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    Essential Information on an Essential Issue

    Letter No.131

    25 September, 2000

    The Digital Divide
  • Falling Through the Net
  • Caritas—Poverty and Wealth in an Information Age
  • Statistics That Matter on the Digital Divide
  • International Initiatives
  • New Zealand Initiatives
  • Community Computer Access
  • East Coast IT Initiatives
  • Towards a Knowledge Economy
  • Digital Brain Drain
  • Beware of Technomania
  • Digital Divide Network
  • Internet Bookmarks on the Digital Divide

  • " Computers, as the central agent of change in the so-called digital revolution, can also be perceived as the agent of division in widening the existent disparities between the `haves' and the `have-nots' of not only America, but the entire planet."
    Claude Henry Potts in The Digital Divide: Social Justice in the Information Age (1999)

    " Over 80% of the people who will need jobs in 10 years are already in the workforce. There is a need and opportunity to make effective use of information and communication technologies to promote on-the-job and institution-based training to up-skill older workers. There is also a need for investment in industry and community-based training both to increase the number of workers able to participate in knowledge-based industries and to overcome `digital divide' problems that may in future limit people's participation in society."
    Ministry of Commerce, The Social Impact of Information Technology, A Briefing to the Minister for Information Technology, Wellington, 17 December 1999.

    The "digital divide" is now the catch-phrase of concern throughout the world's leading economies. While the US economy is booming on the back of high-tech productivity, and the demand for skilled workers in the developed world cannot be satisfied there are also clear signs that the "new economy" is seeing many people and countries falling through the net.

    The growing gap between information technology (IT) "haves" and "have-nots" was high on the agenda of the G8 Summit, held in Japan in July, and also at this month's Millennium Summit at the United Nations.

    — The G8 leaders (from Britain, the US, Canada, France, Germany, Italy, Russia, and Japan) have agreed to create a "Digital Opportunities Task Force" (or "dot force") to help bridge the global digital divide. The G8 communique warns: "If we fail to ensure that all nations have the opportunity to participate fully in the network economy and society, we run the risk that the divide between nations will grow"

    — A report by a panel of UN advisers to UN Secretary-General Kofi Annan has called for the establishment of a fund to enable the entire world to have internet access by 2004. The advisers say that the value of business done over the internet, or e-commerce, is estimated to swell from US$45 billion in 1998 to more than US$7000 billion by 2004. But with less than 5% of the world's population presently on-line to the internet, the digital divide between rich and poor countries continues to widen every day.

  • This digital divide is also a gap that can be found within most developed countries, including New Zealand, as the "new economy" stretches communities along the familiar fault-lines of disadvantage.

    Last year's Commerce Department briefing paper to the incoming government pointed out that the New Zealanders missing out on the opportunities of the information and communications revolution are most likely to be " Maori and Pacific Island Peoples, those with lower incomes, sole parents, people with low or no qualifications, those who are unemployed or underemployed, and those in locations without a sound telecommunications structure, such as parts of rural New Zealand."

    The Commerce paper remarks: "If an IT-inclusive society were to be added to other crucial elements of progress which government plays a role in advancing, namely economic growth, social stability and good governance, and enhancing IT literacy and access were an agreed way of achieving this, then the question arises about the best way to do this ..."

    — Around 43% of NZ households have computers, and around 50% of the NZ population are estimated to have access to the internet.

    — Last year internet subscriber numbers skyrocketed to 592,000 up 88% on the previous year. Free internet providers are expected to substantially impact this year's subscriber figures.

    — Research firm Data Corporation predicts that NZ internet subscriber numbers will grow at a rate of 20.8% during each of the next four years, topping 1.5 million internet subscribers by 2004.

    — NZ ranks 7th out of the OECD countries in the number of internet hosts (computers permanently connected to the net), with 52 hosts per 1000 of population.

