TERALINK News

RealNetworks to Centralize Data Center and Other Business Support Functions for its European Consumer-facing Operations in Luxembourg

The Luxembourg Minister of the Economy and Foreign Trade, Jeannot Krecké, announced that RealNetworks has begun a process to centralize many of its data center and other business support functions for its European consumer-facing operations in Luxembourg.

RealNetworks International SARL will provide subscription-based Internet radio services, videos, ringtones, live digital broadcasts, music downloads and casual games downloads via its RealEntertainment, video, FunPass and GamePass services to customers throughout Europe from its new operations center in Luxembourg. RealNetworks will build upon the progress made to migrate games operations, as well as video delivery infrastructure, to its new operations center hosted at the e-Business & Resilience Centre (eBRC) in Windhof, Luxembourg. "eBRC, consistent with its award of best data center in Europe in 2008, is providing excellent support for our operational initiatives. We look forward to working closer with our partners on design considerations for their next data center in Kayl, Luxembourg," said Edmond Mesrobian, CTO of RealNetworks.

Minister Krecké commented: “I congratulate RealNetworks. The company has casted a vote in favor of Luxembourg as a performing business location for global ICT companies. This clearly demonstrates that the important investments made by the Government over the last years continue to bear fruits and have contributed to making Luxembourg a prime location in Europe for content distribution and data management activities in the digital age.”

New Commercial Internet Exchange Launched, Enhancing Luxembourg’s Leadership in Digital Technology

Major Luxembourg-based Internet companies announced on March 4th the launch of the first Luxembourg commercial Internet Exchange Point, called LU-CIX. The creation of LUCIX is a huge step forward for the Grand Duchy’s Internet community, as it will further develop Luxembourg as a prime e-commerce platform in Europe. LU-CIX follows the model of major international centers such as AMS-IX (Amsterdam), LINX (London) and DE-CIX (Frankfurt). It also mirrors the spirit of openness and neutrality of these centers.

LU-CIX will benefit consumers in Luxembourg – close to 80 percent of households and over 90% of companies now use a high-speed connection, one of the highest penetration rates worldwide. LU-CIX, as a short cut between Internet service providers (ISPs) and content providers, will strengthen Luxembourg’s position as a European Internet node.

Luxembourg Sets New Action Plan for Environmental Technologies

The Luxembourg Board of Economic Development has introduced an "environmental technologies" action plan, with a new environmental aid regime to enable additional incentive measures accepted by the European Commission. Designed to open up multiple opportunities for the development of the Luxembourg economy, the aid plan will provide government support to finance feasibility studies for companies willing to deploy these technologies. The plan also creates awareness among companies in other market segments to implement environmental technologies in their business development strategies. In February, a new cluster was launched by Luxinnovation, Luxembourg's innovation agency, to bring together companies active in the field, offer guidance on the national and European environmental and ecoinnovation incentive schemes, and increase the number of environmental technologies pilot and research projects. On the national level, aid programs dedicated to research and development have been doubled to five million Euros. "Environmental technologies play an important role in helping us to tackle environmental challenges,” said Minister of the Economy Jeannot Krecké, who underlined the importance of "helping companies engage on a sustainable development path." “New markets open up and this particular sector has an important potential for fostering growth and job creation,” he said.

Luxembourg Ranks Third Worldwide in Innovation, Competitiveness

Luxembourg has been ranked third worldwide in overall innovation and competitiveness in the annual survey released in March by the Information Technology and Innovation Foundation (ITIF) following Singapore and Sweden. The Grand Duchy placed ahead of Denmark, South Korea, the U.S., Finland, Britain, Japan and the NAFTA region (U.S., Canada and Mexico.) The EU-15, comprising the 15 Western European countries in the EU, ranked 18th. To assemble its 2009 rankings, the ITIF, a non-partisan organization based in Washington, used 16 indicators in human capital, innovation capacity, entrepreneurship, information technology infrastructure, economic policy factors and economic performance. Using separate criteria, the ITIF also measured progress in competitiveness and innovation over 10 years, with China making the most progress, while Luxembourg placed sixth.

ITU Survey Places Luxembourg Seventh in New ICT Development Index

The International Telecommunications Union in early March issued its new ICT Development Index (IDI), which compares developments in information and communication technologies (ICT) in 154 countries over five years from 2002 to 2007. Luxembourg placed seventh on a survey that combines 11 indicators into a single measure used as a benchmarking tool globally, regionally and at the country level. These include ICT use and skills, such as households with a computer the number of Internet users, and literacy levels.

The most advanced countries are Sweden and the Republic of Korea. Denmark, the Netherlands, Iceland, Norway and Luxembourg. Western and Northern Europe and North America are the regions with the highest IDI scores. Based on ITU estimates, 23 out of 100 inhabitants globally used the Internet at the end of 2008. Given the rapid spread of IMT-2000/3G mobile cellular networks in many countries, there is a clear potential for mobile broadband to connect more and more people — and at higher speed.

New Tax Regimes Set in Luxembourg, Including 80 Percent IP Exemption

Luxembourg has completed a broad range of new tax law changes designed to streamline its structure and encourage economic growth. In place now is an 80 percent tax exemption on income derived from intellectual property (IP) as well as capital gains realized on the disposal of such intellectual property.

Also changed now are withholding tax rates on dividends distributed to parent companies resident in countries that have signed a double tax treaty with Luxembourg (such as the United States and Canada). This was reduced to zero, under certain conditions. Additionally, the corporate income tax is decreasing, from 22 percent to 21 percent, which results in a consolidated corporate tax rate of 28.59 percent when combined with the Luxembourg City municipal business tax.

Together with the abolition of the capital tax duty in early 2009, these additional tax reforms demonstrate confidence in the future and assure that Luxembourg remains an ideal location for holding companies, IP and corporate financing activities.