...that you would like to share with the
room, share with the panel, contribute and
hear other people's points of views. And
indeed that's very much where I would
like to start, because I'd like to ask
each of our panelists-- in order for this
particular one-- what do you see as the
the big challenges that are posed by
technological change going forward in
the coming decade and perhaps beyond?
Let's start with you with the IBM
perspective. All right, so first let me
start by saying, I noticed a lot of the
words are challenges. I would like to see
that as opportunities I will make the
case that there is more opportunity than
challenge here when we look at it in the
right way. If you ask me, the two most
important things-- there is one challenge
which is of all of us, but mostly on the
enterprises. And that's a challenge of
trust. We will need to win the trust in
these new services in these digitised
values that population, ecosystem,
businesses can trust on how we deal with
data. If we believe that data is the new
fuel or the new raw material, then it is
clear that we need to understand two
things. First, and here I talk about
opportunity--
you'd be surprised only 20% of the data
today is searchable. 80% is behind the
enterprise's firewalls. So if anybody is
concerned about somebody coming from the
internet and stealing your data, it is up
to you. Okay--you sit on a treasure trove
of data. But to be able to use them, we
are going to have standards of
responsibility around data. What do I
mean? We have issued a manifesto. Data
responsibility at the IBM-- just to
address a couple of points-- we need to
know who owns the data. We are very clear
from an enterprise point of view.
We think our clients own the data, and
they own the rights to the derivative
models. That addresses those who are data
stewards, towards those who are data
peddlers. So there are businesses on the
internet that make use of data
differently for their use and not for
their clients use. So we need to be very
clear.
There need to be standards on privacy and
protection. GDPR is a good thing. GDPR is a good thing. We need also to be
very clear. There is no unlawful access.
Whoever has the jurisdiction, we cannot
have that. Otherwise, people are not going
to trust the services. The same way, we
need to be very clear on the use of AI,
and on the participation for our
population. We talk about values. If we
enshrine those values-- and that's why I'm
saying it's a joint job we have. It's part
on the enterprises, part it is on the
regulatory framework.
So that's the first-- trust. The second is
the regulatory environment in itself. So
we think digital single market is a
great thing. It's a great thing. It is not
just important to give certainty to the
enterprises for investment, but it is
important to be competitive. The U.S.
today has a digital single market in
which every little company has access to
300 million consumers on a whim. If we
have a fragmented system, however the
fragmentation is, it is not necessarily
legal, it can be hidden, like data
location requirements for spurious
motives that drive cost, geo blocking,
other things that have been tackled with
DSM, it is very important that we get
this environment fixed quickly. As the
biggest trading bloc in the world, data
flow-- so the ability for data
to be available along a worldwide supply
chain without hindrance, is fundamental.
It won't work without it. And say, in
the digital single market, Commission-- the
last Commission, has done a lot
consulting with the ecosystem, and we are
encouraged by what we see, but we need to
stay vigilant. Because for example, in the
trade negotiations, we still do not have
data addressed specifically. And so we
can see that other trading bloc's would
show up and make data location
requirements that then become a
hindrance. I would say-- so, trust and the
right regulatory environment go a long
way to turn challenges into
opportunities. Okay-- thank you for that.
You, from Accenture's point
of view, you're obviously at the cutting
edge of a lot of that technology. What
what are the challenges that you're
coming up? The opportunities, as Eric
as Eric has called them. But what are the
challenges that you see? And how do you
feel about the data regulation that's
coming along? I think just to
re-emphasise the basics. When we look at
what's going on, and I can cite you all
the buzzwords: the nanotech, the quantum
computing, the analytics, the blockchain
and so on and so forth, and last but not
least AI, which is probably the more
pervasive-- what is going on right now.
This is not an evolution. This is a
revolution. And it's in that context that
we need to look at the challenges. The
challenge is not what I would so say
technical barriers. The challenges are
really, you know, sort of do-or-die type
things that we need to get right. And if you look at what we could expect from
this evolution-- that's why it's so
important to talk about it-- is, take the AI-- moving
as we speak from piloting to mainstream.
It's sort of in that pivitol point in
many industries. You let that run for
another 15, 17 years.
Those that invest all-in, we predict this
could mean a 40% like-for-like
productivity increase. Or zero. And like-
for-like since this is a game where
early movers will really take a lot of
advantage. We're talking about those
taking probably thirty to forty percent
more revenue and or profit. So, this is
the kind of order of magnitude we're
talking about. The other data point that
I need to give you to frame the
challenge is, if you look at private
investment in artificial intelligence
only, just as focusing just on that. Sixty-
six percent of that was done in the U.S.
