ICTs and the Internet s impact on job creation and economic growth

Transcription

1 Plicy briefing tl The Digital Ecnmy ICTs and the Internet s impact n jb creatin and ecnmic grwth Highlights The prven psitive crrelatin between ecnmic grwth and investment in the Internet and ther Infrmatin and Cmmunicatins Technlgies (ICTs). Innvatin pprtunity fr develping cuntries generated by the cnvergence f mbile services, bradband internet and clud cmputing. The critical rle f ICTs and the Internet in building a mre sustainable green ecnmy. Dcument N. 373/513 (23 July 2012)

2 ICTs and the Internet s impact n jb creatin and ecnmic grwth Preamble Businesses frm all sectrs make imprtant cntributins t ecnmic grwth, jbs and prsperity. This ICC plicy briefing tl fcuses n the psitive rle f the Internet and mre generally f Infrmatin and Cmmunicatin Technlgies (ICTs) in prmting jb creatin and ecnmic grwth. It draws n existing ICC plicy recmmendatins and prvides supprting facts and figures. It is a tl t help plicymakers seize pprtunities t realize grwth. Included are als cncrete examples, relevant studies and initiatives that shw the cntributin f ICTs and the Internet t jb grwth, ecnmic grwth and the green ecnmy. Please nte: The examples cited in this plicy briefing tl are nt necessarily endrsed by the ICC. Table f cntents 1. The prven psitive crrelatin between ecnmic grwth and investment in the Internet and ther ICTs... 3 A. Legal, plicy and regulatry enabling cnditins Supply f bradband infrastructure Demand fr bradband infrastructure Public plicy issues related t bradband use... 5 B. Reference: cncrete examples/studies Oxfrd Ecnmics study Alcatel-Lucent ecnmic analysis: Increasing the scial and ecnmic impacts f bradband in New Zealand Prject in the wrks: FATIH Prject (Educatinal ICT Transfrmatin Prject), Turkey Other studies Innvatin pprtunity fr develping cuntries generated by the cnvergence f mbile services, bradband internet and clud cmputing A. Legal, plicy and regulatry enabling cnditins...11 Mbile bradband spectrum...11 Clud cmputing...11 B. Example The critical rle f ICTs and the Internet in building a mre sustainable green ecnmy..13 Example 1: Sweden s TeliaSnera Grup...14 Example 2: Magyar Telekm...14 Example 3: Türk Telekm A.Ş...15 Dcument N. 373/513 page 2

3 ICTs and the Internet s impact n jb creatin and ecnmic grwth 1. The prven psitive crrelatin between ecnmic grwth and investment in the Internet and ther ICTs There is a clear and psitive crrelatin between investment in the Internet and ther ICTs, and the grwth f ecnmic activity. Investment in the high speed netwrks and ICT services create a platfrm fr ecnmic grwth, jb creatin, and greater cmpetitiveness. 1 Studies shw a psitive impact n prductivity, n GDP cntributin and n jb creatin in ICT-enabled business sectrs. Accrding t the Wrld Bank reprt Infrmatin and Cmmunicatins fr Develpment 2009, access t telecmmunicatins and the Internet bsts glbal ecnmic grwth, and fr every 10 percentagepint increase in high-speed Internet cnnectins there is an increase in ecnmic grwth f 1.38 percentage pints fr develping cuntries. 2 Nte that bradband delivers mre returns than simple Internet access, which in turn delivers mre returns than basic fixed r mbile cnnectivity. McKinsey & Cmpany estimate that a 10 per cent increase in bradband husehld penetratin delivers a bst t a cuntry s GDP that ranges frm 0.1 t 1.4 per cent. 3 Bz & Cmpany als fund that ten per cent higher bradband penetratin in a specific year is crrelated t 1.5 per cent greater labur prductivity grwth ver the fllwing five years. 4 T seize the pprtunities thus presented by increasing use f ICTs and the Internet, glbal business supprts plicies that prmte market entry and investments and aim at attaining greater gegraphic cverage f netwrks. 5 Frm a business perspective, the mst apprpriate plicies fr attracting investment and prmting innvatin in general require 6 : pen markets that eliminate investment barriers pr-investment plicies independent regulatrs 1 ICC BASIS Key messages, IGF 2011, 21 July 2011, p 3, accessible at: 2 Infrmatin and Cmmunicatins fr Develpment 2009: Extending Reach and Increasing Impact, Wrld Bank, Mbile bradband fr the masses, McKinsey & Cmpany (Feb 2009) 4 Digital Highways: The rle f Gvernment in 21st Century Infrastructure, Bz & Cmpany (2009) 5 ICC BASIS Key messages, IGF 2011, 21 July 2011, p 3 6 Ibid. Nte that many f these principles are cvered in cmmitments made under the WTO. Dcument N. 373/513 page 3

