ME 216 ICT in Industry "Digital Divide"


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Digital Divide, Digital Opportunities, Meeting the Challenge, Genoa Plan and Action

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ME 216 ICT in Industry "Digital Divide"

  1. 1. “Images used in this report may be subject to copyright issue”
  2. 2. The Digital Divide “Closing the Digital Divide is not just about giving to the poor the benefits of the rich. It is about creating a more equitable and balanced world economy.” - Craig Warren Smith (Digital Divide Institute)
  3. 3. The Digital Divide
  4. 4. The Digital Divide Rapid technology change typically occurs in uneven passion. Unprecedented “speed” of progress in the use of new information and communication technologies (ICTs) – but patterns of diffusion are less clear and change fast. Given the pervasive “impact” of ICTs on society, there is a grave concern about whether the rapid and uneven spread of ICTs will further widen the “digital divide” that has already emerged between industrialized and developing countries. Rapid Technology
  5. 5. The Digital Divide The conditions enabling the “spread” of ICTs vary – or are simply unmet – in “many parts” of the developing world, differing speeds of diffusion will inevitably mean a “widening” digital divide.
  6. 6. The Digital Divide ICT use proves to be associated with economic gains, that widening digital divide can only reinforce and the deepen the existing socio-economic divide between the industrialized and developing countries.
  7. 7. The Digital Divide • The extent of the digital divide between industrialized and developing countries. • The analysis of the economic effects of ICT use as a result of: - The commercial applications of the internet - The productivity gains of the application of ICTs to business processes. • The policy fundamentals underlying the successful entry into the information economy of certain developing countries. • The initiatives at international level to put ICTs at the service of development. Contents
  8. 8. The Digital Divide Digital Divide – is used to describe situations in which there is a marked gap in access to or use ICT devices measured by. - The socioeconomic and other disparities (differences, inequalities) between those people have opportunities and skills enabling them to benefit from digital resources, especially the internet, and those who do not have the opportunities or skills: programs that help to bridge the digital divide between rich and poor countries. (Dictionary App) Example: the number of phone lines per inhabitant, number of internet users, mobile telephones in the population. Distinction: Commonly made between a digital divide within a country and one between countries. An example of the former is the divide that usually exists between young and old, male and female, the more and the less educated, the more and the less wealthy, and urban and rural locations. Measuring the Digital Divide Employment Strategy Department, ILO. Excluding Mexico / Duncan Campbell
  9. 9. The Digital Divide Digital Divide in general: Digital Divide refers to that between industrialized and developing countries – although comparisons of ICT use at different spots on the world map are now almost as significant as inter-country comparisons. Example regarding internet usage, International digital divide; the divide between countries: Kuala Lumpur may soon be closer to convergence with Sydney or Milan with Rural Malaysia What is digital divide?
  10. 10. The Digital Divide In the early 21st century, residents of First World countries enjoy many Internet services which are not yet widely available in Third World countries, including: a.In tandem with the above point, mobile phones and small electronic communication devices; b.E-communities and social-networking; c.Fast broadband Internet connections, enabling advanced Internet applications; d.Affordable and widespread Internet access, either through personal computers at home or work, through public terminals in public libraries and Internet cafes, and through wireless access points; e.E-commerce enabled by efficient electronic payment networks like credit cards and reliable shipping services; f. Virtual globes featuring street maps searchable down to individual street addresses and detailed satellite and aerial photography; accessed July 15, 2013 Concrete examples of the global digital divide:
  11. 11. The Digital Divide g. Online research systems like LexisNexis and ProQuest which enable users to peruse newspaper and magazine articles that may be centuries old, without having to leave home; h. Electronic readers such as Kindle, Sony Reader, Samsung Papyrus and Iliad by iRex Technologies; i. Price engines like Google Shopping which help consumers find the best possible online prices, and similar services like ShopLocal which find the best possible prices at local retailers; j. Electronic services delivery of government services, such as the ability to pay taxes, fees, and fines online. k. Further civic engagement through e-government and other sources such as finding information about candidates regarding political situations. accessed July 15, 2013 Concrete examples of the global digital divide:
