THE INTERNET IN EUROPE
Table of contents:
1. Internet usage
Internet usage is lagging behind the US. Europe Online, launched in December 1995, for example, went bankrupt last August, mainly due to disappointing net new subscribers. AOL launched a European service at the end of 1995, in collaboration with Bertelsmann; although it is not normally shy, it refuses to give up subscription figures, suggesting that these may be well below original targets.
A report by Inteco shows that Spain, with half as many households as France (11.5 million vs. 22.1 million) has more Internet-wired homes (160,000 vs. 100,000). A statistical study undertaken by the Médiangles institute in May 1996 however evaluate at 400,000 the number of Internet users in France. Germany is the largest home market with almost 900,000 households with access to the Internet, with half using ISDN. 2 million Germans also have access to the Internet from work but less than 10% use it for personal purposes. In the UK, 25% of the workers which have access to the Internet from work, use it for web browsing.
European Internet usage is however increasing at 8% a month according to some sources. Euro-Marketing Associates in its on-line InterNet Times, reports that Dataquest had foreseen that the number of online users would grow by 124% in 1996 leading to 9.1 million users. The Nordic countries are leading the way. According to Peter Storck, a senior analyst at the New York online research firm Jupiter Communications, Sweden boosts 150,000 homes connected, Finland 90,000, Norway 70,000 and Denmark 60,000 which are very high numbers compared to those countries' populations (between 5 and 9 million inhabitants).The Nordic countries thus have the highest proportion of users, together with the UK.
Whatever the number given, the general conclusion is that
usage is still very low and Europe is clearly lagging behind the US. Internet
usage is particular low in the home. For most Europeans, the Internet remains
a mystery and the majority of Internet-savvy Europeans tend to be students,
researchers and technologists.
2. Barriers to the Internet's development in Europe
A number of economic, legal and social barriers have prevented
or slowed down the growth of Internet usage in Europe. These barriers include
telecommunications market which have been long been dominated by monopolies
and which have been liberalised at different speeds depending on the countries,
with the UK and the Scandinavian countries being the most advanced. Liberalisation
and competition will put pressure on companies to reduce telephone rates,
and thus should encourage the use of the Internet as users pay for local
calls and would thus hesitate to browse the web. Growth of the European
Internet usage has also depended on the development of the telecommunications
infrastructure. Essentially all services except public switched voice telephony
are currently open to competition and have been since 1990. By January
1, 1998, switched voice telephony and all telecommunications infrastructure
will be open to full competition as required by European Union legislation.
The relatively low home PC penetration also has prevents the development of the Internet. The advent of set-top boxes or network computers could enable to bypass this necessary step.
Users importantly will be attracted to the Internet by
its content. Language is therefore a significant barrier to widespread
Internet usage. According to Euro-Marketing Associates in Paris, 85% of
all Web pages are in English while English speakers represent 80 to 85
percent of today's on-line population. This is clearly a strong barrier
to Internet usage growth in the Southern European countries, whereas the
North European countries benefit from having a language which has also
The lack of media attention has clearly had negative effects
on Internet usage; when newspapers in the past have reported on the Internet,
it was often related to cases where the Internet had been misused (pornography,
possibility to adopt children on-line, racist web sites, etc.). Certain
national governments have adopted very strong lines against such misuses,
such as France (see below) or Germany (where a kind of hysteria about Internet
pornography broke out in German media). This has stimulated debates on
the need to both prevent such misuse and on the difficulty of using regulation
in this regard. A lot of information on national initiatives and European
Commission initiatives to prevent abuse can be found here.
It has only been very recently that the European media have started devoting
attention to the Internet's opportunities. Major newspapers have recently
created information technology or multimedia supplements and specialized
weeklies have appeared, while works of vulgarization are being published.
A number of European newspapers are also now available through on-line
Other issues may have had negative effects on the Internet's
development such as security issues which may stop consumers from seeking
to conduct electronic transactions.