4 ICTs and the Internet s impact n jb creatin and ecnmic grwth enfrcement f the rule f law adequate and effective prtectin and enfrcement f intellectual prperty rights pr-cmpetitive and nn-discriminatry legal, plicy and regulatry framewrks that als increase user chice regarding quality and cst f services independent curts plicy appraches that fster entrepreneurship and innvatin Gvernments that aim fr ecnmic grwth can als encurage such grwth-enabling investment by creating demand fr high speed netwrks and Internet services, in particular in areas where gvernments can and d play a key rle, such as educatin, health, and gvernment services, as well as energy distributin and transprt. Hwever, where public investment is deemed apprpriate, it shuld nt distrt market cmpetitin. 7 A. Legal, plicy and regulatry enabling cnditins Creating an ptimal framewrk t prmte investment requires a mix f plicies 8. These shuld be targeted t stimulate cnditins fr the supply f, and demand fr infrastructure, and shuld address certain specific public plicy cncerns. The ability f bradband prviders t invest in and maintain a rbust and expanding bradband infrastructure is supprted by a crdinated plicy apprach frm the public sectr encuraging private sectr investment and innvatin. The public sectr als plays anther imprtant rle as a demand-side driver fr investment by adpting and using bradband itself. ICC prpses the fllwing actins by gvernments t prmte a business climate cnducive t investment in bradband infrastructure, services and prducts enabling higher bandwidth and enhanced service quality. 1. Supply f bradband infrastructure 9 The first mix f plicies shuld be aimed at expanding the supply f bradband infrastructure. They include the fllwing: a. Ensuring a cmpetitive marketplace Gvernments shuld ensure a pr-cmpetitive and market-driven plicy framewrk that prmtes investment in and deplyment f bradband fr gvernment users, business users as well as cnsumers. b. Ensuring efficient and effective frequency allcatin and management prcesses: Gvernments shuld make effrts t increase the available radi spectrum fr the deplyment f advanced mbile bradband cmmercial services, thus ending the current artificial scarcity f spectrum. c. Prmting access in rural, remte and under-served areas: Gvernments can prmte access t bradband infrastructure in rural, remte r underserved areas, and shuld cnsider the cst and benefits t be derived befre implementing such plicies. Any plicy must be transparent and neutral (r better: psitive) with regards t effect n cmpetitin, investment and innvatin. These plicies shuld nt have a crwding ut effect n private investment, which is ensured by chsing high-cst and/r lw incme areas where private investment is unlikely. 7 Ibid, p 4 8 Bradband deplyment, ICC Plicy Statement, 18 Nvember 2002, accessible at: 9 Bradband deplyment, ICC Plicy Statement, 18 Nvember 2002, p 2, accessible at: Dcument N. 373/513 page 4

5 ICTs and the Internet s impact n jb creatin and ecnmic grwth 2. Demand fr bradband infrastructure 10 Gvernments shuld als implement plicies designed t increase demand fr bradband infrastructure, thus enabling a brader ICT and Internet ecsystem: WTO trade liberalizatin f prducts and services delivered via bradband. Legal framewrks that streamline and eliminate licensing and ther requirements fr cntent and services prviders, including freign investment restrictins, in rder t prmte the grwth f cntent and services that drive demand fr bradband. Gvernments shuld assist market demand by becming an early adpter f bradband; fr example via e-gvernment services and slutins, and by encuraging the develpment f lcally relevant cntent. Gvernment culd als assist market demand by fcusing n small- and medium-size enterprises (SMEs); fr example via e-prcurement. Reginal and lcal gvernments culd be used t cnslidate demand where demand may nt have develped therwise. These plicies shuld nt be allwed t distrt the market r create barriers t entry. Gvernments can assist market demand by stimulating IT educatin and training. 3. Public plicy issues related t bradband use 11 Thirdly, ICC cnsiders that the fllwing aspects must be taken int accunt by gvernments in frmulating public plicy relating t bradband: Gvernments shuld prmte a culture f security and netwrk resilience in the bradband sectr. Gvernments shuld ensure that apprpriate legislatin is in place t investigate and cmbat cyber-crime. Gvernments shuld ensure adequate and effective prtectin fr cntent creatin and the freedm f expressin and wrk t educate users abut the imprtance f respecting intellectual prperty and its benefits t sciety. Public plicies shuld prmte, nt deter, investment in next generatin bradband technlgies that enable new bandwidth-intensive and quality-sensitive applicatins and services. B. Reference: cncrete examples/studies 1. Oxfrd Ecnmics study An Oxfrd Ecnmics study in 2011 investigated hw ICTs can help imprve prductivity and cmpetitiveness in Eurpe by analysing crrelatins between ICT investments and prductivity levels. 12 It fund evidence that gvernments play a pivtal rle in fstering ICT investment and use, citing a psitive crrelatin between cuntries with ICT gvernment plicies and prductivity utput. Cuntries with efficient ICT gvernment plicies tend t have high prductivity. Similarly, cuntries 10 Ibid, p 3 11 Ibid, p 4 12 The impact f gvernment plicy n ICT in Capturing the ICT Dividend: Using technlgy t drive prductivity and grwth in the EU, Oxfrd Ecnmics, 2011, p 29 Dcument N. 373/513 page 5