  12. 12. Population (2012 Est. ) 1,073,380,925 3,922,066,987 820,918,446 223,608,203 348,280154 593,688,638 35,903,569 7,071,846,922 World Internet Usage and Population Statistics – June 30, 2012 accessed July.15.2013 Worlds Regions Africa Asia Europe Middle East North America Latin America / Caribbean Oceania / Australia WORLD TOTAL Internet Users 12. 31.2000 4,514,400 114,304,000 105,096,093 3,284,800 108,096,800 18,068,919 7,620,380 360,985,492 Internet Users Latest Data 167,335,676 1,076,681,059 518,512,109 90,000,455 273,785,413 254,915,745 24,287,919 2,405,518,376 Penetration % Population 15.6 % 27.5% 63.2% 40.2% 78.6% 42.9% 67.6% 34.3% Growth 2000-2012 3,606.7% 841.9% 393.4% 2,639.9% 153.3% 1,310.8% 218.7% 566.4% Users % of Table 7.0% 44.8% 21.5% 3.7% 11.4% 10.6% 1.0% 100%
  13. 13. The Digital Divide accessed July.15.2013
  14. 14. The Digital Divide accessed July.15.2013
  15. 15. online-population-passes-1-billion-report/ accessed - July 17, 2013 According to the study, South Korea leads among Asian countries in terms of Internet penetration with 83 percent of its citizens online, while also having the fastest average connection (15.7 Mbps). Japan came in second with an estimate of 79 percent, while Myanmar placed dead last with use 1 percent. Internet use in Asia up 14% in 2012 as online population passes 1 billion
  16. 16. online-population-passes-1-billion-report/ - July 17, 2013 Internet use in Asia up 14% in 2012 as online population passes 1 billion
  17. 17. online-population-passes-1-billion-report/ accessed - July 17, 2013 Internet use in Asia up 14% in 2012 as online population passes 1 billion As for sheer raw numbers, China has the largest Internet population in Asia with 538 million netizens, followed by India with 121 million. We Are Social believes that 102 million new users have come online in Asia this year, a gain of 14 per cent.
  18. 18. online-population-passes-1-billion-report/ accessed - July 17, 2013
  19. 19. online-population-passes-1-billion-report/ accessed - July 17, 2013 Internet use in Asia up 14% in 2012 as online population passes 1 billion The study also notes that the continent spends a collective total of 1.7 million years online every month. Social media penetration is believed to have reached 21 percent, slightly lower than the global average. Social estimates Asia’s Facebook userbase stands at 229 million across the 24 markets tracked. A recent study from Socialbakers pegged the social networking site’s reach at 242 million, although its figures include more countries. Asia continues to go mobile, with an estimated total of 3.1 billion subscribers. Smartphone users are believed to number roughly 844 million.
  20. 20. accessed - July 17,2013 Population living in poverty (2005 PPP$1.25 a day), Asia and the Pacific, earliest and latest The incidence of poverty is below 5% in a number of developing countries, including Armenia, Azerbaijan, Kazakhstan, Kyrgyzstan, Malaysia, Mongolia, the Russian Federation,Thailand and Turkey. Many countries in the region have lower poverty rates in recent years in comparison with rates of the early 1990s; declines have been pronounced in Cambodia,China, Turkmenistan and Viet Nam.
  21. 21. accessed - July 17,2013 Gini index, Asia and the Pacific, earliest and latest The incidence and depth of poverty have been declining fairly consistently.The trend is less clear, however, for income inequality. One means of assessing income equality is by considering the proportion of national production consumed by the poorest quintile of the population.The poorest quintile of the population receive a small share in a number of middle- and high-income countries, such as Singapore (5.0%),Turkey (5.4%), Thailand (6.1%), the Islamic Republic of Iran (6.4%), and Malaysia (6.4%).Those in the poorest quintile do relatively better in India (8.1%), Pakistan (9.1%) and Bangladesh (9.4%).
  22. 22. Similar results come from application of the Gini index, an aggregate measure of inequality that takes into account the complete distribution of income. Inequality in Bhutan, Cambodia, China, Georgia, Nepal, Papua New Guinea, Philippines, the Russian Federation, Singapore, Sri Lanka, Turkey, Turkmenistan and Thailand is highest according to the latest available data, with all the countries listed having a Gini index above 40. No clear regional trend emerges for inequality. Since the early 1990s, inequality seems to have increased in some countries, such as Bangladesh, Cambodia, Nepal and Sri Lanka; while it has decreased in others, such as Indonesia, Islamic Republic of Iran, Malaysia and Thailand. The Gini coefficient is a measure of statistical dispersion developed by the Italian statistician Corrado Gini and published in his 1912 – Web Definition accessed - July 17,2013
  23. 23. The Digital Divide Another feature of the divide is arguably more worrisome than the uneven spread of ICT devices or other technology “outputs”, namely the disparities in “technological inputs” existing between industrialized and developing countries. These disparities are indeed significant, and they correlate quite closely with the spread of ICT devices. The disparities are of concern as national differences in these inputs are precisely those likely to remain fairly stable over time; the number of mobile telephones could increase quickly, for example, by the number of scientists substantially less so.