3. Looking at the future
As the national telecoms markets are slowly being liberalised
(they must be open by January 1, 1998), and with increased media attention,
the number of users of the Internet should increase dramatically over the
next few years. Although it is difficult to predict future usage figures,
Dataquest Inc.expects Europe, by the end of 1996, to hold 20 percent of
the world's active on-line population, or nearly 10 million people.
4. The case of France
The Minitel case
The Minitel is an online system set up by the French national telephone company, France Telecom, 11 years ago, to offset some of the printing costs associated with France's massive yellow pages. Companies in France are now treating the Minitel system very much like the World Wide Web on the Internet--as an extended yellow pages.
The Minitel system now has something like seven million terminals in 30 percent of French homes, something that Internet providers would be jealous of. Some industry analysts claim that as many as 90 percent of France's 57 million people have regular access to a Minitel terminal, either at home or through work. It is a very effective and well used online system, with over 25,000 third party services running on it.
The Minitel example illustrates that there is money to be made in online services. In 1994, 1913 million calls, amounting to 110 million hours led to a FF 6.6 billion turnover, of which half went to the content providers. 784 million calls alone concerned the electronic telephone book.
The key to this success seems to be that the Minitel system does not have security issues and billing problems. Because the entire system is controlled by French telecom, customers feel comfortable connecting to the system and using their credit cards. The French phone company can also add billing for service usage to the phone bill. This way, they can bill for very small increments of charges.
The Minitel's big downside is poor-quality screen display
and graphics. France Telecom launched the Minitel by handing out over a
million terminals for free (the cost-savings on paper directories supposedly
paid for most of the terminals). The solution at the time was 1200 bps
modems and very inexpensive dumb terminals with small screens and tiny
keyboards. France Telecom is now offering a new generation of Minitel terminals.
Magis and Magis Club have colour screens, 9600 bps (i.e. 8 times faster
than the traditional Minitels), as well as a built-in highly secure credit
card reader. Sillage is essentially a telephone with an answering machine
and access to the Minitel However, the graphics are going to be limited
to the lowest common denominator for a long time to come. As people get
used to the fancy graphical user interface provided by Windows and Macintosh
computers at their workplace and try out surfing the Internet, they will
see the Minitel's limitations. The Minitel itself is not really showing
signs of growth. Indeed Minitel usage even decreased in 1995. France Telecom
understands that it can no longer afford to ignore the Internet and has
therefore both made the Minitel accessible on line and launched its own
on-line service, Wanadoo.
France Telecom and its new on-line service
With 1995 consolidated revenues of $29.6 billion, net income of $1.8 billion and over 32 million telephone lines in service, France Telecom is the world's fourth-largest telecommunications carrier. In addition to local and long-distance telephony, France Telecom provides businesses and consumers with data, wireless, on-line, Internet, cable-TV and value- added services. Through its subsidiary TDF, France Telecom is also a leading European television and radio broadcaster.
France Telecom in May 1996 launched a new service called Wanadoo, which is an internet-based, ad supported information service. The Internet connection is now offered at the cost of a local phone call.
Although it hoped to attract 5500 new subscribers each month, results have fallen far beyond these targets as the service only counted 8000 subscribers in September 1996. In October 1996, France Telecom therefore reacted by improving the service, offering faster access to the Internet. It is also trying to add Internet access options, including a CD-rom connection kit, integrating Netscape 2.0 web browser for free. Eventually, France Telecom intends to bundle the Microsoft explorer web browser in the CD rom connection kit. The cost of the service is currently: - $9.12 for 3 hours ($3.04 per hour)or - $18.24 for 15 hours ($1.21 per hour)and an additional $31.50 for the initial set-up.
France Telecom has announced that it would be investing
$200 million on interactive services over the next few years. Industry
analysts are thus keeping a close eyes on its commitment to Wanadoo.
Taxation of cybercafes
Entertainment, games and shows are subject to a specific tax collected for the benefit of regions. The French government is currently reviewing the taxation of computer terminals linked to the Internet and installed in public places, such as cybercafes. In the meantime taxation on such terminals has been suspended in October 1996.
