European Commission Unveils Strategy to Lead Web 4.0 and Virtual Worlds

A new strategy for Web 4.0 and virtual worlds has been unveiled by the European Commission in an effort to steer the next technological revolution and guarantee a safe, open, and welcoming online environment for individuals, organizations, and government agencies across the EU.

Web 4.0, the next generation of the internet, is expected to integrate digital and real objects and environments, enhancing interactions between humans and machines. The EU economy’s outlook beyond 2030 identifies digitalisation as a key driver, with Web 4.0 as a significant technological transition that will bring an interconnected, intelligent, and immersive world. The global virtual worlds market is projected to grow from €27 billion in 2022 to over €800 billion by 2030.

The new strategy aims to create a Web 4.0 and virtual worlds that reflect EU values and principles, where people’s rights are fully respected and European businesses can thrive. The strategy aligns with the 2030 objectives of the Digital Decade policy programme and its key pillars of digitalisation: skills, business, and public services. It also addresses the openness and global governance of virtual worlds and Web 4.0.

Key pillars of the strategy include:

  1. Empowering people and reinforcing skills: The Commission plans to promote guiding principles for virtual worlds and develop a ‘Citizen toolbox’ by the first quarter of 2024. It will also work with Member States to set up a talent pipeline and support skills development through projects funded by the Digital Europe Programme and the Creative Europe programme.
  2. Supporting a European Web 4.0 industrial ecosystem: The Commission has proposed a candidate Partnership on Virtual Worlds under Horizon Europe, starting possibly in 2025, to foster excellence in research and develop an industrial and technological roadmap for virtual worlds.
  3. Supporting societal progress and virtual public services: The Commission is launching two new public flagships, “CitiVerse”, an immersive urban environment for city planning and management, and a European Virtual Human Twin, which will replicate the human body to support clinical decisions and personal treatment.
  4. Shaping global standards for open and interoperable virtual worlds and Web 4.0: The Commission will engage with internet governance stakeholders worldwide and promote Web 4.0 standards in line with the EU’s vision and values.

The strategy builds on the work of the European Commission on virtual worlds and consultations with citizens, academia, and businesses. The Commission hosted a European Citizens’ Panel on Virtual Worlds between February and April 2023, whose recommendations have guided specific actions included in the strategy on Web 4.0 and virtual worlds.

The Commission’s initiative is a significant step towards ensuring that the future of the internet and virtual worlds is shaped by a broad range of stakeholders, reflecting diverse perspectives and interests. It highlights the EU’s commitment to leading the next technological transition, fostering innovation, and ensuring that the digital environment remains open, secure, and inclusive.


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Japan’s Digitalization Effort will have Mixed Credit Impact across Sectors, says Moody’s Report

Japan’s digitalization effort will have mixed credit impact across sectors according to a new report by Moody’s investor services.

Japan’s Digitalization Effort will have Mixed Credit Impact across Sectors, says Moody’s Report

Under Prime Minister Yoshihide Suga, Japan’s (A1 stable) government is aiming to promote digital transformation (DX) through the newly formed Digital Agency.

The Digital Agency will lead efforts to digitalize Japanese government operations, and to increase the efficiency of public services. To differing degrees, the initiative will shape the credit quality of not only the central, and regional and local governments (RLGs), but also Japan’s businesses and financial institutions, and structured finance instruments.

The aim of the government-led initiative is to generate efficiencies in Japan as it is falling behind others in digital adoption and readiness. Businesses that support digitalization could stand to gain, but the rise of new competitors could threaten existing players.

Japan’s new initiative to digitalize government operations and the delivery of public services will bolster policy effectiveness, supporting sovereign credit quality, but will bring mixed credit implications for regional and local governments (RLGs), businesses and financial institutions, according to a new report by Moody’s Japan K.K.

Motoki Yanase, a Moody’s Vice President and Senior Credit Officer:

“Digital transformation will lower operating costs by increasing operational efficiency and dismantling silos between ministries. It could also spur digitalization in the private sector – which if achieved will support economic growth.”

But remote working could bring mixed credit implications to RLGs, some of which could face pressure on their revenues. For instance, fare revenues at RLG-operated mass transit systems will come under pressure as more workers work from home, while property tax revenues could fall as fewer offices are leased out. On the other hand, some local governments could enjoy more tax revenue from companies that open exurban satellite offices.

Meanwhile, businesses that support the digitalization effort, such as startups and companies providing IT infrastructure, stand to benefit from rising demand, but office property and office equipment companies could lose out as remote working takes hold. And financial institutions will benefit from more streamlined operations, although the near-term cost of investing in technology and cyber-risk prevention will be high.

Finally, for the structured finance sector, digital adoption will optimize the origination process, support volumes in an aging society with a shrinking working-age population and strengthen the credit screening process through the use of artificial intelligence. On the flip side, greater digitalization could create cybersecurity risks such as fraud and identity theft.

Image source: Shutterstock


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