Seventeen of that was done in China. So
You can calculate yourself what is
remaining for the rest of the world.
There's some good news, and we praise
ourselves in Europe that our startups in
2017, or just probably slightly over half
of the startups were in and around AI.
But you know, it's all how you want to
describe the glass being half full or
half empty, right? And so in that context--
so that's the first challenge-- so the
investment magnitude, so everybody
understands the challenge. Then let's now
go to the real challenge. Three. Number
one: our companies, our businesses
struggle with how to deploy the
technology. Not so much piecemeal and in
its silos, but really how do you deploy
this in a in a end-to-end way such that
not only it's about productivity
improvement or efficiency gains, but
it's also about having a different human-
machine interface-- if I can call it that
way-- so how how jobs are augmented by by
tech, and not just replaced by tech. But
that aspect, and also the aspect of how
do you innovate, how do you change entire
supply chains, entire customer
relationships, products, services and the
likes? And so this sort of all-in thing
is, if you
survey the CEOs of big companies, 80% of of them tell you "Oh, I want to have
cost efficiency. I want to have the
innovation. I want to have the
augmentation of the jobs, etc." But only
13% 1-0
actually invests in that veneer, and
starts to get the benefit. That's
challenge number one. Challenge number
two is the access to the
skills. Now, we can probably spend the
full day on that. But just again, not only
looking at that additional discussion
about all the government needs to change
the education system, it's about skills
not the jobs, and I mean you all had
similar discussions in similar events as
this one today. The reality is also in
the business. Investment in AI in 2017 went up by 60%. So you could say good news.
How much was the increase in skill
investment in that same year? Only 3% of
companies increase their investment. So
that's not even three percent increase.
Only three percent of companies increase
their investment in skilling and re-skilling.
So this equation cannot hold. And it's
not just-- and it's again in the same
veneer. It's not about too much thinking
about we were safe and we will make
become more efficient so we need less
people. No. We're gonna do different
things, and we're gonna do things
differently. Which requires different
skills. We now-- when you read some of the
the publication's on on jobs, we're
talking about, you know, jobs about
training. Training machines to do what
they could do better. We talked about
explaining jobs, where you have AI or
machine learning spit out results, and
then you need to go and explain to
people why they didn't get their
mortgage, or why you know, the cancer
treatment didn't work. And try to explain
what the AI actually
helped us figure out in a way people
feel we're transparent about it, people
feel like-- to your point Eric-- they can
trust what we say, what the data say.
And then third but not least, is the
access to data. And we're in Europe, and
I'm probably one of the big propagators 
of responsible use of data,
protecting the individuals, and all of
that, but we need to do that in a very
smart way. Because we all know that
advanced today in technology is actually
built through the data, and the
availability of data to train, deploy
your systems and improve the accuracy of
your results. And if that is restraint, it
means that in China, and in the U.S. it's
gonna go faster, and their algorithms,
their systems, their proposals are going
to be more accurate, more to the point,
more useful than the ones that we're
creating in Europe. And that can never be
the purpose. So in those contexts, we
cannot only think about how do we
protect the individual, and then in a
separate silo, think about we need to do
more in technology, why is it that we're
behind? No. We need to do that in a
holistic way, and do smart measures that
continue to also allow the business to
fuel their trajectories of moving, what I
would call moving to the new,
rotating to the new. Sort of an end and
story we need to get to grips with in
Europe, which is I believe the real
third challenge that we're facing in our
part of the world. And this is one that
regulation could get wrong.
Exactly. Overprotective on segmentation
and on use of analytics. I mean, right now
just say it. Use of analytics is
restricted in many cases to only to
scientific use. That will not work for
businesses. And looking at it more
from I suppose the Commissioner, the Commission's think-tank's
point of view, how does that-- what you've
heard, chime with some of the challenges
that you-- I mean, this must be a
huge part of the work that your think
tank, and your work involves. Yes, of course. So
thank you for the opportunity. And
contrary to the gentleman who spoke
ahead of me about the challenges, I just
want to say that one of the key themes
in Davos this year was actually Europe
is Back. And of course, there's always
more to do, but the fact is, Europe has
grown faster than the United States in
the last two years. Employment rates are
at the highest ever, and investment has
also picked up and is now at pre-crisis
levels. So that being said, of course it's
not a time for complacency. I agree that
technology adoption and diffusion needs
to be a key priority. And I say that also
speaking here at a conference of
businesses. I think that in the first
wave of digital technologies, European
companies have frankly been a little bit
too slow to understand how
transformative this was going to be, and
have really failed to take full
advantage of digital technology. So if
you look at the figures, only about 1.7
percent of European companies make full
use of advanced digital technologies.