  24. 24. The Digital Divide An individual must be able to connect in order to achieve enhancement of social and cultural capital as well as achieve mass economic gains in productivity. Therefore, access is a necessary (but not sufficient) condition for overcoming the digital divide. Access to ICT meets significant challenges that stem from income restrictions. The borderline between ICT as a necessity good and ICT as a luxury good is roughly around the “magical number” of US$10 per person per month, or US$120 per year, which means that people consider ICT expenditure of US$120 per year as a basic necessity. Since more than 40% of the world population lives on less than US$ 2 per day, and around 20% live on less than US$ 1 per day (or less than US$ 365 per year), these income segments would have to spend one third of their income on ICT (120/365 = 33%). The global average of ICT spending is at a mere 3% of income. Potential solutions include driving down the costs of ICT, which includes low cost technologies and shared access through Telecentres.
  25. 25. The Digital Divide Technology transfer is one aspect of the divide which has distinct policy implications.The ubiquity on information is defining feature of the digital era yet, ironically, technological development in the post- Cold War era has been increasingly dominated by the private sector, rather than by public sector expenditure “on research and development.”Thus, on the one hand, access to information for application to economic and social ends has never been easier. On the other, the core knowledge permitting technological advance is in the hands – or rather the heads – of major private enterprises.
  26. 26. The Digital Divide The true significance of the digital divide does not reside in the uneven distribution of inputs and outputs – scientists or mobile telephones, for example – but in the fact that both may increasingly important for the economic growth. The outputs give rise to greater flows of information and, as argued, these in turn may result in higher economic growth. The output give rise to greater flows of information and, as argued below, these in turn may result in higher economic growth. Consensus reigns on the fact that investment in land or physical capital. If the digital divide is represented by uneven access to ICT inputs and outputs, then a widening digital divide could lead directly to a widening economic divide between industrialized and developing countries. At this early stage in the communications revolution, the evidence on this point is far from conclusive. Economic Effects of ICT use
  27. 27. The Digital Divide The dot-com bubble (also referred to as the dot-com boom, the Internet bubble and the information technology bubble) was a historic speculative bubble covering roughly 1997– 2000 (with a climax on March 10, 2000, with the NASDAQ peaking at 5408.60 in intraday trading before closing at 5048.62) during which stock markets in industrialized nations saw their equity value rise rapidly from growth in the Internet sector and related fields. While the latter part was a boom and bust cycle, the Internet boom is sometimes meant to refer to the steady commercial growth of the Internet with the advent of the World Wide Web, as exemplified by the first release of the Mosaic web browser in 1993, and continuing through the 1990s. Dot – com Bubble - July 17, 2013
  28. 28. The Digital Divide The volatility of technology inequity markets since 2000, reflected in the boom-to-bust cycle of the first generation of “dotcoms”, is a dramatic reminder how little is known about the effect of ICTs on economic and employment growth. Beyond such short-term vicissitudes, however, the real test of the new technologies’ implications for economic and employment growth will be their effect on the “old” economy. Technology “bubble burst”
  29. 29. The Digital Divide More in-depth analysis shows that 90% of the dot-coms companies survived through 2004. With this, it is safe to assume that the assets lost from the Stock Market do not directly link to the closing of firms. More importantly, however, it can be concluded that even companies who were categorized as the "small players" were adequate enough to endure the destruction of the financial market during 2000-2002. Additionally, retail investors who felt burned by the burst transitioned their investment portfolios to more cautious positions. Aftermath accessed - July 17, 2013
  30. 30. The Digital Divide ICTs ought to lead to positive economic outcomes by making markets more transparent through greater access information, and more efficient through the resulting decline in transaction costs. Studies reviewed in a paper by Smith, Bailey and Brynjolfsson (2000), do find that prices are lower in electronic markets relative to those in conventional markets. These studies concentrate on business-to-consumer markets, but their findings are supported by estimates of potential savings for business-business commercial transactions (the overwhelming share of online commercial transactions) Ought to Lead
  31. 31. The Digital Divide The labour market may also be affected through improvements in job search efficiency. Online job search may be speed up the matching process and be a factor in lower unemployment.
