The digital revolution is changing the way we live, work and talk with one another. Some believe we are having our own "Gutenberg moment" - a technological upheaval as profound as the arrival of the printing press. It is not just that we communicate and consume in new ways; our new digital language changes the way we think and create.
What does all of this mean for European culture? Is the old continent ready for the new world?
Europe, in fact, starts from a position of strength. We may not always size up to the likes of Microsoft or Google, but we produce much - from books and films to fashion and sport - that makes new technology attractive. Our challenge is to encourage access for all to the digital arena, while ensuring that creative talent is justly rewarded so that we continue to achieve excellence. Europe must face this challenge head on, and our best performers are doing just that.
European broadcasting, for instance, has embraced new technologies very successfully. Our model, in which public-service broadcasters work alongside commercial operators, responds to the needs of a plural democracy and ever-changing demands of a diverse public. The BBC has shown the way. Ignoring the doomsayers of the early satellite years, one of the world's oldest public broadcasters has successfully exploited the possibilities of new technology, while maintaining its international reputation for quality and independence. The European Union is right to allow public funding of such broadcasters; it is a political choice that demonstrates our commitment to diversity.
Cinema, too, remains a very strong European brand. We may not have the biggest budgets, but our directors, writers, actors and technicians are among the best in the world. Perhaps more than any other art form, cinema reflects our national and regional differences. Yet, it is precisely this diversity that makes it a European success story. Digitising the industry is a major challenge: a new digital projector and server costs around €75,000, a big investment for many local cinemas. The Commission's Media programme is ready to contribute up to 50 per cent of this cost for cinemas which screen mostly European films.
When it comes to the written word, Europe's authors continue to compete with the best. Language barriers have not prevented Stig Larsson or J.K. Rowling from storming the world's bestseller lists. The question for Europe is how to maintain leadership in the new digital landscape. My fellow commissioners and I will soon discuss the thorny issue of copyright - which affects many creative industries. Our shared aim is to support European creation across all the arts.
Even sport drives our digital agenda. Live events across Europe's most successful sports provide some of the most exciting content for new technological platforms. This summer's football World Cup has encouraged broadcasters to launch new 3D services, for instance.
This is a virtuous circle: top-quality European content drives new technologies. Much of this success reflects a European way of doing things. In our arts and creative industries, we have managed to reconcile quality, choice and access. Our rich cultural and linguistic heritage is a huge asset and we have nurtured diversity by encouraging smaller operators, using public money where this makes sense. Of course, markets sometimes fail in the cultural area because they cannot respond to everyone's needs. This is why the European Union applies the law in a pragmatic and flexible manner - allowing state subsidies where warranted, but fighting dominance where it threatens choice.
Looking ahead, the European Union's member states need to ask themselves: how can we best support our creative industries? Our competition policy helps guarantee choice and innovation, while our single market provides consumers with transparency, confidence and choice. But this does not get to the root of how we foster creativity and innovation in education and work. How can public policy support something that is often distinctly private and individual?
First, we must target public money - already in shorter supply - at the most strategic priorities. In addition to helping local cinemas go digital, the EU is making it easier for young film directors to borrow, by guaranteeing loans.
Second, we must create the right local conditions for innovation. The European Institute of Innovation and Technology is bringing together our leading universities, research centres and businesses to address Europe's innovation gap - and one of the priorities is to explore future media and content delivery.
Third, we must put education at the centre of the digital economy, and the European Union's 2020 strategy does precisely that. We are working towards agreed targets to increase the number of young people in higher or equivalent education and to reduce the number of early school leavers. But we must also ensure that they develop the right skills to equip them for the creative economy: entrepreneurship, problem-solving, communication and digital literacy.
The creativity of our people will shape Europe's role in the digital world. We should be confident, since this is where our countries are strong - our contribution to the arts and creative industries shows what we are capable of. Now we must take this success onto new platforms, so that Europe can cement its place at the heart of the new digital world.
Ms Vassiliou is the European Commissioner for Education, Culture, Multilingualism and Youth.