectives and targets for a successful digital transformation for people, businesses, and the environment, as set out in the Decision establishing the Digital Decade policy programme 2030 2 . A snapshot of this analysis per each Digital Decade target is provided in Figure 1 below.

Figure 1. Taking stock of the progress towards Digital Decade targets set for 2030 3

For the first time, this report includes an assessment of national Digital Decade strategic roadmaps. On this basis it outlines Member States’ individual contribution to collectively achieving the Digital Decade’s objectives and targets and, overall, it confirms the findings of the 2023 State of the Digital Decade report:

-Over the past years, the EU has considerably upgraded its action through regulatory and non-regulatory measures to equip itself with a governance framework and a clear vision of the future, based on specific targets and objectives and the means to achieve them. The Digital Decade policy programme has been designed as main instrument to coordinate this effort: it relies on close cooperation with Member States and stakeholders at European, national, regional and local levels to ensure collective progress 4 .

-Thanks to this enabling framework and joint action, some progress has already been achieved. Notably, the implementation of the Recovery and Resilience Facility (RRF) has given an important contribution to the achievement of the Digital Decade policy programme. These instruments and governance framework are complementary to each other and to the European Semester of economic and social policy coordination. 

-Yet, as shown by Figure 2 below 5 , at the current rate of Member State’s intervention, the remaining time projected to meet the targets is sometimes well beyond the agreed 2030 timeframe. It is therefore critical that Member States follow suit and step up their contribution to the achievement of the Digital Decade objectives and targets with concrete measures and policies, starting with the adjustment of their roadmaps.

Figure 2. Projected time to target based on last annual average progress for each KPI

This Communication outlines the main findings of the analysis and it is accompanied by three Annexes: Annex 1 provides an extensive analysis of the progress made towards the Digital Decade objectives and targets and contains horizontal recommendations addressed to all Member States; based on most recent data available, Annex 2 updates the trajectories for the EU to timely reach each Digital Decade target and key performance indicator (KPI); Annex 3 provides a summary of the analysis made for each Member State and includes country specific recommendations. Both the horizontal and the country recommendations aim to accelerate the EU’s collective progress and propose adjustments to national strategic roadmaps 6 .

2. EU established as the global policy innovator

Over the last 5 years, the EU has strategically pivoted toward a more assertive digital policy framework, recognising the urgent need to shape the digital space with targeted investments and robust regulatory mechanisms when necessary. This approach marks a significant disruption, propelling the EU to the forefront of global digital governance and policy innovation. With its state-of-the-art digital rulebook, the EU should contribute, by levelling the playing field across the Member States, to the future achievement of Digital Decade objectives and targets.

2023 and 2024 have been watershed years for the EU’s leadership in the digital age, and its role as a bolder global-class regulator, inspiring other regions of the world to act. The European Commission’s five-year mandate of 2019-2024, has overhauled the digital policy landscape, by proposing and negotiating 23 legislative files 7  which have contributed to reinforce EU’s position in the Digital Decade. 

New EU-wide rules have contributed to the Digital Decade objectives of competitiveness and of the development of a human-centred digital space, strengthening the protection of people, facilitated the growth of enterprises with the deepening of the single market and shaping the digital economy far beyond its borders. Among the important legislation delivered in this mandate is notably the Artificial Intelligence Act (AI Act) 8 , the world’s first initiative regulating specific uses of artificial intelligence based on the level of potential risk. It seeks to address societal challenges, rights and safety including ethical considerations while establishing effective yet light-touch requirements for AI systems operating within the EU. Other initiatives such as the Data Governance Act 9 , the Data Act 10 or the European Health Data Space Regulation 11 , the Once-Only Technical System (OOTS) 12  under the Single Digital Gateway (SDG) Regulation 13  and the Interoperable Europe Act 14 have built the foundations of our data-driven economy. The EU is strengthening the protection against online harms and disinformation for a safer, more transparent digital space, with the initiation of investigations and information requests being launched to enforce the Digital Services Act (DSA) 15 . Large online platforms have already made changes to comply with the Digital Markets Act (DMA) 16 , giving more choice to EU users and ensuring fair and contestable digital markets where our enterprises can grow. Finally, during this mandate, essential steps have also been taken to steer the implementation of major legislative building blocks of the Digital Single Market, such as the 2018 European Electronic Communications Code 17 , the 2019 Copyright Directive and the revised Audiovisual Media Services Directive 18 .

The Digital Decade objectives of resilience and cybersecurity were also strengthened through upgraded frameworks, such as with the update of the Network and Information Systems Security Directive (NIS2) 19 , the Cyber Solidarity Act 20  and the Cyber Resilience Act 21 . Through the European Digital Identity (EUDI) Regulation 22 , the EU is facilitating access to and use of trusted online services with the EU Digital Identity Wallet (EDIW). The EU has driven more economic and social development by accelerating the deployment of high-speed networks with the Gigabit Infrastructure Act 23 . The EU is reinforcing European energy security by adopting the cybersecurity network code for cross-border electricity flows. 

After this wave of strong regulatory efforts, the EU will now need to deliver on implementation and enforcement, with more consistency and coherence and better synergies across regulatory authorities to govern EU digital policies efficiently. This will be essential to strike a balance between innovation and regulatory burden and contribute to the achievement of the EU’s digital decade objectives and targets.

3. A stronger EU digital industrial basis accelerating progress in the Digital Decade

The past 5 years have seen significant advancements in digital innovation and industrial policy, which have fostered a unique and dynamic European ecosystem. This ecosystem, based on connectivity, edge nodes, high performance computing (HPC), quantum, chips and start-ups, supports the EU’s green transition and digital transformation, thereby enhancing its competitiveness. Strengthening the EU’s technological leadership is crucial for accelerating its progress towards the Digital Decade’s objectives and targets.

As shown in Table 1 , with an estimated global effort amounting to EUR 205 billion over the past few years, the EU has made full use of its funding capacity to support the Digital Decade. Being one of the main political priorities of the Commission to enhance the EU’s prosperity, economic recovery, and resilience, the digital transformation receives substantial coordinated support from EU funding across the board. An initial stocktaking exercise demonstrated that EUR 131.9 billion of the 2021 and 2022 EU budgets (including NextGenerationEU) was allocated to the digital transition, representing almost 17.4% of the total EU budget 24 . In particular, the Recovery and Resilience Plans, combining investments and reforms worth EUR 651.7 billion 25 , serve as a key source of funding for the digital transformation at national level for many Member States and complete the large scale strategic European projects funded under the Digital Europe Programme (DIGITAL), Horizon Europe and the Connecting Europe Facility (CEF).

Table 1. EU relevant budget for the Digital Decade targets (2021-2027 MFF, incl. RRF 2020-26, EUR million) 26   27

In more detail, the Recovery and Resilience Facility represents an unprecedented and, in many cases, the largest source of funding for digital transformation in Member States. Despite major revisions of the Plans, including the incorporation of REPowerEU to address new challenges, the total RRF budget dedicated to digital reforms and investments increased by early 2024 to about EUR 150 billion, representing 26% of the total RRF funding 30 .

With a budget of EUR 1.7 billion, the Connecting Europe Facility (CEF 2) Digital supports investment in key European digital infrastructure projects contributing to the Digital Decade’s targets of more resilient and sovereign infrastructures.

With a budget of EUR 7.9 billion, the DIGITAL Europe programme is the main programme to fund strategic investments that create digital ecosystems, ensuring the EU’s digital autonomy and global competitiveness. It has already achieved several important results related to the deployment of innovative new digital solutions, capabilities and related services. Among others, the EuroHPC Joint Undertaking awarded the procurement of JUPITER, the first system in Europe to achieve exascale performance, i.e., the ability to execute over one billion calculations per second. Data space initiatives 35 in key sectors are currently being set up, most recently the European Cancer Imaging Initiative and the European Genomic Data Infrastructure. DIGITAL has funded numerous testing and experimentation facilities.

Horizon Europe is expected to dedicate 35% of its EUR 95 billion budget to the digital transition through the entire 2021-2027 period 38 , with the legal obligation to earmark at least EUR 13 billion for core digital (general-purpose) technologies 39 .

The InvestEU programme significantly strengthens investments in digital infrastructures and technologies, including media content and skills.

Finally, the Technical Support Instrument 41 provides on-demand tailor-made technical expertise to design and implement structural reforms in EU Member States with a budget of EUR 864 million.

The EU has also started to reduce its strategic dependencies in critical sectors thanks to key initiatives adopted during this mandate. The Chips Act has triggered a wave of new investments in semiconductor manufacturing in Europe. The EU’s Important Projects of Common European Interest (IPCEIs) are progressing, with notable recent approvals of the second IPCEI on Micro-electronics and Communication Technologies and of the IPCEI on Next Generation Cloud Infrastructure and Services. Several industrial alliances were launched in the areas of batteries, data, edge and cloud computing, processors and semiconductor technologies, and cyber technologies 44 . Thanks to the EU’s investment over the past few years, Europe has become a leader in supercomputing, with 3 of the 10 most powerful supercomputers in the world 45 . In January 2024, the EU adopted the AI innovation package to support AI start-ups and SMEs 46 .These initiatives are supported by considerable investments in advanced digital skills development in key strategic digital areas. 

With the Economic Security Strategy 47  adopted in June 2023, the Commission is coordinating assessments of four categories of risks: (1) risks to the resilience of supply chains; (2) risks to the physical and cyber-security of critical infrastructure; (3) risks to technology security and security-relevant technology leakage; and (4) risks of weaponisation of economic dependencies or economic coercion. These assessments are enabling the EU to understand the evolving, new and emerging risks in this challenging geopolitical context and to find ways to mitigate them, by taking measures to promote EU's competitiveness and protect EU’s economic security, including by partnering with the broadest possible range of partners. In particular, the adoption of the Strategy has kickstarted the risk assessments to evaluate the technology security and technology leakage risks in four technology areas that are extremely critical for the EU (out of the 10 areas identified in the Commission Recommendation of 3 October) 48 , i.e., advanced semiconductor technologies, quantum technologies, AI technologies and biotechnologies. 

To further enhance the EU’s strategic sovereignty and support its technological leadership, the Commission proposed the establishment of the Strategic Technologies for Europe Platform (STEP) in June 2023, an instrument to develop critical emerging technologies that are relevant to the green and digital transitions and to the strategic sovereignty of the EU. The Platform aims to boost the manufacturing capacity in digital technologies and deep tech innovation, clean and resource-efficient technologies and biotechnologies, and to strengthen value chains as well as address labour and skill shortages in these sectors.

Last but not least, concrete cooperation is advancing quickly to develop large-scale projects that a single Member State cannot tackle alone. Three European Digital Infrastructure Consortia (EDICs) have been established by the end of May 2024: the Alliance for Language Technologies EDIC, the Local Digital Twins towards the CitiVERSE EDIC and the EDIC for European Blockchain Partnership and European Blockchain Service Infrastructure (EUROPEUM-EDIC). Eight more are in preparation, and a few additional initiatives are under consideration 49 .

As shown in this chapter, joint and coordinated investment in digital technologies is crucial for accelerating progress toward the Digital Decade objectives and targets, thus driving innovation and economic growth, particularly in an era where digital transformation is reshaping industries and societies. Public investments, when combined with private sector efforts, create a synergistic effect that accelerates technological advancements and broadens their impact. For the European Union to remain competitive on the global stage, it is imperative that funding priorities maintain a strong focus on continuing to leverage the stimulating effect of public and private investment enhancing digital infrastructure, fostering digital skills, and supporting digital innovation across all sectors. By prioritizing digital investment, the EU can secure its position as a leader in the digital age, ensuring sustainable growth and a robust, future-proof economy.

4. State of the Digital Decade: Progress in 2024

4.1 A wake-up call

Despite the significant initiatives undertaken at EU level, the detailed analysis of progress on objectives and targets presented in Annexes 1 and 3 50  reveals two significant concerns: insufficient progress in reaching the objectives and targets and significant fragmentation across Member States. This highlights the need for more significant efforts by Member States to ensure the EU’s control over its future. 

4.1.1. Progress towards a competitive, sovereign and resilient EU based on technological leadership

First of all, the 2024 analysis of progress on objectives and targets confirms the findings of the 2023 report and outlines the need to continue working towards maintaining a leadership position in digital technologies: this is essential for the EU’s future prosperity as it could unlock over EUR 3.4 trillion in economic value, which represents a significant 21% of the EU’s current economy and would greatly contribute to achieve the Digital Decade targets and objectives 51 . 

The full potential of the (Digital) Single Market remains untapped: intra-EU trade in services represent a mere 8% of GDP, in stark contrast to its trade of goods, which exceeds 25%. Capitalising on the single market is essential to address major imbalances in the production of digital services. Currently, 80% of the technologies and services needed for Europe’s digital transformation are designed and manufactured in third countries 52 and European platforms have struggled to capture more than 5% of global market value for a decade. More generally, the presence of European firms among the world’s leading ICT companies is minimal, with only 3 Europeans in the top 50 ICT companies by market capitalisation 53 .

Tracking progress against the targets based on 2023 data, the report highlights the EU’s strong position in HPC and quantum as well as limited progress in connectivity coverage, especially in terms of quality. Only 64% of households have access to fiber and the rate of progress (13,5%) is far lower than what we need to reach the gigabit target by 2030. Moreover, there is an extremely low uptake of Gigabit connections of just 18,5%. Coverage of high quality 5G extends only to merely 50% of the EU territory (based on main pioneer band), with the large majority of the deployment of 5G not being stand alone. The investment needed to reach connectivity targets is still significant, amounting to EUR 200 billion. Moreover, the deployment of an estimated 1186 edge nodes is insufficient and predominantly utilised for testing and research, rather than being fully operational and available for general use.

In the semiconductor industry, EU revenues declined by 3% between 2022 and 2023 (dropping from EUR 90 billion to 87 billion), while global revenues decreased by 14% (from EUR 918 billion to 791 billion), indicating however a relatively greater resilience in the EU market.

In the realm of quantum technologies, the first milestone of the Digital Decade target – having the first quantum accelerated computer by 2025 – is expected to be reached this year. However, the level of private investment is still low, representing a mere 5% of total funding.

With limited annual progress, businesses’ uptake of digital technologies remains a key challenge. Cloud adoption has increased by only 7%, falling short of the 9% needed to meet the target. There has been no noticeable improvement in AI take-up, and merely 32% of European companies have adopted data analytics. The digitalisation of SMEs is also progressing too slowly and unevenly across the EU, with an annual increase of only 2,5%, which is half of the growth rate required to achieve the target. The startup ecosystem, despite some progress – 5,6% growth in the number of unicorns – remains underdeveloped. The EU is home only to 263 unicorns (13% of the total), compared to 387 in China, and 1 539 in the USA, partly due to a lack of private capital.

4.1.2. Progress towards the protection and empowerment of EU people and society

While the European population increasingly recognizes the importance of digital transformation, it is increasingly sensitive to the effect of the rapid pace of change in their lives. For the digital transformation to be successful, it is essential for people to remain engaged and supportive. According to 88% of the EU population, public authorities are expected to provide adequate support to help citizens navigate the effects of digital transformation in their lives. The promotion and implementation of the Declaration on Digital Rights and Principles 55 , which aims to give citizens a clear reference point about the type of digital transformation the EU wants, should be stepped up in this context.

Very significant work remains to be done to reach the 2030 targets on digital skills: only 55.6% of EU’s population has at least basic digital skills and, at the current pace, the number of ICT specialists will reach just 12 million by 2030 – well below the EUR 20 million target and amid growing competition for digitally skilled talent. The annual progress achieved in 2023 is alarmingly insufficient, falling between 2.5 and 3 times less than the rate needed to reach the targets by 2030.

The availability of eID schemes, digital public services and access to e-Health records is increasing, but there are still significant differences among countries, as the adoption of eID varies. Significant gaps exist in the provision of fully user-centric, accessible 56 , and sovereign digital public services. 

Online risks are on the rise and disinformation has been identified as one of the most destabilising factors for our societies, requiring comprehensive, coordinated action across borders and actors. The EU cybersecurity landscape continues to be strongly impacted by geopolitical events, with cyberattacks on the rise: ENISA recorded more than 2 500 cyber incidents from July 2022 to June 2023, with 220 incidents specifically targeting two or more EU countries 57 . In 2023, 33.5% of individuals surveyed in the EU 58 reported encountering hostile or degrading online messages, targeting specific groups due to their political and social views, racial or ethnic origin, or sexual orientation, highlighting the prevalence of online hate speech. Moreover, a 10 percentage points increase in public support for better protecting children online, highlights a growing focus on safeguarding children in the digital space. The combination of the significant amount of time spent online by children and the sophisticated, invasive digital techniques used by advertisers, poses new and serious challenges for the protection of children in the online space including risks for their mental health, or abuse of unhealthy food, tobacco, or alcohol. Furthermore, the health dimension of digitalisation has recently attracted attention due to the negative impacts that particularly certain online interface designs, can have on health in general, and in particular on mental health.

One of the major challenges faced in the EU’s digital transformation, as seen from monitoring the objectives and targets of the Digital Decade, is the limited spread of digital technologies beyond large cities, linked to increasing digital divides and to the slow digitalisation of businesses, especially SMEs. Convergence is still lagging as major population centres often concentrate investments, human capital and digital infrastructures while small cities, remote and rural areas struggle to stimulate economic activity and face demographic challenges. A successful Digital Decade will therefore not be possible without greater focus on inclusiveness and the participation of all actors at all levels including regions and cities. To this end the Digital Decade policy programme offers a framework for cooperation among actors with new opportunities of collaboration.

