TRAINING COURSE ON THE PRODUCTION OF STATISTICS ON THE INFORMATION ECONOMY Module B-1: Concepts and definitions of ICT indicators Unctad Manual Chapters 2 & 3

Module B1: Concepts and definitions of ICT indicators UNCTAD 2 Objectives After completing this module you will be able to Understand concepts and definitions of ICT indicators Define the core ICT indicators Understand what is the ICT sector Understand the definitions and classifications used for the indicators on trade in ICT goods and on the ICT sector B1.1. Indicators for ICT policymaking B1.2. Conceptual framework for information economy statistics B1.3. Concepts and definitions of ICT indicators Contents of module 1

Module B1: Concepts and definitions of ICT indicators UNCTAD 3 ICT indicators allow policymakers to: Assess the impact of ICT on their economies Compare with other countries Identify the type of qualified people needed to advance their countrys information economy Estimate the investment needed to provide business with access to ICT. B1.1. Indicators for ICT policy making

Module B1: Concepts and definitions of ICT indicators UNCTAD 4 B1.1. Indicators for ICT policy making The demand for ICT statistics increases as more countries seek to design, monitor and review national policies and strategies to take advantage of the rapid advances in information technology. There are international mandates to produce information society indicators, including on the economic aspects of ICT (MDGs, WSIS, ECOSOC). Also…

Module B1: Concepts and definitions of ICT indicators UNCTAD 5 Policymaking and the corresponding statistical work B1.1. Indicators for ICT policy making Policymaking stages Phases of statistical work Main statistical issues Diagnostic and design of the statistical framework Consult on users needs Selection of indicators Data collection Available statistical sources Definition of concepts Definition of indicators and questions Preparation of data collection instruments (questionnaires) Implementation Production of statistics Ongoing refinement of the statistical needs Relevance and accuracy of statistics and indicators Availability of detailed breakdown by sector, geography and others Accessibility of data (timeliness, metadata) Evaluation Data analysis Coherence with other statistics Sustainability of statistical series over time International comparability ICT satellite accounts

Module B1: Concepts and definitions of ICT indicators UNCTAD 6 The Information Economy, the building blocks B1.2. Conceptual framework for statistics on the information economy

Module B1: Concepts and definitions of ICT indicators UNCTAD 7 e-Business definition From a statistical point of view e-business can be defined according to the presence of e-business processes. OECD defines e-business processes as those (automated) processes (both intra and inter-business) over computer mediated networks. Business processes include: customer acquisition and retention; e-commerce; order fulfilment and order tracking, logistics (inbound and outbound) and inventory control; finance, budget and account management; human resource management; product Service and support; research and development; knowledge management. The measurement of e-business should be based on surveys that include questions on processes and barriers. B1.2. Conceptual framework for statistics on the information economy Pages 16-17

Module B1: Concepts and definitions of ICT indicators UNCTAD 8 E-Commerce definitions OECD Broad definition of an e-commerce transaction: The sale or purchase of goods or services conducted over computer- mediated networks: through any online application used in automated transactions, such as Internet applications, EDI [electronic data interchange] or interactive telephone systems. Narrow definition of e-commerce transactions: The sale or purchase of goods or services conducted over the Internet (through any Internet application used in automated transactions, such as web pages, extranets, EDI over the Internet, or any other web-enabled application). IMPORTANT: the payment and the ultimate delivery of the good or service may be conducted on or off line. B1.2. Conceptual framework for statistics on the information economy Page 19

Module B1: Concepts and definitions of ICT indicators UNCTAD 9 ICT Sector: the definition B1.2. Conceptual framework for statistics on the information economy 2002 (based on ISIC Rev. 3.1)2007 (based on ISIC Rev. 4) ICT manufacturing ICT services ICT trade ICT services Use of OECD guiding principles: Products must be intended to enable/fulfill the function of information processing and communication The 2002 definition (based on ISIC Rev. 3.1) is different from the 2007 definition (based on ISIC Rev. 4). Retail trade of ICT goods is excluded The implementation of the ICT sector definition at country level could be difficult if the national industrial classification does not correspond well with the international classification Pages & the special booklet

Module B1: Concepts and definitions of ICT indicators UNCTAD 10 Core indicators on the information economy The core list includes 16 indicators on the information economy B1.3. Concepts and definitions of ICT indicators IndicatorsCodes 12 on the use of ICT by businessesB1 to B12 2 on the ICT sector (workforce and value added)ICT1 and ICT2 2 on international trade in ICT goods (imports and exports) ICT3 and ICT4 The core indicators express percentages where: The numerator refers to the characteristic to be measured The denominator refers to the reference population Pay attention to the difference between a proportion and a ratio

Module B1: Concepts and definitions of ICT indicators UNCTAD 11 B1 Proportion of businesses using computers Number of businesses* using computers (t) B1 (t)= x 100 Total number of businesses*(t) B2 Proportion of persons employed routinely using computers Number of persons employed* routinely using computers (t) B2 (t)= x 100 Total number of persons employed*(t) t: reference period * in-scope businesses Definition and calculation of the core indicators B1 to B12 B1.3. Concepts and definitions of ICT indicators Pages 22-38

Module B1: Concepts and definitions of ICT indicators UNCTAD 12 B3 Proportion of businesses using the Internet Number of businesses*using the Internet (t) B3 (t)= x 100 Total number of businesses* (t) B4 Proportion of persons employed routinely using the Internet Number of persons employed* routinely using the Internet (t) B4 (t)= x 100 Total number of persons employed* (t) t: reference period * in-scope businesses B1.3. Concepts and definitions of ICT indicators Pages Definition and calculation of the core indicators B1 to B12

