Internet bigger than agriculture or energy sectors - importance of R&E networks

[Several months ago McKinsey did a very interesting study on the economic value of the Internet.
They pointed out that Internet in the G8 countries as well as Brazil, China, India, South Korea, and Sweden is now bigger than agriculture or energy. The Internet represents 3.4% of GDP and accounted for 21 percent of GDP growth over the last five years among these developed countries and as Vint Cerf  pointed out in his blog created 2.6 jobs for every one lost.

It is interesting to note that many governments have a variety of research and financial support programs for agriculture, energy and other sectors, but they hardly spend any R&D money on the greatest job engine in the economy – the Internet. There are some funding programs and research initiatives in telecoms, computation and related fields.  But R&D support for future Internet specifically is very small in comparison.  Given the importance of the Internet to our future economy and job creation one would think governments should make more than a token investment in this field.

The future Internet spans a number of activities including pure research initiatives such as GENI and FIRE, to production facilities which involve deployment of working networks.  The deployment of real working,  next generation Internet networks with an early adopter community to my mind is probably the most important of all these activities. This is where National Research and Education Networks (NRENs)  play a critical role.

This is how the early Internet started. In a landmark study undertaken by University of Toronto researchers showed that the adoption and growth of the commercial Internet was driven in early stages by recently graduated students who had been exposed to the benefits of the Internet at their respective universities and community colleges.  “The (Teaching) Role of Universities in  the Diffusion of the Internet”  http://ftp.zew.de/pub/zew-docs/div/IKT04/Paper_Goldfarb.pdf

There are many viewpoints on what is the role and purpose of R&E networks. Some feel that they should be simple aggregators of traffic and deliver the lowest cost possible Internet service to the research and education community. Others believe that NRENS should focus on supporting eScience and the demands of big data flows from instruments and high performance computing. While others advocate that NRENs should be the backbone of all public sector service delivery such as education, healthcare and government services.  While all these are very important roles for NRENs it is my belief these none of these roles  should be considered an end objective in their own right.  In my opinion, the most important role for NRENs is to lay down the foundation for development of the most important sector of the economy – the future  Internet - by deploying advanced  networks and services for the most demanding and largest early adopter community in the world – the research and education sector .  Exposing researchers and most importantly, students to innovative applications, unconstrained bandwidth, new wireless services, open data, digital collections, federated identity, clouds, green IT, etc  will give them the insight to take this experience to the outside world when they graduate.

The biggest transfer of knowledge between academia and society is not through science journals. Nor is it through patents or commercializing of academic research.   The biggest transfer of knowledge between academia and industry and society occurs once a year at graduation.  The future economy is increasingly going to based on Internet services applications in all sectors whether it is the resource, manufacturing or the service industries. Countries that expose students to the latest Internet innovation and who are comfortable in the collaborating and working in a future virtual world of the Internet will  reap the rewards of a stronger economy and greater job growth.

--- BSA]


Internet matters: The Net's sweeping impact on growth, jobs, and prosperity
http://www.mckinsey.com/Insights/MGI/Research/Technology_and_Innovation/Internet_matters#First

The Internet is a vast mosaic of economic activity, ranging from millions of daily online transactions and communications to smartphone downloads of TV shows. But little is known about how the web in its entirety contributes to global growth, productivity, and employment.
New McKinsey research into the Internet economies of the G-8 nations as well as Brazil, China, India, South Korea, and Sweden finds that the web accounts for a significant and growing portion of global GDP. Indeed, if measured as a sector, Internet-related consumption and expenditure is now bigger than agriculture or energy. On average, the Internet contributes 3.4 percent to GDP in the 13 countries covered by the research—an amount the size of Spain or Canada in terms of GDP, and growing at a faster rate than that of Brazil.

[…]
The Internet's impact on global growth is rising rapidly. The Internet accounted for 21 percent of GDP growth over the last five years among the developed countries MGI studied, a sharp acceleration from the 10 percent contribution over 15 years. Most of the economic value created by the Internet falls outside of the technology sector, with 75 percent of the benefits captured by companies in more traditional industries. The Internet is also a catalyst for job creation. Among 4,800 small and medium-size enterprises surveyed, the Internet created 2.6 jobs for each lost to technology-related efficiencies.
[..]




Why data matters for public policy – Vint Cerf
http://policybythenumbers.blogspot.com/


As a computer scientist and engineer, I’ve always been fascinated by the process that determines how policies and institutions are created. Unlike computing systems, policymaking is anything but binary. An unpredictable combination of special interests, money, hot topics, loyalties and many other factors shape legislation that passes into law.

Now, more than ever, we need to use data to build sound policy frameworks that facilitate innovative breakthroughs. In order to inspire confidence in the future (and the markets), governments have to lead by using today’s facts to place big bets on—not against—a better tomorrow.

To get conversations rolling, Google’s public policy team will be sharing data insights here on this blog. We’ll also be inviting researchers, policymakers and thought leaders to contribute their interpretations of various data sets and what they mean for public policy. This forum will be open to ideas, and we welcome everyone to leave comments discussing their opinions.

Measurement and analysis provide the checks and balances we need to build a better future in the information age. When we don’t examine the numbers, policy is all too often created at the expense of the next generation. The Internet generates 2.6 jobs for every one lost, and today the world’s data is doubling every two years. We need to make sure that we sustain the laws that got us the open Internet we have today, and that sound policies are in place to keep this unparalleled engine of growth going.

Public discussions that are grounded in numbers reveal whether laws are effective and relevant or failing to protect citizens’ interests. We are all entitled to our own opinions, but we are not entitled to our own facts; the facts speak for themselves and it is folly to ignore them. With this blog, we hope to spark policy debates, foster discussions among policymakers and constituents and help citizens exercise their right to hold governments accountable.


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Green Internet Consultant. Practical solutions to reducing GHG emissions such as free broadband and electric highways. http://green-broadband.blogspot.com/

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