4.1.3 Leveraging digital transformation for a smart greening

The digital sector currently accounts for 7-9% of global electricity consumption, which is projected to rise to 13% by 2030 due to the growing demand for Internet services and AI at global level. Efforts to reduce energy consumption of digital services will be crucial, with a focus on energy-efficient semiconductors and climate-neutral edge nodes. Despite its importance for achieving a circular economy, the recycling of digital devices remains limited, with only 10.4% of people reporting to have recycled their mobile/smart phones and another 9.7% and 12.8% their laptops/tablets and desktop computers respectively.

The increasing role of digital transformation and technology adoption in reducing the ICT environmental footprint, driving productivity growth and efficiency gains for companies, as well as advancing breakthroughs in energy, net-zero and clean technologies, is becoming more evident. This sector has indeed the potential to reduce total greenhouse emissions by 15%-20% before 2030, across the whole economy. A significant achievement in 2023 is the development and implementation of a science-based methodology for measuring the net environmental impact of digital solutions, facilitated through the European Green Digital Coalition.

Finally, the RRF is instrumental in supporting the twin, digital and green transition, including Smart Mobility and Smart Energy Systems (such as smart grids and ICT systems).

4.2 The strategic Digital Decade national roadmaps and their role in achieving the EU’s ambition

As mentioned, for the first time, the analysis of EU progress towards the Digital Decade benefits from an analysis of the combined national ambitions as presented in national roadmaps 59  of all Member States. This initial set of national roadmaps represents a successful starting point demonstrating a unified effort by Member States to contribute to the Digital Decade.

In their national roadmaps, Member States propose 1 623 measures aimed at achieving the Digital Decade targets and objectives, amounting to EUR 251.9 billion investments (including EUR 168 billion from the public budget which amounts to 1% of the EU’s GDP). The proposed measures focus mainly on semiconductors (public budget EUR 40 billion, 24%), connectivity (EUR 29 billion, 17%), and basic digital skills (EUR 25 billion, 15%). While references to general objectives in national roadmaps are less developed than the specific targets, they still encompass 414 measures addressing competitiveness (public budget EUR 56.8 billion), technological leadership (EUR 22.3 billion), and cybersecurity (EUR 5.9 billion).

The roadmaps contain also national targets corresponding to the Digital Decade targets and ambitions as illustrated in Figure 3 below. However, only 70% of the expected targets were included in national roadmaps, with 52% of targets being aligned with the EU-level targets. The level of ambition of the Member States is only comparable to the EU’s Digital Decade in the case of basic digital skills, VHCN 60 , basic 5G 61 and Digital Intensity Index while being much lower for FTTP, ICT specialists, data analytics, cloud and AI.

Figure 3. National 2030 targets compared to EU targets

An analysis of the collective effort based on roadmaps against the achievement of targets (cf. Table 2) shows that in the current scenario, the collective efforts of the Member States fall short of the EU’s level of ambition for at least 8 out of 12 KPIs.

Table 2. Aggregation of the national roadmaps’ commitments

A more thorough assessment 64 demonstrates that substantial improvements and adjustments of the national roadmaps are needed to align them with the ambition and benchmarks of the Digital Decade policy programme, as per the Commission’s 2023 Guidance 65 . In particular, all targets should be covered by national targets and trajectories that reflect the EU’s level of ambition, as defined by the co-legislators, and should be translated into more ambitious measures, including budgetary considerations. To ensure a more sustained progress towards these targets Member States should also present an analysis of the impact that these measures will have. Greater attention is required on the challenges faced by each Member State and the general objectives (i.e., human centred digital space, competitiveness, fairness, resilience, sovereignty, inclusiveness, sustainability and greening, coherence of the action) linked with the European Declaration on Digital Rights and Principles 66 . These objectives also emphasise the promotion of cultural and linguistic diversity. The monitoring of the Declaration indeed shows that increasing the profile of the Declaration at national level could also help improve outcomes in the years to come 67 . This will ensure coherence and efficiency in collective action. Finally, stakeholder consultation is a key element of the Digital Decade, and it should be conducted and appropriately reflected in the national roadmaps.

4.3 Recommendations on the way forward

All the advancements made by the EU, supported by vigorous policy action, already start delivering significant progress towards Digital Decade objectives and targets with concrete effects on basic connectivity coverage, semiconductors, and super-computing, as further highlighted in Annex 1.

However, considering the limited progress made in 2023 and the important needs identified by the Digital Decade monitoring in most areas, there is still a critical need for action and investment at EU and national level regarding notably Digital Skills, ICT experts, high-quality connectivity, dissemination of AI and data analytics, start-up ecosystems, whilst efforts in semiconductors should be continued. Among all critical areas, the fostering of collaborative connectivity and computing networks 68  will require at least EUR 280 billion of investment by 2030 69 .

Considering this comprehensive analysis, the Annexes 1 and 3 of this report provide concrete recommendations to Member States on the way forward, addressing the whole possible scope of action: mobilising investments, completing the single market, disseminating technologies, and fostering cooperation between Member States. In a nutshell the recommendations revolve around the following main pillars.

First, in order to swiftly implement and enforce the regulatory frameworks established to drive the digital transformation (including the DSA, the DMA, the AI act, the EU Digital Identity Regulation, the OOTS, the Cybersecurity and Data legislations and the EU toolbox for 5G cybersecurity), the EU and Member States should engage in more coordination and cohesion across the board, synergies among governance entities and funding programmes, and the mitigation of unnecessary administrative burden.

In particular, the reduction of the administrative burden, both in the implementation and enforcement of existing legislative acts, entails promoting synergies, avoiding duplication and adopting a coordinated approach to managing the existing governance structures, with a coherence between digital and cybersecurity policy. In this context, the Digital Decade Board can serve as a central point for Member States, with a broad mandate covering various aspects of digital transformation, such as governance, reporting obligations, and multi-country projects. By leveraging this board, efforts can be further streamlined and harmonised across different entities, across various Member States, ultimately resulting in an adoption the ‘whole-of-government' approach underpinning the Digital Decade. Such approach can break down boundaries between government agencies enabling smooth data and information sharing across their systems. This approach can also foster collaboration in mapping reporting obligations, consolidating, or codifying the digital legal framework, ultimately streamlining processes for businesses and citizens.

Secondly, the Member States should intensify their efforts to strengthen their competitiveness, encompassing productivity, resilience, greening and sovereignty. This requires increased measures and investments, as well as a step change in addressing obstacles to the single market. The EU should be ready to ensure the availability of reliable, fast and secure collaborative connectivity and computing networks throughout the EU, fostering the digitalisation of both business and public services, for the benefit of national and cross-border users. The EU should also equip itself with a more coherent and strategic framework of investment, governance, and capacity-building for an effective and inclusive skills and talent development for the digital age, notably through a swift adaptation of EU education and training systems.

Significant mobilisation of further public and private investments will be critical to foster research, innovation, and digital infrastructure development. These investments are also essential to bridge the digital divide across regions. This includes the cultivation of start-up ecosystems, the creation of software and chips that meet sustainability and security standards and the leveraging of synergies between civil and defence sectors. Progress toward a true capital markets union is also essential for driving growth and innovation.

The report also highlights the need to extend the scope of public policy interventions, particularly in public procurement. This will help accelerate the development of the EU’s digital industrial and services base, including for sovereign AI and cloud technologies and services.

Thirdly, there is still untapped potential to foster the dissemination of digital technologies across society and regions, particularly by developing cooperation and collaboration between European actors at the local level. Building on EDICs, EDIHs and partnerships such as EuroHPC JU, the EU and Member States should establish closer links with local actors, including SMEs, start-ups, universities, etc. This collaboration should also extend to cities and local development banks to fully harness the potential of the European society. The experience and capacities of regions and cities are of paramount importance for a successful Digital Decade. With their practical experience, knowledge, and innovative solutions based on daily contacts with citizens and businesses, regions and cities can help better promote and monitor implementation of the Declaration on Digital Rights and Principles, tackling digital divides and ensuring that the benefits of digitalisation can reach all actors including SMEs.

Fourthly, building on citizens’ growing perception of the potential of the digital transformation to foster a smart green transition, Member States can capitalise on the significant achievements made in 2023 in better understanding the synergies between the twin transitions and possible leverages. The priority is to transition from small scale pilots and initiatives to large scale projects based on cooperation between public and private actors. To achieve this goal, it is notably essential to establish a quantitative target on greening in the Digital Decade, to accelerate the work on identifying best practices as well as to intensify the coordination between national Digital Decade strategic roadmaps and National Energy and Climate Plans (NECPs).

Fifth, a common effort is required to ensure that people and their rights, as committed to in the Declaration on Digital Rights and Principles, are at the centre of the digital transformation, ensuring that they have the adequate digital skills and keeping them on board. To achieve this objective, the EU and Member States will need to better monitor societal and economic risks stemming from digitalisation, addressing issues such as inequality, poverty, online discrimination, and social exclusion and foster direct human support to those who are facing difficulties. Member States should also intensify action against threats to public health and democracy, while at the same time ensuring that the online space becomes a genuinely safe, healthy and secure environment for children. These actions to address inequalities, online discrimination, divides and social exclusion linked to the growing centrality of online interfaces in daily lives are critical to prevent a growing digital disconnect from evolving into digital discontent.

Finally, the identification and sharing of best practices is a key driver of a successful digital transformation and was identified as a priority for both the Commission and Member States. The goal is to foster increased cooperation, mutual inspiration and the sharing of success stories and solutions to systemic challenges. Such collaboration is essential for advancing towards the EU’s 2030 goals and the broader digital transformation. As agreed by the Digital Decade Board and based on the interest of Member States, the process of sharing best practices is scheduled to intensify in 2024, initially focusing on three pilot areas: (i) advancement of digital skills; (ii) uptake of advanced digital technologies, especially AI; and (iii) monitoring of the green footprint of digital technologies. The process will be led by Member States with the Commission acting as an accelerator to identify, select and monitor best practices and their dissemination.

5. International dimension

International cooperation efforts on digital policies focus on (i) promoting the EU human-centric model and regulatory framework, (ii) protecting the EU’s strategic interests including EU economic security and (iii) reinforcing the global role of the EU in the digital world.

The Declaration on Digital Rights and Principles 70 has influenced international texts, including the OECD Declaration on a Trusted, Sustainable and Inclusive Digital Future 71 and discussions for a United Nations Global Digital Compact. The EU has laid down foundations for Digital Diplomacy through Council Conclusions and aims for a stronger, more strategic approach in global digital affairs. The importance of the international dimension of EU digital policies was further emphasised by the European Council in its Conclusions of 18 April 2024, which underlined the need to strengthen the EU’s leadership in global digital affairs and invited the Commission and the High Representative to prepare a joint communication on the subject.

The Commission has continued to develop its network of Trade and Technology Councils (TTC) and Digital Partnerships with like-minded partners like the US, India, Japan, South Korea, Singapore and Canada, developing cooperation on investments and technical support, policy and legislation as well as standardisation. Through the EU-US TTC, the EU has advanced cooperation in key areas such as emerging technologies, secure and resilient connectivity and protection of human rights and values online. The TTC with India and the Digital Partnerships with Japan, the Republic of Korea and Singapore showcase the EU’s strategic engagement in the digital field with the Indo-Pacific.

In the Latin America and Caribbean (LAC) region, bilateral digital policy dialogues have been set up with Brazil and Argentina and a dialogue is planned with Mexico, in complement to the bi-regional dialogue established under the EU-LAC Digital Alliance 72 . In Asia, the EU held a second High Level Dialogue on Digital with China in September 2023 as well as the High- Level Economic Dialogue. The dialogue notably discussed problems EU companies encounter in China such as access to ICT standardisation bodies or cross-border data.

The Global Gateway initiative focuses on digital infrastructure investments to bridge the global digital divide and enhance secure digital connections, notably the deployment of secure 5G networks provided by trusted vendors and the security and resilience of submarine cables, supporting the EU’s digital resilience and reducing dependencies. The Commission has continued to support digital transformation efforts in enlargement countries and the EU neighbourhood, including a long-term roaming arrangement with Ukraine through the EU-Ukraine Association Agreement 73 . The Commission has also engaged in multilateral fora notably on artificial intelligence (G7 Hiroshima AI Process, Council of Europe Convention). To safeguard economic interests, the EU has implemented measures such as the EU Economic Security Strategy, promoting cooperation with key partners in emerging technologies. These measures aim to balance economic openness with strategic interests and enhance the EU's resilience in critical sectors.

Trade policy and agreements also play a vital role in this regard by setting the global and bilateral rules for digital trade in an open but assertive manner, based on European values. The Commission negotiated ambitious commitments on digital trade in recent trade agreements with New Zealand, Chile and Japan. Trade rules allow EU businesses and consumers throughout the economy to have access to the most innovative and best performing goods and services and EU businesses to access to a wider customer base in a global market. As the geopolitical environment is expected to remain tense, agreeing binding digital trade rules with like-minded countries is important to ensure that EU companies can secure access to third country markets and trusted cross-border flows of data, to allow EU companies to scale up and thrive in the digital economy at global level. The EU has also been a driving force in the WTO plurilateral negotiations on e-commerce amongst 90 WTO members, accounting for over 90% of global trade. Most recently, in 2023, the Commission opened negotiations for modern self-standing digital trade agreements with Singapore and with Korea. 

6. Conclusions

Over the past 5 years, the EU has forged an unprecedented digital legacy by developing a vision, the Digital Decade objectives and targets, and the tools to shape its digital transformation towards the achievement of such vision. Its unique digital regulatory framework remains unparalleled, while innovation and industrial policy continue to grow increasingly assertive. 

The state of play presented in this report calls for leveraging the acquis to intensify joint action on the EU’s digital transformation. Member States are invited to take note of the analysis in this State of the Digital Decade report and review the horizontal and Member State-specific recommendations provided in the annexes. It is critical that Member States respond to this call for action and adjust their national roadmaps to align with the ambition of the Digital Decade policy programme, before November 2024 as requested by the Digital Decade decision 74 .

Considering the evidence presented in this report, the Commission will continue its discussions with Member States, the European Parliament, and stakeholders on how to progress together, leveraging the Digital Decade’s governance mechanism, notably the Digital Decade Board. The report will also inform the co-operation with stakeholders and partners outside the EU.

As set out in the Digital Decade policy programme, the Commission will monitor and assess the implementation of these recommendations and report on the progress made in the State of the Digital Decade 2025 report.

The Commission will also start preparing the review of the Digital Decade policy programme, foreseen for June 2026.

(1)  https://digital-strategy.ec.europa.eu/en/library/2023-report-state-digital-decade.

(2)

Decision (EU) 2022/2481 of the European Parliament and of the Council of 14 December 2022 establishing the Digital Decade policy programme 2030, OJ L 323, 19.12.2022, p. 4–26.

(3)

 Commission analysis, SWD ‘Digital Decade in 2024: Implementation and perspective’ with annexes, SWD(2024)260:  https://digital-strategy.ec.europa.eu/en/news-redirect/833325 .

(4)

The report was drafted following a series of workshops and fact-finding missions which encompassed over 100 meetings held across all Member States. These meetings engaged authorities, regulators and civil society representatives.

(5)

In Figure 2 the ‘time to target’ is calculated by projecting the most recent observed average annual growth (as of 2023). It does not foresee any acceleration neither takes into account very recent actions that may have a positive impact. The current KPI for the 5G target does not take into account quality of service, and therefore most of the current 5G deployment can be categorised as “basic 5G”. "Stand-alone" 5G, which ensures high reliability, low latency and is crucial for enabling advanced features, is still not deployed on any meaningful scale, except in very few cases of private networks. Meanwhile, 5G coverage in the 3.4-3.8 GHz band, considered the primary pioneer band for 5G in the Union and the only available mid-band on a large scale offering a good balance between coverage and capacity, stands at only 51% in 2023. Since 2023, the European Commission together with the Member States is working on an update of the 5G indicator, which entails the development of a methodology to map quality of service (QoS).

(6)

This report is complemented by the Staff Working Document ‘Digital Decade in 2024: Implementation and perspective’ with annexes, SWD(2024)260, including horizontal and individual detailed analysis of the Digital Decade strategic roadmaps submitted by the Member States and reporting on the implementation of the European Declaration on Digital Rights and Principles (2023/C 23/01, OJ C 23, 23.1.2023, p. 1–7), which translates the EU’s vision of digital transformation into principles and commitments and provides a clear reference for people, policymakers and companies regarding the desired type of digital transformation in the EU.

(7)  See SWD ‘Digital Decade in 2024: Implementation and perspective’ with annexes, SWD(2024)260:  https://digital-strategy.ec.europa.eu/en/news-redirect/833325 , Annex 1 List of relevant policy initiatives.

(8)  The regulation is expected to be published in the Official Journal in summer 2024 (AI Act webpage: https://digital-strategy.ec.europa.eu/en/policies/regulatory-framework-ai).

