However, a reportby the United KingdomIntelligence and Security Committee titled Foreign Involvement in the Critical National Infrastructure; The implications for national securityobserved that “[a]ny policy which seeks to block all Chinese companies from any future contracts relating to [Critical National Infrastructure] projects is not only impractical but, crucially, given the predominance of Chinese-manufactured and -developed equipment, is unlikely to result in the national security protection envisaged.

During the same period, Apple reportedly refusedChina’s requests for its source code.35Meanwhile, companies including IBM, Hewlett-Packard, McAfee, Cisco, and the German company SAP agreedto use intermediary companies to allow the source code for their products to be inspected under requirements imposed by Russia’s Federal Security Service

One way to address this challenge may be to develop regional compe-tition rules and authorities, like the COMESA16Competition Commission in Africa, which reviews mergers affecting the COMESA region.

he wide-reaching influence of digital technologies on people’s lives has led to calls for a broader definition of consumer welfare in assessing the harm of insufficient competition, covering non-price factors such as quality, choice, privacy,

A better strategy for evaluating firm behaviour is to consider competitive relationships and strategies across markets, entry barriers, con-flicts of interest, the emergence of gatekeepers and bottlenecks, the use and control of data, and the dynamics of bargaining power.

Countries with limited capacity to transform digital data into digital intelligence are constrained in their potential to capture economic value from data. To prevent dependence on a small group of advanced countries in the increasingly data-driven economy, national development strategies need to include digital upgrading (value addition) in data value chains. This would enhance domestic capacities to move from treating data as raw material to processing digital data and using artificial intelligence. It may involve designing national data policies and strategies to seize opportunities that the expansion of data can create, and manage associated risks and challenges

POLICIES AND STRATEGIES TO CLOSE THE DIGITAL DIVIDE AMONG AND WITHIN COUNTRIESInnovation policy

The digital age creates new challenges for peace and security

Roughly half of total electricity used by the Internet was due to consumer devices such as computers, mobile phones, laptops and TVs. The remainder was due to local, fixed and mobile networks, data centres and manufacturing of various components.

A significant concentration of market power can have negative implications on several fronts

The network effect, or the effect that an additional user has on the value of a product to others, and the increasing returns to scale, are both salient features of the digital economy that have enabled a small number of digital platforms to dominate markets. Possessing troves of data and algorithms to process them, these platforms can engage in anticompetitive behaviours that prevent others from enter-ing the market or competing efficiently

Interactions with other megatrendsThe relationship between the rapid spread of digital technologies and the other four megatrends is complex and bidirectional

FIGURE 5.2 LARGE PARTS OF THE WORLD ARE MISSING OUT ON TECHNOLOGY CREATION AND USE

illustrates two salient features in the creation and use of frontier digital technologies for production. First, large parts of the world, especially on the African continent, remain completely excluded.3 These countries are not even importing any significant volumes of the most representative goods. Second, even among countries with some activity in frontier digital production technologies, the roles are quite diverse. Latecomers, for instance, are entering the race, but it is not yet clear if they will become followers. Among the followers, a large number are mainly importing capital goods produced aboard, with very little or no domestic innovation and few exports. Their prospects to advance are limited, as this will require large investment

States of America; Japan; Germany; China; Taiwan, Province of China; France; Switzerland; the United Kingdom; the Republic of Korea and the Netherlands

These top economies account for almost all global activity in each area – above 90 per cent.

The United Nations is uniquely positioned to facilitate dialogue among stakeholders to develop a global compact on agreed principles for managing frontier technologies. It can bring Member States and all relevant stakeholders together to forge consensus on legal and ethical standards, including to guide research and development.

help firms develop strategies to extract and exploit their data; address the growing market concentration and dominance in the data economy; enhance consumer protection; and manage the cross-border flow of data.

Digitalization and data policies to secure and maximize value from the digital economy may involve aspects such as national data strategies, protections of the rights of individuals, open-data guidelines, standards for the interoperability of data functions and promotion of skills relevant for the data economy. Governments should deal with existing and emerging barriers to the growth of their domestic data markets;

A mix of instruments, including innovative financing mechanisms, will likely be required. And public investment must play a complementary role, crowding in rather than crowding out private investment.

To secure a digital future for the many, domes-tic and international policies should go beyond simply enlisting more developing country users and consumers into the digital economy. They should enable the building of domestic capabil-ities to create and capture value. Only then can digitalization fully support the 2030 Agenda.

mpact on the SDGs

The digital technology megatrend interacts with existing global patterns of inequality. Without compensating measures, innovators can take undue advantage of the digital divide compared to other groups. Countries with significant innovative activities will always preserve a lead over countries that mainly adopt new technol-ogies (“follower countries”), much less those that continue to struggle to provide electricity, connectivity, water, sanitation and basic health technologies. Within countries, the digital divide determines which population groups will benefit from technological advances.

