ICT Industry Working Group examples

1
ICT Industry Working Group (examples)
2
Cases

• We will examine the industries in the following
  six countries
• Canada,
• Finland,
• India,
• Ireland,
• Israel, and
• Morocco.

3
Canada

• Population (million) 30
• GDP (million) 607,744
• GDP growth 5.4
• GNP per Capita 19,640
• telephone mainlines 609 per 1000 people
• cost of 3 minutes local call US --
• personal computers 270.6 per 1000 people
• internet hosts 335.96 per 10,000 people
• high tech exports 25 of manufactured exports

Source World Bank website
4
Canada

• Canada is a leader in the Information Technology
  revolution.
• The Canadian IT industry drives annual revenues
  of over 70 billion and employs over 400,000.
• Canadas public policy has fostered the IT
  industry.
• Technology is viewed by all levels of government
  as a major engine for Canadas leadership in the
  global knowledge-based economy.
• The federal government has strategically focused
  on initiatives to brand a connected Canada to
  compete effectively in the information age.

5
Canada - 1997 Revenue - 100.2 billion
Source Industry Canada (Strategis website)
6
Canada - 1997 Employment - 473,928
Source Industry Canada (Strategis website)
7
Canada - 1997 GDP - 42.3 billion (in billion
dollars)
Source Industry Canada (Strategis website)
8
Canada - RD 3.6 billion
Source Industry Canada (Strategis website)
9
Canadian Government - IT Role

• Downsizing
  Infrastructure
  Development
• Federal Programs,
  Policy,
• Policy, RD RD
• Provincial Programs Strategy
• Municipal - Implementation

10
Federal Activities

• Connecting Canadians
• Canada Online
• Smart Communities
• Canadian Content On-line
• Electronic Commerce
• Government On-Line
• Connecting Canada to the World

11
Federal Activities (Contd)

• Service Canada
• Strategic IM/IT Infrastructure
• Secure Channel
• Portal
• PKI
• Directories
• Secure Messaging
• Etc.
• IM/IT is a key Enabler

12
Canada

• Federal Activities by Industry Canada
• IT Policy (Computing and Communications),
• IT Regulation (Spectrum Usage),
• Strategis,
• Supplier Development Program,
• Information Highway Advisory Council,
• Canarie,
• New Media,
• Learning Training,
• Health, and
• E-commerce

13
Federal Activities (Information Highway Advisory
Council)

• 5 Working Groups, 15 Policy Issues
• Competitiveness and Job Creation
• Canadian Content and Culture
• Access and Social Impacts
• Learning and Training
• RD, Applications and Market Development

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Federal Activities (Canarie)
Infrastructure Content
Applications
Initial Thrust
Current Focus
15
Provincial Examples
Ontario Telecommunication Strategy 92
Computing Sector Strategy 93 New Brunswick
Information Highway Strategy 94 Nova Scotia
Information Highway Strategy 94 Newfoundland
Comprehensive IT Strategy 94 Quebec,
Manitoba, Under Development
16
Municipal
Applications
Information Age (IT as an Enabler)
Content
Infrastructure
Non - IT
IT

• Branham Group Inc.

Industrial Age (Sectoral Development)
17
Finland

• Population (million) 5
• GDP (million) 119,834
• GDP growth 6.3
• GNP per Capita 24,790
• telephone mainlines 556 per 1000 people
• cost of 3 minutes local call US 0.14
• personal computers 310.7 per 1000 people
• internet hosts 996.13 per 10,000 people
• high tech exports 26 of manufactured exports
• Source World Bank website

18
Finland

• Finland is not an economic powerhouse, yet it has
  developed a great deal of expertise in networking
  and telecommunications.
• Finland has the highest per capita Internet and
  mobile telephone penetration rates of any
  country.
• Finlands success can be attributed to having one
  of the lowest corporate tax rates in Europe.
• Finland is one of two countries in Europe that
  has a positive balance of trade in ICT hardware.

19
Finland

• Finland still needs to overcome several obstacles
  in order to become a centre of technical
  innovation
• Finland has very high personal tax levels (63),
  which motivates many entrepreneurs to take their
  VC to lower tax jurisdictions and
• Finlands tax policy also is heavy-handed in that
  stock options, once exercised, are treated as
  income, not capital gains.

20
Finland

• The Finnish IT market has grown rapidly in
  percentage terms.
• 1997 - 10.8
• 1988 - 9.6
• 1999 - 10.4
• Over period 1996 to 1999, the Finnish IT market
  grew from 2.743 billion US dollars to 3.676
  billion US dollars
• The Finnish telecommunications market also has
  grown rapidly in percentage terms.
• 1997 - 7.9
• 1998 - 9.6
• 1999 - 7.2
• Over the period 1996 to 1999, the Finnish
  telecommunications market grew from 2.736 billion
  US dollars to 3.108 billion US dollars.