Only about 10 percent of SMEs work with
data analytics. So this is data. I
mean, how are you gonna do really well on
AI, if you don't work with data? I mean-- so,
the point is that it has sort of a
cascading effect. If you don't get it in
the first wave, you're probably not gonna
do terribly well in the second wave of
AI etc. So, for me I would really
prioritise technology adoption and
diffusion. The second point I want to
pick up on what you said about the
digital startups. So, it's true that
Europe has really done a lot to help the
startup ecosystem. I think it is now
competitive. You can more easily start a
company in Europe, you can raise your
first five to ten million without too
many problems. But where we
need to do something is on growth and
venture finance, where Europe essentially
makes it impossible to scale up in the
way that companies can do in the United
States and in China. So here I think we
really need to look at what we can do to
put the kind of financing facilities on
the table that not only enabled startups,
but really scale ups. Because here, Europe
does have an issue, and I think it's
widely recognised. The third issue I want
to put on the table that I
think is very important going forward, is
essentially to rethink infrastructure a
little bit. We always think roads and
bridges, and that's very important, but I
am convinced that a digital
infrastructure, in particular 5g is going
to be very critical going forward. And
here I am very concerned that we are
behind, and that the investments that are
needed are not coming forward. And I say
that 5g is not just about a better
surfing experience or a little bit
quicker in the internet. I am convinced
that future business models will
essentially be built on 5g. So on
autonomous driving, precision farming,
personalised health care-- that's not
going to be possible to do without 5g. So
I think we need to really, really zero in
on this issue and and tackle it. And
then Europe has everything going for it
if we do that. Dieter, I'm wondering if
what you've heard chimes with you. You come from Germany, from the
Federation of German Industries. It's an economy that's built very
largely on SMEs and other similar sized enterprises. Does that--Does
a lot of what you've been hearing chime
with the experience in Germany?
Of the issue of access to investment, the
issue of handling data, access to data
and so on. Do you see those as the
challenges, or maybe you want to add some
more to that list. Let me
first go one or two steps back and
try an analogy. If digitisation is to
be compared with a strong upcoming wind,
the first thing we have to do is to
decide whether we want to shelter, or
whether we want to build windmills. And I
think if I look at Germany, if I look at
the SMEs which you pointed out, that's
the first question we have to discuss.
And we have to encourage, and that is
something what I like in the first
answer Eric gave. Let's not talk about
challenges, let's talk about
opportunities. We have to convince them
that there are quite a lot of
opportunities in in taking the chance of
a digitisation. And secondly, we have to
think about what what are the elements
of digitisation? Is it just a buzzword or
does it contain elements which we have
to care of as leaders, as management of
an enterprise. And according to my
opinion, it contains about
four elements. One is digitise your own
organisation, how you act within your
organisation. Second, digitise your
product, cert digitise your process.
Because in much more cases, digitisation
is the question of processes rather than
of product. And fourth-- and that's coming
to data-- use digital data platforms. And
you especially addressed Germany. In
Germany, we spent quite a lot of time, quite
a lot of money, and quite a lot of brain
to keep extremely high level of data
privacy. By doing that we forgot a bit
about data security and data safety.
About protecting the data, protecting the
transmission of data, or the usage of
data, the technical use of data. And my
theory is, we should change that a little
bit. Not just in Germany, also in Europe.
Maybe all around the world. And we should
give these three pillars the same level.
Data security is at least as important
as data safety and as data privacy.
And coming to the last point, data
privacy. We still build data privacy laws
and regulations on a basic principle
which is called data poverty, which was
founded somewhere in the late 60s in
Germany because of a court decision in
Germany. But data poverty is by no means
the correct building principle for a
data privacy issue in the 21st century,
where we all want to use data. So what we
have to do in that coherence, is we have
to replace the basic principle of data
poverty by a principle of data
sovereignty. And that addresses a totally
different issue. It's not just a legal
aspect, it's much more a technical aspect.
We do have the techniques all over the
world in different research institutes.
