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Lessons from Three ICT Sub-Sectors Comparing Innovation Performance in the EU and the USA: Lessons from Three ICT Sub-Sectors Simon Forge, Colin Blackman, Itzhak Goldberg and Federico Biagi 2 0 1 3 Report EUR 25961 EN European Commission Joint Research Centre Institute for Prospective Technological Studies Contact information Address: Edificio Expo. c/ Inca Garcilaso, 3. E-41092 Seville (Spain) E-mail: [email protected] Tel.: +34 954488318 Fax: +34 954488300 http://ipts.jrc.ec.europa.eu http://www.jrc.ec.europa.eu This publication is a Technical Report by the Joint Research Centre of the European Commission. Legal Notice Neither the European Commission nor any person acting on behalf of the Commission is responsible for the use which might be made of this publication. Europe Direct is a service to help you find answers to your questions about the European Union Freephone number (*): 00 800 6 7 8 9 10 11 (*) Certain mobile telephone operators do not allow access to 00 800 numbers or these calls may be billed. A great deal of additional information on the European Union is available on the Internet. It can be accessed through the Europa server http://europa.eu/. JRC81448 EUR 25961 EN ISBN 978-92-79-29825-7 (pdf) ISSN 1831-9424 (online) doi:10.2791/13458 Luxembourg: Publications Office of the European Union, 2013 © European Union, 2013 Reproduction is authorised provided the source is acknowledged. Printed in Spain Acknowledgements In preparing this study, the authors would particularly like to acknowledge the guidance and support of Marc Bogdanowicz and Paul Desruelle from IPTS. In addition, the report benefitted from discussions at an expert workshop, “Investigating Industrial and Innovation policies for growth: Contrasting Experts’ Views”, organized by IPTS in Seville in November 2011. Finally, thorough checking and editing of the text by Patricia Farrer is gratefully acknowledged. 1 Preface This report is the result of a study conducted in 2011 and 2012, commissioned by the Institute for Prospective Technological Studies (IPTS)1 in the context of a research project investigating the issues of growth, jobs and innovation, which have become main priorities of the Europe2020 Strategic programme of the European Union. The report is authored by Simon Forge (SCF Associates Ltd), Colin Blackman (Camford Associates), Itzhak Goldberg (Fraunhofer MOEZ, Leipzig and Center for Social and Economic Research, Warsaw) and Federico Biagi (IPTS, University di Padua and SDA Bocconi). The objective of the study is to document the existence of innovation gaps between the EU and its main competitors in specific ICT sub-sectors – namely web services, industrial robotics and display technologies –and to explore the role of government policies in Europe’s future needs for innovation in information and communication technologies (ICTs) through a comparison with the USA and Asian countries. The overall aim is to contribute to assuring the strong presence of Europe in global high-technology markets by highlighting the measures at an EU industrial and innovation policy level that could correct any failure by Europe in producing commercially successful innovation in the ICT industries. Our analysis shows that rather than there being a simple innovation gap with the EU lagging behind the USA, a more nuanced picture emerges in which firms in different countries have strengths in different sub-sectors and in different parts of the value chain. For instance, European firms are ahead of the USA in robotics for civilian uses (industrial and service robots), while US firms have been more successful in developing military robots. US companies have been the most innovative in web services. Meanwhile, Asia is much stronger than both the USA and the EU in flat panel displays of all types, used for mobile phones, tablets, computers, TVs and other consumer electronics devices. A key lesson from the analysis of the three subsectors is the critical importance of higher education, particularly elite university research, and of local networks as generated by clusters. Case studies of Apple, Google and Robotdalen emphasize the importance of prior government intervention to form clusters, from which the start-up can profit. Thus a further role for public policy is to support the formation of clusters, typically a lengthy process, and the result of building on existing strengths. Governments can also encourage innovation through appropriate intellectual property and competition laws and, more generally, through the development of a business environment conducive to innovation. Finally, Governments can have a very important role through the funding of early-stage innovation. 1 IPTS is one of the seven research institutes of the European Commission’s Joint Research Centre (JRC). 3 Table of Contents Acknowledgements ......................................................................................................................................... 1 Preface ................................................................................................................................................................ 3 Executive Summary ........................................................................................................................................ 7 1. Introduction ............................................................................................. 11 2. US-EU Innovation Performance in Web Services, Display Technologies and Robotics ...................................................................................................................................... 13 2.1 Web services .................................................................................................................................................................... 15 Apple – key lessons ................................................................................................................................................................ 16 Google – key lessons ............................................................................................................................................................. 18 Amazon – key lessons .......................................................................................................................................................... 19 Skype – key lessons ............................................................................................................................................................... 20 XING - key lessons .................................................................................................................................................................. 21 2.2 Display technologies ................................................................................................................................................... 21 Cambridge Display Technologies (CDT) – key lessons ....................................................................................... 24 Plastic Logic – key lessons ................................................................................................................................................. 24 Novaled AG – key lessons .................................................................................................................................................. 25 E Ink Corporation – key lessons ...................................................................................................................................... 26 Kodak – key lessons .............................................................................................................................................................. 27 2.3 Robotics .............................................................................................................................................................................. 27 iRobot – key lessons .............................................................................................................................................................. 29 Shadow Robot – key lessons ............................................................................................................................................ 29 KUKA Roboter – key lessons ............................................................................................................................................. 30 R.U. Robots – key lessons ................................................................................................................................................... 31 Robotdalen – key lessons ................................................................................................................................................... 31 3. Lessons for Innovation Policies ................................................................................................. 33 3.1 Key inputs in the innovation process ................................................................................................................. 33 3.2 The role of government: financial and institutional instruments ....................................................... 48 3.3 Summary of lessons from the case studies .................................................................................................. 50 Bibliography ................................................................................................................................................... 53 Appendix 1: Case Studies – Web Services,
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