EU unites behind strategy: Interview with Neelie Kroes, EC Commissioner

So says Neelie Kroes, vice president of the European Commission with responsibility for the 'Digital Agenda for Europe' – a portfolio that includes all aspects of information and communication technologies. Kroes and her team have, over the past two years, put together a strategy to make European electronics competitive globally. The strategy has been wrapped up as a 'Communication' – a policy statement, rather than draft legislation – and welcomed by member states and, crucially, by leaders of some major European electronics companies. The approval of this latter group is essential because it is they who will contribute most of the €100billion needed to support the strategy. There is a small, yet not insignificant, amount of 'new' money involved. During the seven year stretch from 2014 to 2020, direct EC funding is budgeted at €1.6bn. The strategy will mobilise companies' R&D budgets such that they will benefit the subscribers and the European electronics industry as a whole – and thus help the larger downstream buyers of electronics -- car makers and machine makers, for example. Kroes said: "Our remaining companies have seen quite a decrease in their global market share over the last few years and you see niche strategies all over the place – often successful, but still niche. What is more, they will soon be confronted with new basic technology as the underlying production processes shift to larger wafers. This means huge investments are needed to to stay competitive with the cutting edge." The €1.6bn will be awarded to projects and research institutes, based on the merits of proposals submitted to a joint undertaking – a body being proposed at the time of writing. The joint undertaking will collect money at a European level (30% of the public contribution), from member states (70%) and from industry and align it behind a common research innovation strategy. Europe has world renowned research institutes in this field, notably the clusters at Dresden, Eindhoven, Leuven and Grenoble. Others at, for example, Cambridge, Carinthia (Austria), Dublin and Milan, will also be pitching to be central to the European R&D network. While the four clusters were identified to demonstrate the leading edge technical capability; they are not guaranteed to be beneficiaries. Kroes added: "Nothing guarantees that any money will go to Leuven, Grenoble, Eindhoven or Dresden. It is just that, on average, you can expect places with world class activity to benefit, mainly because they will be interested and will make good proposals. But there is nothing to stop UK areas from tapping into that money if they put in good proposals." The strategy – 'A European Strategy for micro- and nanoelectronic components and systems' – aims to maximise R&D investment through cross-border collaboration. It will focus on three complementary lines: making chips cheaper (transitioning to 450mm wafers), making chips faster ('More Moore') and making chips smarter ('More than Moore'). "The headline aim is that we stay in this race as Europe," said Kroes. "The main reasons why we believe this is realistic are, firstly, there are comparisons to the US and, secondly, many member states are supporting this industry – but in a fragmented way. There is public support, but no organisation. We need a common view of what needs to be funded first, where the bottlenecks are, where public funding makes most sense. Often, member states will go to local companies, which is fair as far as public policy goes. But if you aggregate that across Europe, there is overlap and gaps that nobody funds, even though they probably would be productive if funded." The leap from €1.6bn in EC funds to a budget of €100bn is huge. Kroes explains: "That figure comes from a document created by the industry and adopted last November. It was signed by all the CEOs, who point out that, in the right framework, they could see investments in the order of €100bn. This crucially covers both R&D and other investments, including factories. This is important; making sure there is a high end manufacturing capability in Europe means having a 450mm fab sometime before 2020." Manufacturing support is not an explicit goal of EC research funding, but if targets to double EU production are to be met, the 450mm fab – and the private and member state money to fund it – will be essential. An obvious comparison is with the Albany project in the US, aimed at developing 450mm wafer technology. "The US is not dreaming when it thinks it can build something world class in Albany," commented Kroes. "It is exactly the logic that one needs to follow; the clustering approach. Building on existing strengths is exactly what we are trying to do. Just working on this strategy has changed mindsets. Already, there are more cross-border co-operations – we have IMEC going to Dresden near GlobalFoundries, for example. Other companies are trying to find out how to grow without having their own fabs and to remain at the forefront of technology." Kroes summed up: "Europe is buying more stuff than it produces. The EU has a larger GDP than the US, but we have a 10% market share, compared to 16%, and that is the gap we are trying to address. We should punch our weight. Neelie Kroes Neelie Kroes studied economics at Erasmus University, before working there for six years as an assistant professor. Following a 20 year political career, during which she was appointed Minister for Transport, Public Works and Telecommunication in the Dutch government, Kroes became president of Nyenrode University from 1991 to 2000 and served on various company boards, including Lucent Technologies. Since 2004, she has been one of 27 European Commissioners. Initially Competition Commissioner, she became Vice President of the European Commission in 2010, with responsibility for the Digital Agenda for Europe.