In addition a huge proportion of the reference sources
found when surfing the web looking for information on French history, culture
and art are American sources. Although this is not a bad thing, it should
be balanced by more French or other national sources. In addition some
observers indicate that more sites on the Internet seem to have been created
by the French-speaking Canadians than by the French proportionally.
DMC, a French company has announced the commercialisation
for Spring 1997 of an affordable set-top box giving Internet access via
home television, the "Looker". It would cost FF50/month and will
come with an infrared keyboard and a credit card reader and be connected
to a television and a telephone line. Consumers would have access to interactive
TV programmes, as well as access to Looker's online service and the Internet.
The company is hoping to attract between 3 and 3.5 million homes (out of
the potential 120 million homes in Europe which have the necessary telephone
and television equipment) in order to be commercially viable.
For more information on France see my final paper on the Internet in France
Table of contents of the paper
I. The Internet in Europe
II. The reasons for the slow adoption of the Internet in France
III. The French Government's role in the Internet's development
IV. Access providers to on-line services and the Internet
V. Future perspectives
Summary of the paper
France has the second largest economy in Europe and its 58 million inhabitants enjoy a very high standard of living. The French, however, have been among the slowest adopters of the Internet in Western Europe. This cannot be explained by the French's suspicion for technological innovation and conservatism as they were one of the first in the world to be 'on-line' through the Minitel, a videotext-based system. Besides the barriers to the growth of Internet usage which still affect or have affected most European countries, such as telecommunications regulations and monopolies which have led to high telephone charges, additional barriers exist in France.
The Minitel, instead of serving as an initiator for consumers to the Internet, seems to be working to its disadvantage. First of all consumers may hesitate to invest in a PC when they already have a Minitel terminal, which was given to them for free and allows them to perform a significant number of transactions, to their satisfaction. In addition the French government, who is in the process of privatizing the national telecoms operator, France Telecom, which operates the Minitel system, is understandably reluctant to promote the Internet as it would probably kill the significant source of revenues drawn by the Minitel. The French government's initiatives in fact seem to have been designed more to pre-empt the use of the Internet for purposes contrary to public order and security than to encourage the development of the Internet. Discussions at government level have focused on the threats posed by the Internet (e.g. pornography over the Internet) and thus on the need to regulate the Internet and monitor its development; although these are clearly important issues to address, the government seems to have forgotten about the huge business opportunities which the Internet could bring to French companies, especially as the telecoms market is in the process of being liberalized pursuant to European Union legislation. Although the battle for the hardware and software market may already be lost, there may still be ample opportunities for French content providers to win a part of the market, which will grow, albeit slowly.
The government and the press have also been calling for
defensive measures to be taken to prevent the Internet from further eroding
the French language and culture. I believe that more positive measures
should be taken to promote the French language and culture; these include
encouraging the digitization of French works (literature, poems), promoting
the use of the Internet to the French population while simultaneously facilitating
the creation of content in French on the Internet.
Extract - Defending the French language and culture
Defending the French language and culture
The Internet is accessible in most countries and all cultures, to a certain extent, are represented on the Internet. The Internet may thus have beneficial effects by enabling easy access to other cultures, including the French culture. However many in France warn of the risk of a cultural uniformization, pointing in particular at the danger of Anglo-saxon hegemony, in particular from the United States, over the Internet. Many fear that the Internet, just like the audiovisual industry, will become dominated by America.
English is indeed by far the dominant language in the Internet world. As mentioned above, 85% of all Web pages are estimated to be in English. English dominance also means for example that one cannot write accents (as are needed in French) on e-mail. In addition a huge proportion of the reference sources found when surfing the web looking for information on French history, culture and art are American sources. Although this is not a bad thing, it should be balanced by more French or other national sources. In addition some observers indicate that more sites on the Internet seem to have been created by the French-speaking Canadians than by the French proportionally.
