AS you read this, a revolutionary shift is happening in the way the world works, with economies across the planet going digital fast. A country’s progress in digital transformation is measured using the Information and Communication Technology (ICT) framework. While ‘technology’ has become a buzzword and everybody intuitively knows that technology is good, it’s not as obvious as a new motorway or power project. Economists have determined that there is direct correlation between connectivity in a country and its GDP growth.
The Huawei Global Connectivity Index 2016 assessed 50 countries. Combined, these accounted for 78pc of the global population and 90pc of global GDP. Unsurprisingly, Pakistan occupied the 50th slot in a list of 50. We were also ranked last in competitiveness, innovation and productivity. Maybe comparing Pakistan on a global basis is unfair. However, even if we were to compare key ICT indicators such as total mobile penetration, unique mobile subscribers, 3G/4G and smartphone penetration with South Asian countries like Bangladesh and Sri Lanka, we still lag behind. This is to be expected as we not only lack a national digital policy, we have also not invested in the bare minimum required to lay the foundations of ICT.
In order to create the road map for Digital Pakistan, we must first identify the backbone of digitalisation, the digital enablers, and finally create the required digital ecosystem.
We must invest in secure and efficient data centres.
There is no dispute that digitalisation’s benefits can only be realised with universal broadband internet access. Broadband connectivity is a basic requirement for the digital economy and networked society. Once that has been achieved, we need to look beyond broadband and work on the other four enablers: data centres, cloud services, big data and internet of things (IOT).
As the foundation of the modern economy, broadband is delivered on fibre optic landlines and 3G (or newer) cellular networks; we must develop a national policy and have a national broadband plan, which articulates a download and upload speed for a targeted number of users. In addition to speed and access, price also plays a crucial part. The average download speed varies. Karachi leads with 3 Mbps, with Islamabad and Lahore at 1.8 Mbps. In terms of pricing, we are more expensive than our regional partners. The comparative prices per 10 Mbps are: Pakistan Rs2,005, India Rs1,200 and Bangladesh Rs2,301. In terms of connectivity, Pakistan’s position is improving. The number of smartphone users is estimated at 40 million, expected to grow to 80m by 2020 according to the Groupe Speciale Mobile Association. However, the increase in smartphones will not achieve the desired effect unless taxes on data are materially reduced or eliminated and import duties on smartphones under Rs10,000 are eliminated.
The next key enablers are data centres. If access to broadband is the heart of the digital economy, big data is the artery. The use of big data is just starting in Pakistan. So far, some data centres here have the ability to predict when a good customer will default on a utility company, forecast demand for the fertiliser and auto industries, determine which socio-economic group will visit a mall based on their car make and model, and determine scorecards for financial institutions.
Without big data optimisation of economic information, digitalisation becomes even more challenging. No longer just a place for hosting IT equipment, data centres form a key part of the infrastructure for enabling digital transformation and satisfying demands on speed, efficiency and processing power. Big data and IOT will create huge amounts of data to be stored, processed and analysed. Pakistan must invest in fully secure, reliable and efficient data centres if it is to digitalise its economy.
Cloud services are also key enablers and are fast becoming a mainstream model for building and deploying IT systems. In Pakistan, they are essential, as most players that are small- and medium-sized enterprises cannot afford to build their own data centres.
IOT is not just a buzzword; it is one of the most fertile areas for enabling digital transformation. IOT in Pakistan is in its infancy. An example is a small power device which not only informs the amount of energy being consumed by each device in your home, but in addition, using big data, also advises how to more effectively save energy and reduce your power bill. As Pakistan is in the very early stages of big data usage, IOT will take time.
The government needs to create a plan for a Digital Pakistan similar to the national financial inclusion strategy. The benefits of a digital economy are not limited to financial inclusion. They impact practically every sector of the economy: e-health, e-education, and e-agriculture are only a few of them.
The writer is the founder of Planet N that funds start-up projects.
Published in Dawn, March 15th, 2017