(9)   Regulation (EU) 2022/868 of the European Parliament and of the Council of 30 May 2022 on European data governance and amending Regulation (EU) 2018/1724 (Data Governance Act)., OJ L 152, 3.6.2022, p. 1–44, http://data.europa.eu/eli/reg/2022/868/oj.

(10)   Regulation (EU) 2023/2854 of the European Parliament and of the Council of 13 December 2023 on harmonised rules on fair access to and use of data and amending Regulation (EU) 2017/2394 and Directive (EU) 2020/1828 (Data Act), OJ L 2023/2854, 22.12.2023, http://data.europa.eu/eli/reg/2023/2854/oj.

(11)  The regulation is expected to be published in the Official Journal in autumn 2024 (EHDS webpage: https://health.ec.europa.eu/ehealth-digital-health-and-care/european-health-data-space_en).

(12)  https://commission.europa.eu/news/once-only-technical-system-key-creation-first-european-data-space-2022-07-20_en. 

(13)  Regulation (EU) 2018/1724 of the European Parliament and of the Council of 2 October 2018 establishing a single digital gateway to provide access to information, to procedures and to assistance and problem-solving services and amending Regulation (EU) No 1024/2012, OJ L 295, 21.11.2018, p. 1–38, https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2018.295.01.0001.01.ENG.

(14)  Regulation (EU) 2024/903 of the European Parliament and of the Council of 13 March 2024 laying down measures for a high level of public sector interoperability across the Union (Interoperable Europe Act) OJ L, 2024/903, 22.3.2024, https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32024R0903.

(15)  Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market For Digital Services and amending Directive 2000/31/EC (Digital Services Act), OJ L 277, 27.10.2022, p. 1–102, https://eur-lex.europa.eu/eli/reg/2022/2065/oj  1–102, https://eur-lex.europa.eu/eli/reg/2022/2065/oj ;  https://digital-strategy.ec.europa.eu/en/policies/list-designated-vlops-and-vloses ;  https://digital-strategy.ec.europa.eu/en/policies/dsa-enforcement . .

(16)  Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and fair markets in the digital sector and amending Directives (EU) 2019/1937 and (EU) 2020/1828 (Digital Markets Act), OJ L 265, 12.10.2022, p. 1–66, http://data.europa.eu/eli/reg/2022/1925/oj; DMA designated Gatekeepers (europa.eu)  . 

(17) Directive (EU) 2018/1972 of the European Parliament and of the Council of 11 December 2018 establishing the European Electronic Communications Code, OJ L 321, 17/12/2018, p. 36-214, http://data.europa.eu/eli/dir/2018/1972/oj.

(18)  Commission guidelines on video sharing platforms, on European works and on the scope of MS media literacy reports (https://digital-strategy.ec.europa.eu/en/policies/audiovisual-and-media-services).

(19)  Directive (EU) 2022/2555 of the European Parliament and of the Council of 14 December 2022 on measures for a high common level of cybersecurity across the Union, amending Regulation (EU) No 910/2014 and Directive (EU) 2018/1972, and repealing Directive (EU) 2016/1148, OJ L 333, 27.12.2022, p. 80–152, http://data.europa.eu/eli/dir/2022/2555/2022-12-27 (consolidated text).

(20)  The regulation is expected to be published in the Official Journal in 2024 (Cyber Solidarity Act webpage: https://digital-strategy.ec.europa.eu/en/policies/cyber-solidarity).

(21)  The regulation is expected to be published in the Official Journal in 2024 (Cyber Resilience Act webpage: https://digital-strategy.ec.europa.eu/en/policies/cyber-resilience-act).

(22)  Regulation (EU) 2024/1183 of the European Parliament and of the Council of 11 April 2024 amending Regulation (EU) No 910/2014 as regards establishing the European Digital Identity Framework, OJ L, 2024/1183, 30.4.2024, http://data.europa.eu/eli/reg/2024/1183/oj.

(23)  Regulation (EU) 2024/1309 of the European Parliament and of the Council of 29 April 2024 on measures to reduce the cost of deploying gigabit electronic communications networks, amending Regulation (EU) 2015/2120 and repealing Directive 2014/61/EU (Gigabit Infrastructure Act), OJ L, 2024/1309, 8.5.2024, http://data.europa.eu/eli/reg/2024/1309/oj.

(24)   https://commission.europa.eu/strategy-and-policy/eu-budget/performance-and-reporting/horizontal-priorities/digital-tracking_en .

(25)  This amount represents the total estimated costs of measures included in the Recovery and Resilience Plans, including REpowerEU measures.

(26)  Source: Joint Research Centre report ‘Mapping EU level funding instruments to Digital Decade targets - 2024 update’ (Signorelli et al., 2024).

(27) The Digital Decade targets indicated in the table with an asterisk (*) benefit from HPC funding. This funding not only supports computing research and infrastructures (e.g., quantum, cloud, AI etc.) but also the training of specialists, the development of hyper-connectivity (5G, edge nodes), and the adoption of HPC by SMEs. In total HPC funding amounts to EUR 3 267 million, mainly channelled through DIGITAL (EUR 1 967.2 million), Horizon Europe (EUR 900 million), CEF (EUR 200 million), and the RRF (EUR 168 million).

(28)  Including measures in the REpowerEU chapters contributing to the digital transition. It should be noted that those measures are considered in the analysis in this report but do not contribute to the achievement of the 20% digital target set by the Regulation establishing the Recovery and Resilience Facility (see also the Guidance on Recovery and Resilience Plans in the context of REPowerEU ). Excluding measures under the REpowerEU chapter, the amount of the RRF that contributes to the digital transition is about EUR 149.7 billion, which represents about 26% of the total RRF funds. 

(29)  While the overall Cohesion Policy funds total is EUR 392 billion, only the following funds are included in the mapping. and subsequent estimations: the European Regional Development Fund (ERDF), the Cohesion Fund (CF), and the European Territorial Cooperation Fund (Interreg), Including the digitalization investments from the REPowerEU chapters.

(30) Excluding measures under the REpowerEU chapter. The share is calculated using Annex VII to the Recovery and Resilience Facility (RRF) Regulation.

(31)   https://ec.europa.eu/economy_finance/recovery-and-resilience-scoreboard/common_indicators.html?lang=en. .

(32) The outermost regions (Art. 349 TFEU) are an integral part of the EU and are located in the Atlantic Ocean, the Caribbean basin, South America and the Indian Ocean. CEF Digital provides higher co-financing rates to projects involving the outermost regions and has funded submarine cable infrastructure in these regions worth over EUR 125 million.

(33) 5G Seagul, 5G DeLux, 5G NETC, MEDCOR, 5G Balkans, BaltCor5G.

(34) Continent-Azores-Madeira ring, Pisces project, ViaTunisia project, as well as various Arctic connectivity projects.

(35)   https://digital-strategy.ec.europa.eu/en/library/second-staff-working-document-data-spaces .

(36) Namely the EU Beneficial Ownership Registers Interconnection System (BORIS) and with the EU Insolvency Registers Interconnection system (IRI).

(37) For example, the hub CIDIHUB in the Canary Islands focuses on digitalisation of businesses while EDIH of Réunion specialises in cybersecurity with funding from DIGITAL.

(38)   https://www.statista.com/statistics/732308/worldwide-research-and-development-information-communication-technology/ .

(39)   https://www.statista.com/statistics/732308/worldwide-research-and-development-information-communication-technology/ .

(40) With Joint Undertakings for Chips, EuroHPC, Smart Networks and Services and other partnerships in AI, Data and Robotics partnership, Photonics or Made in Europe and the Virtual Words and Advanced Materials Partnership).

(41)  https://commission.europa.eu/funding-tenders/find-funding/eu-funding-programmes/technical-support-instrument/technical-support-instrument-tsi_en.

(42) https://reform-support.ec.europa.eu/tsi-2024-flagship-ai-ready-public-administration_en.

(43)   https://reform-support.ec.europa.eu/our-projects/flagship-technical-support-projects/tsi-2025-flagship-compact-pillar-ii-capacity-europes-digital-decade_en.  

(44)   https://single-market-economy.ec.europa.eu/industry/strategy/industrial-alliances_en .

(45)   https://www.top500.org/lists/top500/list/2024/06/.

(46) https://digital-strategy.ec.europa.eu/en/news/commission-launches-ai-innovation-package-support-artificial-intelligence-startups-and-smes.

(47) JOIN/2023/20 final – Joint Communication to the EP and the Council on “European economic security strategy”.

(48) C(2023) 6689 final – Commission Recommendation on critical technology areas for the EU's economic security for further risk assessment with Member States.

(49) For a comprehensive description of the ongoing EDICs: SWD ‘Digital Decade in 2024: Implementation and perspective’ with annexes, SWD(2024)260:  https://digital-strategy.ec.europa.eu/en/news-redirect/833325 Annex 2 Update on MCPs / EDICs.

(50)

 Cf. Communication ‘State of the Digital Decade 2024’ with annexes, COM(2024) 260: https://digital-strategy.ec.europa.eu/en/news-redirect/833324 .

(51)      Since last year, there has been a marginal 0.5 percentage point increase in EU’s share (https://www.statista.com/statistics/263801/global-market-share-held-by-selected-countries-in-the-ict-market/). It may be early to interpret this as a shift in trend, but this could be an encouraging sign.

(52)  https://cerre.eu/wp-content/uploads/2022/12/Digital-Industrial-Policy-for-Europe.pdf.

(53)   https://companiesmarketcap.com/tech/largest-tech-companies-by-market-cap/.

(54)

 Special Eurobarometer 551 ‘The Digital Decade’ 2024: https://digital-strategy.ec.europa.eu/en/news-redirect/833351.

(55)

https://digital-strategy.ec.europa.eu/en/policies/digital-principles.

(56) Cross- border availability remains limited for digital public services for citizens and for businesses, both reaching a score of around 70 points out of 100 (Source: eGovernment Benchmark, Capgemini).

(57)   https://www.enisa.europa.eu/publications/enisa-threat-landscape-2023 .

(58)

 Special Eurobarometer 551 ‘The Digital Decade’ 2024: https://digital-strategy.ec.europa.eu/en/news-redirect/833351.

(59) https://digital-strategy.ec.europa.eu/en/policies/national-strategic-roadmaps.

(60) Very high capacity networks (VHCN) include both fibre to the premises (FTTP) and DOCSIS 3.1 technologies.

(61)  See footnote 5. The current KPI for the 5G target does not take into account quality of service, and therefore most of the current 5G deployment as well as the corresponding national 5G targets can be categorised as “basic 5G”.

(62) Cf. footnote above.

(63) The most recent figures available on AI take-up by enterprises were collected in 2023 and cannot take into account the possible effect of the innovation package to support Artificial Intelligence startups and SMEs that was launched by the European Commission in January 2024 (https://ec.europa.eu/commission/presscorner/detail/en/ip_24_383).

(64)

 SWD ‘Digital Decade in 2024: Implementation and perspective’ with annexes, SWD(2024)260: https://digital-strategy.ec.europa.eu/en/news-redirect/833325.

(65)  https://digital-strategy.ec.europa.eu/en/library/guidance-member-states-preparation-national-digital-decade-strategic-roadmaps.

(66)

 European Declaration on Digital Rights and Principles for the Digital Decade 2023/C23/01: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=OJ:JOC_2023_023_R_0001.

(67)

 See SWD ‘Digital Decade in 2024: Implementation and perspective’ with annexes, SWD(2024)260: https://digital-strategy.ec.europa.eu/en/news-redirect/833325  Annex 4 Monitoring of the European Declaration on Digital Rights and Principles .

(68) An ecosystem that spans semiconductors, computational capacity in all kinds of edge and cloud environments, radio technologies, to connectivity infrastructure, data management, and applications.

(69)  European Commission, White Paper - On options for enhancing support for research and development involving technologies with dual-use potential, 2024: https://research-and-innovation.ec.europa.eu/document/download/7ae11ca9-9ff5-4d0f-a097-86a719ed6892_en; Key Note Speech by President Ursula von der Leyen at the EDA Annual Conference 2023: Powering up European Defence, 30 November 2023: https://ec.europa.eu/commission/presscorner/detail/en/SPEECH_23_6207 . 

(70)

 European Declaration on Digital Rights and Principles for the Digital Decade 2023/C23/01: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=OJ:JOC_2023_023_R_0001.

(71)

OECD, Declaration on a Trusted, Sustainable and Inclusive Digital Future: https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-0488.

(72)

EU- Latin America and Caribbean Digital Alliance: https://international-partnerships.ec.europa.eu/policies/global-gateway/eu-latin-america-and-caribbean-digital-alliance_en.

(73)

Association Agreement between the European Union and its Member States, of the one part and Ukraine of the other part: http://data.europa.eu/eli/agree_internation/2014/295/2023-12-01.

(74)  DECISION (EU) 2022/2481, Article 8.3.

EUROPEAN COMMISSION

Brussels, 2.7.2024

COM(2024) 260 final

ANNEX

to the

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions

State of the Digital Decade 2024

Annex 1: Competitiveness and sovereignty, people, smart greening, policy coherence and synergies

Table of Contents

Introduction    

1. Key drivers of the EU’s digital transformation in 2024    

1.1 A new geopolitical paradigm    

1.2. Fostering competitiveness in a complex economic context    

1.3. Entering a new age shaped by generative AI    

1.4 Keeping people and societies on board in an increasingly hybrid context    

2. A competitive, sovereign and resilient EU based on technological leadership    

2.1. Building digital technological leadership for future competitiveness    

2.1.1. Investing in research and innovation    

2.1.2. A functioning Digital Single Market as a public good for EU’s productivity    

2.1.3. Developing and deploying sovereign and resilient collaborative connectivity and computing infrastructure    

2.2. Supporting EU-wide digital ecosystems and scaling up innovative enterprises    

2.2.1. Promoting the digital transformation of EU enterprises    

2.2.2. Scaling up innovative enterprises    

2.3. Strengthening cybersecurity    

3. Protecting and empowering EU people and society    

3.1. Empower people and bring the digital transformation closer to their needs    

3.1.1. Equip people with digital skills    

3.1.2. Trusted solutions for digital interaction: the EU Digital Identity and the digital euro    

3.1.3. Efficient digital public services user-friendly and accessible to all    

3.1.4. Leverage on digital technologies for health    

3.2. Protect people and a build safe and human centric digital environment and technologies    

3.2.1. Build safe digital environments and safeguard fundamental rights online    

3.2.2. Protect and empower children (including via age verification)    

3.2.3. Promote responsible and human-centric AI systems    

3.3. Promote and preserve our democracy    

3.3.1. Address disinformation and preserve election integrity    

3.3.2. Access to media and media pluralism    

4. Leveraging digital transformation for a smart greening    

4.1. The nexus between green transition and digital transformation    

4.2. Towards Sustainable digital infrastructures    

4.3. The digitalisation for the green transition is entering into concrete delivery.    

4.4. The way forward    

5. Building coherence and synergizing digital policies and spending    

5.1. Horizontal implementation through national roadmaps    

5.2. Striving for an effective, efficient and red-tape free implementation of the digital regulatory environment    

5.3. Synergising funding for digitalisation    

5.4. Increase cooperation across levels, including involving cities and regions more in the Digital Decade    

Table of figures

Figure 1. R&D expenditure on information and communication technology (ICT) worldwide in 2022 (Source: European Commission. (2023) and Statista Inc)    

Figure 2. FTTP coverage in the EU. Historical data, Digital Decade (DD) trajectory and 2024 baseline trajectory towards 2030    

Figure 3: Edge node deployment (EU projection to 2030)    

Figure 4. Number of quantum computers in the EU. Trajectory towards 2030    

Figure 5. Quantum technologies start-ups International Benchmarking study    

Figure 6. Percentage of enterprises using cloud services in the EU. Historical data, Digital Decade (DD) trajectory and 2024 baseline trajectory towards 2030    

Figure 7. Percentage of enterprises using AI in the EU. Historical data, Digital Decade (DD) trajectory and 2024 baseline trajectory towards 2030    

Figure 8. AI venture capital investments International Benchmarking study    

Figure 9. Share of enterprises using Data analytics in the EU. Historical data, Digital Decade (DD) trajectory and 2024 baseline trajectory towards 2030    

Figure 10. Digital Intensity Index Historical comparable data, Digital Decade (DD) trajectory and 2024 baseline trajectory towards 2030    

Figure 11. Unicorns International Benchmarking study    

Figure 12. Number of unicorns in the EU. Historical data and 2024 baseline trajectory    

Figure 13. At least basic digital skills in the EU. Historical data, Digital Decade (DD) trajectory and 2024 trajectory towards 2030    

Figure 14: ICT specialists in employment in the EU. Historical data, Digital Decade (DD) trajectory and 2024 trajectory towards 2030    

Figure 15: Online service provision for citizens (top chart) and businesses (bottom chart). Historical data, Digital Decade (DD) trajectory and revised baseline trajectory towards 2030    

Figure 16: e-Health composite indicator. Historical data and DD trajectory    

Introduction

This annex is an integral part of the State of the Digital Decade 2024 report. It maintains the three-chapter structure from the 2023 report, focusing on competitiveness, people and society and smart greening, and introduces an additional chapter on synergising digital policies and spending.

This report also addresses the implementation of the Declaration on Digital Rights and Principles 1 . The Declaration translates the EU’s vision of digital transformation into principles and commitments.