Technological innovation and digitalization have clearly accentuated income inequalities.

The sheer size of the crisis threatens everything that has been achieved in sustainable development over the past five years, and much of the development progress made under the MDGs. Depending on how quickly the economies of the world can fully reopen and how soon the recovery process can actually begin, hundreds of millions of people around the world could be at risk of falling back into poverty, reversing the gains of the last two decades

o pervasive and well-established, in so many different countries and societies, that they seem beyond the control of policy, obeying their own internal momentum.And yet, they all result from human activity.

We will tackle unconscious bias that exists in people, institutions and even in algorithms

We will soon present an economic recovery package for the Western Balkans focusing on a number of regional investment initiatives.

We might not always agree with recent decisions by the White House. But we will always cherish the transatlantic alliance – based on shared values and history, and an unbreakable bond between our people. So whatever may happen later this year, we are ready to build a new transatlantic agenda. To strengthen our bilateral partnership – be it on trade, tech or taxation.

Be it in Hong Kong, Moscow or Minsk: Europe must take a clear and swift position

But what holds us back? Why are even simple statements on EU values delayed, watered down or held hostage for other motives? When Member States say Europe is too slow, I say to them be courageous and finally move to qualified majority voting – at least on human rights and sanctions implementation. 

European Magnitsky Act

a negotiating partner, an economic competitor and a systemic rival.

EU's unmatched convening power in action.  

There has never been a better time to invest in European tech companies with new digital hubs growing everywhere from Sofia to Lisbon to Katowice.  We have the people, the ideas and the strength as a Union to succeed. And this is why we will invest 20% of NextGenerationEU on digital. We want to lead the way, the European way, to the Digital Age: based on our values, our strength, our global ambitions.

Europe's digital sovereignty

And it is why we will build a European cloud as part of NextGenerationEU - based on GaiaX.

And this is why we need to secure this data for Europe and make it widely accessible. 

new industry strategy in March

Authorising more than 3 trillion euro in support to companies and industry:

general escape clause

These SMEs are the motor of our economy and will be the engine of our recovery.

Conference on the Future of Europe

This new agency will support our capacity and readiness to respond to cross-border threats and emergencies – whether of natural or deliberate origin. We need strategic stockpiling to address supply chain dependencies

And thanks to our unique social market economy, Europe can do just that. It is above all a human economy that protects us against the great risks of life

Global data flows underpin global value chains (GVCs), creating new opportunities for participation in international trade.32 For many economies, participation in GVCs is the deciding factor for trading internationally. More than 50 percent of trade in goods and over 70 percent of trade in services is in intermediate inputs.33 Data and digital technologies are affecting GVC participation in several ways. The development of these value chains has been enabled by global connectivity and cross-border data flows that facilitate communications and can be used to coordinate logistics.34 Global data flows are also enabling so-called “supply chain 4.0”—where information flows are integrated and omnidirectional instead of linear.3

Data collection and analysis are adding value to goods exports through so-called “servicification.”

taking account of the value of services embedded in goods exports, such as the design, professional service, and IT contributions tomanufactured goods, services make up over 55 percent of total EU exports.

Lucian Cernat and Zornitsa Kutlina-Dimitrova, THINKING IN A BOX: A ‘MODE 5’ APPROACH TO SERVICE TRADE, DG Trade Chief Economist Note, Issue 1 March 2014

According to the WTO, using digital technologies to reduce trade costs could increase world trade by up to 34 percent by 2030.23

around 12 percent of global goods trade is via international e-commerce.18 According to a 2019 U.N. Conference on Trade and Development (UNCTAD) report, e-commerce globally was worth $29 trillion in 2017, with around 1.3 billion people shopping online—up 12 percent from the previous year.19

Addressing these issues requires a new way of thinking about the trade rules for cybersecurity.What is needed is a more fine-grained understanding of the types of cybersecurity risk. Consideration should be given to developing a new set of cybersecurity-specific trade rules. This could include using trade policy to support the development of cybersecurity standards, commitments to good regulatory practice and to using risk assessments as a basis for cybersecurity regulation.

Many U.S. and Chinese cybersecurity measures are likely to restrict cross-border data flows and digital trade. These include data-localization requirements and import and investmentrestrictions on data and information technology (IT) products, particularly from countries or along supply chains where cyber risk is high. Import restrictions including higher tariffs are also being used to punish and deter cyberattacks.