6 ICTs and the Internet s impact n jb creatin and ecnmic grwth with ineffective ICT plicies tend t have lw prductivity. Particularly, the study finds that if by 2020, Eurpe was able t increase its ICT capital stck t the same level (relative t the size f the ecnmy) as that f the US, the level f GDP wuld increase by 5 per cent n average acrss Eurpe (abut 760 billin at tday s prices, equivalent t 1,500 per persn). 13 Cuntries that have under-invested in the past may benefit frm catching up the mst. Fr example, in Spain and Italy, which have invested nly abut half as much as the US, the impact n GDP culd be mre than 7 per cent. If Gvernment wuld set the right cnditins, achieving its legislative agenda t prmte market refrm, investment wuld fllw. 14 Accrding t the Oxfrd Ecnmics study, cnditins fr ICT investment must be fstered and, as such, business encurages plicy cnditins including: 15 The harmnisatin f data prtectin laws acrss the EU t increase legal certainty fr cmpanies lking t invest in Eurpean markets. The remval f administrative barriers faced by ICT service prviders when they enter EU markets t help simplify market entry, reduce csts fr cmpanies lking t invest and reduce inefficiencies that impede investment decisins. Fr example, befre entering each new market, cmmunicatins service prviders ften are subject t unnecessarily cmplex ntificatin prcedures befre netwrks and/r services are ffered. 2. Alcatel-Lucent ecnmic analysis: Increasing the scial and ecnmic impacts f bradband in New Zealand 16 An ecnmic analysis undertaken by Alcatel-Lucent fr New Zealand shws that the incremental grwth in GDP stemming frm high-speed netwrk builds will be $5.5 billin ver 20 years, significantly larger than the Gvernment s $1.5 billin capital cntributin. It als calculates that the ecnmic benefits t end-users f the high-speed applicatins cnsidered will amunt t $32.8 billin ver 20 years. Ultra-Fast Bradband (UFB) and the Rural Bradband Initiative (RBI) are part f a gvernment prgram t expand and develp New Zealand s bradband services. UFB will bring highspeed fibre-ptic technlgy t hmes, schls, hspitals, and businesses. Ultimately, 75 per cent f New Zealanders will have access t dwnlink speeds f 100 Mbps and uplink speeds f 50 Mbps. RBI 13 Ibid 14 Ibid 15 The impact f gvernment plicy n ICT in Capturing the ICT Dividend: Using technlgy t drive prductivity and grwth in the EU, Oxfrd Ecnmics, 2011, p Building the Benefits f Bradband: Hw New Zealand Can Increase the Scial and Ecnmic Impacts f High Speed Bradband : an ecnmic analysis undertaken by Alcatel-Lucent in 2012 fr New Zealand Dcument N. 373/513 page 6

7 ICTs and the Internet s impact n jb creatin and ecnmic grwth will deliver bradband t ver 250,000 rural husehlds, delivering speeds f at least 5Mbps t abut 86 per cent f rural hmes and businesses. With high-speed bradband, vide-based health services will remve gegraphical barriers t healthcare. Health prviders will use vide-based services fr clinical educatin and peer supprt. Health prviders and patients will be able t share high-reslutin images via the clud. Schls will be able t use high-definitin vide-cnferencing t prvide new learning ptins fr students. It culd als benefit rural students wh need specialist supprt. Faster bradband service in rural areas wuld deliver significant ecnmic benefits t fd and agri-business prducts, which cntribute tw-thirds f New Zealand's exprt earnings. Imprtant applicatins in this dmain will supprt better feed planning, sil management, fertiliser management, and mre. The study als shws that there are likely t be 25 millin fewer days f missed schl due t sickness and truancy, by using remte learning applicatins and better cllabratin between parents and teachers. Business applicatins that enable mre peple t telewrk are likely t imprve wrk-life balance and can als help reduce traffic cngestin and reduce carbn emissins. If 23 per cent f New Zealand's wrking ppulatin wrked frm hme tw days a week, transprt emissins culd be reduced by arund 402,150 tnnes per year. Withut relevant, cmpelling and useful high-speed bradband applicatins, there will be n cnsumer surplus. The availability f such relevant and cmpelling applicatins requires innvatin, incubatin and cllabratin between gvernment, research and industry partners. Many f the high-speed bradband applicatins that will drive ecnmic gains fr New Zealand will need t be created, adapted r incubated in the cuntry. One f the mst imprtant findings in this study is that the sner a critical mass f high-speed bradband applicatin adptin is reached, the greater the lng term ecnmic and scial benefits will be fr New Zealand. T drive ttal uptake benefits, relevant high-speed bradband applicatins need t be able t wrk n multiple devices (PCs, laptps, tablets, smart phnes, TVs) running different perating systems and acrss multiple access netwrks (fibre, cpper, and 4G LTE wireless). 3. Prject in the wrks: FATIH Prject (Educatinal ICT Transfrmatin Prject), Turkey The Fatih Prject is an educatinal prject financially supprted by the Turkish Gvernment and managed by the Ministry f Educatin. 17 Turkey has initiated this prject t enable equal pprtunities in educatin and imprve technlgy in schls thrugh the efficient use f ICT tls in the learning-teaching prcess. The prject prvides tablets and LCD Smart Bards in all 620,000 schls in the preschl, primary and secndary educatin. In-service trainings fr teachers are planned t ensure effective use f the ICT equipment during the learning-teaching prcess. Thrughut this prcess, educatinal e-cntents will be integrated int the current teaching prgrammes. In this cntext, the bjectives f the FATIH Prject are t: 1. Prvide equipment and sftware substructure, 2. Prvide and manage educatinal e-cntent, 3. Ensure effective use f the ICT in teaching prgrammes, 4. Prvide in-service training f the teachers, 5. Guarantee cnscius, reliable, manageable and measurable ICT use, 17 The fficial web site f the prject is: There is an fficial explanatin f the prject in English language at the subpage f this web page at: Dcument N. 373/513 page 7

