The ICT E-volution
Stakeholders must view the challenges ahead differently if they want to successfully move from being communications societies to becoming Information Societies as well.
Dubai, UAE - Countries in the Middle East and North Africa (MENA) region have come a long way in developing their telecommunications sectors. The explosion of participation in telecommunications markets has been widespread. Today, MENA countries are active communications societies, but must work towards becoming active Information Societies, found a new study by Booz & Company.
Although voice communications have been a success, efforts by MENA countries to become active Information Societies have not yielded the same results: appreciation of the Internet remains limited, with few users. Countries’ efforts to introduce e-applications have been impressive, yet uptake is low. Stakeholders must view the challenges ahead differently if they want to successfully move from being communications societies to becoming Information Societies as well.
Regional Progress: Communications
“The first step for any country is to formulate an ICT strategy, with a clear implementation plan,” explained Karim Sabbagh, a Vice President with Booz & Company. Most MENA countries have set strategies and are implementing them at a good pace.
The region has improved associated economic, business, and social environments and the region’s telecommunications sectors are on their way toward full liberalization. Investment in telecommunications has been strong, and the region has seen local operators grow and expand across Africa and Asia. Furthermore, most MENA countries are working toward facilitating trade in ICT through bilateral trade agreements, investment treaties, and other arrangements.
Information technology infrastructure is widespread. This has been enabled by the rapid liberalization of telecommunications sectors and the licensing of new operators. Broadband infrastructure is increasingly available, particularly with the recent wave of fixed wireless licensing facilitating rural connectivity. International bandwidth continues to increase. Most mobile licensees provide coverage to over 95 percent of the population. Regulators have ensured winners contribute financially with strict technical commitments - ensuring the necessary quality infrastructure is put in place.
“The Liberalization of telecommunications sectors has driven success in mobile communications services; mobile penetration is over 100 percent in many countries, exceeding that of many developed Western markets,” Sabbagh said. This highlights the success of the policies, strategies, infrastructure, and an enabling environment for voice communications.
The Communications/Information Gap
The region has pioneered efforts to address concerns of affordability and unequal access to the Internet. Egypt and Jordan have sponsored IT community centers – bringing Internet to hundreds of rural users, and initiatives to bring a PC to every home. PC initiatives subsidize costs, and offer flexible payment plans that make PCs affordable.
The region has developed public-private partnerships for ICT curriculum development, as well as programs promoting computer skills and initiatives to bring Internet to schools. Bahrain, Jordan, Qatar, Kuwait, Tunisia, and the UAE rank in the top 50 for countries whose children have frequent Internet access at school. The UAE and Qatar have worked to improve local universities’ curricula and have become hosts of international universities. KSA will soon launch the King Abdullah University for Science and Technology for graduate-level scientific research with a multibillion-dollar endowment.
Most countries are adopting e-strategies - increasingly regarded as world-class. Most notable are some strategies in the Gulf region; in the UAE's e-government portal was ranked by the United Nations Department of Economic and Social Affairs as the world's fifth in terms of transactional services and 12th in terms of Web measurement.
Education is following suit - almost every MENA country has a plan to introduce e-learning to schools and universities. Jordan’s Education Reform for the Knowledge Economy initiative has completed e-curricula for five subjects and will connect every public school to a national broadband network. ictQatar’s School Knowledge Net is similar. Bahrain’s King Hamad Schools will create the country’s first comprehensive e-school. Egypt has developed a Web-based e-learning environment and the UAE’s Sheikh Mohammed bin Rashid Al Maktoum IT Education Project provides thousands of students with access to required infrastructure and up-to-date curricula.
“Visible ICT results in the region are not always in line with the indicators of achievement,” commented Sabbagh. “Despite phenomenal adoption of communications services, the appetite for mobile has not been matched by a hunger for the Internet.”
Mobile services are limited in their ability to provide access to information and knowledge, to build capacity, to create ICT applications, and to promote cultural content. Creating a communications society must be coupled with effective channeling of communication for education, growth, and economic performance. The region’s low rates of PC and Internet penetration are often attributed to the high costs of PCs and Internet services. Affordability is a concern - PC subsidies are often insufficient, and IT clubhouses are available only in some areas. Further policies to reduce costs and increase affordability of Internet access are necessary, but there are other reasons for the slow development of Information Societies in the region that policymakers need to address:
A Less Traditional Digital Divide - MENA countries have made great efforts in training and curriculum development, yet there is a gap between what educational institutions are supplying and what industry demands. Most work requires more than basic computer skills. In a survey of Arab executives, 30 percent stated the most important challenge for successful innovation in the region is a lack of qualified personnel. The knowledge gap is widened by the region’s limited interest in RDI. Investing 0.2 percent of GDP in RDI, the Arab region falls far behind the world average of 1.7 percent.