International institutions are beginning to break, paralyzed by too much bureaucracy, too little investment, and intense major power rivalry.

desire to reshape international institutions and rules to suit its power and preferences

technological dynamism

a more anarchic order looming dimly beyond

How do we ensure that any regulatory responses do not interfere with the Internet’s underlying properties, i.e. that they do not “break” the Internet?

If regulation were needed to address consolidation, would it be better to go via the route of consumer protection, competition, or administrative law?

How do the technical community and other stakeholders ensure that there continues to be thriving development and pipeline of open standards that contribute to ensuring continued interoperability and data portability as the Internet economy evolves?

How does concentration in particular services effect the development of standard and non-standard protocols on the Internet?

Do new protocols, standards, or practices championed by especially large organisations have positive effects for all or only some?

re users facing an access environment that is increasingly optimised for the delivery of services owned by a few, or for access to an open and globally-connected Internet?

may be crowding out access to a general-purpose Internet?

Does the current trend of new traffic patterns, what has been referred to as a “flattening Internet topology”, constitute a concern or an opportunity for the long-term viability of the open Internet?

To what degree is concentration, and in some instances near monopolies, on the Internet a result of particular characteristics of the service involved? Are there natural monopolies for some Internet [enabled] services, for which the most efficient number of firms is one? And if so, why?

Could our increasing reliance on just a few companies in the Internet economy make them “too big to fail”? Are there economic and technical dependencies on services that cannot be substituted that effectively create a set of permanent favourites?

How are current trends of consolidation impacting different regions, and are they exacerbating or mitigating digital divides? Is consolidation responsible for creating new digital divides, meaning that some services are offered to others and some are not?

What are the relevant indicators for assessing the impact of consolidation over time? What metrics are available, and how can the Internet community collaborate to monitor trends over time?

On the other hand, trends of concentration in the provision of many services described in this report are often accompanied by many benefits. DNS hosting or CDNs are services that will continue to benefit from economies of scale, and as long as competition persists among the large providers, it will make services like advanced DDoS mitigation more affordable and readily available to a broader range of users and content providers. In the absence of a complete market dominance, or practices leading to single points of failure (e.g., failing to use multiple DNS hosting providers), these trends could have positive effects on security and the Internet’s resilience.

They also reinforce an opportunity divide between developed and developing countries. Mobile app stores1 do this by imposing geographical restrictions

increased dependency on well-known proprietary platforms for interoperation also imply a shift towards a qualitatively different environment than one defined by permissionless innovation, even where open standards support the interoperation.

social login functions offered by some social media platforms enable new developers to outsource the need for developing complex systems for managing not only membership and login credentials, but also the security and legal requirements related to these.

today’s dominant players, given that regulators are increasingly scrutinizing how the platforms leverage and exploit their dominance in one area to favour services in another?

The software company Mozilla has made proposals to the U.S. Federal Trade Commission around API governance, which it calls ‘”the fundamental connective tissue of the Internet.

It is problematic that these and other measures often focus on issues in isolation, potentially failing to understand how different activities fit into the platforms’ overall business models. Some could create unintended consequences by imposing rules with which only the largest companies can comply, further strengthening a dominant position, or by undermining the open and global nature of the Internet itself.

panel of experts to investigate and consider potential responses to digital dominance

Are there economic and technical dependencies on services that cannot be substituted that effectively create a set of permanent favourites?

Could our increasing reliance on just a few companies in the Internet economy make them too big to fail?

For example, the ride-hailing service, Uber, has been using Google Maps’ API to connect drivers and customers to routes and directions.46 This integration was a critical part of Uber’s success, but it meant the company’s core activity depended on access to another firm’s API.

Will the deployment of new infrastructure support the general-purpose Internet for everyone, or could the Internet fade into the background as the evolving edge is captured by a small set of private networks and services designed for a few operators?

Does this mean that a smaller player, depending on transit and therefore subject to longer latency, will necessarily lose out?

Will traffic in access networks be driven by large content and cloud providers feeding their localised infrastructures via private networks?

The Internet was envisioned as a decentralised network which facilitates communication between two endpoints. However, a discussant pointed out that the landscape of network traffic is wholly different now: video streaming makes up a significant chunk of the traffic now, with Cisco estimating the 80% of the Internet Protocol traffic will be video by 2021.96 Since video hosting is dominated by a few companies such as Youtube, Netflix, and Facebook, there has been an emergence of “super-nodes” in the Internet. This has been followed by a concerted effort to be efficient at meeting such consumers’ needs, which further contributes to changing the network topology. For example, several companies employ edge caches at various Internet Service Providers (ISPs) to optimise user performance

The evolution of edge computing is not a substitute for cloud computing in large data-centres, but rather a complement that facilitates the needs of some applications to use both types of computing resources. While some applications powered by AI need edge processing to make inferences on the device, they still rely on data models trained with the cloud’s abundant processing power and enormous amounts of data