21
India

• Population (million) 962
• GDP (million) 381,566
• GDP growth 5.2
• GNP per Capita 370
• telephone mainlines 19 per 1000 people
• cost of 3 minutes local call US 0.02
• personal computers 2.1 per 1000 people
• internet hosts .11 per 10,000 people
• high tech exports 11 of manufactured exports
• Source World Bank website

22
India

• The Information Technology Industry is stimulated
  by
• Government spending on IT in the domestic market
• Widespread English language skills and
• A Large pool of college graduates.
• The current environment encourages Foreign Direct
  Investment (FDI).

23
India

• The challenges to continued growth include
• Slowing industrial growth and exports
• Delays in implementing a new telecommunications
  policy
• Lagging investment in infrastructure
• High inflation in the second half of 1998
• Widespread poverty (40 of population lives in
  poverty) and
• Political uncertainty.

24
India

• The Desktop PC Segment
• The Desktop PC Segment in 1998 crossed the
  one-million mark, showing a growth of 29 percent
  over fiscal year 1997.
• The assemblers sector, a significant portion of
  which is grey, grew by 49 percent.
• The total PC shipments in 1998 was 1,027,190
  units compared to 800,000 in fiscal year 1997.
• Over 82 of the PC sales were in the
  corporate/government sector. This sector grew by
  34 over fiscal year 1997.
• The household sector contributed to 18 of
  overall business. Growth in this sector was only
  7.6 over fiscal year 1997.

25
India

• The IT Software Segment
• The IT software segment had the highest ever
  overall growth between 1998 and1999 estimated at
  a growth rate of 58.
• The domestic industry grossed annual revenue of
  Rs 15,890 core.

26
Ireland

• Population (million) 4
• GDP (million) 75,030
• GDP growth 10
• GNP per Capita 17,790
• telephone mainlines 411 per 1000 people
• cost of 3 minutes local call US 0.17
• personal computers 241.3 per 1000 people
• internet hosts 121.65 per 10,000 people
• high tech exports 62 of manufactured exports
• Source World Bank website

27
Ireland

• Ireland has successfully transformed its economy
  through an aggressive industrial development
  strategy.
• In the 1970s, Ireland was predominately an
  agricultural economy.
• Within a short amount of time the economy
  experienced a transformation, and now high-tech
  industries such as pharmaceuticals and computers
  employ thousands.
• Irelands economy has grown at an average annual
  rate of 8.9 in real terms in the four year
  period from 1994 to 1997, compared to an EU
  average of 2.4.
• Ireland is one of two countries in Europe that
  has a balance of trade surplus in ICT hardware.

Trade Balance
8000
US dollars (000s)
6000
4000
2000
0
1995
1996
1997
Year
28
Ireland

• Irelands economy is viewed by many as a case
  study in successful economic development. Success
  has been attributed to
• The emergence of a dynamic and youthful
  population
• Pursuit of pragmatic and innovative government
  policies
• An openness to trade, not only in goods and
  services, but also in new ideas
• And an emphasis on education and technological
  innovation
• The establishment of a consensual partnership for
  managing the economy, involving Government and
  the social partners
• An unequivocal commitment to full EMU membership
  
• Steadily increasing levels of export growth
• Substantial inflows of high technology inward
  investment
• A stable pro-business government environment
• Strategic investments in social and physical
  infrastructure and
• Above all, a new confidence in Irelands people
  and their capabilities.

29
Ireland

• Ireland is now the Silicon Valley of Europe
• Ireland is the second largest exporter of
  software in the world, second only to the United
  States.
• Seven out of the top ten independent software
  companies in the world, are located in Ireland.
• Over 40 of all European PC packaged software
  (including 60 of business applications software)
  sold in Europe is produced in Ireland.
• Companies located in Ireland include the "Whos
  Who" of the Computing World
• IBM/Lotus, Computer Associates, Novell,
  Microsoft, Sun Microsystems, Symantec, Oracle,
  SAP and Informix.

30
Ireland

• The Irish software industrys success is
  characterized by
• Almost 600 Irish owned software companies
• Large number of new start-up companies - 40-50
  Annually
• Highly export oriented, exports represent 60 of
  production, with the US being the largest market
  for Irish software companies
• Young, skilled, well-educated people with strong
  technological, linguistic and business skills
• A world class software oriented support
  infrastructure including localization, disc and
  CD ROM manufacturing and duplication, user manual
  printing, turnkey and fulfillment services,
  technical support and call centre services.
• A world class telecommunications systems
  providing cost effective, flexible and reliable
  services.
• The Irish IT market continues to perform above
  average.

31
Ireland

• The Irish IT market has grown rapidly in
  percentage terms.
• 1997 - 10
• 1988 - 10.3
• 1999 - 11
• Over period 1996 to 1999, the Irish IT market
  grew from 1.221 billion US dollars to 1.645
  billion US dollars
• The Irish telecommunications market also has
  grown rapidly in percentage terms.
• 1997 - 11.3
• 1998 - 12.1
• 1999 - 9.6
• Over the period 1996 to 1999, the Irish
  telecommunications market grew from 2.201 billion
  US dollars to 4.839 billion US dollars.