The Ever-Present Language Barrier - Lack of Arabic content is an issue hindering the development of Information Societies. Arabic is spoken by over 250 million people, yet attempts to develop content for this large market have not been successful. Arabic content is currently estimated at 0.5 percent of global online content, while more than half of Arabic-speaking Internet users do not speak English. Without sufficiently attractive, engaging, and informative Arabic content and applications, it will be difficult to promote Internet use and adoption.
Investment Bias - “Local ICT entrepreneurs face difficulties in accessing funds to develop innovative projects. This is cited as the most important challenge to innovation by 17 percent of surveyed Arab executives,” stated Sabbagh. The region is more biased toward traditional investments; of the private equity and venture capital funds in the region, those that focus on real estate equal more than US$2.3 billion. Those that focus on technology, media and communications, are of a combined size of little more than US$1.6 billion. Investment in IT is nowhere near as popular as investment in telecommunications.
There is limited private sector activity in ICT applications development. E-commerce activity is generally low. Regional companies are missing opportunities to reduce costs, increase business opportunities, and stimulate cooperation among business partners and suppliers. This is exacerbated by the lack of cooperation between governments and business sectors to promote B2B e-commerce.
Looking Ahead through New Lenses
The MENA region must carefully consider its ICT path and must reexamine efforts to include the I and T in ICT.
Policymakers typically adopt measures such as “number of public and community access points” and “number of initiatives for affordable connectivity” as indicators of achievement. While regional progress along these lines may seem to be successful, infrastructure will take countries only part of the way forward.
“The region must ensure infrastructure is leveraged as a means to greater knowledge and information. For instance, the challenge is not to simply develop community access points, but rather to ensure that they are effectively leveraged,” Sabbagh explained. What percentage of the target communities frequent the access points? How have these access points improved the education or livelihood of their users? What measures, such as awareness campaigns and educational incentives, can be implemented to encourage community members to take advantage of the digital opportunities on offer?
To build capabilities, countries must remain vigilant to ensure the introduction of effective curricula and training programs and to ensure that the connectivity of schools and universities allows students to profit from the desired leap from communications to information. Promoting use of the Internet in ways that expand students’ imaginations and deepen intellectual curiosity is critical. Ensuring alignment between skills taught in schools and those demanded at work is vital; strategies must cover the curricula, teaching methods, and address the direction, freedom, and security with which the region’s youth can explore the Internet.
Promoting a culture of entrepreneurship within the private sector is perhaps the biggest challenge. Although governments, regulators, and NGOs can push the development of ICT applications and programs, a true Information Society must develop organically. The magic of the Internet is its grassroots, bottom-up development, and there are measures countries can take to encourage the Information Society’s organic growth.
If Arabic content and applications are to be developed, the region must look to local entrepreneurs and small and medium-sized enterprises (SMEs), and support them in the areas of finance, administration, and innovation:
- The region should support and encourage funds targeting ICT innovation. It should consider providing loans to ICT startups and creating innovation funds and competitions that encourage SMEs to produce applications. The UAE has started; launching an ICT Development Fund to provide grants, scholarships, and advisory services to support ICT innovation.
- In facilitating business and trade, many SMEs suffer from red tape. In the MENA region, the process for an entrepreneur to start a business requires an average of 32 days; compared to two in Australia. “The region must take action to modernize legislation and streamline registration processes to encourage entrepreneurs to continue innovating,” commented Sabbagh.
- Public-private partnerships are an excellent medium for governments to support local companies. Jordan’s Education Initiative is a success story. The Ministry of ICT brought together more than 35 partners to develop infrastructure, curricula, and other applications. The result was the development of world-class applications, an injection of capital, the transfer of technology, and the sharing of ideas.
Developing ICT requires programs that stretch beyond physical infrastructure to education, the private sector, and government. Physical infrastructure is useless unless citizens and businesses have the access and incentives to utilize it. User adoption, education, regulation, legal frameworks, and business environments are key requirements for success. As governments consider ICT, they must have a clear and compelling economic prize in sight.
Vision of the Future
In terms of ICT development, the region has come a long way. This is largely due to government involvement and regulatory perseverance, particularly in sector liberalization and policy initiatives. While these actions have spurred the growth of communications technology, information technology is developing at a slower pace. The region’s next moves must further the goal of leaping from communications to information. “The region has tremendous potential, and there is no telling what it can achieve once it has attained the goal of becoming a sustainable Information Society,” concluded Sabbagh.