Inclusion, and Overcoming the Digital Divide
May 15 (Tuesday) 2007
Last time I reported on the "Microsoft Government Leaders Forum – Asia 2007" held in Beijing in April. I would like to take this opportunity outline the content of my speech at the forum. I participated as a speaker at a session that focused on the subject of inclusion, which was also the overarching theme of the forum. Information technology is a tool with the great merit and potential of increasing efficiency in economic activity, promoting innovation, and enriching lives everywhere. Inclusion represents a critical issue in maximizing this potential. "Inclusion" refers to spreading the boons of IT to as many people as possible; put differently, it is inviting as many people as possible into the realm of IT benefits.
In reality, however, there is a significant obstacle in the way of this: the "digital divide". The digital divide refers to the disconnect between those who benefit from IT and the many who do not. "Inclusion" is overcoming this disconnect and spreading the boons of IT to the extent possible. The session that I participated in was about reporting on the state of this digital divide in various countries, as well as the efforts that are being made towards inclusion. For example, while a portion of the citizens in world powers such as China and India, where IT has been developed rapidly, are blessed with the benefits of IT, it remains a fact that 100s of millions of people are being left on the margins.
In the case of Japan, this kind of disconnect that comes with digital divide, at least in the traditional sense of the expression, does not really exist. Telecommunication lines, broadband networks, and even mobile phones are pervasive from urban metropolises such as Tokyo to distant regions in the countryside. Even an age breakdown shows that mobile phones, computers, interactive televisions and etc. have spread among the elderly population, which typically has difficulty becoming comfortable with IT. In other words, no serious digital divide has been confirmed in Japan.
A significant problem, however, comes to light in the discussion of whether or not citizens are sufficiently or appropriately enjoying the benefits of advanced IT technology and widespread IT infrastructure. In other words, a state of gross under-utilization has emerged where this high-caliber IT technology and far-reaching infrastructure are not being suitably used. Put differently, from the perspective of IT utilization it could be said that Japan as a whole has fallen to side of the digital divide that is not benefiting from IT. As a Japanese citizen, I do not enjoy engaging in this kind of self-criticism at such an international event. However, that it is possible for technology and infrastructure to be developed and spread to such an extent and still be so drastically under-utilized is a situation that deserves serious consideration at such an international forum, and with this in mind I decided to raise this important issue.
Not making full use of advanced technology is a problem with both domestic and international elements. The domestic problem is one of under-utilization, while the international problem involves under-serving.
There are many symptoms of the problem of IT under-utilization; for now, five examples help to illustrate.
The first is the inconsistency of "e-Japan". The Japanese government is introducing various policies such as e-Japan and u-Japan in the name of IT utilization, but these policies have not seen much success. For example, online tax payments were made possible several years ago, but attached documents are still required to be submitted at tax offices in person. Tax payments via the internet are thus highly inefficient, and consequently there are few users.
The second example is the problem of receipts at hospitals. Many hospitals have begun the digitization of information such as medical charts. Receipts for medical fees, however, still must be delivered to the social security medical fees expenditure fund. Every year 1.3 billion paper receipts are sent out, a situation that is both remarkably inefficient and prone to errors.
The third example is education and IT. As part of government policy, many schools have internet connection and plenty of computers at their disposal. Yet, IT has not really spread among students and children. For example, reports cannot be submitted by E-mail, and students cannot receive class notes when they are unable to attend school. In addition, the level of interest in IT education among teachers is remarkably low, which represents a significant obstacle.
The fourth example involves the many companies that are unable to overcome their own legacies. In leading service industries such as banking, insurance and securities, enormous sums of money are being poured into the installation of computer systems and system integration. Yet, this has had done little to improve productivity. This is because these industries have been unable to change from the old practice of face-to-face business.
The fifth example is the problem of company executives. In many Japanese companies, the president and other executives rely too heavily on administrative assistants and other staff. These executives often do not have a firm grasp on data, do not make calculations, and in the end do not come to their own decisions. As a result, no matter how advanced the new IT system may be, productivity will remain weak within the vicinity of top executives.
The final example is the problem of IT in very small companies. The incorporation of IT into these kinds of companies has been extremely slow. A primary reason for this lies in a problem that predates IT. There is little transparency in the flow of money and people in areas such as accounting, production, inventory, personnel management and etc. Furthermore, there is a strong sense of arbitrariness and a general lack of rules. In other words, there is an element of incompatibility between the basic structure of these companies and digitized systems. This is a prevalent problem among small companies, and as a consequence even if IT is developed it is not used to its potential.
I would now like to shift focus to the issue of international under-serving. Japan is putting forth great efforts to spread IT to the world, such as providing various forms of technological assistance to developing countries. Unfortunately, these efforts are not being maximized in the field of IT where Japan could contribute the most.
The classic example is mobile phones. The level of technology in Japanese mobile phones is extremely high; in fact, Japanese mobile phones, which are developed and used domestically, are the most advanced in a world already brimming with different mobile phone functions. Yet, these superior products are generally not used outside of Japan. This is because Japanese mobile phone development is being conducted under special pricing and communication cost systems of domestic communication carriers. As a result, there is basically no strategic agenda to spread these phones around the world.
Japanese mobile phones are sold at a price significantly lower than cost, and the difference is made up in high calling rates. This kind of special calling rate system does not fit with the global market, so there is a need to develop and sell mobile phones at a globally-applicable price. Mobile phone makers, organized around heavy users of domestic communications carriers, do not have the leeway or intention to pursue this, and their focus remains exclusively domestic. It possesses the world's most advanced technology, but is not promoting the utilization of this technology for people around the world – this is the sad reality of under-serving in Japan.
Though it boasts extremely high-levels of IT and domestic diffusion of this technology, the fact that it is not sufficiently utilized among society or company activity, and moreover does not translate globally leaves no choice but conclude that Japan, in a different sense of the expression, has fallen on the dark side of the digital divide. The reason for this is not the technology itself. Rather, the problem comes from a lack of strategic ambition from the government and companies to genuinely use IT, as well as interfering social and business practices. It is my earnest hope that these problems will be overcome, and that Japan's advanced IT will facilitate economic revitalization and enrich the lives of those both within and outside of the Japanese peninsula.