18 July, 2014 | Public Policy2014

2014 Digital Economy Submission

Pearcey Foundation’s input to the Victorian Government’s Digital Economy strategy

1 Background

This paper summarises a proposal to establish the Pearcey Research Institute for the Digital Economy (PRIDE). This multi-disciplinary Institute will gather and maintain data on the current and potential economic, as well as the technical status and prospects, of the Digital Economy (DE). It will provide a non-aligned research resource to inform policy debate and policy decisions as well as assist both the Private and Public Sector to maximise the opportunities for innovation and improve our competitiveness as a nation. Additionally it will create the opportunity for the technology sector to speak with a unified voice on the linkages between economic issues and digital technology-based issues, facing our nation and the world.

2 Outline of capability

Create a hub around the DE – a research centre of excellence and expertise on the DE, based in Victoria with state, national and international focus;

Ability to inform government policy on the DE and its potential impact on innovation and productivity;

A body that underpins Victoria’s Digital Industry covering

1. Exports;
2. International collaboration (see Attachment 1 for a summary of 13 DE research centres around the world identified by the Pearcey Foundation);
3. Participation in the global debate on the DE;
4. A capability to investigate and develop deep knowledge on emerging issues that require a detailed critical understanding and appreciation of advanced technology and its potential economic impact. For instance, the impact of eCurrencies such as BitCoin on Australia’s current banking environment and how should governments react?

3 Structure of the multi-discipline Institute

The final form and structure of this Institute will require detailed discussions and planning by all interested stakeholders. For its part the Pearcey Foundation has offered in a separate submission a “Proposal to create a Digital Economy Studies Institute” (originally submitted to a Federal Government enquiry in 2009) as a starting point for such planning activities. However, this outline has resulted from discussions between several parties at one of Victoria’s leading academic institutions covering a potential multi-disciplinary approach to the Institute. It would potentially involve the collaboration between the Pearcey Foundation and the proposed Institute to address the issues surrounding the DE raised in this brief submission.

Some of the key roles this institute might include the following:

3.1 Data collection

The multi-disciplinary Institute will undertake a sustained long-term data collection effort to capture enterprise data, including product capabilities, workforce and skills to enable:

• National as well as International benchmarking;
• Measurement of the level of enablement provided by ICT in all sectors of the digital economy, including healthcare, education, energy & resources, environment, entertainment, manufacturing, transport, financial services, primary industries, government services, not-for-profit sector;
• Progress against industry targets (annual, tri-annual, 5 year, etc.).
• Analysis of the role of exports and imports including global linkages (i.e., building an understanding of the Australian ICT food chain);
• Geographic and sectoral mapping;
• Forecasting;
• Detailed mapping of what R&D is being undertaken by whom and where, and with what intended or potential impact;
• Extracting value from the 180 (or so) prior studies undertaken on the ICT industry in Australia over the last four years;
• Identifying and assisting in data collection wherever gaps in information are identified;
• Assisting with international data collation and interpretation (e.g. with the OECD ICT Directorate). It is intended that the Institute would exploit all existing repositories and ensure that duplication of effort is avoided, wherever practical.

3.2 Research

Research staff at the Institute would also undertake collaborative analysis and research based on the captured industry data and information, including such activities as understanding and publicizing:

• National and International trends and business climate-related issues;
• Industry performance and competitiveness;
• Cross-sectoral issues;
• Linkages between government policy and technology uptake especially by SME’s;
• Providing potential Policy Options, along with associated opportunity and risk analysis;
• Skill needs and forecasting, gender issues, etc.;
• Exploring research priorities and ICT infrastructure needs for deployment;
• Economic and other ICT industry analysis of trading partners and competitor nations.

This will enable Australia to address questions such as: how better can we support innovation, the diffusion and take up of new technologies, and innovative processes across industries and the community? NOTE: The approach suggested in data collection and research are starting points only for the initial discussion amongst potential stakeholders in determining what the Institute’s short and long term focus should be.

4 Business model

In broad terms the model would be require enabling funding from Government and Industry and potentially could embrace some existing institution that is already operating. Perhaps extensions to embrace activities similar to the Melbourne Institute’s capabilities related to their Household, Income and Labour Dynamics in Australia (HILDA) Survey, for example, could be contemplated or the current Victorian Government’s survey of high technology SME’s operating in Victoria, could be extended to a national level. Broadly speaking the income sources for the Institute would be split as follows:

• 50% pure research based on traditional academic grants and potential industry grants;
• 50% consulting/advisory services which are fee earning.

The exact model would only be firmed up after the stakeholders had agreed on the roles the new institute would undertake.

5 Benefits to Victoria

The creation of this group will establish the following capabilities:

A world class repository of knowledge on the economic impacts being generated by the implementation of advanced technologies across the broad economy and society at large. This centre will be the group to whom Australia turns for expert opinion and guidance on how policy should and could be framed to manage these developments;

A comprehensive understanding of Australia’s competitiveness or otherwise in the new technological world. The group would represent Australia at global conferences, at the G20, at the UN forums etc., where expert advice is required on the big new developments and their potential social and economic impact;

A knowledge base that would be underpinned by a comprehensive sustained economic analysis based on a set of data collected on a continuing basis. This could cover employment data, skillsets monitoring, SME capabilities and economic output etc.

