How big is the impact of the Internet's potential on Asia, including the
impact on development of the knowledge economy?
We all have a sense that the
information and communications technology (ICT) industry has transformed social
media, education and the way business is done. But we are not sure what is the
best way to use the knowledge economy to propel our future growth.
In 1973, American sociologist
Daniel Bell predicted the arrival of the post-industrial society by 2000, with
a world dominated by the service industry, high-value professional and
technical employment, and innovation driven by scientific research.
In 2000, the number of global
Internet users was only 360 million, rising to 2.3 trillion with an annual
growth rate of 528 per cent between 2000-2011, of which 45 per cent reside in
Asia. The highest penetration of Internet usage is in North America (78.6 per
cent), whereas penetration in Asia is only 26.2 per cent, pointing towards huge
potential for Asian growth.
According to Internet World
Statistics, the top Internet country in Asia is China, with 513 million users,
followed by India (121 million), Japan (101 million) and Indonesia (55
million). Within Asia, the highest penetration is South Korea (82.7 per cent),
Japan (80 per cent), Singapore (77.2 per cent), Taiwan (70 per cent) and Hong
Kong (68.7 per cent). China has 38.4 per cent Internet penetration.
However, the highest number of
Facebook users in Asia is India (45 million) followed by Indonesia (43 million)
and the Philippines (27 million). Asia had 195 million Facebook users as of
March, or 23.3 per cent of 835 million worldwide, compared to 44.8 per cent
penetration for Internet usage. The reason is, of course, Facebook is not used
in China, but even then, there are 447,000 recorded users, less than the number
in Cambodia (449,000).
Did you know that 26.8 per cent
of the users of the Internet are English-speaking (565 million), while 24.2 per
cent are Chinese speaking (510 million)? The third most important language is
Spanish (165 million). The Malay language, which is common to Indonesia and
Malaysia, is not counted yet amongst the top 10 languages, mainly because the
penetration of the Internet in Indonesia (245 million people) is only 22.4 per
cent. Malaysia has a web usage rate of 61 per cent, with over 17 million people
online.
The post-industrial society has
already arrived in the advanced countries, with the service sector accounting
for 76.7 per cent of US GDP, compared with only 1.2 per cent for agriculture
and 22.1 per cent for industry. Employment in the service sector already
accounts for 77 per cent of total employment in the US, with the increase in
service-sector employment driving employment growth in the coming years.
Within the service sector, three
sectors - education services, health care and professional and business
services (all knowledge industries) - are expected to grow at double the speed
of employment in the US as a whole. In contrast, manufacturing employment is
only 10 per cent of total employment in the US, compared with 28 per cent
employed in manufacturing in China. But the service sector in China accounts
for only 43 per cent of GDP, compared with 55.2 per cent for India.
What is the relationship between
information, knowledge and value creation? In 1991, one of the pioneers on
information theory, Robert Lucky, argued that the information value chain is a
pyramid, with the bottom data having no value, classified data becoming valued
information, with applied knowledge (technology) having more value, and wisdom,
the highest value, being learnt, experienced and useful not only to understand
but perhaps to predict events.
What the Internet revolution has
achieved is to distribute information and knowledge very quickly to the masses
across the world. Indeed, the main benefit of the Internet is that it broke
down "silos" of specialised information and data that could be shared
and used by everyone with access to the Internet. Indeed, the Internet has
enabled "Wiki-knowledge production", which has produced a huge public
good, available to all, with free input by thousands of anonymous volunteers.
Public goods are no longer produced by governments, universities or firms, but
by the collaboration of thousands of empowered individuals.
There is no doubt that as Asia
ponders its own post-industrial society, how it adapts to the new knowledge
economy will make a difference between future success or failure. Leading
economies like Singapore and South Korea have put tremendous resources into education,
research and development in key areas. South Korea even revived its five-year
plans to transform itself into a high growth, high knowledge green economy.
Both the Chinese and Indian 12th five-year plans have ambitions to become
creative and innovative economies.
In this regard, it is useful to
compare and contrast the IBM way towards innovation and value creation versus
the Indian approach. In the IBM book Making the World Better (2011), IBM uses a
methodology insiders call SMUBA, an acronym for Seeing, Mapping, Understanding,
Believing and Acting. It is a process to master complex systems and to move
from data, analytics and implementation.
Multinationals like IBM now
realise that it is impossible to innovate alone by having centralised research
laboraties. The work is shared and done through key research labs spread
throughout the world, through connecting research to product development, academic
and government collaboration, internal collaboration across departments and
labs, collaboration with clients, innovation by acquisition and open
innovation.
In contrast, the Indian model of
innovation and value creation is distinctly Indian in three ways - producing
frugal, affordable solutions for the masses without compromising quality;
innovation in organisational and process models that improve quality and
service delivery; and innovations in the process of innovation (frugal cost
solutions through frugal cost of innovation).
The race is already on to create
the Asian multinationals and products to compete with Apple, Amazon, Google and
Facebook. The setback that Samsung faced recently will probably accelerate that
process of innovation and competition across Asia.
Andrew Sheng is president of the
Fung Global Institute.
Business & Investment Opportunities
YourVietnamExpert is a division of Saigon Business Corporation Pte Ltd, Incorporated in Singapore since 1994. As Your Business Companion, we propose a range of services in Strategy, Investment and Management, focusing Healthcare and Life Science with expertise in ASEAN. We also propose Higher Education, as a bridge between educational structures and industries, by supporting international programmes. Many thanks for visiting www.yourvietnamexpert.com and/or contacting us at contact@yourvietnamexpert.com
No comments:
Post a Comment