A common premise goes that as a country does more online, the economy can become a more transparent and efficient one. It is commonly held that Ireland’s relatively low rate of broadband penetration is holding the economy back when it comes to fully embracing all of the benefits of the Internet and other online technologies and applications.
Hardware not enough
But building a digital economy is not simply a matter of supplying citizens and business with computers, broadband connections and mobile phones. It also depends on the stake holders being able to use the technology skilfully, the transparency of the business and legal systems, and the extent to which governments encourage the use of digital technologies.
The Irish Department of Telecommunications’ inability or unwillingness to empower the regulator Comreg to enforce local loop unbundling and break the incumbent’s stranglehold on the broadband market seems a perfect example of why Ireland isn’t further up the ladder from its current static position of 16th in what the Economist’s Intelligence Unit calls ‘e-readiness’.
E-readiness is defined by the EIU as the state of play of a country’s IT and communications infrastructure and the ability of its consumers, businesses and government to use these technologies for their benefit.
Ireland remains static
Every year, the EIU ranks countries around the globe on their comparative e-readiness. Ireland comes in at 16th, unchanged from last year, when you consider New Zealand and Austria are tied for 14th. Perhaps surprisingly, we are ahead of Belgium, South Korea, France and Japan – all of which I would have considered to been more developed digital economies. This would be the case certainly, if we were to use broadband penetration as the sole barometer. But according to the EIU, broadband is becoming less of a determining factor and other environmental criteria – such as information security and innovation – have emerged as more telling differentiators.
We are still a full 91 percentage points behind the e-readiness leader Denmark whose government has done some very smart things to encourage businesses and consumers to use technology for greater efficiency. Under Danish law, all businesses are required to carry out transactions with the government electronically where in most other western European countries, the figure averages out at just over 50%.
Broader view
So if we can learn anything from this e-readiness investigation, it is that the perceived ‘holy grail’ of universal broadband penetration in Ireland will not be enough for us to compete at the highest level in the international digital economy. We will also need innovative e-commerce services for consumers, security measures to reassure them that it’s safe to transact online and a dynamic e-government strategy that compels businesses to adopt leading edge digital channels for business.
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