Module B1: Concepts and definitions of ICT indicators UNCTAD 13 B5 Proportion of businesses with a web presence Number of businesses* with a web presence (t) B5 (t) = x 100 Total number of businesses* (t) B6 Proportion of businesses with an intranet Number of businesses* with intranet (t) B6 (t) = x 100 Total number of businesses* (t) t: reference period * in-scope businesses B1.3. Concepts and definitions of ICT indicators Definition and calculation of the core indicators B1 to B12 Pages 22-38

Module B1: Concepts and definitions of ICT indicators UNCTAD 14 B7 Proportion of businesses receiving orders over the internet Number of businesses* receiving orders over the Internet (t) B7 (t) = x 100 Total number of businesses* (t) This indicator may alternatively be developed with reference to the total number of businesses using the Internet. B1.3. Concepts and definitions of ICT indicators Pages Definition and calculation of the core indicators B1 to B12 t: reference period * in-scope businesses

Module B1: Concepts and definitions of ICT indicators UNCTAD 15 B8 Proportion of businesses placing orders over the Internet Number of businesses* placing orders over the Internet (t) B8 (t) = x 100 Total number of businesses* (t) Like B7, B8 may be constructed in reference to total number of businesses that use the Internet. B1.3. Concepts and definitions of ICT indicators Pages Definition and calculation of the core indicators B1 to B12 t: reference period * in-scope businesses

Module B1: Concepts and definitions of ICT indicators UNCTAD 16 B9 Proportion of businesses using the Internet by type of access Businesses* type of access (i) B9 (i) (t) = x 100 Total number of businesses* (t) i: specific type of access according to the breakdowns, that should allow for aggregation into: narrowband fixed broadband mobile broadband B1.3. Concepts and definitions of ICT indicators Pages Definition and calculation of the core indicators B1 to B12 t: reference period * in-scope businesses

Module B1: Concepts and definitions of ICT indicators UNCTAD 17 B10 Proportion of businesses with a LAN Number of businesses* with a LAN (t) B10 (t) = x 100 Total number of businesses* (t) B11 Proportion of businesses with an extranet Number of businesses* with an extranet (t) B11 (t)= x 100 Total number of businesses* (t) B1.3. Concepts and definitions of ICT indicators Pages Definition and calculation of the core indicators B1 to B12 t: reference period * in-scope businesses

Module B1: Concepts and definitions of ICT indicators UNCTAD 18 B12 Proportion of businesses using the Internet by type of activity Businesses* undertaking activity (j) by using the Internet (t) B12 (t) = x 100 Total number of businesses* (t) This indicator may also be developed with reference to the total number of businesses using the Internet. j: each type of internet activity (see next slide) B1.3. Concepts and definitions of ICT indicators Pages Definition and calculation of the core indicators B1 to B12 t: reference period * in-scope businesses

Module B1: Concepts and definitions of ICT indicators UNCTAD 19 …continued from previous slide B12 Proportion of businesses using the Internet by type of activity Response categories: Sending or receiving Telephoning over the Internet/VoIP ( voice over Interne Protocol ), or using video conferencing Use of instant messaging, bulletin boards Getting information about goods or services Getting information from general government organizations Interacting with general government organizations Internet banking Accessing other financial services Providing customer services Delivering products online Internal or external recruitment Staff training B1.3. Concepts and definitions of ICT indicators Pages 22-38

Module B1: Concepts and definitions of ICT indicators UNCTAD 20 B1.3. Concepts and definitions of ICT indicators Definition and calculation of the core indicators ICT1 to ICT4 ICT1 Proportion of total business sector workforce involved in the ICT sector Number of persons employed in the ICT sector ICT1 = x 100 Total number of persons employed in the business sector ICT2 Value added in the ICT sector Estimated value added of the ICT sector ICT2 = x 100 Total value added of the business sector To study with NA department To study with the employment department

Module B1: Concepts and definitions of ICT indicators UNCTAD Valuation of value added for ICT2 Value added at factor costs + other taxes, minus subsidies, on production = Value added at basic prices + Taxes, minus subsidies on products (not including imports and VAT (value added tax)) = Value added at producers price + Taxes minus subsidies on imports + Trade and transport costs + Non-deductible VAT = Value added at market prices 21

Module B1: Concepts and definitions of ICT indicators UNCTAD 22 B1.3. Concepts and definitions of ICT indicators ICT3 ICT goods imports as a percentage of total imports Value of imports of all ICT goods ICT3 = x 100 Total value of imports ICT4 ICT goods exports as a percentage of total exports Value of exports of all ICT goods ICT4 = x 100 Total value of exports ICT goods classification according to OECD, based on the Harmonized System (HS) Definition and calculation of the core indicators ICT1 to ICT4 Pages 22-38

Module B1: Concepts and definitions of ICT indicators UNCTAD 23 Other non core ICT demand (use) indicators Use of mobile phones for business-related activities: receiving and placing orders, other activities; check the non core indicators M1 to M4, pages 29 and 30 Current and capital expenditure on ICT IT security measures and experiences Type and value of goods purchased and sold via e- commerce Barriers to ICT B1.3. Concepts and definitions of ICT indicators Pages 22-38

Module B1: Concepts and definitions of ICT indicators UNCTAD 24 Review: Module 1 essentials Basic concepts The information economy The political context Policy making and statistical work The 12 core indicators on ICT use by businesses The 2 core indicators on the ICT sector The 2 core indicators on trade in ICT goods Other non core ICT demand (use) indicators B1.3. Concepts and definitions of ICT indicators