Finally, the annex identifies significant gaps and shortages and recommends policies, measures or actions, addressed to all Member States. Such recommendations target areas where additional collective action is required. They advocate for the mobilisation of additional investments and actions to complete the Digital Single Market and boost the dissemination of technologies as well as foster cooperation among Member States.

The analysis primarily relies on the monitoring conducted through the Digital Economic and Society Index (DESI). It is further supported by relevant studies and expert analysis, and the National Digital Decade Strategic Roadmaps submitted by Member States.

1. Key drivers of the EU’s digital transformation in 2024

The key drivers identified in the 2023 Digital Decade report 2 remain globally relevant and important in 2024. However, there have been some notable intensifications and shifts. The current analysis and subsequent recommendations are made in the light of those developments.

1.1 A new geopolitical paradigm

Recent months have seen a marked increase in geopolitical inflection points, driven by escalating conflict, growing fragmentation and power politics 3 . The consequences of these trends, including the increase in cybersecurity threats 4 , disinformation, supply chain disruption, economic coercion and armed conflict, overlap and compound one another 5 . There is no indication that the risks generated by this situation are likely to tail off in the foreseeable future.

The global tech race has intensified in 2024. All major economies, including the EU, the US, China, Japan, and India, are becoming increasingly aware of the economic and national-security significance of advanced technologies and some countries are pursuing aggressive policies to regulate and, at times, secure technology supply chains 6 . As dependencies on these technologies are growing, their risk of being weaponised increases 7 .

Against a backdrop of permanent instability, the EU’s greatest assets are its economic power, its internal market, its resilience, and its wide network of trade partners 8 . In this context, the EU is assuming greater responsibility for its diplomatic leadership and its security and defence by boosting investments 9 and focusing on innovation, especially in dual-use digital technologies 10 and emerging disruptive technologies 11 .

1.2. Fostering competitiveness in a complex economic context

The economic landscape of 2024 is characterised by exceptionally high uncertainty, exacerbated by geopolitical tensions 12 . Additionally, Europe’s economic growth has experienced a slowdown, while debt levels have continued to rise through 2023 and 2024 13 . Furthermore, electricity prices have stabilised at a structurally high level, being three times as high as in the US and more than twice as high as in China 14 . The reasons include increasing inflation rates, a rise in the frequency and severity of adverse supply-side disruptions, and growing supply chain vulnerabilities for essential resources and technologies. Overall, this has created a more challenging investment environment for digital transformation 15 , resulting in the EU lagging significantly behind the US, where productivity gains since 2019 are tenfold in the US (6% compared to 0.6% in Europe) 16 .

All these elements highlight the urgent need for the EU to prioritise action in areas that foster innovation and growth, improve productivity, and mitigate disruptions – in particular in the areas of digital technologies and digital skills 17 . In a broader sense, substantial investments are required to face the challenges of digitalisation, environmental sustainability, population ageing, energy transition the emerging trend of deglobalisation and a reduction of reliance on fossil fuels 18 . Additionally, efforts to strengthen the single market’s attractiveness are crucial to reversing the EU’s declining competitiveness, which stems from insufficient integration 19 . Such measures are essential for modernising EU’s economy and boosting production capacity. Moreover, successfully twinning the green transition with the digital transitions is vital. Achieving these goals will require a dynamic digital transformation.

1.3. Entering a new age shaped by generative AI

While the transformative role of AI has been known for years, the rise of generative AI in 2023 marked a new phase in the technological revolution with the possibility of systemic chain reactions for business, citizens, and public administration in terms of both opportunities and risks. Generative AI is massively democratising content generation 20 – including accessibility, modularity, ease of use and human-like features – presenting tangible prospects for a wide use by all people and enterprises and bringing a possible unique acceleration in AI uptake by European citizens, businesses and public administrations 21 . The wide increase of computing power now enables the integration of AI across various aspects of daily life –cars, mobiles, homes and sport watches among others. This integration is driving systemic innovation, boosting economic efficiency, and enhancing the productivity of business operations. By 2030, the net impact of AI on Europe’s economy is projected to contribute an additional EUR 600 billion to a previously estimated EUR 2.8 trillion 22 . Moreover, the deployment of generative AI is expected to generate business value raging from EUR 2.4 to EUR 4.0 trillion annually 23 . This technological shift will also significantly affect jobs and skillsets in ways that are not yet fully anticipated and understood.

Developing of a robust generative AI ecosystem requires the EU mastering the entire technological value chain across all layers. This includes ensuring the simultaneous development of all interdependent components 24 , the chips and high-performance computing capacities crucial for training models and foundational data for AI systems, and the researchers and specialists who develop these systems. Additionally, it involves cultivating a skilled work force capable of deploying AI in business, including SMEs, and establishing a robust connectivity infrastructure, which encompasses data centres. Investments supported by a well-functioning; deep capital market are also vital. Each of these elements is crucial reinforcing the need for comprehensive progress in all facets of the Digital Decade, to avoid jeopardising the whole initiative.

1.4 Keeping people and societies on board in an increasingly hybrid context

Digital technologies increasingly permeate every aspect of people’s daily lives, sometimes with no or more limited offline alternatives. While they derive important benefits from this transformation in their lives it becomes crucial to tackle the pressing concerns stemming from vulnerabilities and inequities, and more generally to help people adjust to the fast pace of change, notably through a coherent and strategic approach on digital literacy. A substantial share of Europeans feels unequipped or uncomfortable with digital transformation: only 56% of adults have at least basic digital skills and about 100 million European citizens perceive digitalisation as a source of complexity in their lives. A large majority of Europeans (88%) believing that public authorities should prioritise providing human support to help navigate the digital transformation 25 . People also feel vulnerable in the face of online scams or unfair practices regarding cancellations, refunds, and price gouging 26 . Finally, concerns over AI’s impact on human contributions, including jobs, and the loss of privacy, are palpable and growing 27 .

In 2024, technology continues to test our societies with 72% of Europeans now worried about the potential for manipulation and disruption of elections in the EU through cyberattacks 28 . More generally, the exposure of democratic societies to foreign interference is of particular concern this year, - the biggest electoral year in history, with countries worldwide including for 450 million Europeans, voting in pivotal elections. In this context, societal polarisation is emerging as one of the foremost risks for democracies 29 , potentially jeopardising our ability to address effectively the pressing global challenges of our time. Therefore, one critical challenge is ensuring that digital technologies and services enhance – rather than undermine – trust in institutions.

Preventing interferences that impede societal stability such as disinformation is also paramount. Since May 2023, AI-generated false articles have increased by over 1 000% notably published by a constellation of more than 600 unreliable news and information websites 30 . New breeds of social media bots and tools created by generative AI are spreading political, election-related disinformation in ways that are increasingly difficult to detect. More evidence this year has shown that online platforms' recommendation algorithms carry a political bias that can disproportionately promote content, ultimately nudging public opinions and threatening democracy and social cohesion.

Finally, recent developments have exemplified the complex interlinkage of digital technologies with public health. On the positive side, the increased use of AI in health, health data spaces, and increased communication between patients and physicians are opening new opportunities 31 . However, 2023 has also highlighted the negative effects of online interface designs in mental health, as evidenced by addictive behaviours, attention deficits, or desensitisation to violence 32 . Recent analyses regarding children have pointed to a significant shift in childhood experiences, with the rise of a ‘phone-centric culture’. This shift, combined with overprotection offline and declining education standards, has been associated with lower PISA mathematics scores and worsening mental health outcomes, including higher rates of addiction, depression, anxiety, and self-harm 33 .

2. A competitive, sovereign and resilient EU based on technological leadership

The following sections monitor progress on the key general objectives for competitiveness, digital sovereignty (which requires technological leadership), cybersecurity, collective resilience and strong digital ecosystems, as well as their respective targets (gigabit connectivity, edge nodes, quantum and digitalisation of business, including SMEs, Cloud, AI and Big Data).

2.1. Building digital technological leadership for future competitiveness

In recent years, the EU’s competitiveness has faced significant challenges, particularly due to its technology related shortcomings. The EU has lagged behind in all three key dimensions of innovation, production, and adoption, especially in critical technological developments 34 . These deficiencies have notably affected its performance in digitalisation, raising concerns 35 . Furthermore, the EU’s lag in the ICT race has resulted in a decrease in the global revenue share of EU GDP in the ICT market by 10.5% over the decade between 2013 and 2022 36 , substantially effecting productivity gains.

When it comes to digital technologies and networks, the US is home to 28% of the world’s digital companies, followed by China at 23% and the EU at just 14%. This distribution highlights significant asymmetries in the production of digital services 37 . Notably, 80% of the technologies and services crucial for Europe's digital transformation are still designed and manufactured outside the EU 38 . Furthermore, European platforms have not yet managed to capture more than 5% of the global value over the past decade. Overall, European companies have minimal presence among global leaders, with only three out of the top 50 ICT companies by market capitalisation 39 being European.

In this context, a sustained and coordinated effort is essential to strengthen the EU's digital technological leadership, as a key factor in enhancing its competitiveness. This effort also requires robust governance mechanisms, for European companies and ensure a level playing field within EU’s single market.

2.1.1. Investing in research and innovation

While the EU continues to stand out as a significant contributor to global scientific advancement, since 2022 China has become the new frontrunner, leading publications in the fields of engineering, enabling strategic technologies and ICT 40 . Meanwhile, the EU is falling behind in patent applications, with only Sweden (thanks to the contribution of Ericsson) being the only EU country among the top ten filers of international patent applications. Chinese applications in 2022 were eight times the number filed in Europe and eight out of ten of the top filers of international patents are located in North-East Asia.

Additionally, the EU has also not met its 3% target levels for total (public and private) R&I investment 41  which represents only 2.2% of EU GDP. 42 This level is well below that of the US (3.4%) and slightly below China’s (2.4%), reflecting a particularly low level of investment in the private sector. This discrepancy is even more pronounced in the ICT sector, where the EU’s spending in the ICT sector was around seven times less than the US in 2022 (EUR 39.2 billion against 301.5 billion; cf. graph below).

Figure 1. R&D expenditure on information and communication technology (ICT) worldwide in 2022 (Source: European Commission. (2023) and Statista Inc 43 )

In the tech race, the EU’s companies are aiming for leadership in emerging and disruptive technologies, aiming to enhance their military and intelligence capabilities, while actively pursuing civil-military fusion strategies. To better protect the EU’s strategic assets, interests, autonomy and security, the Commission has introduced safeguards under the Horizon Europe Regulation 44 and investment safeguards under the European Innovation Council. Continuing its efforts to address vulnerabilities and research security risks in the R&I sector, the Commission proposed a Council Recommendation of 24 January 2024, 45 as part of the European Economic Security Strategy. This proposal highlights the necessity to advance a shared understanding of vulnerabilities and take steps to address them at an EU level.

Furthermore, the EU has adopted guidelines for research involving dual-use items, to ensure that risks are identified, managed and mitigated effectively by authorities and research organisations. 46 In line with the Economic Security Package of 24 January 2024 47 , the Commission has launched a public consultation on EU-level R&D support involving technologies with dual-use potential 48 . This consultation seeks to assess the adequacy of support in response to existing and emerging geopolitical challenges outlined in the Economic Security Strategy.

2.1.2. A functioning Digital Single Market as a public good for EU’s productivity

Intra-EU trade in services accounts for only about 8% of GDP compared with about 25% for goods. The past 5 years were marked by intensive legislative activity, creating the conditions for a competitive Single Market. A truly functional Single Market will be critical for progressing towards the Digital Decade objectives and targets. By securing a level playing field for all European businesses, the digital single market is one of the key enabling factors allowing companies to seek new opportunities, grow and achieve the necessary scale to compete at EU level and internationally, while also providing more tools to navigate difficult times. The Digital Single Market also widens consumer choice, removing artificial barriers within the EU and helps set common values and standards.

The effective implementation and enforcement of the recently approved legislation will be a key challenge over the coming years. Moreover, a true capital markets union in particular is key for succeeding in the strengthening of the Digital Single Market and ongoing green and digital transitions 52 .

2.1.3. Developing and deploying sovereign and resilient collaborative connectivity and computing infrastructure

The success of the Digital Decade will depend on the EU’s capacity to build an ecosystem that is grounded in the convergence between connectivity infrastructure and computing services, including chips manufacturers, electronic communications, network equipment providers, edge and cloud service providers, evolving towards the provision of collaborative connectivity and computing.

2.1.3.1. Gigabit connectivity infrastructure

A cutting-edge digital network infrastructure is a prerequisite and an essential enabler for developing the services and applications that will benefit European business and consumers as a factor of productivity and economic development. For this reason, the ambition in the Digital Decade is to provide all Europeans and businesses with Gigabit fixed and mobile networks. In the Declaration on Digital Rights and Principles, the EU and its Member States also committed that digital connectivity should be affordable for all 54 .

The EU is still far from achieving its connectivity targets. Fibre networks, which are critical for delivering gigabit connectivity, only reach 64% of households, compared to over 99% in Japan and South Korea 55 . Despite significant progress in some Member States (in particular a 38% increase in FTTP deployment in Greece linked to a catch-up effect) average annual progress in the EU (+13.5%) remains far too limited to ensure that the target of 100% coverage will be achieved by 2030, taking into account the cost and difficulty of covering the remaining 36% of households. Without additional action and investment, less than 90% of the target will be achieved by 2030.

Moreover, significant discrepancies exist between Member States concerning in particular fibre rollout, which is critical for delivering gigabit connectivity. The discrepancy in the deployment of fibre networks may be explained by a different starting point in terms of the quality and the footprint of legacy infrastructure, the different geography of Member States, and also different approaches of public financing of fibre deployment and regulatory treatment of access to legacy networks. Avoiding unnecessary overbuild of infrastructure, in particular that which is publicly funded, has worked well, for instance in France.

There is still a significant digital divide between urban and rural areas in the European Union. Fixed VHCN coverage (FTTP & DOCSIS 3.1) increased by 11.5 p.p. from 44.2% in 2022 to 55.7% in 2023, which is still much below the overall fixed VHCN coverage of 78.8%. FTTP coverage in rural areas increased by 12.1 p.p. to 52.8% in 2023, lagging behind the overall FTTP coverage of 64.0%. 5G coverage in rural areas is increasing quickly, by 22.7 percentage points (p.p.) within one year, reaching 73.7% in 2023. However, this is still much lower than the overall 5G coverage at 89.3%.

On the demand side, as of 2023, the take-up of at least 1 Gbps broadband in the EU remains very low, at 18.5% 56 , while in 20 Member States, less than 10% of consumers have adopted this high-spread broadband. The take-up of high-speed fixed broadband subscriptions is lower in the EU than in the US (20.44%), South Korea (88.04%) and Japan (84.77%) 57 .

Figure 2. FTTP coverage in the EU. Historical data, Digital Decade (DD) trajectory and 2024 baseline trajectory towards 2030

While the rollout of 5G currently reaches 89.3% of EU’s population (with just 73.7% coverage in rural areas), it still fails to deliver advanced 5G performance widely across Europe. Most of the current 5G deployment can be categorised as ‘basic 5G’, while higher quality of service and additional functionalities is still needed to meet the demand for more advanced 5G services. This is also a requirement to achieve the computing continuum that includes connectivity, cloud/AI as well as the Internet of Things (IoT).

‘Stand-alone’ 5G, which ensures high reliability, and low latency, which is crucial for enabling advanced features, is still not deployed on any meaningful scale, except in a very few cases of private networks.

Meanwhile, in 2023, 5G coverage in the 3.4-3.8 GHz band (3.6 GHz band), which is considered the primary pioneer band for 5G in the EU and the only widely available mid-band offering large scale that offers the possibility of large contiguous spectrum portions of 80-100 MHz stood at only 50.6%. This band is critical because it has the potential to achieve high-quality 5G coverage (a good balance between coverage and capacity).

Accelerating deployment is crucial because the availability of high quality dense 5G infrastructure is not only a major driver for today’s EU competitiveness, but also the main basis for the future 6G deployment, which will reuse large parts of the 5G infrastructure (e.g., fibre backhaul, LEO satellites, etc.).

The deployment of connectivity networks needs to accelerate, as well as their evolution to a Connected Collaborative Computing Network (3C Network), as described in the White paper on connectivity ‘How to master Europe's digital infrastructure needs?’ published in February 2024 and subject to public feedback 59 . 

According to estimates, the increasing softwarisation and cloudification of electronic communications networks require an additional EUR 80 billion of investment up to 2027. This is additional to bridging the more than EUR 200 billion investment gap required over the next 6 years to achieve the Digital Decade connectivity targets. 60

These estimates require sustained efforts by private operators and public authorities, going well above the amounts budgeted by the Member States in their national roadmaps to ensure high quality gigabit connectivity with high reliability, low latency and speed that users will need by 2030. More also has to be done to address the unique fragmentation of the European telecom retail markets and provide conditions for scaling up.

The White Paper on connectivity describes the future of the EU’s digital network infrastructures and related challenges. It underlines the need to invest in research and technological capability deployment, as well as in secure and resilient digital infrastructures, and to build a real single market for communications networks enabling the expansion of the sector from the traditional consumer internet market towards a computing continuum: from chips and other components for high-speed processors embedded in devices, to edge computing working cohesively with centralised cloud services and AI-powered applications managing the network.