32
Israel

• Population (million) 6
• GDP (million) 98,081
• GDP growth 2.2
• GNP per Capita 16,180
• telephone mainlines 450 per 1000 people
• cost of 3 minutes local call US 0.07
• personal computers 186.1 per 1000 people
• internet hosts 146.78 per 10,000 people
• high tech exports 33 of manufactured exports
• Source World Bank website

33
Israel

• Israel has a very well developed IT
  infrastructure, which has fostered the
  development of a successful IT industry.
• Initial focus was military, but now strong
  civilian IT sector is emerging.
• IT is readily available in business, education
  and homes.
• IT is part of the education system.
• In schools, there is 1 PC for every 10 students.
• Israel has instituted a policy of gradual
  liberalization in the telecommunications sector.
• Rapid change has resulted as a result of
  liberalization
• As of 1992, mobile and international services are
  open to competition, with foreign companies free
  to invest heavily in national operators.
• In January 1999, competition opened for the
  domestic telecom market.
• Israel was early in anticipating internet
  development
• Invested in high-performance infrastructure.
• Academic Network, ILAN, provides service to all
  universities and research centres.

34
Israel

• Many hardware producers have opened subsidiaries
  in Israel.
• The software sector is also very strong.
• Highly skilled Russian immigrants have helped
  stimulate a strong IT software industry.
• Global activity exceeds 1.5 billion US dollars.
• 18,000 computer specialists.
• Local supply of software is strong with 300
  software houses.
• Exports exceeded 1 billion US dollars.
• The industry has capitalized on its military
  expertise.
• Information security and network management
  products contribute the most to exports and
  constitute nearly 20 of all software exports.
• Telecommunications equipment constitutes one of
  the most dynamic sectors in the Israeli industry.

35
Morocco

• Population (million) 27
• GDP (million) 33,514
• GDP growth - 2.0
• GNP per Capita 1,260
• telephone mainlines 50 per 1000 people
• cost of 3 minutes local call US 0.08
• personal computers 2.5 per 1000 people
• internet hosts 0.17 per 10,000 people
• high tech exports 27 of manufactured exports
• Source World Bank website

36
Morocco

• Government launched a national program to develop
  the IT industry.
• Main actions for Information Society are
• The creation of a State Secretariat for IT.
• The creation of CSTI (Comite de Suivi des
  Technologies de lInformation), an initiative
  of the Ministry or Commerce and Industry, which
  has begun the building of a national strategy.
• The creation of an academic network linking
  research centres and universities
• The development of national RD through public
  centres. Morocco has instituted a IT development
  policy based on the liberal economic model and
  its historic ties to Europe.
• The study Competitive Morocco, completed in
  1996, examines different fields of economic
  development including tourism, textiles and ICT.
• Major factors influencing the development of the
  ICT sector include
• The low cost for human capital
• Local high-level engineering skills
• IT is well-established in the local economic
  framework and
• A stable socio-political environment.

37
Morocco

• There remain areas of concern that have prevented
  Morocco from real success in its policy
  initiative.
• The regulatory environment for business remains
  too complex.
• The hardware market is dominated by European and
  American firms and few value-added activities
  take place in Morocco.
• All hardware is imported.
• PC clones are assembled in Morocco.
• The Software industry also is burdened with
  difficulties.
• Virtually all software is exclusively in French
  there are nearly no applications developed in
  Arabic.
• Piracy constitutes a major problem.
• The home market is poor as a result of economic
  conditions.
• Market is made up of SMEs, which represent 80 of
  industrial structure.

38
Morocco

• IT is growing at a steady pace.
• The market in 1998 for IT has increased to over
  300 million US dollars.
• 55 is in equipment and 45 in services.
• 512 companies form the Moroccan IT sector.
• At the end of 1998, the number of PCs is
  estimated at 350,000.
• This indicates a growth of 17 over 1997.
• The market is shared among administration (25),
  banks (22), SMEs (30), and other sectors -
  liberal professions and large firms (23).
• Source EITO 99

39
Morocco

• Among Arab states, Morocco has the highest
  telecommunications network growth.
• It grew 23 per annum between 1990 and 1995.
• Teledensity increased from 1.7 in 1990 to 5.5 n
  1998.
• This constitutes fifth largest growth in world.
• Quality also has improved.
• Still has much work and even more in rural areas.
• EITO, 312-315 (all M)

40
South Africa

• Population (million) 41
• GDP (million) 129,094
• GDP growth 1.7
• GNP per Capita 3,210
• telephone mainlines 107 per 1000 people
• cost of 3 minutes local call US 0.07
• personal computers 41.6 per 1000 people
• internet hosts 34.02 per 10,000 people
• high tech exports -- of manufactured exports
• Source World Bank website