    — Internet connectivity in NZ is usually through land-based telephone wires (although this is changing). While over 97% of NZ'ers have access to the telephone, this percentage is less for Maori, Pacific Island and low income families.

    — While a 1998 survey showed nearly 30% of NZ households overall had computers, only 23% of Maori households and 17% of Pacific Island households had computers.

    — An AC Neilson Survey has found that just 15% of NZ'ers earning under $30,000 have ever accessed the internet, compared with 60% of those earning over $80,000.

    — While a recent study showed that 43% of farmers had computers, a reason that fewer use the internet is that electric fences interfere with the sending of data down telephone lines which makes e-mail and data transfer difficult if not impossible.

    — NZ schools compare well with their international counterparts with respect to connection to the internet. A recent survey shows that 96% of primary and 99% of secondary schools report some type of connection to the internet.

    Initiatives to address the digital divide are springing up in many developed countries.

    In Britain, Chancellor Gordon Brown earlier this year pledged a big expansion of information technology opportunities for the poor. He says the government has a responsibility to ensure that the benefits of new technology are shared across the community to prevent Britain becoming a two-tiered society divided between a "wired-up superclass and an information underclass."

    Brown's plan will see one million British people, who are out of work and claiming a benefit, offered free computer training courses within the next two years. Brown: "Britain is now embarking on the biggest public education programme on offer in our history, opening up new opportunities for millions of people"

  • In the US, President Clinton is setting a national goal of making computers and internet access available for every American, and has directed the US Commerce Department to devise a national strategy to achieve that goal.

    More than 50% of America's schools and over 80% of its classrooms are now wired for the Internet. The Clinton administration's goal is to have all schools connected by the end of this year.

    A US Commerce Department report last year documented the wide digital divide existing in America. It found that black and Hispanic households are only two-fifths as likely to have internet access as white families. Households with incomes of $75,000 and above in urban areas are more than 20 times as likely to have internet access as households at the lowest income levels.

    In targeting these gaps, the Clinton administration wants to expand computer access to low income families and has proposed spending as much as $100 million to provide computers and internet access in as many as 9 million households. The administration also proposes extending high-speed technology to rural communities and sending hundreds of tech-savvy AmeriCorps volunteers into low-income neighborhoods.

    Here in New Zealand, a Deloitte Consulting report on government services shows that all but one of the twelve departments and agencies surveyed are, or are considering, delivering services electronically. This may include everything from paying fines, to applying for a passport and checking tax records. This also brings with it the obvious governance questions of guaranteeing access to these services across all sections of our communities.

    State Services Minister Trevor Mallard is keen to emphasise the role that schools can play in providing public access to government services delivered over the internet. He says he is considering "putting quite a lot of funding" into the school system next year to allow schools to open for longer hours and provide supervised access to the internet for the public at weekends.

    An example of how to help bridge the digital divide at a local level can be found in New Plymouth's Community Computer Access Centre, recently opened by the Taranaki Employment Support Foundation Trust. The centre contains four second-hand (pre-Pentium) computers with a range of business software, and an internet connection.

    Centre trustee Elaine Gill says the centre is aimed at disadvantaged people, who generally tend to be those in lower socio-economic groups and are mainly women. Visitors to the Centre can explore the world of computing and follow training courses on their own, or ask for help from a part-time supervisor.

    Gill says a lot of women who might be wanting to return to the paid workforce grew up with electric typewriters and needed to be computer literate to apply for jobs: "A lot of people simply can't afford to pay $5 for 15 minutes on a computer in a cybercafe or to do a polytech course"

    The Tairawhiti Development Taskforce, which brings together central and local government, Maori and private sector leaders to work together for the economic development of the East Coast, has also set its sights on closing the local digital divide.

    The Taskforce is distributing around 2000 computers to local schools and community groups to help them extend and improve their use of new technology. The computers have been surplus to the requirements of various government agencies such as Winz.

