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DRAFT Module 3: Measuring the ICT sector. Ms Sheridan Roberts, Consultant Information Society Statistics Sunday 8 March 2009. Presentation outline. The ICT sector within the ‘Information society’ Size and growth of the ICT sector Standard international definitions and concepts
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DRAFTModule 3: Measuring the ICT sector Ms Sheridan Roberts, ConsultantInformation Society StatisticsSunday 8 March 2009
Presentation outline The ICT sector within the ‘Information society’ Size and growth of the ICT sector Standard international definitions and concepts OECD definitions – under ISIC Rev 3, Rev 3.1, Rev 4 Partnership on Measuring ICT for Development – core indicators Progress in measuring the ICT sector Practical issues for ICT sector measurement International comparability versus national policy interests Identifying and classifying ICT sector units Dealing with differences between ISIC definitions of the ICT sector What data to collect Ratio indicators – which denominator to use Other information economy classifications Content and media sector ICT and Content and media products
Estimated size of the ICT sector 2007, US$ Adapted from Idate, DigiWorld Yearbook 2008
Share of ICT value added in business sector value added, OECD, 1995 and 2006 Source: OECD Key ICT indicators, www.oecd.org/sti/ICTindicators
OECD definitions of the ICT sector • The three OECD definitions of the ICT sector have wide acceptance among member and non-member countries • OECD released the first definition of the ICT sector in 1998, based on ISIC Rev. 3 • It was defined as follows • For manufacturing industries, the products of a candidate industry: must be intended to fulfil the function of information processing and communication including transmission and display, or must use electronic processing to detect, measure and/or record physical phenomena or to control a physical process. • For services industries, the products of a candidate industry: must be intended to enable the function of information processing and communication by electronic means. • The definition was slightly refined (wholesale) with ISIC Rev. 3.1 in 2002.
OECD definitions of the ICT sector • With the development of ISIC Rev. 4, OECD redeveloped the definition, which was released in 2007. • The definition was narrower than the previous definitions • The production (goods and services) of a candidate industry must primarily be intended to fulfil or enable the function of information processing and communication by electronic means, including transmission and display. • Note the removal of products that “use electronic processing to detect, measure and/or record physical phenomena or to control a physical process”. • The OECD 2007 definition is included in ISIC Rev. 4 as an alternative aggregation (as was the 2002 definition in Rev 3.1). • A rough approximation of the 2007 definition is possible using the ISIC Rev. 3 or Rev. 3.1. • the approximation removes 3 of the 4-digit ISIC classes from the earlier definitions.
OECD definitions of the ICT sector • Main issues • absence of ICT retailing from both definitions • 2007, removal of products that “use electronic processing to detect, measure and/or record physical phenomena or to control a physical process” • 2007, removal of manufacture of fibre optic cable • 2007, software publishing has characteristics of both ICT and ‘content’ but is included in the ICT sector • 2007, broadcasting has characteristics of both ICT and ‘content’ but is included in the Content and media sector.
Partnership on Measuring ICT for Development – introduction
Practical issues for ICT sector measurement • International comparability versus national policy interests • Given the importance of BOTH international comparison and national policy interests, it would be ideal to select a scope and set of data that are able to satisfy both requirements. • For example, if Egypt wished to include other industries such as broadcasting (ISIC Rev. 4 Division 60) or postal activities (Division 53) that would create a sector that would not be described as an ICT sector for international comparison (which would be a subset of such a sector)…. • …but could provide very useful information for national purposes. • Terminology is important given the existence of a generally accepted standard.
Practical issues for ICT sector measurement • Identifying and classifying ICT sector units • What type of units to include • usually enterprises or establishments • ideally would include private and public corporations, and unincorporated units that are ICT producing units. • Are units already identified and classified for statistical purposes? • If not, could use ISIC Rev. 4 • Units are normally classified according to their predominant activity (in terms of value added) (ISIC Rev. 4) • Use the detail of ISIC to determine to which class the unit’s activity belongs. • ISIC Rev. 4 has a lot of useful information on how to classify units with more than one activity.
Practical issues for ICT sector measurement • Dealing with differences between ISIC definitions of the ICT sector • Rough correspondences will improve comparability. • What data to collect • Core ICT indicators – gross value added (consisting of a number of items) and employment (numerator and denominator) • A range of other data possible e.g. capital expenditure, revenue, product details, R&D, innovation, wages and salaries, employment splits (e.g. gender, occupation) • The unit chosen can affect what data are feasible. • Ratio indicators – denominator • It is useful to express ICT sector measures as ratios e.g. per OECD and the Partnership core indicators • using values for the total business sector as the denominator. • The definition of the total business sector, especially for ISIC Rev. 4 is not straightforward and not entirely resolved. • Generally, it will be a matter of what data are available (a pragmatic approach).
Content and media sector • The OECD 2007 definition of the Content and media sector was developed in parallel with the revised ICT sector definition. • Like the ICT sector definition, the C&M sector definition is included in ISIC Rev. 4 as an alternative aggregation. • The definition closely follows ISIC Rev. 4 • It consists of industries of Division J of ISIC (Information and communication) except for those that are already included in the ICT sector definition. • Main issues • Software publishing has characteristics of both ICT and ‘content’ but is included in the ICT sector. • Broadcasting has characteristics of both ICT and ‘content’ but is included in the Content and media sector. • ISIC Rev. 4 does not separately identify electronic content activities (industries) so neither does the C&M sector definition.
Information economy product classifications • The OECD’s information economy product classifications are based on the UN Central Product Classification Ver. 2, which has just been finalised (31/12/2008) • they are expected to appear in the final CPC publication as an alternative aggregation. • There is a classification for ICT products….and one for Content and media products. • The classifications were developed in parallel with the development of the CPC • with OECD input into the CPC for ICT services. • The information economy product classifications were agreed to by OECD member countries at the end of 2008, with minor revisions in January 2009 for late CPC changes (mainly ISIC links).
ICT products • Most of the products are from the ICT sector and most ICT sector products are included • Four ICT sector products are in the Content and media products list. • There are major differences compared with the 2003 ICT goods classification released by OECD (and used as the basis for the Partnership’s ICT goods trade indicators) • There is not yet a correspondence between the goods in the ICT products list and the 2007 (or earlier versions) of the WCO Harmonised System for trade statistics.
Content and media products • For the purposes of defining a Content and media products list, the following principle was used: Content corresponds to an organised message intended for human beings published in mass communication media and related media activities. The value of such a product to the consumer does not lie in its tangible qualities but in its information, educational, cultural or entertainment content. • For Content and media products, most of the products are from the C&M sector and all C&M sector products are included • Four Content and media products are linked to the ICT sector (only).
Thank you • I would be happy to answer any questions • I can be contacted at SheridanRoberts@InfoSocietyStats.com