Get digital

Israel isn't doing enough to produce high-output information-industry workers.

There are several definitions of the digital gap. This concept first appeared in the global lexicon a few years ago, and has already won a place of honor in strategic and economic planning in several countries. The concept is a byproduct of the ongoing information revolution. Its victims include enterprises, businesses, and countries that are not adapting themselves to the new reality.

In his book, Being Digital, Massachusetts Institute of Technology Media Laboratory founder and chairman Nicholas Negroponte writes that bits are replacing atoms as legal tender. Once upon a time, wealthy countries were those possessing natural resources, such as metals, forests, and energy. The focus later shifted to impressive industrial capacity. Today, a wealthy country is one with the ability to produce, process, store, and sell information.

Instead of products built out of molecules, and transported by ship or plane, information is now transported in prodigious quantities on optical fibers, wireless communications networks, and telephone networks. The worlds richest countries deal in software, computers, creating information and ways of processing and storing it. Advanced countries are those that are able to quickly adopt information technology, and use it intelligently in every field: commerce, banking, industry, education, medicine, agriculture, and, of course, the military.

The added value of information industries is based primarily on high-quality workers, not raw materials or energy. In order to highlight how this revolution can be utilized for our benefit, I will cite two figures. The average output of an Israeli worker in conventional industry is $25,000 per year, while the average output of a information industry worker can reach $200,000 a year, or even $1 million a year (in the microelectronic industry).

Unfortunately, we dont have enough of these workers, and we arent doing enough to create them more quickly. Countries like China and India produce a million software personnel and electronics engineers per year; we produce just a few thousand. This fact alone is opening a huge gap between us. If that is not enough, consider the following fact Israel currently has 600,000 children living below the poverty level. The vast majority of these children have no access to a computer or the Internet. In the top income decile, 75% of homes have a computer, and Internet access reaches 90%, compared with only 3% in the bottom decile. That is what the digital gap means.

There is an enormous difference between children who have learned to use a computer and surf the Internet in third grade, and those who reach this stage only in seventh grade. In contrast to a social and economic gap, which can closed, this digital gap cannot be closed. If we do not teach our children how to use modern technology, they will be lost to the information industry. They will have difficulty finding suitable employment with a proper salary, and will be doomed to remain in the poverty cycle. If, on the other hand, we make 400,000 poor children into future workers in the high-tech industry, instead of simple industrial workers, our GDP will leap 50%. Instead of per capital GDP of $16,000-17,000, we will reach $25,000, like the advanced countries.

Giving children a computer and an Internet hookup it is not enough. We need suitable educational frameworks, proper teachers, research institutes, and technological and industrial infrastructure. We must create jobs for hundreds of thousands of information workers, or even more. The investment is liable to reach tens of billions of dollars.

This trend has been adopted in the US, Japan, Singapore, Europe, and, in the past decade, countries like Ireland, India, and China. The investment is enormous and long-term, but we have no alternative. For the sake of comparison, in the US, 45% of homes in the bottom income decile are hooked up to the Internet, compared with only 4% in Israel. The result for Israel is a loss of competitiveness on global markets. This is a high-priority national problem.

In the past, one factor in this situation was a lack of understanding on the part of the government. Today, the government is aware of the situation, and provides support in various ways: social projects aimed at increasing computer and Internet penetration (Computer for Every Child, Window to Tomorrows world, Tapuah - The Israeli Society for the Advancement of the Information Age, and others), and government projects, like Project MERKAVA (lateral computerization of government ministries) and the Lehava Project, programs of the Ministry of Industry, Trade, and Labor, the budget of the Office of the Chief Scientist, support for the universities, support for the educational system, etc. The level of support, however, is too low, and actions to reduce the gap are too slow, and lack a guiding hand. A turnaround in the states attitude toward the problem may be emerging. In a meeting with Minister of Finance Benjamin Netanyahu and Account General Yaron Zalika in the latters office, Netanyahu announced that he intended to make a big effort to narrow the digital gap. In order to deal with the problem, the following measures should be taken:

  • A senior minister for high tech should be appointed to coordinate activities currently carried out by various ministries. The minister should prepare a master plan for government policy in the information industry.
  • Regulations should be amended to facilitate rapid investments in communications, technological infrastructure, bandwidth, fast Internet backbone, etc.
  • Massive investment in the educational system for training information workers.
  • Aid to the less well-off to make them part of Israels information industry.

Countries like China, India, Ireland, Singapore, Taiwan are already doing it. If we dont become part of this trend, we will decline to the status of a third world country.

The author, president of the Israel Information Technologies Association (ILA), is a former CEO of Motorola Israel and former VP of Motorola (NYSE: MOT). The ILA will hold a conference on April 5, 2005.

Published by Globes [online], Israel business news - www.globes.co.il - on April 3, 2005

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