The Smart Networks and Services Joint Undertaking (SNS JU) brings together industry and public bodies under an EU platform for R&I funding towards 5G advanced and 6G systems, to leverage the EU’s strength in network supply towards the broader value chain including cloud and software as well as devices and components. The SNS JU initiated 6G research in Europe through the co-funding of 63 research and innovation projects on 5G advanced and 6G networks, encompassing architectures, advanced wireless and optical communication, Non-Terrestrial Networks, and secure and reliable communications.

The White Paper also highlights the importance of submarine cable infrastructures, carrying over 99% of intercontinental data traffic, and for which a Recommendation to Member States 61 was adopted in February 2024. The recommendation seeks to foster action for accurate mapping of existing cable infrastructures to facilitate an EU-wide assessment of risks, vulnerabilities, and dependencies, in particular on high-risk suppliers. These will be mitigated by a “Cable Security Toolbox”, a common governance of cable technologies and cable-laying services, ensuring rapid and secure repair and maintenance of cables, as well as identifying and funding critical intra-EU and global Cable Projects of European Interest (CPEIs).

2.1.3.2. Semiconductors

Semiconductors are the ‘steam engine’ of the digital and green transformation, providing critical applications and infrastructures to smartphones and cars, healthcare, energy, communications, defence, space, and industrial automation. The semiconductor market is expected to double over this decade from its 2021 value, reaching more than USD 1 trillion by 2030. 62 This expansion encompasses areas such as chip design, wafer production, chemical provision, packaging, and capital equipment.

Semiconductors are at the centre of geostrategic interest and industrial and security strategies across the world. Our partners and competitors deploy vast public and private investments and offensive economic measures, to guarantee supply and production capacity for their economies.

The supply chains are globally interconnected but, for most segments, still highly concentrated in Asia, creating dependencies from non-EU chip designers and manufacturers, and packaging (including advanced packaging) facilities, which can result in supply shortages disrupting entire industrial sectors (e.g., automotive, industrial automation, communications).

Europe’s ambition in the Digital Decade is to double its share of global production (from 10 to 20%) and to increase its global leadership in this sector, targeting investments to produce the most advanced semiconductors (2 nanometre process). The EU can leverage its powerful research (IMEC, CEA LETI and Fraunhofer) and technological capacity (ASML, ASM, chemicals), which are state of art for the most advanced chips thanks to past strategies and investments.

The combined EU27 semiconductor value chain market share in 2022 was EUR 90 billion or 9.8% of global value chain revenues. Revenues went up substantially from the 2019 levels of EUR 57 billion, but market share fell slightly from 9.9% in 2019. The US is currently the market leader (around 40%), followed by Taiwan (15%), South Korea (13.2%), Japan (12.4) and the EU27, whose revenues are 9.8% of the global market by value according to International Data Corporation 63  estimation. By country headquarters, the total combined EU-27 value chain revenues are concentrated in the Netherlands, Germany, France, Austria, Belgium, and Luxembourg. Semiconductor manufacturing contributes 56% of total value chain revenues, with equipment at 29%.

The Digital Decade sets the target that the EU’s market share for cutting-edge semiconductors should reach 20% of global revenue by 2030. However, at this stage, cutting-edge semiconductors are still not available on the market and significant investment is planned in EU and will boost manufacturing capability in Europe in the coming years.

Between 2022 and 2023, revenues in the EU declined by 3% (from 90 to 87 billion euros), while global revenues fell by 14% (from 918 to 791 billion euros). In this challenging context, the next stage for the EU is to reinforce further the semiconductor ecosystem in Europe, from R&I to manufacturing capacity, expanding industrial presence across the supply chain. In 2024, the EU faces a significant challenge in ensuring a robust production network, necessitating massive financial input. The EU must in particular overcome weaknesses in chip design, manufacturing, and assembly and packaging, as manufacturing in the EU had fallen over time because of outsourcing to foundries outside the EU and the impact of the 2020-21 shortage.

With the EU Chips Act which entered into force on 21 September 2023 and the second Important Project of Common European Interest on Microelectronics and Communication Technologies (IPCEI ME/CT), and the Alliance on Processors and Semiconductor technologies, the EU has taken bold steps to implement its vision of EU becoming a major actor of the manufacturing of world class semiconductors. Achieving the ambitious Digital Decade goals will require a continuous concerted effort from European entities.

2.1.3.3. Edge nodes

The development of Edge nodes represents not only a paradigm shift towards a decentralised model of data storage, providing low-latency and privacy-preserving data processing. It also marks the future of digitalisation infrastructures as an essential building block for driving innovative and efficient infrastructures grounded on AI-based software, computing and telecommunications networks. This revolution is also an opportunity for the EU to safeguard the security, sovereignty, and technological independence of digital networks as critical infrastructures.

Figure 3: Edge node deployment (EU projection to 2030) 64

The Digital Decade policy programme aims to deploy at least 10 000 highly secure, climate-neutral edge nodes, distributed in a way that guarantees access to data services with low latency (i.e., a few milliseconds) wherever businesses are located. 

The total deployment of edge nodes in the EU reached 1186 estimated units in 2023, an increase from 499 units in 2022. This estimation is still insufficient to meet the total target, accounting for only 12% of the edge nodes target for 2030. Moreover, the market is far from mature with only 12% of this deployment corresponding to production, while 88% is used for testing and research purposes.

According to preliminary findings of the Edge Observatory and IDC figures 65 , Europe’s edge computing expenditure in 2023 accounted for 22% of global spending on edge computing (EUR 190 billion in 2023). The United States is expected to spend the most on edge computing, more than 40% of the worldwide total, followed by Europe and China. It is expected that Latin America and China will experience the fastest spending growth over the next five years.

The spread of edge nodes in the EU shows significant geographical disparity with front runners in France, Germany, Italy, and Spain. These member states have the potential to set trends and spread best practices, building in particular on France’s fast rate of investment in edge computing infrastructure and adoption of related technologies since the early 2020s, as well as on Spain’s procurement practices to foster environmentally friendly procurement building on the 59% of enterprises which consider the environmental impact of ICT services or equipment before selection.

2.1.3.4. Quantum computing

Quantum technologies will transform the EU’s industry and society fundamentally, providing for huge productivity gains and revitalising industry, enabling the performance of complex computational tasks, such as modelling biomolecular and chemical reactions, accelerating the accurate diagnosis and treatment of diseases, and protecting communication systems with extremely secure keys. Quantum technologies will be crucial for securing European sovereignty, as highlighted in the European Economic Security Strategy 66 , and the Commission Recommendation on critical technology areas for the EU's economic security for further risk assessment with Member States 67 . 

Since 2018, more than EUR 8 billion has been committed to quantum technologies by the EU and Member States, complemented with the launch of multi-country projects, individual agreements and, most recently, the European Declaration on Quantum Technologies, which is being signed by Member States.

In this context, the first milestone of the Digital Decade target - having a first computer with quantum acceleration by 2025- is expected to be reached this year. The HPC-QS project 68 is scheduled to soon deploy two systems manufactured by the French start-up PASQAL, which began as a project funded by the EUR 1 billion Quantum Technologies Flagship, in France (GENCI) and in Germany (Jülich). The continuation of the Quantum Flagship and the ongoing procurement and deployments of additional quantum computing and simulation systems overseen by the EuroHPC Joint Undertaking, as well as the further development and deployment of the European quantum communication infrastructure (EuroQCI), launched in 2019, and of advanced quantum sensing infrastructures will help the EU progress toward its 2030 target which is to have three quantum computers based on European technology.

Figure 4. Number of quantum computers in the EU. Trajectory towards 2030

The quantum ecosystem is also relatively strong in the EU, with the number of quantum technologies start-ups being the strongest in the world, when GDP weighted.

Figure 5. Quantum technologies start-ups International Benchmarking study 69

On the other hand, European public investment in quantum, although promising, has not yet been matched by the private sector: in 2021, around 25% of quantum industry participants globally were based in Europe, yet the region had received less than 5% of global funding. The European industry needs to identify and invest in quantum use cases that could transform productivity and lead to concrete improvements in everyday life.

While progress to date is promising, more coordination and joint action are needed to reach the 2030 target, building on the December 2023 European Quantum Declaration. 70

2.2. Supporting EU-wide digital ecosystems and scaling up innovative enterprises

The ability of business to harness powerful digital ecosystems and embrace digitalisation is essential for EU’s prosperity and competitiveness in the long term. Digitalisation enables businesses to streamline operations, increase efficiency, and adapt quickly to changing market dynamics, while fostering leadership, agility and resilience to market disruptions.

2.2.1. Promoting the digital transformation of EU enterprises

The adoption of digital technologies by business is key to ensure a convergence of productivity between leading and laggard firms and avoid the strengthening of “winner takes all” effect as well as ensure the diffusion of productivity gains across the economy. Reaping the productivity gains of digital technologies not only requires access to secure and affordable technologies but also complementary changes in organisation of businesses, led by management and skills factors 71 .

2.2.1.1. Take up of advanced digital technologies

In 2023, the adoption of digital technologies by European companies was still well below the Digital Decade targets, in particular those for the uptake of AI and big data. Under current trends, and without further investment and incentives, the targets will not be met by 2030: the projected baseline trajectory indicates that only 64% of businesses will use cloud, 50% big data and 17% AI, far from the 75% objective set for 2030. 72  Another major concern is that European cloud providers’ market share has decreased from 27% in 2017 to 13% in Q2 2022 73 .

Take up of cloud services

In 2023 the estimated economic value of European cloud data flows is estimated to be EUR 107 billion, of which EUR 77 billion was in the EU (estimated to increase to EUR 328 billion by 2035). The 2023 European total economic value of cloud data flows is thus greater than each of the respective GDPs of Bulgaria, Croatia, Estonia, Latvia, and Lithuania.

In 2023, despite the European cloud computing market expected to be worth EUR 560 billion, 74  cloud uptake among enterprises in the EU was just above one in three (38.9%) with large differences between Member States, company size and cloud service types. This represents an increase of 4.9 percentage points from the last measurement in 2021, corresponding to an annual progress of almost 7%. This remains below the progress of over 9% each year until the end of the decade that would be necessary to meet the target.

Figure 6. Percentage of enterprises using cloud services in the EU. Historical data, Digital Decade (DD) trajectory and 2024 baseline trajectory towards 2030

The EU needs to accelerate the uptake of cloud services, while ensuring respect of European core values and interests. Dissemination and exploitation efforts and strategies, jointly developed by both public and private actors, need to strongly boost the use of new advanced cloud solutions, such as the ones expected to be developed under the IPCEI-CIS, in particular among SME ecosystems. The Cloud IPCEI Exploitation Office should play a key role in this dissemination in addition to the spillovers and dissemination commitments undertaken by the direct participants in the IPCEI CIS.

In recent years, significant public intervention targeted the European Cloud market's supply side, aiming to foster diversification by promoting the development and deployment of interoperable and trusted cloud-to-edge business offerings tailored to European users' requirements. This was done via investments (for example as part of the IPCEI-CIS or under the DIGITAL programme, which covers the procurement of the smart middleware Simpl), the switching provisions in the Data Act designed to eliminate vendor lock-in practices, and through other initiatives like the European Alliance for Industrial Data, Edge and Cloud.

While this intervention has initiated a move towards a more diverse European cloud market, substantial obstacles remain such as unfair market practices including tying and bundling, unfair contractual relationships limiting customers' negotiation power 75 , and telemetry practices where providers leverage their customers' metadata to gain competitive advantages.

Take up of artificial intelligence

The take up of AI is certainly the most pressing and crucial element of the business digitalisation in the EU. The adoption of this technology has marked the least progress in 2023. No improvement is perceptible compared to 2021. From 2021 to 2023, the percentage of enterprises using AI saw little change, increasing slightly from 7.6% in 2021 to 8% in 2023. Based on the current rate of progress, the adoption of AI risks to remain below 17% in 2030.

Figure 7. Percentage of enterprises using AI in the EU. Historical data, Digital Decade (DD) trajectory and 2024 baseline trajectory towards 2030

The EU currently lags behind international competitors when it comes to the adoption of emerging technologies, which include AI. Venture capital investment in AI is also low compared to the US and China.

Figure 8. AI venture capital investments International Benchmarking study

2023 was a disappointing year for Europe's venture capital market, including for AI start-ups. 76 Venture capital investment in European start-ups reached EUR 51.7 billion in 2023 but this represented a drop of 45.6% compared to 2022. 77 EU enterprises also continue to experience difficulties to scale up, due to remaining obstacles to the EU’s Single Market.

While some encouraging signs exist, such as a high number of enterprises in the EU experimenting with AI, and the high and growing number of start-ups working with generative AI, vigorous action is needed to ensure better progress towards this target.

The EU can build on actions such as the recently adopted AI innovation package of 24 January 2024, which will facilitate the creation of AI factories, built around European public supercomputers, bringing together AI-dedicated supercomputers, associated data centres connected via high-speed networks and the corresponding human capital.

The European Digital Infrastructure Consortia (EDICs), fostering cooperation between Member States, are also laying down a new foundation for AI development. The first two EDICs created by Commission’s decision in February 2024 concentrate on AI. One of them is the Alliance for Language Technologies European Digital Infrastructure Consortium (ALT-EDIC) which will provide centralised access to language data for the development of European generative AI ‘Large Language Models’, offering valuable tools to aggregate the required data in particular for Member States with limited language visibility. A third EDIC, Networked Local Digital Twins towards the CitiVERSE (LDT CitiVERSE EDIC), will implement a digital ecosystem around shared infrastructure components and state-of-the-art technologies for data, AI-based services and related elements for cloud-based Smart Communities.

Take up of big data/use of data analytics

Data is the fuel for training and improving artificial intelligence (AI) algorithms and it is an essential driver for innovation in AI. In 2023, only 33.2% of European companies have used data analytics, with large discrepancies between Member States. If progress does not accelerate, it is estimated that take up will reach just over 50% by 2030, a full 25 percentage points below the 2030 target.

Figure 9. Share of enterprises using Data analytics in the EU. Historical data, Digital Decade (DD) trajectory and 2024 baseline trajectory towards 2030

More broadly, the latest figures 78 indicate that the EU data economy increased in 2023 to EUR 544.1 billion, against EUR 497.8 billion in 2022, representing 4.2 % of EU’s GDP. In a baseline scenario, the value of the EU data economy will increase to EUR 851.5 billion by 2030 representing 5.8 % of the overall EU GDP.

The EU data economy employed around 7.66 million data professionals in 2023, accounting for 4.3 % of total employment. Under the same baseline scenario, it is estimated that by 2030 the number of data professionals will increase to 9.9 million, with a compound average growth rate of 3.5 % in 2025-30 period.

The challenge for the years to come will be to swiftly implement all aspects of the European data strategy, starting with applying the provisions of the Data Governance Act 79 and Data Act 80 , to create legal certainty and ensure a secure and fair legal framework for the data economy. Stakeholders will also need to focus on the concrete deployment and interconnection of the common European data spaces, leading to an internal data market with more data availability and more data-driven innovation and policies.

2.2.1.2. Fostering the digitalisation of SMEs

Progress toward the digitalisation of SMEs in 2023 is still insufficient and quite uneven across the EU. Between 2021 and 2023, the only two comparable years so far, the percentage of enterprises with at least basic levels of digital intensity slightly increased to 57.7% from 54.8% in 2021. This corresponds to a modest annual advancement of 2.6%, which is less than half the pace of growth required to reach the 2030 target 81 . Under a business-as-usual scenario, only 68% of SMEs will be digitalised by 2030, showing that further efforts are needed. It is also at a lower rate than in the US 82 .

Figure 10. Digital Intensity Index Historical comparable data, Digital Decade (DD) trajectory and 2024 baseline trajectory towards 2030

This percentage varies greatly among Member States, with more than 75% of SMEs having already reached this level in Finland, Sweden, Netherlands, Malta and Denmark, while less than a third in Bulgaria and Romania.

Over the coming period, the European Digital Innovation Hubs (EDIHs) will play a key role in bringing the various European digital initiatives to the actors on the ground, supporting their implementation at local level, while also accompanying businesses in their digitalisation efforts.

2.2.2. Scaling up innovative enterprises

The startup and unicorn ecosystem plays a pivotal role in increasing the EU’s competitiveness. These ventures promote economic growth by introducing disruptive technologies, creating new job opportunities, promoting innovation, and attracting investment. They embody agility, creativity, and adaptability, driving traditional industries to evolve and remain relevant in a rapidly changing market landscape. Furthermore, startups serve as a breeding ground for entrepreneurship, nurturing a culture of risk-taking and innovation essential for long-term economic sustainability.

In recent years, the European ecosystem has been quite successful in increasing the number of unicorns, demonstrating that Europe can develop its own model of startup-ecosystem across the continent, supported by the Digital Decade commitment to at least doubling the number of unicorns compared to the 2022 baseline.

Yet, the EU is currently home only to approximately 13% of the world’s unicorns. At the end of 2023 there were 263 unicorns in the EU, which was a 5.6% increase compared to 2022 (249 unicorns at the end of 2022). In both percentage and absolute terms this is a significant reduction in the annual growth of the number of EU unicorns compared to 2020 (~30% increase) and 2021 (~62%). Fewer unicorns were created in the EU in 2023 than any year since 2017, against the background of a global contraction in private capital markets throughout 2023.