If this capability is built over time, then Victoria through this new institute, will be recognised as the intellectual centre in Australia on all matters associated with the DE. It will be Victoria to whom other state and federal governments turn to for leadership in the DE. In this environment, Victoria will be the magnet for:

1. Global conferences on the DE
2. Students of the DE from around the world applying to study in this institute so building the economic underpinnings of the University and the State
3. Investment in, and revenues for, the institute to provide comprehensive reports on the DE and all of its underpinnings
4. Those whom government and industry call upon for expert advice and comprehensive assessment of all DE related matters

6 Authors of this submission:

This submission is from the Pearcey Foundation. Full details on the Foundation are included in Attachment 2.

Respectfully submitted by Wayne Fitzsimmons on behalf of the National Committee of the Pearcey Foundation. Wayne Fitzsimmons, Chairman 0418 382 625 www.pearcey.org.au

Attachment 1 Overseas Digital Economy Institutes

1 Australia University of Southern Queensland Australian Digital Futures Institute Australia’s social, cultural, educational and economic future depends on the capacity to design and utilise emerging digital technologies and embrace the opportunities of new media. The Australian Digital Futures Institute plays a global role in forging strategic partnerships, leading inter-disciplinary research, and realising focussed end-user outcomes to foster a digitally literate society. As the future emerges, ADFI’s role in horizon-scanning, prototyping, deployment and evaluation becomes critical in an increasingly dynamic world.

2 Australia Australian Communications and Media Authority (ACMA) Research Series Our research program helps us to make informed decisions as an evidence-based regulator and understand the implications that regulation of communication and media markets may create. It aims to inform strategic policy development, regulatory reviews and investigations, as well as help Australians to make better decisions about media and communications.

3 Canada University of Calgary The Centre for the Digital Economy@ (CDE@) The Centre has been created to become the policy centre on economic, public and management issues surrounding the digital economy in Canada. The ultimate purpose of the Centre is to facilitate and promote the development of objective and evidence-based knowledge that responds to, and anticipates, managerial and government policy decisions. The Centre for the Digital Economy was created through seed money provided by four leading telecommunications companies in Canada: Bell Canada, Rogers Communications, Shaw Communications Inc., and TELUS. “It is important for Canadians, as both consumers and producers in the digital economy, that there be a source of independent analysis that engages in the development and assessment of government policies and initiatives, informed by Canada’s unique evolution and circumstances.”

4 UK Anglia Ruskin University, UK Cultures of the Digital Economy (CoDE) Research The Cultures of the Digital Economy (CoDE) Research Institute is a multidisciplinary initiative at Anglia Ruskin University, Cambridge, specialising in the creative and cultural opportunities which are generated through the emerging Digital Economy. CoDE engages in and enables collaboration between cultural, creative and technical industries and academia. CoDE's key thematic research areas are: Digital Performance, Production and Play; Serious Gaming and Mobile Applications; Creative Design for User Interaction; Digital Humanities and Network Politics. The Institute fosters a critical and experimental interdisciplinary research environment and through projects, seminars and published research aims to explore the role of current and emerging technologies in a creative context. CoDE is a crucible for thinking outside traditional disciplinary boundaries and a catalyst for establishing connections with industry and local, national and international communities. Its location in Cambridge provides it with excellent potential for collaboration with entertainment, technological, scientific, arts and the heritage industries.

5 UK Imperial College London, UK Digital Economy Lab The Digital Economy Lab acts as a portal for all the research, teaching and engagement which is taking place within this grand challenge at Imperial College London. We aim to link external organisations to relevant expertise at the College and to foster the growing digital community within the College so that they can work together more effectively.

6 UK University Aberdeen Dot.rural dot.rural is the RCUK Digital Economy Hub focusing on the rural digital economy. Rural areas have specific characteristics that create challenges around issues such as quality of life and wealth creation. These include: small, often dispersed populations; narrow and uneven channels of information flow; rapid change in population structures and economic activity bases; and restricted access to digital infrastructure. We believe that rural areas of the UK can, through the user-led application of digital technology, be more economically, socially and environmentally sustainable. Our aim is to harness the Hub’s expertise with a range of partners to realise this ambition.

7 UK University of Nottingham, UK Horizon Digital Economy Research Welcome to Horizon Digital Economy Research. Established in 2009, this venture represents an initial £40 million investment by Research Councils UK (RCUK), The University of Nottingham and over 100 academic and industrial partners; in both a Research Hub and Doctoral Training Centre within the RCUK Digital Economy programme. Building on the Digital Britain plan, Horizon research focuses on the role of ‘always on, always with you’ ubiquitous computing technology. Our aim is to investigate the technical developments needed if electronic information is to be controlled, managed and harnessed — for example, to develop new products and services for societal benefit.

