Efforts to bridge the digital divide often focus on reducing the cost of an internet connection. But new research suggests that a more effective approach may be to lay the technical foundations that drive demand and improve user experience, before worrying about cost.
As our world becomes increasingly digitized, the social stratification resulting from unequal ability to access and productively use the internet has become one of society’s biggest issues. The problem is less pronounced in developed countries than in developing ones. Indeed, using simple internet access as a metric paints an encouraging picture in regions such as the EU, where access rose from 39% of households in 2002 to 76% at year-end 2013. Yet only half of all Europeans use the internet daily, and 30% have never used it at all.
“Because of a proportionately greater investment in vital technologies such as cloud computing, big data analytics and data centres, leader countries have stimulated very high levels of demand among their populations”
Many studies show a link between internet connectivity and economic growth. Research has shown that a 20% increase in ICT investment can lift a country’s GDP by one percentage point. Because of this correlation, many governments are willing to invest in broadband, particularly in the developing world: from 2005 to 2015, internet penetration in developing economies grew from 8% to 32%, a growth rate of 400%.
Even so, two-thirds of the world’s population remains offline, with the problem especially acute in the developing economies. As of year-end 2011, only about one-third of the world’s developing-country population was online, compared with 80% of citizens, on average, in developed countries. The gap is striking, especially given that there are now almost as many cell phone subscriptions as there are people on earth. What should governments and the private sector be doing to close the gap and create greater digital equality?
Some answers are suggested by the latest edition of the Huawei Global Connectivity Index (GCI), a study that measures different countries’ progress toward achieving digital parity. This year’s Index shows that the most connected countries tend to make the investments in information and communications technology (ICT) necessary to drive demand and improve user experience – two elements seldom discussed when debating solutions to the digital divide.
The Index gives each country a rating based on several dimensions of connectivity, including supply, demand, and experience and potential. Our research found that “leader” countries – the 16 most connected nations – often score better for demand and experience than for supply. In other words, because of a proportionately greater investment in vital technologies such as cloud computing, big data analytics, data centres and the Internet of Things, leader countries have stimulated very high levels of demand among their populations. People in these countries want more mobile broadband access, more e-commerce options, more cloud computing services and data analytics. In fact, the Index shows that “leader” countries have demand scores more than 1.6 times greater than the next group of “follower” nations.This suggests that the countries that are most successful in narrowing the digital divide have taken an approach similar to the one used in consumer marketing to sell everything from washing powder to smartphones. They treat the disconnected population just as a company would treat its target customers.
First, create demand for your “product” – in this case, connectivity – by raising awareness of it and explaining its benefits. It is often assumed, incorrectly, that people without internet connections appreciate the value of being connected. But someone who earns two dollars a day, and doesn’t fully understand the value of the internet, is unlikely to pay for a connection. Even those with smartphones may not take full advantage of them: half of all smartphone subscribers don’t use data, confining themselves instead to sending text messages and making calls.
“Many studies show a link between internet connectivity and economic growth”
Step two is to create a better user experience. As every telecoms company knows, user experience on the network holds the key to profitability. The better the experience enterprises and individuals have on the network, the more data they will use. This is a fundamental difference between data and voice services. In the voice-only era, if you made a successful phone call (one that was clear and uninterrupted), you weren’t necessarily motivated to make more calls as a result. But with data – video, music, games and work-related traffic – a successful experience on the network leads people to spend more time on it.
This suggests that, although basic access to connectivity at the right price is undeniably important, countries that lead in the digital economy are those that have deliberately taken the steps necessary to ensure higher internet adoption, and a better experience for users. They have done so by investing in key technologies that deliver the experience.
Our research shows that developing countries have done a good job of increasing the supply of fixed and mobile connectivity. But they still lag the mature economies in building up and using broadband, cloud computing, the Internet of Things, big data, and data centre technologies that will form the foundation for digital development over the next decade and beyond. Adopting these foundational technologies will increase demand for internet connectivity, leading people to want access in the first place. It will also improve their experience online, making them want to stay there.
This article has also been published in ‘Europe’s World’.