  32. 32. The Digital Divide The durable productivity gains have been greatest in the enterprise in which ICT use has been greatest (Bresnahan, Brynjolfsson and Hitt, 1999). At the aggregate level, the growth in multi-factor productivity in the late 1990s (compared with a decade earlier) was greatest in countries in which ICTs were most widespread. And these were countries where employment growth was greatest. ICTs lie behind the automation of routing jobs in manufacturing, but are also associated with the growth of the service sector, including “intangible” markets – markets in which the product itself is digital – such software development Productivity Gain
  33. 33. The Digital Divide The effects of the internet may well be related to favourable employment creation outcomes, but is important to note that the communications revolution involves more than just internet use. A strong correlation between the spread of telecommunications and economic growth has already been observed and more recent studies have sought to determine the causal relationship between the two. Example: Thought it stands to reason that wealthier countries can afford better telecommunications infrastructures, Is it true that better telecommunications lead to greater economic growth? - The wealthy countries can afford better telecommunications - Better telecommunications are also determinant of economic opportunity
  34. 34. The Digital Divide Economic advantages of ICTs particularly relevant to development • The internet expands the scope and scale of market opportunities. By acquiring knowledge of markets and prices, etc., small firms could expand their market presence or improve their performance. • Lower barriers to entry for new business start-ups in terms of lower physical equipment costs and capital costs are important for would-be entrepreneurs. In intangible products such as software, knowledge and innovation are more critical than access to financial capital. Similarly, telecentres or simply mobile hone rental, can create many jobs with minimal investment. • ICTs encourage the outsourcing of activities that could be captured by developing countries as they fit into global value chains. Developing countries could exploit their own comparative advantages, one of which might be their location in a complementary time zone. Closer, more integrated relations between developed and developing countries could result. • The development of information-based products allows developing countries to leapfrog into higher-value-added, higher-income industries. Moreover, where information-based products are intangible there is less need to rely on the existence of good physical infrastructure for supply or distribution, for example. • The language of 75% of the content of the internet is English, and this is both an opportunity and an obstacle for developing countries seeking to develop their own internet content, and to trade in, for example , indigenous music or other cultural or information-based products. When the internet use rises in a given location, the internet becomes local and local content then predominates over foreign content. Economic Divide between Rich and Poor
  35. 35. The Digital Divide Differences in national income do not fully explain the differences in the spread and use of ICTs. Analysis of 15 national cases in the ILO’s World Employment Report 2001 found that progress in three policy spheres – education and skills, industry and trade policy, and infrastructure – was particularly relevant in developing countries that have made substantial inroads into information economy. It is important then to have a national strategy on ICTs. The internet itself originated in the 1960s as part of the US Department of Defense national strategy on military research. Governments that have recognized the significance of ICTs for economic growth and employment generation have not been inclined to take a piecemeal approach. Rather, they have evolved a comprehensive, coherent national strategy to harness the technologies to these beneficial ends. Influence of developing countries’ policy priorities on successful entry into the information economy
  36. 36. The Digital Divide No developing country has made substantial progress in the information economy or achieved entry into global value chains in information and knowledge-based services without an educated, skilled workforce. The relationship between educational attainment and ICT use is widespread for individual countries (ILO, 2001, Chapter 2 and 7). It is clear that the knowledge economy to which ICTs give access to rests fundamentally on levels of educational attainment and on skills. Example: One estimate of the cost of shortage of ICT skills currently prevailing in the European Union calculates a forgone GDP growth of UD$106 billion since 1998 (ILO, 2000, p. 10) Education, Learning and Skills
  37. 37. The Digital Divide Participation in ICT markets can be achieved on the basis of full range of skills. Developing countries can create jobs in ICT markets at the same time as they develop higher ICT skills. Indian Software Industry (Mid – 1990s) In this particular industry India has enjoyed growth in excess of 50 percent per year since the mid – 1990s, currently employs 180,000 people and generates over US$4 billion in annual revenue; at the same time well over 250,000 Indians are employed in data-entry and data- processing
  38. 38. The Digital Divide “Making productive use of ICTs does not necessarily imply a very time-intensive, “linear” investment in education: it is often enough just to know what is needed and where to learn it” Many of those who design software or conform it to different uses do not even have formal qualifications or diploma in the field.