8 UK National Institute of Economic and Social Research The National Institute of Economic and Social Research is Britain's longest established independent research institute, founded in 1938. The vision of our founders was to carry out research to improve understanding of the economic and social forces that affect people’s lives, and the ways in which policy can bring about change. The Institute is independent of all party political interests. We receive no core funding from government and are not affiliated to any single university, although our staff regularly undertake projects in collaboration with leading academic institutions. Institute staff are organised into four groups: macroeconomics and finance; employment; productivity, innovation and skills; and labour markets and disadvantage. We carry out research across 18 themes, which bring together researchers across the four groups, with expertise in a range of research methods, including quantitative and qualitative approaches. Our research themes reflect key areas of policy. They include health and well-being, policy evaluation, welfare, migration, inequality poverty and disadvantage, families early years and early intervention, education training and skills and employment policy and practice.

9 UK Newcastle & Dundee Universities Social inclusion through the digital economy (SiDE) Poor health, disability, family breakdown, poverty and unemployment are just some of the reasons why people of all ages may become marginalised from society and may lack the skills, confidence or opportunities to access and benefit from digital technologies that have the potential to transform their lives. SiDE Research Hub aims to tackle social exclusion by making it easier for people to access the life-changing benefits offered by digital technologies. Research will address four fields where digital technologies and the building of a truly inclusive digital economy could deliver major social benefits: connected home and community, accessibility, inclusive transport services; and creative industries.

10 US Leonard N. Stern School of Business, US Center for Digital Economy Research The Center for Digital Economy Research has been in existence in one form or another since 1980. Originally part of the Information Systems Department at Stern, it was renamed the Center for Information Intensive Organizations in 1997; and then the name was changed in 2001 to the Center for Digital Economy Research to align it with a school-wide initiative focused on the digital economy. Center faculty conduct research on information technology in business. The focus of much of this research is on the digital media and financial services industries with particular emphasis on electronic commerce and electronic markets. CeDER currently has four research tracks: business intelligence and data mining; IT economics; technology-enabled organizational forms and relations; and: interactive marketing.

11 US University of Maryland Center for Digital Innovation, Technology, and Strategy (DIGITS) The Center for Digital Innovation, Technology, and Strategy serves to leverage intellectual capital across academia, industry, and government. The center focuses on the study of emerging digital technologies and the impacts of digital innovations on business functions, firm strategies, and policy across a number of industry verticals. The center’s mission is to disseminate scholarly research, to connect research with practice and policy, and to foster experiential learning for students.

12 US MIT Initiative on the Digital Economy The Initiative on the Digital Economy is committed to breaking new ground in the study of the digital revolution and its profound impact on society, work, and the economy. We are developing a constant stream of research results on critical topics, organized around our four key pillars, or subject areas: • Productivity, Employment, and Inequality • New Digital Business Models • Big Data • Social Analytics

13 US University of Massachusetts Amherst National Center for Digital Government The National Center for Digital Government (NCDG) seeks to build global research capacity, to advance practice, and to strengthen the network of researchers and practitioners engaged in building and using technology in government. NCDG's mission is to build global research capacity, to advance practice, and to strengthen the network of researchers and practitioners engaged in building and using technology and government. The goal of NCDG is to apply and extend the social sciences for research at the intersection of governance, institutions and information technologies. For more information about NCDG, please read our Vision and Objective statements. And be sure to check out the News section for NCDG happenings.

Attachment 2 - The Pearcey Foundation

The Pearcey Foundation is a not-for-profit organisation established by individuals from within the ICT industry who are keen to promote a unifying dialogue between members of the industry, government and the community at large. In making this proposal, the Pearcey Foundation’s intention is to act as a catalyst to create a lasting institution that will result in more effective policies and strategies for the promotion and take-up of ICT within the digital economy. Other than acting as a catalyst and initial steward for the initiative, the Pearcey Foundation does not seek a continued formal role in managing the institute, and anticipates an independent board drawn from relevant stakeholders to undertake this role. Given endowment funding, individual research grants, in-kind commitments and fee for service work, it is believed the institute will be self-sustaining in the long term, and the quality of its research work will create a substantial return on investment for all stakeholders. Our request, however, is that the centre be known as The Pearcey Research Institute for the Digital Economy (PRIDE), after Dr Trevor Pearcey, one of the original visionaries for the Australian ICT industry. Trevor was the architect and team leader responsible for the design and construction of Australia’s first (and the world’s fourth) digital computer, CSIRAC in 1949. He is considered by many to be the father of the ICT industry in Australia (refer to www.pearcey.org.au for details related to his contribution to the Australian ICT industry).

This submission was prepared by members of the Pearcey Foundation acting in their personal capacities.

• Mr Wayne Fitzsimmons, Chair, Pearcey Foundation Director, M-Group Pty Ltd,
• Mr Charles Lindop, Co-Chair of NSW Committee Director, ITFC Pty Ltd
• Dr Peter Thorne National Committee Consultant
• Mr Ian Dennis Emeritus Chair, Pearcey Foundation Executive Director, CIIER