Is Ireland ready to grasp the digital economy?

A recent report ranks Ireland in the top 25 of countries ready to make use of ICT to increase economic competitiveness. But we still fall short in many other areas, writes Paul O’Riordan.

Ireland’s digital economy is expected to be worth €21.1bn by 2020, making up some 10% of GDP and creating 150,000 jobs. With this in mind, it’s fair to say that Ireland’s economic future has never been more dependent on the digitisation of our native businesses. It is against this backdrop that the World Economic Forum launched its Global Information Technology Report for 2015 last week.

Issued annually, the forum monitors 143 countries to see how ready they are to make use of ICT to increase economic competitiveness and improve the wellbeing of citizens. The resulting Networked Readiness Index is a table detailing which countries are the most advanced in technology and, importantly, are in the best place to benefit from it.

Thankfully the report showed Ireland in relatively good health, cracking the top 25 for the first time, which was a gain of one point on last year.

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It reflects a steady progression up the league table over the past four years and puts us ahead of EU heavyweights such as France (26) and Spain (34), but behind the likes of the UK (8) and Germany (13). Undoubtedly there is room for improvement in specific areas.

The skills pillar of the index gauges the ability of countries to make effective use of ICT through the existence of basic educational skills, captured by the quality of the educational system, the level of adult literacy, and the rate of secondary education enrolment.

While Ireland is punching above its weight in 8th place and with the quality of our education system ranked fifth in the world, it is not all good news; we are languishing in 24th position when it comes to the quality of our maths and science education in schools — the so-called Stem subjects (science, technology, engineering, and maths).

Addressing the shortfall in Stem education quality is of vital national importance moving forward. It’s by teaching the next generation the right technology skills — with a strong base in maths and science — that Ireland is going to be able to produce the computer scientists who will be so important to helping our economy grow and prosper in the future.

After all, in today’s digital economy it’s not just careers in IT that require computing skills; all careers in all industries require computing literacy.

Another area of concern is our infrastructure, as we ranked 26th overall worldwide. While this position places us almost within the top 25th, it hides some more serious issues.

Looking at the percentage of the total population covered by a mobile network signal, we drop to 66th place; our mobile cellular tariffs are some of the most expensive in the world (125th cheapest) and for fixed broadband internet tariffs, we’re languishing in 59th place.

If we consider the individual’s use of IT in Ireland, we have a low percentage of mobile-phone subscriptions (89th position) and are only in 29th place for fixed broadband internet subscriptions.

Meanwhile, we are ranked 45th for internet use for business-to-consumer transactions and 35th for ICT use for business-to-business transactions.

Many of these findings sit at the heart of one of the biggest challenges facing Ireland today as it evolves into a digital economy: Our infrastructure is not keeping pace with digital developments.

What’s more, we are not particularly competitive when it comes to pricing and affordability for either businesses or individuals. This conundrum poses a real problem for us. Without affordable connectivity and the right skills, people will miss out on job opportunities and Ireland will gradually become less competitive on the global stage.

What is encouraging, however, is that real, tangible efforts are being made to address our infrastructure issues. For example, the Government’s National Broadband Plan promises fibre broadband to be delivered to every part of rural Ireland by 2020.

Meanwhile, the joint venture between the ESB and Vodafone will see regional fibre broadband services delivering speeds of up 1,000 megabits per second, across hundreds of towns in Ireland, which will have a major impact on our connectivity.

The report also highlights how attractive Ireland is in terms of ICT competitiveness, especially thanks to our established political and regulatory environment (that facilitates ICT penetration) where we rank 14th overall.

Overall however, the Global Information Technology Report for 2015 is mixed news for Ireland. While steady progress is being made, we need to urgently continue the investment in our IT infrastructure in order to provide business and individuals with the high-speed connectivity required in today’s digital world.

In addition, we need a greater focus on supporting Stem subjects and computer science within our education system, at all levels.

Ireland cannot risk finding itself on the wrong side of the digital divide. We must continue to build on the steady progress made in recent years and urgently address the areas of concern (as highlighted by the World Economic Forum report) if we are to truly transform Ireland into a digital economy and reap all the benefits that this will bring.

Paul O’Riordan is managing director of Oracle Ireland

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