Today, José María Álvarez-Pallete presented the details of Telefónica's Digital Deal, an initiative that the company's president has been advancing for several weeks in response to the need to build back better our future, after the global health emergency that is characterizing the course of 2020. Telefónica proposes this Digital Deal as the next step on the evolutionary path of the 2014 Digital Manifesto for an open and secure internet and, more recently, with the second version of the document, updated in 2018, focused on achieving a human-centric digitalisation.
The COVID-19 pandemic has challenged the world generating the biggest health, economic and social crisis in peacetime since the nineteenth century. During these difficult times, communication networks have been the backbone of all our economic and social life. Connectivity has kept us close to our families, helped small and medium enterprises adapt to such an exceptional situation, and enabled distance education. The crisis has highlighted the importance of connectivity infrastructures and digital services.
"When the physical world has had to close its doors, connectivity has kept the digital world open, becoming the backbone of the economy and society", José María Álvarez-Pallete
In the first five weeks of confinement, we have digitized our societies and economies more than in the previous five years. But at the same time, this process of accelerated digitalisation has revealed digital divides and growing inequalities, especially in developing countries with fewer social protection mechanisms. Inequalities are probably the main challenge we have to face in the aftermath of the pandemic. Given this situation, we have a great opportunity to use this disruption as a spur to build a better society than the one we had before. To do this, we need now more than ever a deal to manage the digital and energy transition by putting people at the centre.
"We need a Digital Deal to ensure that people and societies can benefit from the changes that digitalisation is generating, so that no one is left behind in this fast-paced new technological world", José María Álvarez-Pallete
The idea of the new Digital Deal means updating the proposals that Telefónica led in 2014 and 2018 with the launch of the Digital Manifesto to ensure that technology contributes to improving people's lives without anyone being left behind. The series of the Manifesto has helped to highlight that the time has come to define the foundations for a digital society and to apply ethical principles and humanist values, with consequences in the social, economic, ethical and regulatory spheres. The Digital Deal is an evolution of these initiatives promoted by Telefónica to build back better our societies and economies, after an unprecedented historical situation.
The Digital Deal implies a collaborative approach between the public and private sectors, and must be based on a new governance model that is able to combine social, environmental and economic aspects while ensuring a long-term sustainable digital transition. There is no doubt that building recovery from the COVID-19 is perhaps the greatest challenge since the Second World War. The call to action needs to be “Build it back, better!” on which the five pillars and fifteen foundations of the Digital Deal are based:
1) Making societies and economies more sustainable through digitalization:
- Use digitalization to achieve the green transition: Digitalization can link the economic recovery plans for growth with the green agenda and be a key driver of decarbonized development.
- Foster innovation and accelerate digitalization of companies and public administration: Create massive public funding programs and financial incentives to support the development of start-ups and the digitalization of business, esp. SMEs. And design and implement digital transformation strategies of public administrations to include the use of technology (e.g. health, education, justice).
- Support strategic sectors and technologies to reinforce digital sovereignty: Design long-term plans to support local digital industries creating clusters of excellence for new technologies (e.g. 5G, AI, Blockchain, Open RAN) and promote interoperable digital and data infrastructure projects (e.g. Edge Computing, Cloud Computing) to achieve economies of scale and strategic capacities.
2) Tackling inequalities by investing in digital competences and updating welfare systems:
- Upskill and reskill people: Creating equality of opportunities by boosting public-private partnerships for the upskilling and reskilling of people (current workforce and adult learners), promoting a life-long learning attitude for all.
- Modernize education for a digital society: Drive digitalization of the educational systems by updating educational content to the digital era and create Public-Private ecosystems to implement new methodologies of education that are open and accessible to provide same opportunities to all.
- Reform social protection and labour frameworks to bring obligations and rights in line with realities of a digital and platform-driven economy.
3) Building an inclusive and sustainable connectivity:
- Abolish all policies that inflate spectrum and other costs for infrastructure investment: Prioritize coverage, expand licence terms at no additional cost, assign abundant spectrum in awards for 5G, and fund Universal Service from public budgets instead of industry contributions to increase operators’ financial leeway for network investment.
- Support innovative policies and technologies for a fast and efficient roll-out of advanced broadband networks (4G or 5G and fibre): Facilitate network deployments by streamlining administrative processes for civil works; allow for more network sharing of operators and support roll-out of networks in rural and remote areas with regulatory decisions and public funds as part of national social cohesion policies and foster innovation in network technology (e.g. Open RAN).
- Consider modern communication networks as green infrastructure aligned with climate change objectives in Sustainable Finance Taxonomies.
4) Ensuring fair competition:
- Reform supervision of markets: Assure contestability and non-discrimination in digital markets dominated by few digital platforms by adequately adopting existing telecom regulation and principles and expand mandates of telecom regulators to supervise such non-competitive markets.
- Modernize outdated regulatory and fiscal frameworks: Create a Level-playing-field for all market participants and services regarding taxes, privacy, security and consumer protection. Modernize international and national tax rules to assure fair contributions to local communities and abolish unjustified sector-specific taxes and privacy rules for communication services.
- Update merger policies: Competition authorities should allow for more in-market consolidation and network sharing by telecom operators.
5) Improving confidence by an ethical and responsible use of technology:
- Create a human-centric digital economy: Develop a “Digital Bill of Rights” to protect people’s dignity and fundamental rights in a data driven society.
- Foster digital confidence and use of data: Improve cybersecurity and cyber resilience with “security by design” along the whole digital value chain, provide people with better choice and control over their data (“Data Ethics”), and define responsibility of intermediaries to fight illegal and harmful contents.
- Adopt a risk-based approach for AI usage and foster data-driven innovation: Create ex-ante certifications for high-risk AI systems (e.g. facial recognition, self-driving cars) and better transparency for less risky uses through voluntary labelling schemes. Modernize data governance rules by fostering voluntary data sharing and regulated access to data lakes of dominant digital gatekeeper that foreclose competition.
The last few weeks have shown us that the incredible is possible if we collaborate and work together towards a common goal. The spirit of cooperation must be maintained in the fight against the economic crisis that characterised the worst moments of the health emergency. The public and private sectors will inevitably have to work together to safeguard our prosperity and our way of life.
It is time to lay the foundations for a more digital and sustainable society and economy. We need to define a "Digital Deal" among governments, people and businesses to build back better our societies and economies.