We do not have off-the-shelf products we
can buy. And I think these are the
directions which we have not to walk, we
have to run to be at the end the winners
in a new digitised world. So I'd like to
open it up to the floor a bit actually.
I'm sure you've heard some points there
that chime with some of the ways in
which you operate. Maybe you are part of
some of that issue, maybe you are
tackling some of that issue, maybe you
see it as an opportunity. But we've
looked there at trust and skills and
access to investment, access to data. I
can see a couple of hands going up
already. There's one there at the back.
Any thoughts on what you've heard so far?
Could you introduce yourself with your
name and your affiliation if you would?
I am Gerhard Huemer from UEAPME, the European
SME Association. We would like to ask a
question to Mrs Mettler. I fully agree
when you say that there is a problem in
financing scale-up in Europe, but when we
speak with our startup companies, we hear
even more often that the scale-up problem in Europe is a
problem of higher costs than in US and
an Asia,
and more time-consuming due to imperfect
internal markets. From consumer laws,
different insolvency laws, different text
laws, etc. And then the circle is closed
because if you need more time and more
money to scale up in Europe, then
investors will do it somewhere else. Is
the Commission working on this
problem? Thank you. And you want to jump
in? I mean, I know you're not here to speak
directly for the Commission, but is that
something that you wanted to comment on?
Of course. I mean, I think you know well
that we are working on it. And that's why
the digital single market, you know, why
we we have launched all of this. Of
course we understand that the market
continues to experience quite a bit of a
fragmentation, but that is not only the
fault of the Commission. I mean, as you
know, we can also look to the Member
States for some of that responsibility.
However, that being said I don't think
you can just look at at economies. You
can look at societies. And what I hear
from the people in the startup community
is that Europe is actually becoming more
and more attractive. We are seeing fewer
and fewer digital entrepreneurs leave
either for across the Atlantic or across
the channel. And that's a huge
opportunity for us that I hope that
Europe will see. So my point is that as
the world seems to move into, I don't
know, maybe more a liberalism or that
that Europe, I believe is actually very
attractive for these groups of people
that start these kind of companies. So
the mood that I hear from the startup
community is actually much better than
it used to be. And if we can keep some of
these guys that have the potential to
build these kinds of companies in Europe,
that's a huge, huge boom for us. So
what's changing in Europe that's
making those digital startups and so on
want to stay rather than-- Part of it is-- We've
heard Angela Merkel sort of trying to
encourage them to stay, but we need more
than me more than politicians saying it,
I suppose. Part of it is not just around
regulation. That's what's my point. You don't just exist in
an economy. You exist in a society. And
there I have to say that what is
happening across the Atlantic, as well as
across the channel, is just making these
places less attractive than they used to
be. So it may not be that Europe has
exponentially become that much more
attractive, but there are certain values--
this is also a conference about values,
about democracy, about freedom. And here, I
have to say for people who care about
this, Europe would most certainly be an
attractive location to do business and
to start your company. Do we have any
other questions at the moment from--
The reality is of course that--
and some of that will play-- but the
reality is that the most important
change is the availability of money.
Because even a few years ago, even at
startup and finding angel investments or
the first couple of loans was difficult.
And most Member States have now programs
in place where you can get
cheap loans, participation, that you're
not back due. The venture capitalists have
a lot more money, and since the low-- I
mean, it's one of the consequences of the
low interest, is all sorts of people with
money are just looking for different
ways to invest the cash. And the startup
scene is one thing, and there's also a
cultural thing going on with our
Millennials. You know, starting your own
company has grown in image. I mean
it's just the cool factor is much better
than it used to be. So those two factors--
and I have a few startups in my family--
if I if I talked to the guys and what
makes them startup, it's-- they don't have
to go to the U.S. They still will
go to the U.S. to scale, but they won't
leave Europe, which is a different thing.
And they have the money. Kind of leads me
to what was is my next question, which
is this business of trying to redress
the balance between Europe and the
competition in the U.S. and China, and
other parts of the world. How do you
think Europe, particularly with regard to
to technological change, innovation, AI,
and what we've been talking about, is
going to be able to continue to fight
that battle to redress the balance. We're
here. We've already heard today that Europe on that front is is
lagging behind. What are your sectors
able to bring that would redress
that balance? I have a view here that can spin
off the tone that the discussion has
taken. Here's my my sense, living half in
the US and and half in Europe. The
discussion here in the last years has
been very much a catch-up discussion to
say, how can we get our startups ready?