Figure 11. Unicorns International Benchmarking study

AU: Australia, CN: China, IL: Israel, JP: Japan, KR: Republic of Korea, UK: United Kingdom, US: United States of America, EU: European Union

The difference in absolute numbers of EU headquartered unicorns compared to other key countries remains stark, with 263 unicorns in the EU 83 , 387 in China, and 1,539 in the USA by the end of 2023. This underlines the need for focused action at both EU and national level, to ensure not only that the 2030 Digital Decade target of 500 unicorns in the EU is met, but also to sustain growth and match the performance of other parts of the world.

Figure 12. Number of unicorns in the EU. Historical data and 2024 baseline trajectory

Progress toward achieving the Digital Decade is still facing many challenges. Worsening external finance conditions will hit young and innovative companies hard, especially those introducing new market innovations. These firms depend heavily on external funding, making them vulnerable to any tightening of finance accessibility. This dependence, coupled with their exposure to investor risk aversion, heightens uncertainty about their financial stability. It is therefore essential to ensure supportive finance conditions to foster innovation and sustain the growth of these emerging enterprises.

Moreover, a relative lack of private capital for ‘big ticket’ investments forces too many EU startups to seek late-stage growth capital from venture capital funds outside of Europe 84 , with the consequence of often moving their corporate headquarters outside of the EU. The lack of take-up of established best policy practices across Member States leads to fewer opportunities for startups to attract and retain talent, access finance or have their innovations procured in public procurement.

The challenging picture for delivering conditions that are conducive to unicorn creation is completed by the suboptimal linkages between EU and national research programmes and programmes (which are critical to support the emergence of national champions from EU-funded innovation programmes), and the insufficient support to stimulate the creation of more spin offs from universities.

2.3. Strengthening cybersecurity

The Digital Decade objectives 85 include improving resilience to cyberattacks, contributing to increasing risk-awareness and increasing knowledge of cybersecurity processes, as well as increasing efforts by public and private organisations to achieve at least basic levels of cybersecurity. The Digital Decade Decision provides the possibility to develop specific targets as part of its review planned in 2026 86 .

Furthermore, in the Declaration on Digital Rights and Principles, the EU and its Member States committed to take further measures to promote traceable and safe products on the digital single market, and to protect people, businesses, and public institutions against cybersecurity risks and cybercrime, including via cybersecurity requirements for connected products placed on the single market 87 . 

In 2023, EU’s cyber threat landscape has continued to be strongly impacted by geopolitical events 88 , with operations continuing to target the EU actors, particularly government, military, critical infrastructure, and foreign affairs bodies. Threats include ransomware, supply chain and physical attacks, and sabotage of digital infrastructure.

Cyberattacks and extorsion operations were on the rise in 2023 89 . Ransomware groups are not only targeting corporations but also government agencies and critical infrastructures, with geopolitical motivations. The EU Agency for Cybersecurity ENISA itself recorded more than 2,500 cyber incidents from July 2022 to June 2023, with 220 specifically targeting two or more EU countries. Public administrations and health were the top targets at 19% and 8%, while 6% of all hacks targeted the manufacturing, transport and financial sectors.

In April 2023, the Commission has proposed the Cyber Solidarity Act, aiming to strengthen the solidarity at the EU level to better detect, prepare and respond to cybersecurity threats and incidents. The network of National and Cross-border Hubs would serve to increase detection of cybersecurity threats and incidents. The Cybersecurity Emergency Mechanism would enhance preparedness by setting up coordinated preparedness testing and other preparedness actions for important and essential entities. This Mechanism would also include an EU Cybersecurity Reserve consisting of services from a selected pool of trusted private companies providing managed security services, such as incident analysis or incident response coordination.

Four years on, more efforts still need to be made by some Member States to implement the EU 5G Security Toolbox and effectively mitigate the risks, posed in particular by high-risk suppliers. In 2023, the Commission also underlined its strong concerns about the risks to the EU security posed by certain 5G suppliers 90 and is working to ensure security and avoid the exposure of its own corporate communications to high-risk suppliers and to reflect its assessment in all relevant EU funding programmes and instruments.

At the beginning of 2024, the Commission adopted the first-ever European cybersecurity certification scheme 91 , in line with the EU Cybersecurity Act. The scheme offers an EU-wide set of rules and procedures on how to certify ICT products in their lifetime and thus make them more trustworthy for users. This major step promotes Europe's global digital leadership.

On 30 November 2023 the European Parliament and the Council have reached a political agreement on the Cyber Resilience Act (CRA) 92 , which was adopted by the European Parliament on 12 March 2024 and will enter into force in the course of 2024. The CRA makes the selling of hardware and software products on the European market contingent on compliance with cybersecurity requirements. It is the first regulation of its kind not only in Europe but also internationally. 

The law introduces security by design obligations for manufacturers of hardware and software products. Acknowledging that manufacturers along the entire supply chain are responsible for security outcomes, it not only covers the final product, such as a laptop or an operating system, but also its hardware and software components. During the transition period of 3 years from the act’s entry into force, the European Standardisation Organisations will be tasked with developing standards to facilitate compliance by manufacturers, and the Commission will adopt relevant delegated and implementing acts as well as guidance to ensure that manufacturers can easily comply with the act.

The NIS2 Directive 93 requires Member States to adopt national cybersecurity strategies which must contain policies that directly contribute to meeting the general objective on cybersecurity set out in the Digital Decade, such as policies on promoting active cyber protection and on promoting and developing education and training on cybersecurity, cybersecurity skills, awareness raising and research and development initiatives, as well as guidance on good cyber hygiene practices and controls, aimed at citizens, stakeholders, and entities.

3. Protecting and empowering EU people and society

Putting people at the centre of the digital transformation of our societies and economies is at the core of the Digital Decade. This is reflected in the European Declaration on Digital Rights and Principles and in the general objectives and targets of the Digital Decade Decision, focused on building a human centred digital space, safeguarding fundamental rights and addressing digital divides, promoting digital skills, empowering democratic life, and protecting vulnerable people, including children. The following sections monitor progress in relation to these objectives and targets which include basic digital skills, ICT specialists, eGovernment services, e-ID and e-Health.

3.1. Empower people and bring the digital transformation closer to their needs

In a context where digital tools are now pervasive in every aspect of our daily lives, Europeans should be able to acquire all basic and advanced digital skills and have the possibility to adjust to changes brought by the digitalisation of work through up-skilling and re-skilling, in particular in line with the Declaration on Digital Rights and Principles 94 . It is equally essential to provide people with trusted tools, like secure e-ID means, to ensure that digital technologies and online public services, including health services, are accessible to everyone across the EU, including those with disabilities 95 .

3.1.1. Equip people with digital skills

A digitally skilled population: at least basic digital skills

A key target of the Digital Decade is to ensure that at least 80% of individuals aged 16-74 possess at least basic digital skills by 2030. In 2023, slightly more than 55.6% of those individuals reported having at least basic digital skills, with variations across Member States from 82.7% to about 27.7%. Compared to 2021, the EU average level of at least basic digital skills in 2023 increased by only 1.7 percentage point, a pace of progress that is insufficient to reach the 2030 target. Compared to the ideal trajectory required to reach the 80% target, the EU is 4.2 percentage points below the 2023 ideal value needed to be on track. Without further action, only 59.8% of the population would have at least basic digital skills by 2030 as estimated along the baseline trajectory.

Figure 13. At least basic digital skills in the EU. Historical data, Digital Decade (DD) trajectory and 2024 trajectory towards 2030

Shortcomings in digital skills do not only concern older population. A notable portion (30%) of the younger generation aged 16-24 years lacks at least basic digital skills. While the gender gap in basic digital skills continues to narrow (55% of females versus 57% of males), there are considerable differences linked with the level of education (80% of individuals with high formal education, versus 34% of those with no or low formal education) and a clear urban-rural divide (63% of people living in cities versus 48% of people in rural areas).

During its current mandate, the European Commission has made substantial efforts to advance digital skills in the European Pillar of Social Rights Action Plan and the Digital Education Action Plan 2021-2027, advocating for EU-level support to strengthen education and training systems, in particular through the Structured Dialogue on digital education and skills. 2023 marked the European Year of Skills, which reinforced the importance of acquiring essential skills, including digital skills, to secure quality employment and address workforce shortages. In 2023, another important achievement was the adoption of a digital education and skills package, including two proposals for Council Recommendations: one on the key enabling factors for successful digital education and training; another on improving the provision of digital skills and competences in education and training. In addition, through the unanimous adoption of the Council Recommendation for Roma equality, inclusion and participation, Member States committed to develop measures to support the acquisition of digital skills by Roma people 96 . Finally, the Commission has mobilised various funding programmes to boost digital skills across Europe, such as the European Social Fund Plus 97 , Digital Europe Programme (DEP) and Erasmus+ 98 .

The monitoring of the Declaration on Digital Rights and Principles shows that Member States are quite active in taking measures to provide digital education, training and skills to their citizens 99 .

Nevertheless, increased, and focused efforts by the European institutions as well as the Member States are necessary to facilitate the acquisition of digital skills. In the context of an ageing population and an increasingly technology-driven society, there is a crucial need to follow a multi-faceted approach targeting digital skills in primary, secondary and higher education, Vocational Education and Training and lifelong learning, as well as focusing on priority or ‘hard-to-reach’ groups. Moreover, the current economic landscape and challenges for Europe’s competitiveness call for a more coherent and strategic framework of investment, governance, and capacity-building for effective and inclusive digital skills and talent development. This requires a swift adaptation of EU education and training systems to the digital age, to ensure they can play a key role in improving the provision of digital skills at all levels and in a lifelong learning perspective, thus contributing to increase Europe’s growth and competitiveness 100 .

A highly skilled digital workforce: ICT specialists and advanced digital skills

In an era characterised by rapid technological advancements, the shortage of ICT specialists is a systemic issue that is essential for reaching all Digital Decade objectives and targets. It is therefore vital to build up a sufficient talent pool of highly skilled professionals in those key capacity areas. The EU’s ambitious Digital Decade target aim to employ at least 20 million ICT experts in the EU by 2030, with more graduates and gender convergence in the sector.

Figure 14: ICT specialists in employment in the EU. Historical data, Digital Decade (DD) trajectory and 2024 trajectory towards 2030

Over the past ten years, significant advancements have been made in the supply of ICT specialists. In 2023, nearly 9.8 million ICT specialists were contributing to the EU's employment representing an annual increase of 4% compared to 2022. However, in 2023, the EU is 0.9 million specialists below the value that would be needed to be on track towards the 2030 target, as estimated along the baseline trajectory. According to the current trend, the number of ICT specialists in the EU will be around 12 million in 2030 if no further intervention is put in place. The gender gap is still substantial and persisting. In 2023, just 19.4% of ICT specialists employed in the EU were women, also undermining how digital solutions are designed and deployed, with proven negative consequences for social equality and welfare overall. To reach the digital decade targets, the EU is also increasingly reliant on attracting foreign talent. In 2023, 11% of ICT specialists employed in the EU came from third countries, compared to 8% in 2019 101 .

European companies already face increased competition for digitally skilled talent, with more than 60% of EU enterprises that recruited or tried to recruit ICT specialists reporting difficulties in doing so in 2022 102 and significant advanced digital skills gaps in more traditional non-ICT professions 103 .

These issues are projected to increase and be exacerbated by the global race for digital talents. For example, the demand for professionals working in AI development and deployment has increased by 33% from 2019 to 2022 in selected OECD countries 104 . Estimates suggest that, to meet future industry demand of AI skills alone, between 0.5 and 2.8 million Europeans will need to acquire these skills over the next five years, while approximately 1.2 to 3.7 million individuals will be required to gain proficiency in cloud computing skills 105 .

There are many and complex drivers behind these shortcomings, including the low number of young people entering science, technology, engineering and mathematics (STEM) or ICT studies, with only 4.2% of all graduates in the EU pursuing degrees in ICT 106 : a shortage of specialised training programmes, misalignment with industry needs and the lack of flexibility of existing learning pathways. Furthermore, the challenges in attracting and keeping women in tech impede the needed increase of EU’s workforce in ICT. More diverse teams lead to better decision-making and more innovative products and services, positively impacting the usability of technology for diverse users, including women.

One cornerstone of the Commission’s strategy was the adoption of the Council Recommendation on improving the provision of digital skills and competences in education and training 107 . Advanced digital skills are also supported by multiple funding programmes, notably the DEP, which includes the development of specialised educational programmes at different academic levels 108 as well as short-term training courses in diverse key digital areas. Member States are also building the Cybersecurity Skills Academy, one of the European Digital Infrastructure Consortia in preparation.

The Commission has recently also taken a set of mutually reinforcing actions to make the EU more attractive to third-country talent as well as to boost intra-EU mobility 109 . The Commission is, in particular, proposing to set up an EU Talent Pool to facilitate the strategic international recruitment of non-EU jobseekers in shortage occupations 110 . It is also revising the EU Blue Card Directive 111  which, among other things, has introduced equivalence as regards skills attested by professional experience and comparable higher education qualifications in some ICT jobs. Finally, through the Talent Partnerships with key partner countries, the EU is supporting mobility schemes, capacity building and investments in human capital.

Despite these actions, it will be challenging to reach the 2030 Digital Decade targets on ICT specialists under a business-as-usual scenario. Urgent action is imperative through a comprehensive and coordinated approach spanning the entire education and training continuum, including lifelong learning and leveraging collaborative efforts among stakeholders.

3.1.2. Trusted solutions for digital interaction: the EU Digital Identity and the digital euro

With digital transactions and interactions becoming essential in daily lives, EU citizens need more and more easy-to-use, reliable, and safe means for online identification, authentication, for storing and sharing digital attestations, and using electronic signatures. The EU Digital Identity regulation, entered into force in May 2024, answers to this need and represents a game changer in both simplifying the life of citizens and businesses, and protecting fundamental rights online, ensuring safety and privacy, giving citizens full control over the data they share, and avoiding profiling, tracing and tracking, in line with EU digital rights and principles.

The swift implementation of the EU Digital Identity Wallets (EDIW) by 2026 is also the condition for the achievement of the Digital Decade target: by 2030 100% of Union citizens should have access to a secure electronic identification (e-ID) means recognised throughout the Union, giving users full control over identity transactions and shared personal data.

Currently, notified e-IDs are available in 22 Member States (plus Norway and Lichtenstein), being available to 93% of the EU population. However, the take-up of e-IDs is very uneven across Member States. In 2023, 35.7% of individuals in the EU used an e-ID to access services provided by public authorities or public services of their country, from 95% in the Netherlands to less than 1% in Cyprus 113 . The implementation of the EDIW is expected to promote uptake, with a single tool for accessing public and private digital services.

Since April 2023, the DEP finances 4 large-scale pilot projects to test use cases such as: storing and sharing education credentials, travel documents, like boarding passes, or digital driving licences; accessing digital public services (including cross-border); opening a bank account, accessing it and authorising payments; buying a pre-paid SIM card; signing contracts; and proving professional affiliations. The wide participation by almost all Member States reflects the recommendations of the 2023 State of the Digital Decade report, which invited Member State ‘to prepare to set and implement the EUDIW, in particular through pilot projects and by mobilising the digital ecosystem’.

Finally, the Task Force on Age Verification, set up under the Digital Services Act with Member States, the European Regulators Group for Audiovisual Media Services (ERGA) and European Data Protection Board (EDPB), is currently exploring how to make best use of the Wallet for age verification purposes, as a key response to concerns linked to children’s exposure to harmful content (cf. below). Age verification supported by the Wallet is also one of the priority use cases in the call for proposals for new pilot projects that are expected to start in 2025.

As the use of banknotes and coins declines, the European Central Bank plans to introduce a digital euro by 2027. The European Parliament and Council are currently examining the legislative framework proposed by the Commission in June 2023 to establish the digital euro and to regulate its essential elements. Once this legislative process is complete, the European Central Bank will decide on its issuance. This pan-European public payment scheme would provide central bank money in digital form, allowing citizens and businesses to make secure, private, and widely accepted payments across the entire euro area. The digital euro, as a public good, aims to ensure our monetary system keeps pace with digitalisation while remaining inclusive. It would establish a new European infrastructure, enabling market players to innovate and develop value-added services. The goal is for the digital euro to be fully interoperable with the European Digital Identity Wallets, supporting various use cases from e-commerce to in-store and peer-to-peer transactions, even without internet connectivity.

3.1.3. Efficient digital public services user-friendly and accessible to all

Member States are continuing to progress towards the target of making 100% of key public services for citizens and businesses accessible online. In 2023, the average EU score was 79 out of 100 as regards availability of digital public services for citizens (from 77/100 in 2022) and 85 out of 100 as regards businesses (from 84 in 2022). Both values remain below the 2023 value required to be on track towards the 2030 target (7.8 points below for citizens and 5,4 below for businesses). Despite the number of measures taken in Member States to make digital public services accessible to all Europeans 114 , in a business-as-usual scenario, the achievement of the EU target by 2030 remains challenging.

Figure 15: Online service provision for citizens (top chart) and businesses (bottom chart). Historical data, Digital Decade (DD) trajectory and revised baseline trajectory towards 2030

Substantial gaps remain in the delivery of digital public services which are fully user-centric, accessible to users with disabilities 115 , and sovereign– in a context where most digital services, e.g., cloud, are developed by non-EU companies.