  39. 39. The Digital Divide Still, it remains important to encourage the acquisition of higher-level skills, such as software use and development, and knowledge of hardware. • The most profitable and secure niches in international ICT markets are heavily skill-dependent. - India owes the success of its software industry in large part to its long-term investment in higher education, and to the 55,000 graduates in science and engineering it produces annually. - Silicon Valley proximity to Stanford University and other Institutions of relevant higher learning in California is no coincidence so, too, the growth of the ICT industry in Bangalore, India, and in Xian, China, is related to its proximity to long – established science and engineering institutions. Acquisition of higher – level skills
  40. 40. The Digital Divide Is to be able to adapt ICTs to their most “profitable uses” whether in domestic or global markets. As the economic advantages of ICTs extend across the economy and are no longer confined to the ICT sector, “software and system maintenance skills become important for all enterprises. Ireland’s rise to prominence as both user and developer of software relied on the industry on the wise use of the European Social Fund’s Investments in the Irish education system, as well as on the Industrial Development Authority’s strong focus on developing the software industry. Tax Incentive were also granted for training provision. Acquisition of higher – level skills
  41. 41. The Digital Divide Singaporesubsidizes 70 % incentives of the cost of continuing education for its software developers, thus subsidizing the national investment in future wealth. Singapore is one of Asia’s great success stories, transforming itself from a developing country to a modern industrial economy in one generation. During the last decade, Singapore’s education system has remained consistently at or near the top of most major world education ranking systems. How Singapore has achieved and sustained so much, so quickly? • The ability of the government to successfully match supply with demand of education and skills – a major source of Singapore’s competitive advantage. • A clear vision and belief in the centrality of education for students and the nation; • Persistent political leadership and alignment between policy and practice; • A focus on building teacher and leadership capacity to deliver reforms at the school level; • Ambitious standards and assessments; and • A culture of continuous improvement and future orientation that benchmarks educational practices against the best in the world. Acquisition of higher – level skills
  42. 42. The Digital Divide The Philippines was named the world’s best country in business English proficiency, even beating the United States, according to a recent study by GlobalEnglish Corporation. GlobalEnglish has released early this month the results of its annual Business English Index (BEI), the only index that measures business English proficiency in the workplace. For 2012, results showed that from 76 represented countries worldwide, only the Philippines attained a score above 7.0, "a BEI level within range of a high proficiency that indicates an ability to take an active role in business discussions and perform relatively complex tasks." The Republic of the Philippines
  43. 43. The Digital Divide “This is particularly interesting because the Philippines, a country with one-tenth of the population of India, recently overtook India as a hub for call centers. Over 400,000 Filipinos are now employed in call centers, roughly 50,000 more than in India,” the study said. The Philippines, which scored 7.11 and the lone country in the intermediate level, were joined by Norway (6.54), Estonia (6.45), Serbia (6.38) and Slovenia (6.19) in the top five. GlobalEnglish noted that a country’s business English capability is an indicator of its economic growth and business success. “It is not surprising that both the Philippines and Norway—the only two countries in the top five in both 2011 and 2012—are improving their economies, based on the latest GDP data from the World Bank,” it added The Global English Corporation
  44. 44. The Digital Divide ICT jobs that do not necessarily require high levels of education rely on those that do: are internet café or telecentre may create jobs and highly used, but when the equipment breaks down it can only be repaired by appropriately skilled workers.
  45. 45. The Digital Divide Industry and Trade Policy: Facilitating Market Access - July 18,2013 Electronic commerce , commonly known as e-commerce, is a type of industry where buying and selling of product or service is conducted over electronic systems such as the Internet and other computer networks. Electronic commerce draws on technologies such as mobile commerce,electronic funds transfer,supply chain management,Internet marketing,online transaction processing, electronic data interchange (EDI), inventory management systems,and automated data collection systems. Modern electronic commerce typically uses theWorldWideWeb at least at one point in the transaction's life-cycle, although it may encompass a wider range of technologies such as e- mail,mobile devices social media,and telephones as well.
  46. 46. The Digital Divide
  47. 47. The Digital Divide The regulatory framework for the encouragement of e-commerce (such as authorization of electronic signatures, or payment and taxation facilities) remains incomplete in most countries of the world, and this is a brake on growth of the wider commercial applications of ICTs. Industry and Trade Policy: Facilitating Market Accessed - July 18,2013 The Development in Malaysia The growth of “online malls” – or single websites that regroup a variety of individual e – businesses. E-commerce in Malaysia is fast approaching a growth inflection point. It was in the mid-90s that e-commerce first burst into the Southeast Asia nation, fuelled by the global dot-com mania and partly by the Government’s concerted digital transformation initiative, the MSC Malaysia. After the dot-com bubble burst in the early 2000s, blog shops started to slowly emerge.Towards the end of 2000s, more and more are using blogging (e.g. and social networking platforms (e.g. Multiply, Facebook) to setup their online stores. With 28 million people, Malaysia has an internet penetration of 61%, behind New Zealand (86.2), Korea (81.5), Australia (78.9), Japan (78.7), Singapore (75.1), and Hong Kong (75) (source: Google). Increasingly better and cheaper online payment solutions too are catalyzing e-commerce activities in Malaysia.
  48. 48. The Digital Divide Rakuten in Malaysia - July 18,2013 Rakuten is the latest entrant in the Malaysian e-commerce market. The Japanese e-commerce giant launched its e-commerce service in Malaysia on November 1, 2012. At launch, it managed to recruit 40 local merchants (i.e. Senheng Electric, Best Denki, CARiNG Pharmacy, and Poh Kong) with over 11,000 products listed on the Rakuten Online Shopping platform. According to Rakuten Malaysia CEO Masaya Ueno, it is the first venture in Southeast Asia region where Rakuten enters the market without any local partner. Both ventures in Thailand (launched 2009) and Indonesia (2011) involve partnerships with local players.