How can we give them the same market
size? How can we give them the same
access to angel capital? How can we scale
them? What are the barriers? And what
needs to be put in place? That's for sure
an important issue. The discussion has been
obfuscated sometimes a little bit by
fighting yesterday's battles. I don't
think that there will be a startup that
will make a better Facebook than
Facebook, or a better search than Google.
That is a battle that, you know, that is
not playing to the strengths of Europe.
We were so convinced about Europe's
strength in high quality manufacturing,
that the only division of IBM outside
North America-- we placed internet of
things into Munich. Worldwide division
into Munich, the largest investment we
made outside of the U.S. in the last years.
Because--I alluded to it before-- 20% of
the data are out free-roaming.
80% are behind the enterprise's
firewalls. So instead of being disrupted
by somebody coming from the outside, it's
time for the existing companies to
disrupt themselves and to modernize
themselves. I think there is a huge
chance for Europe in that. So play a game
that you actually have a comparative
advantage in, and win that. There are a
couple of elements here that I think are
still missing compared-- if you want the
comparison to the U.S.
There's a base infrastructure-- Anne talked
about the base infrastructure which is
most on the communication side. I would
argue high performance computing and
artificial intelligence are kind of
reciprocally intertwined. Unless you make--
mostly also for the small companies-- you
make available high performance
computing utilities that are really
competitive--and we are talking
pre-access scale, we are talking
excess scale-- that is if you want where
there is a significant amount of of
competition right now between the
systems if you want-- the US Europe and
China. That's something we need to do. And
the third one-- and we already talked
about it-- is skills. This is a
different game. It doesn't require
university degrees for everybody.
It doesn't. Do all systems training
systems-- I mean, we launched P-Tech, an
initiative where IBMers go and coach
schools. We agree on curricula. We give
them privileged access. I mean there's a
lot we can do together, but playing to
win means playing to one strength
instead of fighting yesterday's battles.
Let me support a bit what Erich
says. I think as soon as it gets to
enterprises, as soon as it gets to
industrial data, to industrial
digitisation, we are much better off than
the US. But what we cannot compete with is
the whole business to consumer business.
That's no chance at all. We do not have
the market size. So, forget
about doing a better-- You
mentioned Facebook or Google. That said
will not happen. But if you look at
industrialised platforms, the data
platform in industry, they are owned much
more by European manufacturers. Of course,
in quite a lot of but a big portion, they
are hidden between the companies walls.
All the interfaces are standardised
interfaces by industry standards much
more developed in Europe than in the
rest of the world. So I think if we-- if
you take the first word serious, let's
look at it-- It's something which is a
challenge, but it will help us to compete
in future.We have an excellent
starting point. Where I'm a bit sceptic
is the subject artificial intelligence.
That's the reason why I didn't want to
put it in the same basket. Twenty years ago
AI, it had a different name, but AI
research and development started
in Germany. And most of our universities
have given up on that because we didn't
have the computing power, we didn't have
some money to support it and all
of that stuff. We didn't have the data
and right now we-- Remind us what it was called then. What was the term that was used? You said it had a different name.
(German) Okay. Well.
It's the same, but in German. So right now
we are in big danger that we lose
that because as Joe said, the majority of
the investments in AI is not done in
Europe right now. It's done in China. it's
done in the States. So that's a difficult
issue, and we have to keep that up. And let
me underline a sentence Erich also said,
we have to start to rethink our
educational process. In quite a lot of
European countries, and Germany is, sorry
to say, one of the bad
examples. We do not have let's say IT or
digital oriented lessons in our basic
school education. And I'm not voting to
get eight year old software engineers or
eight year old programmers. That's not my
aim.
But I'm deeply convinced that a basic
digital knowledge is the best
precondition for digital sovereignty in
the future. So it's a kind of a basic
competence for the future. And we have to
really fast rethink our educational
schemes in Europe, especially in Germany.
We are I think far behind compared to
the Nordic countries within the EU.
Can I ask if anybody in the audience
has experience of this, particularly with
regard to the competition from China and
from from the U.S. in terms of working
with new advancing technologies? Is
that something that chimes with anybody
in the audience? Not particularly.