8 ICTs and the Internet s impact n jb creatin and ecnmic grwth Prject aim: The FATIH prject aims t prvide ICT equipment t classes t achieve the ICT-supprted teaching plan by the end f 2013 fllwing the gals that have been set in the Strategy Dcument f the Infrmatin Sciety, the Develpment Reprt, the Strategy Plan f Turkey s Ministry and The Plicy Reprt f ICT twards the e-transfrmatin f Turkey. The prject declares that Infrmatin and Cmmunicatin Technlgies will be ne f the main instruments f the educatin prcess and it will als make teachers and students use these technlgies effectively in the Strategy f Infrmatin Sciety as prepared by the State Planning Organizatin ( ). The fllwing gals have been declared: Develpment f a life-learning apprach, which alng with the prper structures will allw individuals t imprve themselves thrugh e-learning. All secndary educatin graduates shuld have the ability t use basic infrmatin and cmmunicatin technlgies. One ut f three individuals in sciety shuld benefit frm e-educatin facilities thrugh the effective use f Internet. Prvide equal pprtunities t everybdy t learn and use infrmatin and cmmunicatin technlgies. One ut f tw individuals in sciety shuld be Internet users. Internet shuld be reliable fr sciety. The ttal amunt invested in the prject cannt yet be calculated, but there will be 40,000 schl buildings and 620,000 classrms which will have the ICT equipment and the necessary fiber infrastructure t supprt an intranet system. In additin, apprximately 16 millin students will have tablet cmputers prvided free by the gvernment. The cst f this prject is estimated t be arund 10 billin USD. The timeline f the prject is 3-5 years and it will impact ecnmic grwth bth directly and indirectly. A pilt prgramme has been started in 56 schls and nearly 5000 students have tablets frm Gvernment. At the end f 2012, infrastructure changes will als be made within the targeted schls and fiber deplyment will take place in phases. 4. Other studies The cntributin f ICTs and the Internet n ecnmic grwth and jb creatin is highlighted by varius ther surces: Internet-related cnsumptin and expenditure is nw bigger than agriculture r energy, and ur research shws that the Internet accunts fr, n average, 3.4 per cent f GDP in the 13 cuntries we studied the Internet s ttal cntributin t the GDP is bigger than the GDP f Spain r Canada, and it is grwing faster than Brazil The Internet accunted fr 10 per cent f GDP grwth ver the past 15 years. And its influence is expanding. 18 The Internet accunted fr 21% f the GDP grwth in mature ecnmies ver the past 5 years While large enterprises and natinal ecnmies have reaped majr benefits frm this technlgical revlutin, individual cnsumers and small, upstart entrepreneurs have been sme f the greatest beneficiaries frm the Internet s empwering influence Tday 2 billin peple are cnnected t the Internet, and almst $8 trillin exchange hands each year thrugh e-cmmerce Our research shws that the Internet accunts fr, n average, 3.4 per cent f GDP acrss the large ecnmies that make up 70 per cent f glbal GDP. If Internet cnsumptin and expenditures were a sectr, its weight in GDP wuld be bigger than the energy r agriculture industry Ibid, p 2 19 James Manyika and Charles Rxburgh, The great transfrmer: The impact f the Internet n ecnmic grwth and prsperity, McKinsey Glbal Institute, Octber 2011, p 1 Dcument N. 373/513 page 8

