I agree with everything you say, apart from the general assumption in #1.
The examples you provide for European laws being too restrictive are correct imo, and there are more examples of laws that were, in my mind, the poor execution of a good idea (take the EU privacy directive that forces the opt-in for cookie tracking. This has in its execution by Google etc. generally become more of an annoyance than a privacy feature).
However, I think the decisions the European Court of Justice makes on these issues could be a chance for Europe. The 'right to be forgotten' and the recent safe harbor decision show--in my opinion--that the ECJ wants to establish a more privacy-focused jurisdiction in Europe. That could be a chance for, say a Google competitor that does not track you through AdWords but, instead, relies on a monthly subscription model (this might not be a very good idea, but you get my point). And when Angela Merkel says that 'too much privacy is bad for business', I disagree, because Europe cannot come to the table one decade late and copy what worked in the Bay Area.
If Europe establishes a reputation for a different sort of service that relies on strong encryption, user privacy and the absence of ad-support but rather subscription, I think the European startup world could thrive in serving a market that is currently emerging rather than one that has been there for the better part of a decade.
I don't think enough users care enough about privacy for there to be a massive market there. If not why didn't more people switch to DuckDuckGo or Diaspora?
"the poor execution of a good idea (take the EU privacy directive that forces the opt-in for cookie tracking. This has in its execution by Google etc. generally become more of an annoyance than a privacy feature)"
That's because Google rather have these annoying notices than make it easy to disable tracking. The EU did the right thing in leaving it up to the industry how to solve these problems, it's just that the industry doesn't want to.
The examples you provide for European laws being too restrictive are correct imo, and there are more examples of laws that were, in my mind, the poor execution of a good idea (take the EU privacy directive that forces the opt-in for cookie tracking. This has in its execution by Google etc. generally become more of an annoyance than a privacy feature).
However, I think the decisions the European Court of Justice makes on these issues could be a chance for Europe. The 'right to be forgotten' and the recent safe harbor decision show--in my opinion--that the ECJ wants to establish a more privacy-focused jurisdiction in Europe. That could be a chance for, say a Google competitor that does not track you through AdWords but, instead, relies on a monthly subscription model (this might not be a very good idea, but you get my point). And when Angela Merkel says that 'too much privacy is bad for business', I disagree, because Europe cannot come to the table one decade late and copy what worked in the Bay Area.
If Europe establishes a reputation for a different sort of service that relies on strong encryption, user privacy and the absence of ad-support but rather subscription, I think the European startup world could thrive in serving a market that is currently emerging rather than one that has been there for the better part of a decade.