Digital public services have been one of the main areas of investment in the Recovery and Resilience Facility with EUR 24.5 billion directly contributing to these targets 116 .

On the legislative side, the implementation of the Single Digital Gateway Regulation 117  has contributed to reduce the administrative burden for the EU citizens and businesses with the single digital gateway user interface, the Your Europe portal giving access to a wide range of online information and public services. Furthermore, the recent launch of the Once Only Technical System (OOTS) will allow connecting administrations across the member state and the cross-border exchange of public documents and data. Both the single digital gateway and the OOTS make it easier for citizens and to study, move, work, retire and for companies, notably SMEs, to do business across the EU.

In April 2024, the Interoperable Europe Act 118 entered into force and, with mandatory interoperability assessments, will boost the availability of user-centric and cross-border key digital public services. The Data Act will mitigate concerns related to the dependency of public administrations on technological solutions provided by foreign vendors like hyperscale cloud providers. Steps forward have also been taken on digital accessibility, a fundamental right for people with disabilities, which saw a significant shift following the adoption of the Web Accessibility Directive in 2016.

Finally, Member States strengthened their collaboration across the EU, developing common infrastructure and leveraging advanced technologies for cross-border services. The EDIC in the field of connected public administration (IMPACTS) is under preparation, and the European Blockchain Partnership and European Blockchain Services Infrastructure (EUROPEUM) has been established.

Reducing administrative burden has been a key priority of the European Commission 119  especially as regards SMEs. Embracing digital transformation and leveraging innovative technologies for efficient public services can unlock significant time and cost savings while improving the overall effectiveness and responsiveness of public policies.

Digitalisation indeed has the potential to significantly streamline bureaucratic processes and cut through red tape in Europe with electronic documentation and signatures, online government services, data sharing and integration, automated data verification systems, automated compliance and reporting and digital identity.

Digitalisation can have even more profound impacts by enabling a significant shift in regulatory approach cutting red tape and allowing more innovation, such as the use of regulatory sandboxes, as implemented in in the financial industry. By creating a safe space for experimentation, regulators can collaborate with stakeholders including innovative enterprises, to understand emerging technologies, assess potential risks, and develop appropriate regulatory frameworks that balance innovation with consumer protection and systemic stability. The potential for regulatory shift could be explored in areas such as healthcare, financial services, mobility or agriculture, with a view to providing not only a more agile framework but also to improve data-based and AI powered-high quality information for users and beneficiaries. Digitalisation has thus the potential to foster a regulatory shift as well as to radically simplify regulatory compliance while providing for new services, for example in the area of precision agriculture, traceability and farm management essential for the farmer’s competitivity and to foster their positive footprint on the environment. In this respect a European Digital Infrastructure Consortium for AgriFood is also under consideration among Member States.

3.1.4. Leverage on digital technologies for health

The use of health data and of advanced technologies have great potential to improve access to health services by citizens, increase the quality and efficiency of healthcare, develop personalised approaches and support research and innovation 120 . According to the findings of the Eurobarometer 2024, four out of five respondents consider digital technologies to be important by 2030 for accessing or receiving healthcare services (e.g., telemedicine, artificial intelligence supporting diagnosing diseases).

During the pandemic, the EU Digital COVID Certificate (EU DCC), developed in record time and risen as global standard, is a notable example: more than 2.3 billion certificates were issued EU-wide and a total of 78 countries were connected to this European solution, which significantly contributed to the global fight against the disease, protecting EU citizens’ health, and restored their right of free movement.

The Digital Decade Policy Programme establishes the target of 100% of Union citizens with access to their electronic health records. In 2023, the EU scored 79/100 up from 72/100 in 2022, corresponding to an annual growth rate of 9.7% 121 . All Member States now have some form of electronic health access service in place, be it regional or national, and have improved the extent of accessible health data categories, access technology and means, and the access opportunities for certain categories of people. The current value is above the expected value of the trajectory in 2023. At this pace, the target will be reached in 2026.

Figure 16: e-Health composite indicator. Historical data and DD trajectory

The successful conclusion of the political negotiations on the European Health Data Space Regulation is an important milestone to further reinforce progress in this area and empower and benefit citizens by further developing secure access to electronic health data nationally and across borders, contributing to more efficient healthcare delivery, and improving the quality and accessibility of health data for secondary use for research, innovation and health policy making purposes.

The Commission has put forward several initiatives on health data infrastructure and research and innovation in the area of health. The European Cancer Imaging Initiative, launched in December 2022 is federating cancer imaging and clinical data across 12 European countries to support innovation in clinical decision-making and prediction; the 1+ Million Genomes Initiative is establishing secure access to genomic and linked clinical data through the European Genomic Data Infrastructure and a European reference genome, the Genome of Europe; and the European Virtual Human Twins Initiative, launched in December 2023, which aims to accelerate personalised care through advanced modelling, with applications in drug discovery, clinical research, and medical training.

Recently, the attention on the health dimension of digitalisation has also focused on the fact that particularly certain online interface designs can have negative impacts on health, in particular mental health, as result of excessive connectivity and related stress, addiction risks, or exposure to violent and inappropriate content 122 . Recently adopted legislations, notably the Digital Services Act, offer tools to address such risks (see section below).

3.2. Protect people and a build safe and human centric digital environment and technologies

The general objectives set out in the Digital Decade Decision emphasise the fostering of a human-centred, fundamental-rights-based, inclusive, transparent and open digital environment 123 . Furthermore, the Declaration on Digital Rights and Principles encompasses principles and commitments for accessing a trustworthy, diverse and non-discriminatory digital environment. It underscores in particular the role of very large online platforms in mitigating risks arising from their services, including disinformation.

3.2.1. Build safe digital environments and safeguard fundamental rights online

The misuse of online platforms and their algorithms can facilitate and amplify the spread of hate speech, violent extremism, and terrorist content, posing threats to individuals or specific target groups. Recent events, like the Middle East crisis, provided yet another reminder of how online platforms can be used for incitement to terrorism and dissemination of illegal hate speech. According to Eurobarometer 2024's findings, risks linked to misuse of personal data, the proliferation of fake news and disinformation are one of the main issues of concern encountered online, while non-justified removal of content and non-transparent content moderation practices were the two least mentioned issues.

In 2023, 33.5% of EU individuals reported having encountered hostile or degrading online messages targeting specific groups because of their political and social views, racial or ethnic origin, or sexual orientation, highlighting the widespread nature of online hate speech 124 .

In the Declaration on Digital Rights and Principles, the EU and Member States have committed to tackle all forms of illegal and harmful content online, in full respect for fundamental rights, notably freedom of expression. 125

Beyond strong supervision and enforcement, it will be crucial to monitor emerging trends and deepen knowledge and research into complex issues such as the dynamic interplay between digital tool usage, exposure to harmful content, and mental health and well-being, in terms of addiction, depression anxiety, self-harm, depression.

3.2.2. Protect and empower children (including via age verification)

Protecting children is a key priority for the Digital Decade. In the Declaration on Digital Rights and Principles, the EU is committed to empower children to make safe and informed choices, including by promoting positive experiences for children and protecting them against harmful content and abuse 128 . The risks related to illegal and harmful content presented above are even more pertinent to children, as young people frequently use digital products and services designed for adults. Digital services, from social media to interactive games, can expose children to risks such as addiction, unsuitable content, bullying, grooming, dangerous challenges, child sexual abuse or radicalisation, and some of these phenomena are surging across the EU. Statistics from the Insafe helplines run by the EU-funded Safer Internet Centres (SIC) show that there has been a 34% increase in the number of reports from young people about cyberbullying between 2022 and 2023 129 , while the number of reports to the INHOPE hotlines of suspected child sexual abuse material from the public also increased by one third 130 . Other sources show a dramatic increase (+320%) of grooming reports, including financial sextortion, in EU countries quadrupling from 2022 to 2023, settling at over 32 thousand online enticement reports in the EU alone 131 .

On 7 June 2023, the Commission Communication on a comprehensive approach to mental health put mental health on par with physical health, as part of a strong European Health Union 132 , and it flags the potential negative effect that digital tools can have on children’s well-being and health, calling for a safer and healthier digital space for children. The combination of the significant amount of time spent online by children with the sophisticated and invasive digital techniques used by advertisers poses new and serious challenges for the protection of children, from mental health issues to unhealthy food, tobacco and emerging products and alcohol marketing. In this regard, some precautionary action might be also needed, linked to the absence of evidence that the online space is sufficiently safe for children and teens.

The Audiovisual Media Services Directive (AVMSD) and Digital Service Act (DSA), in addition to the General Data Protection Regulation (GDPR), seeks to protect the privacy and safety of minors, e.g., by banning targeted advertisement addressed to minors based on profiling, and requiring VLOPs and VLOSEs to assess and mitigate systemic risks of their services to children’s rights as well as negative effects of their services on people’s mental or physical well-being.

To better protect children online, in May 2022 the Commission also adopted a proposal for a Regulation on preventing and combating child sexual abuse (CSA) 133 while the 2022 Better internet for kids strategy (BIK+) supports children’s empowerment and provides resources for awareness campaigns and offers helpline and hotline services.

Finally, the Task Force on Age Verification is currently exploring the use of the EU Digital Wallet for an EU-wide, interoperable, secure and privacy preserving solution to prove users’ age.

Protecting children online is also a well-established priority at national level and, in recent years, in most Member States there have been notable developments and an increasing attention to children's online safety, health and as well-being online, sexual exploitation, and cyberbullying 134 . A very small number of National Digital Decade Strategic Roadmaps (mainly Poland and Romania) cover protecting children online, reporting specific measures planned or already in place. When reported, the measures include legislative action and the development of relevant strategies, but not specific funding.

Going forward, greater attention is needed, as reflected by the growing perception that children need to be better protected online (the 2024 Eurobarometer survey showed a 10 percentage points increase in one year). This would encompass a more solid understanding of the complex interlinks between digital tools and well-being of children as well as concrete and bold action 135 , design of technical solutions, strong enforcement of the existing legislation, strengthened information on existing rules, awareness raising on risks and proactive measures to minimise them.

3.2.3. Promote responsible and human-centric AI systems

The emergence of General Purpose and Generative AI models (GPAI) has led to both unprecedented potential and heightened risks including malfunctioning systems endangering physical safety, opaque decision-making processes, privacy infringements, criminal exploitation of data, discriminatory algorithms, and the proliferation of AI-generated disinformation.

In response to these challenges, the landmark European AI Act was officially adopted in April 2024. This pioneering regulation is the world's first horizontal AI legislation and seeks to address societal challenges, rights and safety, including ethical considerations while establishing effective yet proportionate requirements for AI systems operating within the European Union. Provisions within the AI Act include prohibitions on AI systems posing unacceptable risks (considered as a clear threat to the safety, livelihoods and fundamental rights), minimum quality standards for AI systems and use cases that pose a high risk to fundamental rights (such as in healthcare, education, and policing), enhanced transparency measures, and mechanisms for individuals to file complaints regarding AI-related harms. The monitoring of the Declaration on Digital Rights and Principles 136  shows that parallel efforts to address AI are made at national level, including through soft law codes or co-regulation. Many other regions in the world have been inspired by the European approach and are now considering legislative measures looking at the EU’s experience and expertise.

Looking ahead, successful implementation of the AI Act is paramount. Collaboration with Member States, SMEs, and other stakeholders will be essential to ensure effective implementation, including through the development of technical standards, guidance documents, and common principles.

3.3. Promote and preserve our democracy

Achieving the Digital Decade general objectives and upholding the European Declaration on Digital Rights and Principles is essential for the EU’s democratic systems, as these aim to counter the spread of online misinformation and disinformation. This effort ensures that citizens can make informed choices and have cross-border access to reliable information, provided by high-quality, independent and transparent media. 

3.3.1. Address disinformation and preserve election integrity    

Disinformation has been identified as one of the biggest destabilising factors for our societies going into the future 137 , including in the EU where 38% of EU citizens listed ‘false and/or misleading information circulating online and offline’ as the biggest threat to democracy 138 in 2023. According to the Eurobarometer 2024, 45% of Europeans consider fake news and disinformation to be one of the issues encountered online with the biggest personal impact on them.

The proliferation of disinformation poses a significant threat to civic discourse and the integrity of electoral systems in the EU. The COVID-19 pandemic and then the political developments of 2023, notably the Russia's ongoing invasion of Ukraine and the Israeli-Palestinian conflict, further fuelled disinformation, linked in particular to foreign information manipulation and interference (FIMI) 139 . The spread of disinformation has the potential to amplify societal and political polarisation, as well as distrust in institutions, including in electoral processes. On top of the earlier recognised patterns of mis- and disinformation, the recent rise of generative AI has brought novel threats, such as its use to facilitate the creation of disinformation or spread it through chatbot hallucinations and deepfakes.

In the last years, the European Commission proposed two main pillars of the strategy against disinformation: the Digital Services Act, according to which VLOPs and VLOSEs must take appropriate mitigation measures in case their functioning poses the risk of amplifying disinformation, and the Code of Practice on Disinformation, which is now in process of being converted into a Code of Conduct under the DSA. In March 2024, the Commission adopted guidelines on the mitigation of systemic risks for electoral processes setting out the measures that it expects to be adopted by VLOPs and VLOSEs to comply with the DSA. Three formal proceedings for breaching the obligation to counter the spread of disinformation have already been opened under the DSA, notably against X and Meta’s Facebook and Instagram.

In December 2023, the Commission adopted the defence-of-democracy package, consisting of proposals and recommendations to address challenges such as foreign interference, to encourage civic engagement and democratic participation in the EU. In line with the Declaration on Digital Rights and Principles, the Commission Recommendation of 12 December 2023 asked Member States to take measures to promote inclusive participation and resilience against disinformation and cyber threats 140 . The monitoring of the Declaration on Digital Rights and Principles also shows that, due to the challenge of tackling harmful content itself, most Member States’ efforts rely on improving citizens’ media literacy and critical thinking through various educational activities, that are key prerequisites for building our society’s resilience towards disinformation along in the long term 141 .

The Commission has funded the European Digital Media Observatory (EDMO) to join efforts by academia, civil society and public authorities to strengthen media literacy and build societal resilience to online disinformation. 

3.3.2. Access to media and media pluralism

Empowering independent media actors to provide reliable information online and people to seek out such information is key to strengthening democratic societies’ resilience in the digital age.

TV remains the most used media to access news, however online media are catching up, while the printed press is dropping to just less than 1/5th of the population consuming it everyday 142 . The first European Media Industry Outlook from May 2023 143 shed a light on key trends in the media industry, also showing that media increasingly operate under the logic of an attention economy, whereby different forms of content (news, advertising, entertainment) compete to capture attention.

The European Media Freedom Act (EMFA), which entered into force on 7 May 2024, aims to improve the functioning of the single market for media services as they become increasingly digital and inherently cross-border. This strengthened EU media law framework will be promoted by the new independent European Board for Media Services.

The EMFA includes unprecedented safeguards for media and journalists against political interference, as well as rules ensuring that media can operate more easily across borders, without undue pressure and benefiting from the digital transformation of the media space. With its provisions on the provision of and access to media services online and transparency rules on media ownership, the act will lead to more diverse range of quality media content enabling pluralistic public debates, in line with the Digital Decade objectives and the Declaration on Digital Rights and Principles.

The EMFA comes together with other initiatives supporting media freedom and pluralism, such as the proposed Directive to improve the protection of journalists and human rights defenders from abusive court proceedings (SLAPPs) and recommendations on internal safeguards for editorial independence and ownership transparency in the media sector and the protection, safety and empowerment of journalists. It has synergies with the DSA, the Code of Practice on Disinformation and other digital regulation. Finally, actions to promote the digital transformation of media industry, its pluralism, quality journalism, fact-checked information and media literacy are supported under the Commission’s Media and Audiovisual Action Plan 144 and dedicated funding 145 , notably the Creative Europe programme.

4. Leveraging digital transformation for a smart greening

The Digital Decade objectives aim to ensure the sustainability and resource-efficiency of digital infrastructures and technologies. It also highlights several infrastructure sustainability targets such as the development of edge nodes and semiconductors. Together with the European Declaration on Digital Rights and Principles, the Digital Decade seeks to promote sustainable digital technologies, products and services, as well as providing access to information on environmental impact and energy consumption. Furthermore, it encourages the adoption of digital technologies that have appositive impact on the environment and climate 146 .

4.1. The nexus between green transition and digital transformation

Global warming concerns have grown in recent months, and environmental hazards continue to dominate the risk landscape. Temperature records continued to be broken in 2023 and climate change and biodiversity loss are among the world's biggest challenges in the next decade, according to the World Economic Forum's 2024 Global Risks Perception Survey (GRPS) and the Munich Security Report 2024 147 . Europe is particularly exposed as the fastest warming continent in the world, with several regions such as Southern Europe being hotspots for multiple climate risks 148 .

With climate change concerns, assessing the environmental effect of technologies’ growing proliferation and use has become paramount. While challenges persist in measuring impacts and determining the assessments that should occur, data robustly shows technologies’ footprint on the environment is set to enlarge. Digitalisation is a resource-intensive process (energy, water and raw materials extraction), and while some technologies are revealing sustainability paths, the so-called 'twin transition’ is not yet guaranteed in practice.