9 ICTs and the Internet s impact n jb creatin and ecnmic grwth There is als a clear cnnectin between the maturity f the Internet ecsystem and rising living standards an increase in Internet maturity similar t the ne experienced in mature cuntries ver the past 15 years creates an increase in real GDP per capita f $500 n average during this perid It tk 50 years fr the Industrial Revlutin f the 19 th century t achieve the same results. This demnstrates bth the magnitude f the psitive impact the Internet delivers t all levels f sciety and the speed at which it delivers them. The crrelatin t increased living standards is particularly relevant fr develping ecnmies, where the ptential exists t rapidly leap frward and drive Internet-related grwth. 20 The Internet als serves as a pwerful catalyst fr jb creatin Jbs are created in the Internet ecsystem itself, as Internet cmpanies hire wrkers hwever; the Internet als has helped create jbs in ther industries. 21 The Internet has fundamentally empwered the cnsumer and preliminary research shws that nline prices are, n average, 10% lwer than their ffline cunterparts as a result f the price transparency that nline tls ffer. 22 In China, every 10% increase in bradband penetratin culd cntribute an extra 2.5% t GDP grwth 23. Accrding t a recent study dne by the Inter-American Develpment Bank fr the Latin American and the Caribbean regin, it is estimated that a 10% rise in the market penetratin f bradband services increases the GDP in 3.2% n average and bsts prductivity by 2.6% 24. McKinsey estimates that bringing bradband penetratin levels in emerging markets t tday s Western Eurpean levels culd ptentially add US$ billin in GDP and generate millin jbs 25. The right cmbinatin f applicatins and affrdable access can lead t a 2.7% GDP increase, and 1% increase in Human Develpment Index in Kenya 26. A McKinsey Glbal Institute reprt n Internet-driven grwth highlighted this pr-grwth message: Internet as a sectr is abut 3% f GDP, r bigger than agriculture r energy, and represents ver 20% f ecnmic grwth in the past 5 years, and grwing. Fr every jb that the internet destrys, 2.6 new net jbs are created 27 A US study published in January 2012 shws that investments and innvatin in the transitin frm 2G t 3G wireless technlgies and Internet infrastructure spurred the creatin f sme 1,585,000 new jbs frm April 2007 t June 2011 and estimates that under the current transitin, every 10 percent increase in the adptin f 3G and 4G wireless technlgies culd add mre than 231,000 new jbs t the U.S. ecnmy in less than a year 28. Small and medium sized businesses experience a 10% increase in prductivity frm Internet usage, and thse wh heavily use web technlgies grw and exprt twice as much as thers 20 James Manyika and Charles Rxburgh, The great transfrmer: The impact f the Internet n ecnmic grwth and prsperity, McKinsey Glbal Institute, Octber 2011, p 3 21 Ibid, pp Ibid, p 5 23 A 2010 Leadership Imperative: the future built n Bradband. Bradband Cmmissin, ITU, UNESCO (2010) Garcia-Zaballs, A / Lpez-Rivas, R: Gvernmental cntrl n sci-ecnmic impact f bradband in LAC cuntries, wrking paper 25 McKinsey & Cmpany, Mbile bradband fr the masses, p 3 26 Alcatel-Lucent Bell Labs-Putting Bradband in the Palm f Peple s Hands: A mdel t Drive Faster Ecnmic and Scial Grwth, Jan «The Internet is 20% f Ecnmic Grwth» Business Insider. Accessed n 14 Octber 2011, 28 Shapir Rbert and Hassett Kevin A. The Emplyment Effects f Advances in Internet and Wireless Technlgy: Evaluating the Transitins frm 2G t 3G and frm 3G t 4G -New Plicy Institute and NDN-January 2012 Dcument N. 373/513 page 9

10 ICTs and the Internet s impact n jb creatin and ecnmic grwth wh d nt take advantage f such technlgies. 7 SMEs wh use the Internet als reprt the creatin f twice as many jbs as ther SMEs wh d nt use the Internet 29. Ericssn and Arthur D. Little in 2010 cnducted a glbal review f 124 sci-ecnmic studies n the impact f bradband and fund that fr every 1,000 bradband cnnectins, 80 jbs were created 30. The Internet can increase GDP in the fllwing ways: 31 Fstering cmpetitin In the Internet s rapidly changing envirnment such renewal is particularly imprtant t ensure benefits are captured. Encuraging innvatin An envirnment that encurages innvatin and entrepreneurship is vital t capturing Internet-related grwth. Features f such an envirnment include access t start-up capital, prtectin f intellectual prperty rights, supprt fr research and develpment, and the availability f wrld-class cmmns research cnducted by research universities and gvernment-funded teams. Develping human capital The United States in particular has used its vast talent pl, tlerance fr risk, and excellent resurces in tertiary educatin t prmte Internet-related human capital, serving as an incubatr fr new industries and as a magnet t attract talents frm arund the glbe. Building infrastructure Infrastructure, the fundatin f the entire Internet ecsystem, is a prerequisite fr grwth The need t build infrastructure is nt just an issue fr develping natins Infrastructure requirements will cntinue t grw, even in the mst advanced ecnmies. There is a strng link between increased telecmmunicatin penetratin and faster ecnmic and scial develpment cmmunicatins, particularly mbile, pen grund-breaking pprtunities t transfrm industries and imprve living cnditins, particularly in develping cuntries. 32 Tday (figure 1.1), the ICT sectr cntributes 8% t the GDP f the EU-27, accunts fr 25% f the ecnmic grwth, 6% f jbs, and 20% f expenditure n R&D&I. The telecmmunicatins sectr, as part f this ICT sectr, accunts fr arund 40% f prductivity grwth and 3% f ttal GDP grwth f the EU-27, and directly emplys mre than ne millin peple. 33 ICTs are prbably the single mst imprtant enablers f ecnmic grwth, prductivity and welfare enhancement t have appeared ver the last 60 years Innvatin pprtunity fr develping cuntries generated by the cnvergence f mbile services, bradband internet and clud cmputing The cnfluence f high speed mbility, bradband Internet and clud cmputing creates an unprecedented pprtunity t drive availability and adptin f services, particularly in develping markets. Fr these services t achieve their ptential, the regulatry framewrk must create an enabling envirnment fr investment, maximize availability f spectrum fr industry, and allw crssbrder data flws. 29 Pelissie du Rausas, M., Manyika, J., Hazan, E., Bughin, J., Chui, M., Said, R., «Internet matters : The Net s sweeping impact n grwth, jbs and prsperity», pp Ibid, pp Putting Bradband in the Palm f Peple s Hands: A Mdel t Drive Faster Ecnmic and Scial Grwth, Alcatel-Lucent study. 33 Building the Eurpean Knwledge Ecnmy: Telecmmunicatins and the future prsperity f Eurpe and its citizens, Telefónica, p 9 34 Ibid, p 36 Dcument N. 373/513 page 10