  49. 49. The Digital Divide On its differentiation strategy, Rakuten positioned itself as a virtual shopping mall, based on a business-to-business-to-consumer (B2B2C) model. Merchants of various product types (i.e. electronics, fashion, health, pets) build online stores on the Rakuten platform and sell directly to customers. Unlike other e-commerce platforms, Rakuten offers a host of value-added services to merchants on its platform. It is leveraging on operational experience with its flagship Rakuten Ichiba, Japan’s largest online shopping site with more than 39,000 merchants. Mr Ueno elaborates: “Rakuten offers an additional layer of support by providing e- commerce consultants and experts to advise merchants on their online business strategy, implementation, sales and marketing as well as lead and revenue generation. Coupled with access to our team of experts in Japan and over 15 years of e-commerce leadership and expertise, we are ideally placed to offer the best of e-commerce to both our merchants and consumers.” Rakuten in Malaysia - July 18,2013
  50. 50. The Digital Divide Several governments have encouraged the growth of information processing for export through the creation of specialized zones. Given the well-educated, English speaking workforce, For example in Barbados.The government and the Barbados Investment and Development Corporation identified information processing as a strategic sector for growth. By 1997, 2% of the workforce was employed in this sector, in some 2,500 jobs. In Jamaica“digiports” or free – trade Zones for digital work have been Created,offering incentives such as low-cost premises, tax concessions, and 100% profit and dividend repatriation rights.
  51. 51. The Digital Divide National trade policies need to ensure that imported inputs can be made available at affordable prices, in order to encourage the growth and competitiveness of domestic industries, such as software development. Such policies run risks in so doing are not without tradeoffs.
  52. 52. The Digital Divide Telecommunication infrastructure is a sphere where it is vital to make correct policy decisions, for information economy to expand. Access and affordability are prime concerns in many developing countries. Empirical / Factual Relationships • Telephone costs tend to be higher in poorer countries when per capita GDP is expressed in purchasing power parity terms. • The more expensive the access charges (comprising local telephone calls and internet service provision (ISP-internet service provider) fees), the less the internet is used. Inverse Relationships • Network effect: in most developing countries there are proportionately fewer subscribers to the telecommunication system than in industrialized countries, and telecommunication costs are inversely related to the number of subscribers, but government policies in this sector also appear to matter • Declining costs are being driven by technological change both in communication devices and in telecommunications infrastructure • The decline of telecommunications as a national monopoly and the resulting rise of privatization and competition are driving prices downward worldwide, as well as increasing access. Over 90 developing countries opened their telecommunications markets to the private sector in the period 1990- 1998 (World Bank, 2000, p.22) Telecommunications Infrastructure
  53. 53. The Digital Divide Despite all these factors, only a minority of developing countries have fully liberalized their telecommunications sector, and many face a major dilemma as they contemplate doing so. For the settlement fees received by a national telecommunications systems often represent a major contribution to the state budget and to foreign exchange earnings. Liberalizing the telecom market would entail forgoing these earnings, at least in the short term, before alternative sources of tax revenue emerge from the greater commercial activity that more affordable telecommunications are intended to generate.
  54. 54. The Digital Divide This recognition, however, is still fairly recent and, despite the proliferation of initiatives, little is actually known about the effectiveness of programmes and projects. Most United Nations agencies are affected by ICTs, either through the use they make of them or because of their implications for the substance and delivery of technical cooperation programmes. Examples: • Through Trade Points Programme the United Nations Conference on Trade and Development UNCTAD has sought to promote electronic commerce for small businesses in developing countries, ensuring their integration into international markets and value chains. • World Bank’s various initiatives in this area include the Information Development Programme (InfoDev), which endeavours inter alia to disseminate policy advice on ICT for development and on best practice. • The International Telecommunications Union (ITU) has signed a memorandum of understanding with Oracle Corporation and Cisco Systems for the creation of 50 training centers worldwide. • The ILO is exploring is exploring further how ICTs can be harnessed for the delivery of technical cooperation. International Initiatives
  55. 55. The Digital Divide Initiatives with broader significance (2001): The ICT Task Force and Trust Fund, created in July 2000 by the United Nation’s Economic and Social Council (ECOSOC), which “recognized the key role of partnership, involving national governments, bilateral and multilateral developing agencies, the private sector and other relevant stakeholders in putting ICTs in the service of development” (United Nations Economic and Social Council, 2000, para. 3). The task force will remain under the oversight of ECOSOC but will operate outside the United Nations structure, seeking to exercise a “matchmaking” function, bringing donors and projects together. Its main objective is coordination: The problem that the Task Force is established to address is not the global divide per se, but rather a.The inconsistency and the uncoordinated character of the present multitude of efforts to bridge the divide b. Inadequacy of resources that are currently engaged in bridging the divide, which is at least partly due to (a) (ibid., Annex, para.9
  56. 56. The Digital Divide • The Digital Opportunities Task Force, or DOT Force, which was created by the G8 states in Okinawa, also in July 2000. The DOT Force was set up with a temporary secretariat and is jointly administered by the World Bank and the UNDP; as with the ICT Task Force, it seeks to match donors with projects promoting ICTs for development. It is likely that, once inaugurated, DOT Force projects will come under coordination of ECOSOC’s ICT Task Force. The Digital Opportunities Task Force, or DOT Force
  57. 57. The Digital Divide Promising examples in this regard include the use of online, interactive learning modules to promote vocational training, as has occurred through the ILO’s programmes both at headquarters and at its Internal Training Center, in Turin.