    The Taskforce is also working with Telecom to establish CommunityNet centres which will provide computer and internet training and support for people in the region. CommunityNet will involve an internet start-up package of two free phone lines and two years free phone rental, $1,500 cash grant, and a free Xtra internet connection for two years. The Tairawhiti Taskforce will provide accommodation and computers for the programme.

    Taskforce Chairman and Deputy Prime Minister Jim Anderton: "These community-based initiatives are just the start. But they are a good start for the Tairawhiti area"

    Prime Minister Helen Clark has also taken a direct interest in combating NZ's digital divide, partly sparked by attending a two-day conference on "progressive governance" hosted in Berlin in June by German chancellor Gerhard Schroeder. The gathering of heads of state from 15 countries also featured discussions on the impact of information technologies on the delivery of state services.

    Two months ago, Clark established a new think tank, called the Science and Innovation Advisory Council (Siac), to help steer NZ's progress towards a knowledge economy. The council aims to promote a long-term strategic direction for NZ's research, science and technology sectors, and also address local issues of the digital divide. It will meet every three months and report directly to the PM.

    The members of Siac include Rick Christie of investment company Rangatira; John Blackham of software developer Xsol; Vicki Buck, a former Mayor of Christchurch; Kate Frykberg, of internet company The Web; Donna Hiser of information consultancy Innovus; Michael Matthews of Tatua Dairy Co; Stephen Tindall of The Warehouse; Sir Angus Tait, electronics pioneer; and Michael Walker, a leading Maori scientist.

  • Some of the indicators in the NZ knowledge economy are very healthy. In ownership of personal computers, the cost of international phone calls and mobile phones per head, the number of internet hosts per head and public expenditure on education NZ rates well against its peers in the OECD.

    But, according to Neil Richardson, chairman of the government's Foundation for Research, Science and Technology, NZ ranks abysmally low in perhaps the three most important indicators of a knowledge economy: the percentage of exports that are high technology and high value-added, the number of technical graduates (computer science, mathematics and engineering) per head, and the amount of money spent on research and development.

    Richardson: "The knowledge economy may be the key to New Zealand's prosperity in the 21st century. But right now, it's a myth. We are lagging behind the rest of the developed world in a race we cannot afford to lose" Richardson's list of concerns include:

    — Around half our total exports are commodities whose prices fluctuate widely on world markets. The real returns on these commodities will continue to decline.

    — Only 11% of NZ'ers have a university-level education, well below OECD averages.

    — We turn out more lawyers than engineers and struggle to keep talented technical people at home.

    — Although our researchers are a highly productive group (responsible for as many scientific publications per head as the Americans), the number of researchers in the NZ labour force is low by international standards.

    — While Government investment in Research and Development is higher than the OECD average, private investment in R&D is so low that the total public and private spending falls behind every OECD country except the Eastern European countries, Spain, Portugal, Turkey and Mexico.

    Keeping talented and skilled people at home will be an increasing challenge of the international digital divide. Britain, Europe and the United States are already changing immigration laws in order to attract skilled workers from South East Asia and the former Soviet bloc. And these moves are also expected to further exacerbate the "brain drain" of young high-tech employees from Australia and New Zealand.

    The US Congress last year raised the cap on special work permits for highly skilled immigrant workers from 65,000 to 115,000 per year. Already there are moves to see this cap pushed up to 200,000 work permits per year. Germany has just instituted its first "green card" scheme to encourage up to 20,000 foreigners to fill the skills gap in the IT sector.

    Britain is proposing changes to its immigration laws in order to address chronic IT skill shortages. (Health and education professionals are also in critical demand). Newspaper reports suggest that more than 100,000 professionals will be allowed to immigrate each year signalling the first relaxation in immigration laws in the UK for more than 30 years., an internet job search site representing 4,500 British recruitment agencies, says that anybody with a work permit even with limited experience in web design or IT, could be out of work in the UK for no longer than a week. Managing Director Philip Rawlinson says that salaries are "highly negotiable" especially for Kiwi's and Australians who have very good reputations as workers.