11 ICTs and the Internet s impact n jb creatin and ecnmic grwth A. Legal, plicy and regulatry enabling cnditins Mbile bradband spectrum 35 Mbile bradband is spear-heading the nging deplyment f high-speed Internet services and the resulting benefits t glbal ecnmic grwth in bth develped and develping markets. Access t new radi spectrum is the key requirement fr the expansin f mbile netwrks. Failure t adequately prvide fr the increasing demand fr mbile bradband data usage culd limit scial and ecnmic develpment, innvatin and cmpetitin. Because in sme cuntries the available spectrum fr mbile bradband usages is very limited, and because identificatin f additinal spectrum can take up t ten years in the internatinal cntext, experienced business bservers expect significant spectrum cnstraints t becme apparent within the next five years. Fllwing the recent data traffic explsin bserved particularly in develping cuntries, business urges gvernments and regulatrs t take prmpt actin nw t ensure that sufficient spectrum is available at reasnable prices t supprt the increasing demand, as it characteristically takes a number f years t allcate new spectrum resurces t peratrs. Clud cmputing 36 Clud cmputing is still a relatively new phenmenn, but the ptential benefits f the shift t clud cmputing, especially t businesses, are enrmus. They include: Greater efficiency in allcating resurces Leveraging the scale ffered by clud cmputing fr imprved technlgies Imprved infrmatin sharing Additinal platfrms fr innvatin and new services Imprved prductivity, lwer cst Imprved speed t market Availability and reliability Security functins Clud cmputing raises three primary public plicy issues, all f which turn n cnsideratins f crssbrder data flws. These issues relate t data privacy, security and natinal laws/jurisdictin. Many regulatrs are als lking at cluds and asking whether existing laws apply and hw t enfrce laws in the clud. Althugh much f the technlgy behind clud cmputing is nt new, the innvatin it facilitates and widespread usage at crprate and individual levels has resulted in sme new issues cming t the fre. As with the Internet in general, clud cmputing facilitates interactin between cnsumers at many levels. Ging frward, legitimate cncerns abut privacy and security shuld be addressed with a flexible plicy framewrk that encurages innvatin and expansin f the benefits f clud cmputing services. Clud cmputing will cntinue t grw nly if users are cnfident that their data can be mved between prviders r brught back in-huse if desired. Cnsensus n hw t ensure such interperability f clud services will be necessary ver time, but attempts t mandate practices are sure t stifle innvatin. 35 ICC BASIS Key messages, IGF 2011, 21 July 2011, p 5, accessible at: 36 Ibid, p 9 Dcument N. 373/513 page 11

12 ICTs and the Internet s impact n jb creatin and ecnmic grwth B. Example One key example f innvatin pprtunity fr develping cuntries generated by the cnvergence f mbile services, bradband internet and clud cmputing is the I-Hub in Kenya: 37 Thrugh ihub, the technlgy cmmunity, industry, academia, investrs and venture capitalists can meet, share ideas and cllabrate. The centre is the first f its kind t perate in Kenya. It allws technlgies t prgress frm the ideas stage t becming real prducts and the key t its effectiveness is pen innvatin the prcess f cmbining internal and external ideas, as well as internal and external paths t market, t advance the develpment f new technlgies. Thrugh the space prvided by ihub, members develp the skills they need t turn their ideas int actins: they build a vivid visin, a team and a business plan, with help frm an in-huse business unit. Membership is pen and free t thse wh wrk in prgramming, design r research. There are three levels f membership: white members are thse wh wish t be part f the ihub cmmunity virtually, but cannt be physically present; thse wh wrk n specific prjects ( green members) can have face-t-face meetings, scialise and surf the web; red membership ffers a semi-permanent desk and pririty t use the meeting rm, fr a mnthly fee. Internet cnnectivity is ften a cre part f supprting start-up develpment. The electrnic arts brand Zuku has prvided ihub with affrdable, high-speed Internet, which helps t accelerate cllabratins amng members. The cllabrative space facilitates pen discussins amng yung entrepreneurs, investrs, ptential business partners, mentrs and ther members experienced in wrking with telecmmunicatin cmpanies such as Ggle and Nkia. A knwledge-sharing culture built up thrugh cllabratin, start-ups helping each ther, skill sharing and mentrship are key features f the ihub cmmunity. At an individual level, ihub members strive t imprve their skills and knwledge. Examples f ihub s success 38 M-Farm was invented by yung Kenyan Jamila Abass. It is a mbile-phne service that delivers real-time infrmatin t farmers n current market prices, weather alerts and agrsupplies in their area. It als brings farmers tgether t buy r sell their prducts in grups, helping them t gain access t larger markets. Innvatins such as the elimu tablet cmputer are helping Kenyan primary schl students t imprve their test scres and IT literacy. This is intended t bst their engagement in learning and prmte respnsible citizenship fr sustainable develpment thrugh educatin in envirnmental cnservatin, applied science, agriculture and human rights. The accunting package Uhasibu helps small and medium-sized enterprises t wrk within Kenya s legislatin and prcedures. Fr a small subscriptin fee, the nline applicatin can be used t generate VAT reprts, mnitr petty cash and keep track f payments withut buying expensive financial management sftware. 37 Hw t nurture entrepreneurship and stimulate innvatin ihub article, accessed 15 February 2012, available at: 38 Ibid Dcument N. 373/513 page 12