  58. 58. The Digital Divide
  59. 59. The Digital Divide This report is the result of a unique international collaboration.The Digital Opportunity Task Force (COT Force), created by the G8 Heads of State at their Kyushu- Okinawa Summit in July 2000, brought together forty three teams from government, the private sector, no profit organizations, and international organizations representing both developed and developing countries, in a cooperative effort to identify ways in which the digital revolution can benefit all the world’s people, especially the poorest and most marginalized groups.The “digital divide” is threatening to exacerbate the existing social and economic inequalities between countries and communities, so the potential costs of inaction are greater than ever before. A Report of the Digital Opportunity Task Force (DOT Force)
  60. 60. The Digital Divide G8 - The Group of Eight (G8) is a forum for the governments of eight of the world's eleven largest national economies; not included are Brazil at 7th (IMF), India at 9th and China at 2nd. The forum originated with a 1975 summit hosted by France that brought together representatives of six governments: France, the Federal Republic of Germany, Italy, Japan, the United Kingdom, and the United States, thus leading to the name Group of Six or G6. The summit became known as the Group of Seven or G7 the following year with the addition of Canada. The G7 is composed of 7 of 8 of the wealthiest countries on Earth (as national net wealth) and by 7 of 11 of the wealthiest countries on Earth by GDP, and it remains active despite the creation of the G8. In 1997, Russia was added to the group which then became known as the G8. The European Union is represented within the G8 but cannot host or chair summits A Report of the Digital Opportunity Task Force (DOT Force) Wikipedia accessed July 18, 2013
  61. 61. The Digital Divide The DOT force has analyzed the underlying causes of the digital divide, the power reducing and empowering potential of new technologies, and the complex mix of strategies, policies, investments, and actions required to create digital opportunities for all while addressing key development imperatives.
  62. 62. The Digital Divide The DOT force has identified priority actions that must be taken – by national governments and their citizens, the international community, the private sector, non-profit and community organizations – in various forms of partnership, to make this opportunity a reality.The members of the DOT force greatly appreciate the opportunity afforded by the G8 Leaders to build upon the foundation of the G8 Okinawa Charter on the Global Information Society.
  63. 63. ports/26092001_dotforce.htm accessed Aug 3, 2013The Digital Divide
  64. 64. A Nine-Point Action Plan The DOT Force captures the essence of its recommendations through nine steps:  Create pro-competitive national e-strategies (with regional cooperation, e-government, international benchmarking for e-readiness,and creation of an International eDevelopment Resource Network)  Improve connectivity, increase access and lower costs (via multiple access technologies, community centres, rural access,and national network information centers)  Enhance human capacity development, knowledge creation and sharing (via ICT access in schools, teacher training, distance learning, collaborative networks,university-based networked centers of excellence twinned with those in G-8 nations)  Foster enterprise and entrepreneurship for sustainable economic development (via private sector mentoring, incubation activities, entrepreneur resources exchanges,private-public partnerships, and donor assistance in ICT)  Participate in new international policy issues raised by ICTs like the Internet (via support for attending international forums and a network of Southern-based expertise)  Support dedicated ICT initiatives for the Least Developed Countries (eg. via the African Partnership Initiative, African Connection)  Promote ICT in healthcare and tackling diseases like HIV/AIDS (via knowledge sharing, media campaigns)  Support local content and applications creation (in local languages,via localized e-government services,open source software, and non-commercial content exchanges)  Prioritize ICT in G8 and other donor programmes.
