The digital push

Dindo Manhit, President, Stratbase ADR Institute

The digital push emanates from a universal drive for continuity and urgency to recover from this punishing pandemic. Digital technology in all its permutations has become an accessible tool to cope with the disruptions of lockdown measures, economic survival, and managing political stability.

Digitalization is playing an increasing role in the daily lives of the Filipinos as attested by the latest Pulse Asia survey (November 2020), which said 64% of Filipinos use the internet, indicating a general increase in internet usage induced by stay-at-home quarantine policies and the shift to work-from-home mode in both government and private offices.

In assessing digital competitiveness, the IMD World Competitiveness Center uses the subfactors of regulatory framework, capital, and technological framework to gauge digital capacity.

According to the IMD World Digital Competitiveness Ranking 2020, our country ranked 57th — 7th from the last place — among 63 countries. Ranked at 62nd under Regulatory Framework, our country placed very low in the categories of Starting a Business (62nd) and Enforcing contracts (61st). In terms of Technological Framework, our country ranked 49th; 62nd in Communications Technology; and 61st in internet bandwidth speed.

But there is a bright spot. The top ten ranking given by the World Bank in telecommunications investment recognizes the performance of the aggressive infrastructure spending of the two dominant telcos, Globe Telecom and Smart, to upgrade their digital facilities.

Globe Telecom has announced big modernization efforts in Luzon and the upgrading of its signal to high-speed LTE signal in Visayas and Mindanao. The company is increasing 2021 investments by 250%, or an estimated P70 billion, to build new cell towers and expansion of its 5G network.

Smart Communications will likewise be spending heavily, projecting P88 billion to P92 billion capital expenditure to further expand services to the underserved and unserved parts of the country. More consumers will be enjoying high speed connectivity with 5G signals in more urban centers this year.

Despite a 500% spike in internet usage reported by telcos, The Ookla Speedtest Global Index Report for November 2020 measured a 148.52% for mobile broadband and 262.20% improvement on the country’s internet average download speed for fixed broadband compared to 2016.

Responding to the pandemic-stricken world, the ongoing World Economic Forum (WEF) — The Davos Agenda 2021 will be tackling the theme, “How governments and other stakeholders approach technological change will play an important role in “resetting” society, the economy and the business environment.”

Prompting this agenda was the new World Economic Forum-Ipsos survey (Dec. 23, 2020 – Jan. 8, 2021) involving 28 countries and 23,004 online adult participants. The survey revealed that “most adults are uniquely optimistic about accessing technology, digital tools and training in the next 12 months.” Additionally, it states that: “There has been a palpable mindset shift when it comes to technology. Throughout the pandemic, technology has been a lifeline to survival — both personal and for businesses — and it is now seen to hold the key to recovery.” And for the current year, the most likely “Expected Change in 2021” points to the 25% increase in the “availability of digital tools and technology.” 

This means that both domestic and international factors converge to represent the so-called digital push. Certain necessary components, however, need to be present in order to capitalize digitalization and move forward with the digital push.

Good governance must be present. It is indispensable in providing a sensible regulatory environment that would enable our telecom companies to thrive and deliver the much-needed digital services to the Filipinos.

Attuned to digital competitiveness, a good regulatory and technological framework is equally important in upgrading and building the country’s digital infrastructure and facilities. Digitalization can only succeed if the national government possesses a sound digital mindset and will commit substantial budget allocations to build a nationwide broadband backbone that will integrate with private telco infrastructure assets. This can more than quadruple the pace of digital infrastructure building and bring the country up to par with global digital standards.

Also, good governance entails the leveraging of productive government-business collaboration toward the delivery of public digital services and the streamlining of related services in this time of pandemic.

Exhibited by the private sector’s performance during the pandemic, it is appropriate to emphasize how this sector bolstered investments and resource mobilization in the COVID-19 response. In this sense, a trusting and mutually respecting attitude, rather than predatory, should be imbibed by the government. Only with synergy of the public and private sector can the adverse impacts of the COVID-19 pandemic be mitigated and recovery achieved.

In so far as digitalization has become a reality of our everyday life, and in so far as the prospects of the new normal have changed how we live; the digital push could be reinforced and actualized into public benefits not only through public-private collaboration but with the participation of the whole population, as well.

This article was originally published in BusinessWorld.

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