13 ICTs and the Internet s impact n jb creatin and ecnmic grwth Surce: 3. The critical rle f ICTs and the Internet in building a mre sustainable green ecnmy ICT use is respnsible fr apprximately 2-3 per cent f current glbal carbn dixide emissins. Hwever, the use f ICTs accunts fr rughly 40 per cent f recent verall prductivity grwth amng OECD cuntries. The applicatin f ICTs has real ptential t reduce energy cnsumptin in the remaining per cent f carbn emissins. Accrding t the study Smart 2020: Enabling the lw carbn ecnmy in the infrmatin age, 39 a study jintly cnducted in 2008 by the Glbal e-sustainability Initiative (GeSI), the Climate Grup and McKinsey, ICTs have the capacity t deliver carbn savings five times greater than the sectr s wn ttal emissins (2 per cent f ttal greenhuse gas emissins). The study fund that the ptential t reduce glbal emissins with ICT slutins is mre than 7.8 Giga-tns by 2020 equivalent t 15 per cent reductin f glbal emissins, fr nly a lw increase in ICTs wn emissins. Mre recent studies have shwn even greater ptential, in particular as new services and applicatins enabled by high-speed high-capacity bradband are intrduced. An analysis by Accenture and Vdafne in 2009 f five sectrs in Germany (lgistics, transprtatin, buildings, smart grids and dematerializatin) cncluded that the smart use f ICT slutins culd reduce CO 2 emissins in Germany by as much as 25 per cent. 40 In the US, a fllw-up study t Smart 2020 prduced by the Bstn Cnsulting Grup, Climate Grup, and GeSI puts reductins frm ICT-enabled energy efficiency at between per cent. 41 In a 2008 reprt 42, WWF and Ecfys identify 10 key areas in which ICT culd help deliver up t ne billin tnnes f strategic CO 2 reductins, including: smart city planning, smart buildings, smart 39 SMART 2020: Enabling the Lw Carbn Ecnmy in the Infrmatin Age, published by the Glbal e- Sustainability initiative (GeSi) and The Climate Grup June Carbn Cnnectins: Quantifying mbile s rle in tackling climate change, Vdafne and Accenture, (2009) 41 The Bradband Bridge: Linking ICTs with Climate Actin fr a Lw-Carbn Ecnmy : a reprt by the Bradband Cmmissin, Feb Identifying and assessing the pprtunities t reduce the first billin tnnes f CO2, The ptential glbal CO2 reductins frm ICT use, WWF Sweden, 2008, Dcument N. 373/513 page 13

14 ICTs and the Internet s impact n jb creatin and ecnmic grwth appliances, dematerializatin services, smart industry, i-ptimizatin, smart grid, integrated renewable slutins, smart wrk and intelligent transprt. T achieve these slutins, ne f the reprt s key recmmendatins t plicymakers is t increase the penetratin f bradband internet access t all husehlds. 41 The business cmmunity believes green ecnmy is embedded within the brader sustainable develpment cncept 43. It is described as an ecnmy in which ecnmic grwth and envirnmental respnsibility wrk tgether in a mutually reinfrcing fashin while supprting prgress n scial develpment. Business has a crucial rle in delivering the ecnmically viable prducts, prcesses, services, and slutins required fr the transitin t a green ecnmy. A Green Ecnmy requires three pillars (ecnmic, scial and envirnmental) f sustainable develpment t wrk in a mutually reinfrcing fashin. Effrts by all actrs shuld recncile the need fr shrt and medium-term prfit with lnger-term systemic change. Ecnmic grwth is, and will be, essential t prvide the resurces and scial equity necessary t build capacity and finance actins in a transitin twards a green ecnmy. The private sectr has already taken cncrete actins tward building a green ecnmy including; reducing envirnmental impacts acrss value chains, increasing energy and resurce efficiency and investing in lw-carbn and renewable energy and waste reductin. The fllwing examples reflect the critical rle f ICTs and the Internet twards a mre sustainable green ecnmy: Example 1: Sweden s TeliaSnera Grup TeliaSnera Grup: In Sweden, TeliaSnera cntinues t have 100 per cent purchased electricity frm renewable surces withut CO2 emissins. Finland signed a cntract fr renewable electricity beginning in last quarter f 2009 and reaching full effect in The calculated share f renewable energy frm the grup s purchased electricity cnsumptin was 64 per cent in In 2009, videcnferencing almst tripled with mre than 6,500 meetings in 40 lcatins. At the same time, air travels between lcatins equipped with TelePresence equipment and Stckhlm decreased by 44 per cent cmpared t In 2009, 560 TelePresence videcnferences were held in Helsinki and Gthenburg, saving up t 35 wrking mnths in travel time, ne millin in travel csts and 141 metric tns CO2. Surce: Ibid, p. 40 Example 2: Magyar Telekm 38 Hungarian Magyar Telekm's strategy t reduce its wn carbn ftprint includes a hybrid car fleet, the intrductin f PEM cells n base statins, the creatin and the prmtin f a car sharing system, and the launch f an autmatic remte switching f cmputers ut f use. The cmpany als purchases almst 15% f its electric energy frm renewable surces. Besides, the cmpany has started several prjects t ratinalise its netwrks' energy cnsumptin. Free air cling has already been installed in almst 1000 base statins. Magyar Telekm uses videcnferences instead f travelling when feasible, and ffers services t its custmers that replace travel and material cnsumptin as well - such as e-billing, hsting (Data Park) and ther services. The cmpany targeted a 10% CO2 reductin between 2008 and Surce : Ibid, p Our Cmmn Future (1987) r the Brundtland reprt defines sustainable develpment as: "develpment that meets the needs f the present withut cmprmising the ability f future generatins t meet their wn needs." Dcument N. 373/513 page 14

