3 Things that Help Digital Economies Grow
We’re approaching (if not already) that era where around 3 billion of us are connected to the Internet. For a lot of us in urban and developed cities, using apps to organize our transport, digital banking, virtual business meetings, and much more, are becoming second nature rituals that we perform on a daily basis. With digital infrastructures slowly expanding into rural areas in Asia, this will no doubt have a significant impact on our economic growth in the region. The digital economy brings with it technological innovation, business competitiveness, and opportunities for small-and-medium enterprises that help drive economic growth. In shaping this digital economic growth, these three factors play a crucial role:
- Strong Digital Infrastructures
Infrastructure is the backbone of any digital economy, providing it with structure, stability, and sustainability. Much like investing in strong logistics infrastructure to help boost trade in a country, investing in digital infrastructures is crucial to enabling businesses and countries take advantage of the economic opportunities that are already helping our global digital economy grow at a rapid pace annually. With the number of Internet users rapidly increasing and more businesses using digital platforms to conduct their businesses, having the freedom, accessibility, and availability of reliable digital infrastructures are all crucial to growing local digital economies. The roles of communications service providers, digital service and content providers, and hardware and software managers will be cornerstone to helping build and maintain these infrastructures. Even more, policy makers, regulators, industry participants and end users will all continue to shape how networks, devices, data, protocols, and servers and storage are utilized in our current and future digital economies.
- Social Media Platforms
Social media is playing an increasingly important role in creating business value for businesses and organizations in the form of brand health, marketing optimization, revenue generation, operational efficiency, customer experience, and innovation. It is therefore no surprise that social media platforms like Facebook, Instagram, Whatsapp, Twitter, etc are being stormed by not just individual users but businesses who seek to engage with their customers on a whole new level. Smaller businesses and newer business models that rely solely on a social media centric mode of doing business are able to fully take advantage of the economic opportunities that exist via this platforms. While in Asia doing business on social media is becoming popular, it goes without saying that having access to these platforms is essential to participating in regional and global digital economies. It starts with individual citizens having the freedom to engage on these platforms, which would also enable businesses to effectively utilize social media to grow their businesses.
- “Digital friendly” Regulatory Policy
Policy is certainly something that is not “fast paced” like technological developments and innovation. In reshaping regulatory frameworks to help grow local digital economies, policy makers need to keep in mind that the “digital market space” provides consumers with much greater choice and transparency than ever before. Even with current “big data” challenges, consumers are still in their strongest position to make buying choices and protect their own interests. When rethinking regulations, policy makers need to scope out the market situation more broadly since the digital value chain is more intertwined. This includes removing outdated regulations that result in discrimination between industries and experimenting with non-regulatory methods of encouraging online behavior. In approaching the growth of the digital economy, policy makers also need to ensure that regulatory systems are adaptive to the constant changes in the digital era. In other words they need to “devolve and evolve”. Policy makers also need to be wary of the geographical levels of their different policies that aid or inhibit the growth of local digital economies.
Infrastructure, social media, and regulator policy are of course only some of the few factors that will contribute to the continued growth of our global digital economy. But it goes without saying that these will have the biggest impact on how businesses in the region (especially small-and-medium enterprises) are able to take advantage of the growing digital economic opportunities that exist today. It is important for governments to therefore revisit their digital infrastructure investments, their support to small and medium enterprises in the digital marketplace, and the rules and regulations that may need to adapt to the ever-changing global digital economy.