André Malraux, the first Minister of Culture, set forth, in 1959, the goal of " making known the most important works of art to the largest number of people ". Five priorities of cultural policy were derived from this goal: education, creation, preservation, access, and promotion.
The first modern language regulation aimed at monitoring and transforming the use of French emanated in 1966 from President Charles de Gaulle, a name associated with French independence, nationalism and power. Further regulations followed and committees were established to examine issues relating to the use, practice, promotion, enrichment, and dissemination of French in France and abroad. The first Parliamentary regulation dates back to 1975 and took the form of a consumer protection law; it provided for an exception to the "use French" rule when the word for a product had no French equivalent. The 1994 Toubon Law replaced the 1975 regulation, with a much clearer cultural objective. French is required for all radio and television shows and advertising; exceptions include musical works, original version films, and language learning programs. Private individuals or entities engaged in "public sector" activities (a term not defined in the law) must comply with the language regulation. However, the extension of the law into the sensitive area of privacy rights was successfully challenged under constitutional law by opponents to the bill as an excessive constraint on the freedom of expression.
The French were also instrumental in the drafting and adoption of the European Community Directive requiring that its member countries dedicate at least one-half of their television air time to European -made programs. The Directive was the European answer to the fear that Europe's cultural autonomy, and thus its cultural creativity were being seriously undermined by the American intrusion. Europe, which takes pride in its multi-secular capital of culture, took this step to try to prevent the United States from commodifying culture.
Promotion of Multimedia and supervision of the Internet
A law adopted in June 1996 places the Internet under the supervision of the High-level Telematics Committee (Comite Superieur de la Telematique or CST), a re-modelled version of the Committee which used to oversee the 25000 Minitel servers. The CST reports to the Superior Audiovisual Council (Conseil Superieur de l'Audiovisuel or CSA). The CST will adopt recommendations which access providers will have to follow. The Internet community reacted strongly to the imposition of such a supervisor, emphasizing the freedom of speech. Indeed the definition of morality and decency is very difficult to pinpoint as it means different things to different people and cultures. Also some have insisted on the need to have international solutions and not French solutions to the problems, which are international in nature.
The French government has been instrumental in bringing the issue of the supervision of the Internet and the protection of public order and morality to international forums. In April 1996, the French government presented a proposal for an International Cooperation Charter to its OECD partners which would aim at defining effective common principles of application of national law, definition of the responsibilities of the parties involved, commitment to the exchange of information and the promotion of a code of conduct established on a voluntary basis by the professionals involved and including principles such as respect for public order and human dignity, and the protection of privacy, property, and consumers. establishment of legal and police cooperation. The French are also leading the discussions within European forums, such as the European Union.
The French government is also looking into the legal and fiscal aspects of the development of the new Internet services.
As regards support to the creation of multimedia program,
on-line or off-line, funds from the National Cinema Center to support the
creation of CD-ROM and CD-I have been doubled; 30 million francs will be
available for the next two years. In addition the National Book Center
will spend 1 million francs in 1996 to help publishers' investment costs
related to multimedia projects; also a fund for multimedia investment for
publishing companies should be created and allocated a 20 million franc
5. Interesting sites
The Virtual Tourist's guide to Europe provides a clickable map of Europe which links users to WWW servers in each country in Europe. Users will find links to ministries of tourism, weather data, and historical documents on nations such as Greece, France, Italy, and Turkey. The site serves as a gateway to the numerous online resources for European countries and is an excellent starting point for business travelers and tourists who wish to explore Europe via Internet before they embark on their travels.
Eurolink is a massive ongoing effort to compile information from all of Europe within a single site. Fifteen countries are represented so far, each via one primary source within that country. Each site has its own organization scheme and agenda
Europe Online incorporates various sites into one user-friendly navigation, information, and communication service. It enables you to shop online by pointing and clicking to visit Marketplaces in Paris, London, and Amsterdam, provides information on the European Union Institutions, has a section for kids, and newspapers from Germany, France and the UK.
The following site lists all the addresses of the cybercafes in Europe.