15 ICTs and the Internet s impact n jb creatin and ecnmic grwth Example 3: Türk Telekm A.Ş Energy saving Prject : Türk Telekm A.Ş., an incumbent peratr in Turkey, has launched an energy saving and efficiency prject in The prject aims t replace renewable energy resurces and ensure effective use f them, substitute lw efficient equipment with high efficient ne, and start rganizing telepresence meetings instead f face t face meetings. TT has already achieved a 13,5% energy saving by preventing at the same time 32,6 millin kg carbn emissins, with the aim t reach a 25% energy saving and preventing 224,6 millin kg f carbn emissins by the end f Surce: Green-Ecnmy Dcument N. 373/513 page 15

16 ICTs and the Internet s impact n jb creatin and ecnmic grwth The Internatinal Chamber f Cmmerce ICC is the wrld business rganizatin, a representative bdy that speaks with authrity n behalf f enterprises frm all sectrs in every part f the wrld. The fundamental missin f ICC is t prmte pen internatinal trade and investment and help business meet the challenges and pprtunities f glbalizatin. Its cnvictin that trade is a pwerful frce fr peace and prsperity dates frm the rganizatin s rigins early in the 20th century. The small grup f far-sighted business leaders wh funded ICC called themselves the merchants f peace. ICC has three main activities: rule setting, dispute reslutin, and plicy advcacy. Because its member cmpanies and assciatins are themselves engaged in internatinal business, ICC has unrivalled authrity in making rules that gvern the cnduct f business acrss brders. Althugh these rules are vluntary, they are bserved in cuntless thusands f transactins every day and have becme part f the fabric f internatinal trade. ICC als prvides essential services, fremst amng them the ICC Internatinal Curt f Arbitratin, the wrld s leading arbitral institutin. Anther service is the Wrld Chambers Federatin, ICC s wrldwide netwrk f chambers f cmmerce, fstering interactin and exchange f chamber best practice. ICC als ffers specialized training and seminars and is an industry-leading publisher f practical and educatinal reference tls fr internatinal business, banking and arbitratin. Business leaders and experts drawn frm the ICC membership establish the business stance n brad issues f trade and investment plicy as well as n vital technical and sectral subjects. These include anti-crruptin, banking, the digital ecnmy, marketing ethics, envirnment and energy, cmpetitin plicy and intellectual prperty, amng thers. ICC wrks clsely with the United Natins, the Wrld Trade Organizatin and intergvernmental frums, including the G20. ICC was funded in Tday it grups hundreds f thusands f member cmpanies and assciatins frm ver 120 cuntries. Natinal cmmittees wrk with ICC members in their cuntries t address their cncerns and cnvey t their gvernments the business views frmulated by ICC. ICC Cmmissin n the Digital Ecnmy Business leaders and experts develp and prmte the cntinued and stable grwth f the Digital Ecnmy, and further adptin f its underlying ICT fundatin, thrugh regulatry advcacy f key business psitins and best practices thrugh ICC s Cmmissin n the Digital Ecnmy. Thrugh its members wh are ICT users and prviders frm bth develped and develping cuntries, ICC is recgnized in expert circles as the glbal cnsensus vice fr private sectr expertise n plicy matters that drive the Digital Ecnmy. It als prvides the ideal platfrm fr develping glbal vluntary rules and best practices fr this area f interest t cmpanies wrldwide. Dedicated t the expansin f secure ICT-facilitated trade, ICC champins the liberalizatin and regulatry harmnizatin that are required t achieve a free flw f infrmatin acrss all brders. ICC led and crdinated the input f business arund the wrld t the United Natins Wrld Summit n the Infrmatin Sciety (WSIS), Geneva 2003, Tunis 2005, and cntinues this effrt in the activities established in the Tunis Agenda thrugh its initiative, Business Actin t Supprt the Infrmatin Sciety (BASIS Dcument N. 373/513 page 16