Okay. Well, we'll keep going on that
one. Yes, Jo. I think one of the
things we should consider is if you look
at-- We know the U.S. gets all
the money, and the money flows almost
automatically to the Silicon Valley, but
also other pools of innovation in the
rest of the U.S. So it's not just Silicon
Valley. What China does and frankly also
Japan did this to some extent, is to have
a sort of comprehensive strategy. They
have a country strategy. You can say it's a
totalitarian state or sort of, but they
have a comprehensive strategy, even have
a target. AI base based businesses 150
billion by 2030 or 35, I forgot the exact
year. But they have a precise target and
a precise year, and then they will fuel
the investment. I'm sure through gazillion
different initiatives that contribute to
that theme. And I think there is a
strength in there. If governments would
would have the courage-- and they did so
in the past with some things. I'm going
to illustrate it in a few seconds.
If we could do a more
comprehensive, and EU could help
coordinate that is not just one or two
countries but it's more pervasive. But
look at what Germany did with X.0. X.0, your organization, did a lot of
work mobilising the members. But also the
Merkel administration was behind you and
very voicy about what they would do, what
they thought was important. So it's got
a good osmosis, and almost a central
plan if
you will. We want to be big in this. It's
our industrial base. We're gonna rotate
data to the new. We're gonna invest R&D,
etc, etc. So it can be done. And so Macron
is working on something similar
for AI. He's going to come out with that in
one or two weeks. So if we do a more
comprehensive view on how our strategy
should look like country by country but
also EU-wide, and be more articulate and
even further like this where some
policymakers, business folks kind of align
on sort of the grand scheme of
things, I think that it's not
neat around the corners, but it's the
right thing to do. If we then make sure
there is enough money going in R&D,
because R&D used to be this idea about
you do R&D and then 10, 12 years
later something comes out of it. Even
fundamental R&D today could spring into
something really great two to five years
max. So the R&D investment is a sure bet.
And we have very strong circles of
institutes in Europe that we could
leverage. I mean, in Germany what you do with
the FKE for instance; the Turing
Institute in the UK. So there are the
instances we can leverage. We should do
it, but in a more accelerated way. And
then we talked about the skills thing. And again there we have a
sort of frozen middle, right? We have the
top of governments when you speak to
them privately, they're all convinced we
need to go much faster and it's really a
priority to shift gears. Also in the
labour market you know in sync with this
new educational paradigm. You talk to the
people themselves, we'd even have surveys
within bigger enterprises, are people
ready and willing in different shapes
and formats to move along and rotate
themselves to all these new skills? Sixty, seventy
percent says, absolutely. Yeah. We're
willing to do the investment ourselves.
We're willing to study, to learn even in
our free time. And in-between, we get
somehow stuck with the structures, the
change, the difficulties the raiders in
the machine that are having a tough time
translating
what the people know and what we and the
top of the politicians know, to something
that really starts working, you know, in
reality. I just wanted in this context
perhaps to mention that the Commission
will come forward with the communication
on AI, because of course it's important
that these initiatives not only take
place at member state level, but also at
a European level. So I think that that is
definitely recognized. Let me say that I
mean, of course there is a formidable
challenge coming from China and the U.S.
but if you look at the top research
institutes, the top 100 research
institutes on AI, 33 of them are in
Europe. Europe has more programmers and
engineers than the United States. We also
know it's about machines. And I mean
who's better at machines than the
Europeans? I mean, if you look at-- We
speak about IOT, and of course we're not
so good maybe on the I, but we're pretty
good on the T. And so the point is, you
know, that and you mentioned-- Who was it
who mentioned the industrial data? You
know, that our incumbent businesses sit
on piles and piles of data that frankly
the Googles and the Facebooks cannot
have because it's not consumer data. This
is industrial data. So if we get a
strategy going around this, coupled with
a high standard. I mean, I think that
Europe always needs to think about also
how do we differentiate ourselves?
