Facebooks vice president of messaging products David Marcus argues in an interview with the Wall Street Journal that Europes unfriendly business environment is forcing entrepreneurs to move to the US in order to succeed. Marcus has seen this first hand, having grown up in Europe. He told the paper that he had to move [to America] to get to where I am. Its true that Europe can take a harder line than the States when it comes to regulation. EU state aid laws can make it harder for startups to get funding and people have criticized Europes tax regime. European governments are also often inclined to pursue alleged wrongdoing more harshly. In 2014, the European Parliament voted (non-bindingly) in favour of breaking up Google over fears about the search giants dominance. Another example is ride-share service Uber, which has been hit with injunctions in France, Spain, Belgium and other European countries for violating local legislation. But according to Marcus, its not European regulation per se thats to blame, but the broader business environment. His message targets business leaders as much as EU regulators, particularly those in the telecoms sector, which he accuses of lobbying for protectionist legislation rather than encouraging homegrown companies. Success comes because you can create an environment where you deliver successful companies, he told the WSJ. As a European entrepreneur I hope that we can create that environment here in Europe so that the next companies like this are actually built here rather that in the US. The problem, Marcus argues, is that business leaders dont care about why European entrepreneurs are leaving Europe to build innovative companies in the US. Instead, he said, there is a protectionism narrative which is quite disappointing. His message is, of course, calculated to benefit Facebook. Its a non-European company that risks being hit by the protectionist attitudes hes attacking. Theres also significantly higher levels of venture capital funding in the US, which is sure to attractive to entrepreneurs thinking about relocating. But similar calls for reform have been made repeatedly in the past. At the 2014 TechCrunch Disrupt conference in London, Europes regulatory regime was damned as sclerotic, and VC Jason Whitmire asserted that Berlins tech hub happened in spite of the government rather than because of it. (In other areas, however, Europe is comparatively laissez-faire. Britain has been hailed as potential world-leader in a new golden age of drone technology, after strict American regulations have forced interested companies to conduct their research in Europe.) Marcus also defended Facebook against demands that the company should invest in telecommunications infrastructure on the Continent. He argued that Facebooks products made the services offered by telecos more attractive, thereby boosting their profits. “80 per cent of people wanting to buy mobile data plans want access to services that are built by other companies,” he said. His position will be buoyed up by a report published today by Deloitte on Facebooks global economic impact. The study claims that the social network contributes $227 billion to the global economy and creates nearly 800,000 jobs in Europe. Some economists have cast doubts on the methodology behind the report, however, saying the figures are meaningless and inflated. Join the conversation about this story »
Posted on: Tue, 20 Jan 2015 17:56:38 +0000
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