Connectivity underused even in developed countries – study

A brand new study commissioned by Nokia Siemens Networks revealed that even the world’s best-connected countries are not maximizing the use of their available communication technologies to enhance social and economic prosperity.

While it’s common to find worldwide or regional studies that point to the Philippines’ lackluster communications infrastructure profile compared to other countries, the latest Connectivity Scorecard shows that top countries like the United States, Sweden, Japan and Finland also fail to exploit their communication infrastructure to the fullest.

Developed by Leonard Waverman, professor of economics at London Business School, the Connectivity Scorecard measures the extent to which countries use or deploy telecoms and IT infrastructure that drives today’s information economy — from copper wires, fiber optic lines, mobile phones to computers.

In addition, the Scorecard uniquely categorizes indicators of connectivity by consumer, business and government to determine how the three sectors put to positive use the technologies available to them.

Under Waverman’s direction, economic consulting firm LECS conducted the study for Nokia Siemens Networks. For each component of the Scorecard, countries are benchmarked against the best in class in their tier, thus if a country was best in all dimensions, it would score a maximum of 10.

Countries typically considered to be highly connected achieved only modest scores on the Scorecard: the average score for a group of 16 countries that include the US, Sweden and Korea was 5.05.

Low scores reflect gaps in a country’s infrastructure and usage or both. The US which ranked first in a group of 16 innovation-driven economies (as defined by the World Economic Forum), received only a score of 6.97 out of a possible 10 because it was found to have a low consumer broadband penetration.

There are 43 million US households today with broadband Internet access compared to just two million in 1999, according to the results of a new Consumer Electronics Association (CEA) research study on broadband access in America.

The US also ranks 15th in the world in high-speed Internet penetration. But under Waverman’s Scorecard, these figures aren’t good enough.

Korea, typically a high scorer when it comes to its ICT profiles, ranked 10th on the Connectivity Scorecard because it didn’t do well in business usage metrics. This is in stark contrast with the results from the CEA study that show South Korea along with Asian countries like Hong Kong, Singapore and Taiwan already enjoying higher than 50 percent penetration, and Japan coming close with 49 percent.

How did the Philippines fare? Included among the nine nations that are classified in the study as resource- or efficiency-driven economies, the Philippines is seventh on the list with a 2.38 rating.

Russia with a score of 6.11 placed first, buoyed by its high literacy rate, along with good scores on several measures of usage and infrastructure, especially mobile usage.

The Philippines’ mobile penetration reached 51 percent (46 million subscribers) early last year, which analysts find remarkable for a country with relatively low GDP per capita.

The country’s broadband Internet market also started to grow in 2006 with 340,000 subscribers and about half a million by mid-2007. The fixed-line market, however, failed to achieve a respectable teledensity than a low four percent.

According to the study, in many cases policy and regulatory activity designed to promote connectivity is not achieving the impact intended.

The research also finds that different countries have different to-do lists to achieve maximized gains from connectivity. India and Nigeria, for example, have to improve performance on basic literacy and access measures, while deploying broadband and mobility technologies.

“What this study demonstrates is that not even the world’s richest countries can afford to become complacent about their current telecoms and computing profile. Every nation has substantial work to do before achieving an ideal score in connectivity,” says Waverman, in a press statement issued by Nokia Siemens.

“To increase the societal and economic benefits made possible by connectivity, countries need to consider infrastructure and usage as a combined yardstick,” he adds.

The research team hopes the Scorecard’s results would send a strong wake-up call to governments and businesses about the need to address deficiencies in their countries’ use of communication technologies, and realize how billions of dollars in economic benefits could be gained if they rethink their use of connectivity.