Because frankly we're probably not gonna
be playing in the same field as China in
AI. I mean we have completely different
privacy standards. I mean there is
essentially no data privacy in China, so
of course they can work with data in
completely different way than we can. But
that doesn't mean we cannot play. Perhaps-
and I think for Europe in any
case, the only way we will be able to
compete is if we set the highest
standard. And that is often times
difficult to do, but here let me say it's
also a necessity. Because on AI everyone's
very bullish and it's of course really
important. But there is also a flip-side
that is very dangerous around AI. And
there's also a need to look at for
instance, autonomous lethal weapons
around what is called "real" fake news. I
mean there is now if you look at the
next wave of fake news, AI enabled
fake news, and who's going to be
regulating that? Who's going to be
looking into the ethical standards for
AI? Frankly, I can only see leadership
coming in that area out of Europe, you
know? So the point is we need to think
about what is our competitive advantage
here, and how are we going to do things
the European way, and then try to be
globally competitive. But then you would--
Everybody has to agree with what you just
said, but speed is of the essence. There
is, there are technologies you can buy,
but learning and skill takes time. You
can't-- I mean, you can catch up,
but you know, up to a point. So while we
need to fix all these conditions, and I
mean, we have been vocal on-- In AI, you
need three things. First, we need to make
clear to people that this is not about
substituting the human. It's about
augmenting-- If we are realistic. Okay? In
60, 70, 80, 90 years we might have
singularity, but not in anybody's
lifetime. Second: transparency. Jo
mentioned it before. These algorithms are
beautiful. They give you an outcome, but
you might want to know what reasoning
process or what training data went in to
tell you that you have this kind of
cancer, or another kind of cancer, because
it might be relevant. The third thing, as
we said is skills. So we need to fix
that, but we need to be fast. Yeah, I mean
I hear you. By the way, I think the
business community can help with that.
Because you know, I mean I would
encourage you then to really raise the
awareness among policymakers why this is
so important. We do. You leave me on to my
next point, which is whether--
Perhaps from industry point of view,
whether we have the right policies to
promote technological change. Is that
something that-- Is the framework there? Is
it a help? Is it a hindrance, if I
may be so bold? I wonder if-- That is
obviously playing a little bit into
some of the competition elements as well.
How does it look from an industry point of view?
Deter, maybe-- I think if we're talking about
technological frameworks, we should try
to develop them by ourselves. The
business community must be the driving
force to do that. We shall not wait
until the governments or the Commission
builds us a legal framework. So we
have to do the first step. Of course that
has to go in coherence with our ethical
expectations. That's not just when
we talk about digitisation. Especially
when it goes to artificial intelligence,
we are not just talking about a tech
dimension. It has much more dimensions
which also have to be discussed. And
they're fully agreed to. And who would be
better off than the European culture to
discuss that? It's not blaming the others.
But I think we have a competitive
advantage if tech dimension and, what
do you call it, non-tech dimension go
together or have to go together. But I see
the business in the lead to do the
technical part. What we need is an
investment-friendly framework from the
politics, which goes into very, very
detail. We were talking about artificial intelligence research and
development, which we have to force.
And of course that has to be fast.
No five year, six year, seven year
decision process is how we change the
content of software engineer education
at our universities. That will not help.
So, what we need is a framework by the
political agenda which tells us, that's
the direction,
we support you, not the direction we want
you to go. That's the Chinese way. Chinese
way is the government tells you where
you have to go. We need kind of a more encouraging
way, and then we need the
investments, we need the legal framework
starting by taxes and everything
else. And we also need let me address
this as well, a kind of societal
framework. Being an entrepreneur, being
a freelancer, being someone who runs an
enterprise is not as popular in Europe
as it is in the States or in other parts
of the world. Jo mentioned that it was
getting better. And I fully agree to
that.
But it's still not on the level
like in the U.S. So we have to do some
promotional aspects, some promotional
activities to tell society how
helpful it is when we have entrepreneurs
doing their business here. Jo, from a sort
of a global actor's point of view, working
with lots of different regulatory
systems, how does that help or hinder
technological innovation in a
business like yours? Well, it clearly
hinders. And you know, for big corp, at
least the more successful big corp, let's
just say they are successful despite
that, and because of their size they can
afford to invest a bit each time, to see
what they can do to adjust and adapt. For
younger enterprises especially in Europe,
of course it's not as easy because they
need to hop from one country to the next,
and then relearn whatever they have
already learned because most of the time
we need to change again the product, the
service, because the regulation is
different, the data protection is
different, da-da-da-da-da. Right? So it-- You
cannot hide it. It is a hinder. At
the same time what it also does-- Because
this is a global phenomenon, right? It's
not just Europe. And a lot of companies
even if they are relatively small, they 
are actually global companies.
You're getting more and more a need
of a sort of a framework that actually-- And
to your point, Dieter,
businesses develop
amongst themselves. And you see these
initiatives spring up. Things around
responsible AI. So what are we gonna
agree amongst ourselves that responsible
AI looks like? And what are we gonna do?
And what are we going to not do? And what
are some of the principles we're going
to stick to and hold each other more or
less morally accountable for if we're
all working in the same environment and
supply chain? So those kinds of things
I see evolve quite frankly quite quickly.