    If computers are the answer are we asking the right question?
    Not everyone feels the urgency to bridge the digital divide. Turning Point, a coalition of eighty US non-profit organisations, is asking whether we are rushing towards a high-tech future without fully considering the consequences.

    The coalition is calling for wider public debate on the social, environmental, economic and human health consequences of embracing various new technologies.

    turning pointOver the last few months, the coalition has been publishing a series of provocative full-page advertisements in the New York Times, warning of the effects of "technomania" on local communities.

    Turning Point criticises the rush to put computers into schools as happening under an "atmosphere of hysteria", and warns that it will mean fewer teachers, less teacher training, more "distance learning" and less face-to-face, human centred or environmental experience for students.

    The coalition is also critical of the push to convert the "bricks and mortar" economy into e-commerce. It says that large corporations want governments to subsidise e-commerce activity by banning taxes and tariffs on internet transactions. Turning Point's concern: as more and more shopping shifts to the internet, the tax income base of most nation-states will decline ... threatening their ability to provide health, education and social services.

    — more on the Turning Point "technomania" campaign can be found at

    The Digital Divide Network argues that now, more than ever, unequal adoption of technology is excluding many people from reaping the fruits of the global economy. The US-based non-governmental network sees the digital divide as a complex issue with no singular cause or effect. Addressing the digital divide will require a multi-faceted approach involving:

    Affordable access to information tools for the elderly, the poor, the disabled, and those living in rural areas.

    Economic development of communities developing an infrastructure of telecommunications facilities and cultivating a well-trained workforce so that communities can remain competitive in attracting and retaining businesses.

    Internet content that is relevant to and produced by communities addressing the availability of community-relevant information, overcoming language and literacy barriers, and promoting the diversity of cultural voices.

    A society devoted to lifelong learning developing the learning skills which will enable all generations to adapt to constantly changing times.

    on the Digital Divide

    New Zealand: Flaxroots Technology Conference Report (April 2000)

    The Social Impact of Information Technology, A Briefing to the Minister for Information Technology, Wellington (December 1999)

    The Digital Divide Network

    Clinton Administration Digital Divide Website

    Falling Through the Net: Defining the Digital Divide (report)

    SOURCES — Ministry of Commerce, The Social Impact of Information Technology, A Briefing to the Minister for Information Technology, Wellington, 17 December 1999;
    Washington Post 28 January 2000 "Clinton Sets Final-Year Goals";
    USA Today 15 February 2000 "Gore proposal could narrow `digital divide'";
    The Dominion 18 February 2000 "British poor to get free web training" Daily Telegraph
    "Exploring the Digital Divide" Rural Bulletin, June, July, August 2000, MAF Policy, Wellington,
    The New Zealand Herald 24 June 2000 "NZ losing knowledge race" by Daniel Riordan;
    The Dominion NZ Infotech Weekly 26 June 2000 "Net subscriber numbers tipped to hit 1.5m by 2004" by Amanda Wells;
    The Dominion NZ Infotech Weekly 3 July 2000 "Clark taking up digital divide challenge" by Tom Pullar-Strecker;
    Washington Post 14 July 2000 "Panel urges bigger pool for tech jobs";
    Press Release Jim Anderton "Information Technology initiatives for the East Coast".
    Washington Post 23 July 2000 "G-8 Leaders Call For Solutions to Rich-Poor Divide" by Doug Struck;
    The New Zealand Herald 31 July 2000 "Siac to tackle education and `digital divide'" by Daniel Riordan;
    The Daily News 04 September 2000 "Bridging the digital divide" by Neil Ritchie;
    The Guardian (UK) 4 September 2000 "Skills shortage prompts immigration rethink" by David Henke;
    Scoop archive 28 September 2000 "Kiwis could benefit from British Immigration Drive" by John Howard;

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