The monitoring of the Declaration so far reports a limited number of measures taken by Member States in relation to developing sustainable technologies and technologies that have a positive impact on climate and the environments, such as standards and labels 149 .

The perception of the role that the digital transformation and the adoption of technologies is playing is growing, both regarding the need to reduce the ICT footprint and achieve productivity growth and efficiency gains for companies, as well as breakthroughs in energy-efficiency, net-zero and clean technologies. Figures released by the International Energy Agency (IEA) suggest that global electricity demand rose considerably in 2023 and is expected to grow at ai much faster pace in the next two years, in line with the global demand for Internet services and AI 150 . Electricity consumption from data centres, AI and the cryptocurrency sector could double in the next two years, as large storage capacities and efficient processing techniques are required to feeding AI systems. But today's data centres are not designed to support this: greater energy and storage capacities will need to be built 151 .

More generally, there is a growing sense that digital transformation can steer a ‘smart green transition” which is enabled by and supports a more competitive European economy.

4.2. Towards Sustainable digital infrastructures

The digital sector remains a significant source of energy consumption, emissions and waste. Today, it accounts for approximately 7-9% of global electricity consumption, forecasted to rise to 13% by 2030 152 , and for increasing amounts of e-waste 153 .

For example, in the case of France, the vast majority (79%) of the carbon footprint of the digital sector comes from digital devices (including smartphones, computers, tablets), especially at the production stage. However, recent trends suggest that the GHG emissions of device manufacturers are slowly decreasing (-5.4% between 2021 and 2022), while the data centres’ which represented only 16% of the emissions, have increased over 2021-2022 with +14% of GHG emissions, +15% electric consumption, and +20% water consumption 154 . A prospective study 155 evaluated that, in a no-policy change scenario, the carbon footprint of the digital sector would increase by +45% by 2030. This large increase is driven by the growth in data flows, mainly videos, itself supported by a growing number of data centres. The latter could represent 22% of digital GHG emissions in 2050, despite the use of technologies ensuring better energy efficiency.

A substantial share of digital energy and resource consumption is expected to be linked to AI, as reported by the OECD 156 . This is due likely massive increase in data storage and processing. Recent estimates predicting that at a global level, the electricity consumption of data centres could double between 2022 and 2026 157 . Depending on the technology used, cooling of data centres can also have a significant impact on water use and hence need to be addressed on the path towards sustainable digital infrastructures.

In terms of the circular economy, the use of recycling remains limited as in the EU, 10.4% of people reported recycling their mobile/smart phones, 9.7% for laptops and tablets and 12.8% for desktop computers. At business level, almost one in two enterprises (48.7%) have considered the environmental impact of ICT services and equipment before selecting them and applying some measures, affecting the paper or energy consumption of the ICT equipment 158 .

In 2023, the EU has set eco-design minimum efficiency requirements for smartphones, tablets and earlier for servers and computers that are currently under review. The revision of the Energy Efficiency Directive 159 included, for the first time, provisions on the energy performance of data centres. New planning and assessment rules have been adopted with a view to encouraging new data centres to be located where waste heat can be reused, and energy and water needs for cooling be reduced. In addition, the Delegated Regulation 2024/1364 160 sets out the rules to monitor the energy performance of data centres and to collect and publish data, including also on the energy and water footprint of data centres.

The Commission also conducted in 2023 a study led by its JRC to identify common indicators for measuring the environmental footprint of electronic communications services 161 . The final report includes a selection of possible indicators to be used as a basis for future Code of Conduct for sustainable telecommunications networks, which should be finalised by the end of 2025.

Energy-efficient semiconductors are critical for reducing the energy consumption of electronic devices, playing a pivotal role in global efforts to mitigate carbon emissions. This is an area where the EU has a clear global leadership. Several developments, supported by the EU and Member States, will contribute to accelerate progress toward carbon neutrality. First, the miniaturisation of chips will considerably increase their energy efficiency. In particular, the leading European technologies developed by ASML and Imec will enable to design 3 nm chips that will deliver 35% of efficiency gains as compared with 5 nm ones. Second, low-power processors will lead to groundbreaking energy savings in AI technologies based on edge. Third, the use of new materials – so called wide-bandgap materials such as Silicon Carbide and Gallium Nitride are also expected to improve performance and energy efficiency.

Investment will be critical to incentivise the move towards more resource-efficient digital technologies. The Recovery and Resilience Facility thus supports measures that leverage digital technologies to support the green transition, such as the digitalization of transport systems, including railways and urban transport, or the deployment of Smart Energy Systems (including smart grids and ICT systems).

The EU Taxonomy Regulation Delegated Act on climate mitigation and adaptation has set clear criteria that will help steer investment towards greener data centres and proven green digital solutions as a sustainable economic activity. Over the summer of 2024, the Commission will publish an EU Cloud Rulebook as a single point of reference for relevant rules applicable to the cloud, including on sustainability.

In February 2024, the Commission launched a feedback period for stakeholders on the White Paper titled 'How to master Europe's digital infrastructure needs?' 162 . As set out in one of the several scenarios, the Commission may consider facilitating greening of digital networks through promoting the timely switch-off of copper networks and moving to a full fibre environment and more efficient use of networks (codecs) throughout the Union territory. It includes engaging with the industry to further improve the usability and potential scope of the EU Taxonomy for green investments, metrics to estimate the net carbon impact of digital solutions, and the cooperation of all players of the digital network ecosystem to reduce their carbon footprint, including concrete actions such as codecs performance labels.

4.3. The digitalisation for the green transition is entering into concrete delivery.

The digital transformation is playing an essential role in the efforts to reduce the environmental footprint and achieve the European Green Deal, with a potential to reduce the total GHGs by 15%-20% before 2030 (WEF, GESI), if properly used and governed.

In this regard, 2024 is a delivery year with very substantial and concrete outcomes.

-One of the current priorities has been to deliver a science-based methodology to measure the net environmental impact of digital solution, to enable the collection of evidence as a basis to develop policies. Launched in 2021 by the Commission the European Green Digital Coalition 164  (EGDC) was established to bring main ICT stakeholders to develop science-based methodology to quantify the net environmental impact of digital solutions, to demonstrate its usability in use cases, and to develop guidelines for major sectors. The EGDC has successfully delivered all goals in March 2024 and will engage as of Q4 of 2024 with stakeholders of climate critical sectors, namely energy, transport, construction, agriculture, health, smart cities, and manufacturing, to develop eligibility criteria to support such digitalisation with sustainable finance.

-The Commission is supporting a range of AI-driven projects through Horizon Europe and DEP to optimise resource utilisation, minimise waste, and curb energy use across various sectors.

-Digital tools are playing a key role to foster coordination and cooperation at local level. The newly established European Digital Infrastructure Consortium CitiVERSE will contribute to build smart and green cities, fully in line with the twin digital and green transition and the New European Bauhaus of creating inclusive, aesthetic and sustainable cities. By the same token, the European Digital Innovation Hubs (EDIH) network promotes a sustainable approach to digitalisation in all the activities and services they provide at regional level to SMEs and local public administrations. The European Green Deal Data Space will be implemented as of Q4 2024 and it will boost a data economy to achieve Green Deal Objectives in the area of Circular Economy, Biodiversity, Climate change/ adaptation and Zero Pollution. The EU today is home to 114 hubs addressing both the green transition and digital or derivatives of those policy priorities.

-Destination Earth (DestinE), a digital twin of the Earth supported by the European Commission, is on the eve of being launched and open to users mid-2024. With its groundbreaking features enabling to model, monitor and simulate natural phenomena, hazards and the related human activities with a unique level of accuracy, speed and interactivity, DestinE will assist users in designing accurate and actionable adaptation strategies and mitigation measures.

-The Commission supports the electricity grid operators (DSOs and TSOs) to develop a digital twin of the European grids. This will foster cooperation between grid operators, help drive and coordinate public and private investments, and facilitate standardisation efforts.

4.4. The way forward

Building on the growing citizen’s perception and overall political support in Europe on the important potential of the digital transformation to foster a smart green transition 165 and on the achievement realised in 2023, the priority is to develop synergies and move from small scale pilots and initiatives to large scale projects based on cooperation between public and private actors.

5. Building coherence and synergizing digital policies and spending

The Digital Decade includes a joint commitment to ensure that digital policies, measures and programmes which are relevant for EU’s digital transformation are taken into account in a coordinated and coherent way to fully contribute to Digital Decade objectives, while avoiding overlaps and minimising administrative burdens. This section monitors progress towards these objectives.

5.1. Horizontal implementation through national roadmaps

The first round of national roadmaps marks a successful starting point for discussing, aligning, and sharing pathways for digital transformation across Member States along a common vision. For the first time, the EU can count on national roadmaps for all 27 Member States. Four countries (Czechia, Germany, Greece, and Latvia) have also thoroughly and explicitly integrated the recommendations from the State of the Digital Decade Report 2023 into their roadmaps. Nevertheless, a comprehensive assessment 166 demonstrates that substantial horizontal improvements and adjustments in the national roadmaps are needed to align them with the benchmarks set out in the Digital Decade Policy programme, as per the Commission guidance published in 2023.

5.2. Striving for an effective, efficient and red-tape free implementation of the digital regulatory environment

The need to reduce the administrative burden both in the implementation and enforcement of existing legislative acts and when reflecting on new legislative initiatives has been increasingly raised by the Commission and Member States 167 . They have called for synergies, the avoidance of duplication and the adoption of a coordinated approach in managing the existing governance structures, as well as stressing the need for coherence between digital and cybersecurity policy. The following areas could be explored to promote the implementation of the digital acquis, as follows:

-The possibility to consolidate part of the digital acquis in some areas – building on the experience of the European Electronic Communications Code which merged five directives into a single legal document.

-Making full use of the follow up to the White paper on the future of connectivity adopted in February 2024, regarding the simplification of the telecom regulatory framework against a background of a convergence between telecom and cloud-edge services.

-Undertaking a comprehensive mapping of reporting obligations across the entire digital acquis, building on the initial work already done in 2023, with a view to simplify reporting obligations, leveraging the experience of sandboxes, and building on the new possibility of digital reporting.

-Ensuring a swift implementation of the acts, guidelines, codes of practice and other legal initiatives which the European Commission and its new AI Office will have to adopt over the next few months to prepare the ground for the AI Act.

Last but not least, the ‘whole-of-government' approach promoted by the Digital Decade can reduce boundaries between government agencies and facilitate the seamless exchange of data and information between the various systems, thereby simplifying processes for businesses and citizens. 

The new Comitology committee (for implementing acts) and the Digital Decade Board (DDB) as an Expert group (for collaboration and cooperation activities with Member States) were established by Decision of the Commission in 2023. The DDB was designed as a central point for Member States and granted with a broad mandate covering potentially all issues and discussions related to digital transformation, including with regards to governance and reporting obligations, and multi-country projects.

In 2023 and 2024, the Commission and the Member States discussed ways to give the DDB a strategic role, to build on the Board's mandate, and upgrade its positioning as a reference for decision-makers and political leaders under the impulse of the Spanish, Belgium and soon Hungarian Presidency of the EU Council.

The Digital Decade Policy Programme could in particular play a role in promoting synergies between the work of sectorial boards (such as the European Board for Digital Services under the DSA, or the AI Board) and in analysing and clarifying how various EU laws and their governing bodies, such as expert groups, will intersect with one another, ensuring a better understanding of those interactions by stakeholders, especially SMEs.

5.3. Synergising funding for digitalisation

Several EU programmes - such as Horizon Europe, DIGITAL, CEF digital, RRF, and InvestEU – are essential to achieve the objectives and targets of the Digital Decade.

The significant scale-up of EU investment in digital technologies delivered through programmes and instruments in the Multi-annual Financial Framework (MFF) 2021-27 creates opportunities to improve efficiencies, including the cross-fertilisation of industries. It also opens a window to reinforce European innovation by exploring and exploiting technologies at the interface between the civil, defence and space industries, such as artificial intelligence, cloud and quantum computing, as set out in the Action Plan on Synergies between the European civil, defence and space industry of February 2021.

Building on the conclusions of the Council May 2024 168 , the creation of synergies requires adequate planning, designing, and programming of EU funding programmes, aligning strategic priorities, and harmonising rules. Synergies can be developed and fostered in three main areas.

First, complementary funding enables different programmes to participate in the same project. Complementary funding was possible for many of the European Digital Innovation Hubs (EDIH), funded under the DEP in combination with the European Regional Development Fund due to the very strong regional dimension of the EDIH.

Second, sequential funding addresses successive projects built on each other, upstream or downstream, notably between Horizon Europe, Digital Europe Programme (DIGITAL or DEP) and Connecting Europe Facility (CEF2 – Digital) to prepare, deploy and connect digital infrastructures. Horizon Europe supports research, technological development, demonstration, piloting, proof-of-concept, testing and innovation - including pre-commercial deployment - for innovative digital technologies. The DEP focuses on large-scale digital capacity and infrastructure building to support the uptake and deployment of critical existing or tested innovative digital solutions across the EU. The CEF2 - Digital supports the deployment of very high-capacity backbone networks and 5G networks, both corridors and smart communities, necessary to deploy digital services and technologies across the EU. Another example of sequential funding is the action being put into place to allow for the migration of innovation from the civil to the defence sector, in the context of spin-in or spin-off calls.

Third, alternative funding enables one programme or instrument to take up high-quality project proposals from other programmes, in particular through the Seal of Excellence, which recognises the value of a project and encourages other funds to benefit from the high-quality evaluation process. Under Horizon Europe, the European Innovation Council (EIC) Accelerator Seal of Excellence offers a wide variety of funding opportunities by using synergies with other EU and national programmes such as NextGenerationEU or Cohesion funds. The DEP awards the Seal of Excellence notably for the European Digital Innovation Hubs (EDIHs). 151 EDIHs are funded by the DEP and over 70 Seals of Excellence EDIHs have been funded by the European Structural and Investment Funds (ESIF) or the RRF. In 2023, CEF Digital also attributed Seals of Excellence to a number of projects submitted in Call 2 for Global Gateways, which could not otherwise be funded due to lack of budget. Building on the success of the Seal of Excellence, the Strategic Technologies for Europe Platform (STEP) Regulation 169 has introduced the Sovereignty Seal. The Sovereignty Seal will be awarded to projects meeting the minimum quality requirements (including eligibility, exclusion, and award criteria) in the selection process under the DEP, the European Defence Fund, the EU4Health programme, Horizon Europe, or the Innovation Fund.

Last but not least, synergies can also take place between grants and repayable forms of support such as loans, guarantees and equity investment to address particular market failures or investment gaps. The InvestEU Fund can be combined with grants or financial instruments (or both), funded by the centrally managed EU budget or by the EU Innovation Fund. Such a streamlined investment process enables visibility of the project pipeline and maximises synergies across relevant EU programmes in areas such as digitisation. This is the case with the blending operations between DEP and InvestEU, where the InvestEU guarantee is increased to provide targeted equity support in the field of strategic digital Technologies or chips.

5.4. Increase cooperation across levels, including involving cities and regions more in the Digital Decade

One of the major issues faced by the EU’s digital transformation, as reflected in the monitoring of objectives and targets, is the lack of dissemination of digital technologies beyond hot spots including some large cities as shown by the persisting digital divide and the lack of digitalisation of businesses, especially SMEs. As shown by the 9th Cohesion Report 170 regional convergence is still lagging as capital regions often concentrate investments, human capital and digital infrastructures while other regions, remote and rural areas, struggle to boost economic activity and face demographic challenges. A successful Digital Decade will not be possible without greater attention to inclusiveness and the involvement of all actors at all levels. Institutionally, the multiple references to regions in the policy programme demonstrate the objective of the European Parliament and the EU Council to ensure an inclusive approach for the digital decade that goes beyond EU and national level.

Regions and municipalities share many of the key challenges obstructing the digital transformation whether on infrastructure, smart governance, smart mobility, start-up ecosystems, open data or digital sustainability. A recent survey 171 undertaken by the EIB shows that access to digital and technical skills represent major obstacles to the digital transformation of more than half (58%) of municipalities in the EU. More generally, local and regional authorities play an important role in the delivery of Union’s initiatives as 70% of EU legislation needs their intervention to be implemented 172 .

The Digital Decade Policy Programme and the Declaration on Digital Rights and Principles are an opportunity to increase regions and cities’ contribution to the EU’s digital transformation, providing a common language and a comprehensive framework, enabling alignment on priorities defining the ‘European way’ based on cooperation and a governance mechanism that creates new opportunities for Member States, regions and cities to partner up and intensify their action, including via projects such as the LDT-CitiVERSE-EDIC.

Conversely, the specific experience and capacities of regions and cities are critical for a successful Digital Decade with a wealth of practical experience, knowledge, innovative solutions based on everyday contacts with people and businesses that can also help better monitor the Declaration on Digital Rights and Principles, tackle issues such as the digital divide and ensure that the benefits of digitalisation can reach all local groups, including SMEs. Local observatories and Observatories of Digital Divide are promising channels through which regions and cities are hosting a breeding ground of information from the public on the challenges of digitalisation in their daily lives, and on digital divides 173 . The Cities Coalition for Digital Rights 174 , a network of cities committed to promoting and defending digital rights in the urban context can also play a key role in implementing the Declaration on Digital Rights and Principles.