Access networks and access devices — the edge of the Internet — evolve rapidly, with many and varied devices connecting to new services, potentially using specialised networks, driven in large part by the IoT. 5G cellular network standardisation and deployment are partially driven by anticipated uses that depend on bespoke access networks with much greater processing capabilities in base stations close to mobile terminals.

n the digital networking world, we are seeing more and more data traffic go ‘dark’. Content service operators are using their own transmission systems or slicing out entire wavelengths from the physical cable plant. This withdrawal of traffic from the shared public communications platform is now not only commonplace, but the limited visibility we have into this activity suggests that even today the private network traffic vastly overwhelms the volume of traffic on the public Internet. And the growth trends in the private data realm also is far greater than growth rates in the public Internet.

Cisco estimates that global traffic between data centres will grow by 32.7% annually between 2016 and 2021, a higher growth rate than the traffic between data centres and the users, which is projected at 25.2%

Underpinning the trend of content and cloud providers investing in their own infrastructure is the dominance of a small set of providers in the application layer, predominantly Google, Facebook, Amazon, and Microsoft. Their services rely on a global network of interconnected data centres and servers to process and deliver content closer to the users

large content and cloud providers are investing in their own international connectivity infrastructure to serve their networks of data centres and servers across the globe.

How will concentration affect the development of standard and non-standard protocols on the Internet?

Will new protocols, standards, or practices championed by especially large organisations have positive effects for all or only some?

the impact of a consolidating Internet economy on the development and deployment of protocols for interoperability indicates that scale is not just a source of efficiency, but also a source of power.

Is the one-stop shop inevitable, or is there a path towards an Internet economy in which there’s a greater diversity of players that are more competitive and innovative?

While some companies dominate their original markets such as search, e-commerce, and messaging, their increasingly diversified service offerings are overlapping and starting to compete in other markets.

Does the flattening of the Internet change the fundamental characteristics of the global infrastructure – and in particular those of global reach and integrity, and interoperability and mutual agreement?

What is the benefit or impact, if any, for competition and the open and interoperable Internet when the Internet platforms secure a significant presence across the application and services layers?

Transit is changing in ways that can reduce demand for traditional Tier 1 international transit. As IXPs are more widely used, CDN use grows and data is stored closer to users, and large platforms build their own infrastructure.

Since Google entered the marke

As large investments are required in order to provide the full range of capabilities and resources, the IaaS and PaaS markets appear to be consolidating around the major players.

With the ability to access and manage servers remotely, from anywhere on the Internet, new businesses have emerged that specialise in renting out space and processing on their servers. Today, cloud computing services dominate this arena. They use large data-centres with expertise and economies of scale, offering their specialised services globally. Customers tend to access these resources as needed instead of buying and managing servers themselves

DNs using private networks to distribute content internationally also helps drive down demand for transit.

As the demand for streaming content grows around the globe, how will the networks that provide such services meet the bandwidth demands, particularly in those countries in which there are significant connectivity challenges?

to what degree will the Internet platforms seek to gain a foothold in the access markets?

to what degree will evolving access technologies bring the unconnected online faster?

whether the entry of digital actors traditionally operating in other Internet domains (e.g., the app layer) might improve competition within 1 layer, while only entrenching their overall dominance cross-domain

whether the access provision domain almost intrinsically tends to dominance due to the impact of economies of scale and other operating factors

How will the increase in time spent online, combined with the extension of the application layer into domestic and public life (e.g., smart homes), impact the Internet and its users?

The ability to choose

No permanent favourites

lay out what that evolution is, what it might mean for Internet users, and what the appropriate technical and policy responses might be.

Our analysis did not lead to a clear set of recommendations, but instead to an even longer set of questions that we think we need answers to before we have anything sensible to recommend.

The OASIS-led Universal Business Language represents a free, common, library of standardised electronic business documents for digitisation of commercial/logistical processes in domestic and international supply chains

It’s also simple to author a rule in this form – an algorithm: it involves constructing ‘control tables’ in parallel to new and/or existing text versions of policies.

express regulations in computational form so that anyone can automate their application.

It has been estimated that an average customs transaction involves 30 parties, 40 documents and 200 data elements that form a ‘data supply chain’ along the value chain of any product.

easier for governments to deliver and maintain.

trade rules in a ‘data driven’ format can address inequalities

the digitalisation of trade implies functional use of data to improve the automation potential of cross-border processes.

2020 has started as 2019 ended, with new cyberattacks, hacking incidents and data breaches coming to light almost every day

an AI-based network-monitoring tool can also track what users do on a daily basis, building up a picture of their typical behaviour