  65. 65. The Digital Divide Under each of the priority areas identified in Okinawa, the DOT Force has identified detailed actions that should be taken: • Fostering Policy, Regulatory and Network Readiness - through establishing and supporting both developing country and emerging economy National eStrategies including eGovernment, and universal participation in new international policy and technical issues by ICT and the internet. • Improving Connectivity Increasing Access and lowering Costs – Through establishing and supporting a range of targeted interventions as well as dedicated initiatives for the ICT inclusion of the Least Developed Countries. • Building Human Capacity – through a range a targeted training, education, knowledge creation and sharing initiatives, as well as promote ICT for healthcare and in support against HIV/AIDS and other infectious and communicable diseases. • Encouraging Participation in Global e-Commerce and other e-Networks – through enterprise and entrepreneurship for sustainable economic development, including poverty alleviation, and promote national and international effort to support the creation of local content and applications.
  66. 66. The Digital Divide The international community has set by consensus a range of goals and political commitments to close some of the economic and social divides, for example having the proportion of the world’s population living on less that $1 a day between 1990 and 2015. Development Goals
  67. 67. The Digital Divide The international community has identified seven “International Development Goals” (IDGs) that are at the heart of the flight against poverty and the struggle to create opportunity, prosperity, health, safety and empowerment for all the world’s people, especially the poorest and traditionally marginalized groups.The 7 IDGs are: • Reduce the proportion of people living in extreme poverty by half between 1990 and 2015 • Enrol all children in primary school by 2015 • Make progress toward gender equality and empowering women by eliminating gender disparities in primary and secondary education by 2005 • Reduce infant and child mortality rates by two-thirds between 1990-2015 • Reduce maternal mortality ratios by three-quarters between 1990-2015 • Provide access for all who need reproductive health services by 2015 • Implement national strategies for sustainable development by 2005 so as to reverse the loss of environment resources by 2015 The International Development Goals and Information and Communication Technologies
  68. 68. The Digital Divide The G8 initiated Digital Opportunity Task Force (DOT Force) has a specific responsibility and potential in pursuing the goal of Digital Opportunities for All. • By offering a fresh vision of how to bridge the Digital Divide both within countries and between rich and poor countries, and by proposing innovative tools and processes to do this in a participatory fashion, the members of DOT Force call on the support and continued commitment of the leaders of the G8 to initiate a broad range of local, regional and international initiatives to foster a development-supportive process of globalization. Making the case for ICT in Development
  69. 69. The Digital Divide
  70. 70. The Digital Divide Fresh thinking and attitudes are required from all sides. Such thinking will need to be cognizant of the need for: • Holistic approaches with multi-stakeholder involvement • Leveraging linkages and partnerships into the global economy • National ICT strategies which also permit bottom-up approaches • Taking advantage of new and emerging technologies • New approaches to development assistance Thinking Differently, Acting Cohesively
  71. 71. The Digital Divide Cost – effective, country-differentiated and empowerment – oriented solutions are now available to combine the pursuit of a more equal access to information and knowledge with an acceleration in the fight against poverty on a global scale. Wherever and whenever such solutions have successfully been implemented, the international, the international community should be encouraged to consider whether such success is: 1. Replicable (in the same country or region) 2. Transportable (to other geographical, social and economic environments) 3. Scalable (within a country, region or globally). Making the best of the tools and experiences available
  72. 72. The Digital Divide
  73. 73. The Digital Divide In the light of the considerations presented above, some priority actions can be identified. In the spirit of the Okinawa Charter, and as a way to move from statements to real results, we have identified nine action points, which constitute our proposal for a Genoa Plan of Action. We believe that in the context of an increasingly integrated world economy the following Plan of Action provides the basis for developing economies to achieve sustainable ICT-enabled development, both economic social. 1. Help Establish and Support Developing Country & Emerging Economy National eStrategies 2. Improve Connectivity, increase Access and Lower Costs 3. Enhance Human Capacity Development,Knowledge Creation and Sharing 4. Foster Enterprise and Entrepreneurship for Sustainable Economic Development
  74. 74. The Digital Divide 5. Establish and Support Universal Participation in addressing New International Policy and Technical Issues raised by the Internet and ICT 6.Establish and Support Dedicated Initiatives for the ICT inclusion of the Least Developed Countries 7.Promote ICT for Health Care and in Support Against HIV/AIDS and Other Infectious and Communicable Diseases 8. National and International Effort to Support Local Content and Applications Creation 9. Prioritize ICT in G8 and other Development Assistance Policies and Programmes and Enhance Coordination of Multilateral Initiatives
  75. 75. The Digital Divide Specifically, this will mean fully integrating ICT in G-8 and other donor development assistance policies and programmes, as well as enhancing coordination multilateral initiatives. The members of the DOT force are convinced that the basic right of access to knowledge and information is prerequisite for modern human development. ICT must be embraced wholeheartedly by the broad development community at the earliest opportunity
  76. 76. “Let the wise hear and increase in learning, and the one who understands obtain guidance, An intelligent heart acquires knowledge, and the ear of the wise seeks knowledge” Thank you!