You used to have that only in in things
like climate preservation, right? Like the
UN Compact and those kinds of things. I
see now similar initiatives where people
agree how they're going to treat this
whole thing about displacement of jobs,
fast automation, AI, the questions around
the ethical thing around the AI, the
transparency, the bias, all these things.
And we sort that out amongst ourselves
and try to find allies and even if we're
competitors on those kinds of things, I
can assure you, you find the colleagues
having the same interest and really
trying to work together. So what I've
probably said before-- This goes beyond
the philosophy or agreeing on something
in general. This is really companies
seriously working together to agree on
protocols. And that's kind of their
way of dealing with the lack of unity
across the globes. It's sort of a meta
regulation that is sort of self
imposed that is organically you know
taking shape as we speak. So Anne, how does
how does Europe deal with that if regulation and policy is being
thought of in those terms, and how can Europe ensure
that it develops the framework that
meets what industry needs whilst also
reflecting those special values that
we've all been talking about in Europe.
The fact that we do have very strong
worker rights and concern for the
environment, the circular economy,
sustainability, which are perhaps lacking
in other parts of the world. I mean, what
I honestly have to say is sometimes
challenging
from the public policy perspective is
because on the one hand we're expected to
make sure nothing ever goes wrong. In a
very fast-paced environment where
technological change takes place. So
because if anything does go wrong, we are
blamed. On the other hand, we're supposed
to build this super enabling framework
where companies can thrive and do
business and scale-up. And that I have to
say sort of having a front-row seat to
this now, I understand is a formidable
challenge. However, that being said, I
think the absence which is not
regulating and not paying attention to
what some of the dangers are is also not
an option. So I think on some of the
issues that Europe does indeed
see itself perhaps as playing a major
role in regulating some of the digital
economy because it is different from
sort of the analogue economy and you
know, even though there are many
companies coming and complaining about
it, I can tell you just as many are
coming and are pushing for it. And so
you exist in this constant sort of
environment where your people try to
stop you and push you and and so
whatever you do, you never get it
right. And this is sort of what I have
learned after my three years. That
being said, I do think we need a little
bit more of a framework here because
digital as I said is different from
analog, and we don't see a whole lot of
leadership elsewhere in getting to
grips with some of these issues. Because
let me say, I mean, since this is about
values, there is a profound feeling among
sort of social dislocation among parts
of our society. I mean, we sit here and we
talk about the engineers and the
programmers. I know that they don't have
issues, but others do. And so I mean, what
we did at the European level for
instance is we have the European pillar
of social rights, which was essentially a
reaffirmation of social values
on social protection. I think
these kinds of things are very important
because especially in Europe where we
have a comprehensive
welfare state, it is important to say
as we go forward we will still try to
take care of you, but we will do it in a
different way. We will you know, not try
to prevent change, because frankly we
cannot do that. But we will try to
accompany you during periods of change
in your life. And here, I have to say that
the companies often leave the really
heavy lifting more to the policy types
because it's for us to tell people often
that the new reality is that you will
not have a job for life, you will have
several jobs and possibly several
careers. You know? You need to redo,
rethink the educational system. All of
that is very complex. So, I mean, I am
always listening with great interest to
sort of, all the complaints, but seeing
it from where I sit now, I have to say
it's a formidable challenge, and
it's really difficult. Anne, you gave
us the challenge before to do our part. I
think actually I would like to pick up
one of Jo's comments here. Companies
that operate worldwide like Jo's
company or my company, we have a
role to play and we can play a role, even
influencing on both sides of let's say
of the Atlantic. That we get together on
standards. We did so with first the
privacy shield and then GDPR, and
all the things we are actively
working on both sides of the
regulation. And in many voids we are
trying to fill, in we're saying, hey, we
believe these are the minimum ethical
rules that we should give ourselves as a
commitment even in the absence of strict
regulation because it's still nascent.
Okay? But that dialogue I would
agree with you that dialogue needs to be
more intense and we are going to have to
have the dialogue not just in the
countries but at country level, EU level,
and frankly our biggest trading partner
is the US. Okay? So we and we have
affinity in values, whatever short term
agenda there might be on one or the other
side.
By the way with the UK too. I'm getting
signs that I think Mr. Barnier-- Yes, in
fact I can see Mr. Barnier has just arrived. I
don't need a sign. So I think we will
wrap up the discussion there. Thank you
very much indeed for your contributions
and if I could ask for an applause,
that's great. Thank you, Shawn.
