Book Review THE RACE TO THE INTELLIGENT STATE: CHARTING THE GLOBAL INFORMATION ECONOMY INTO THE 21st CENTURY by Michael Connors 1997 Capstone Publishing, Oxford, 242 pages Is the world really in the midst of a "post-industrial information revolution?" What kind of environment will information technologies like the Internet create in the coming decade, and how will this impact the labour forces and destinies of countries ranging from the U.S. and Japan to Thailand and India? A number of futorologists, academics and policy makers have already addressed such issues, in a generally upbeat manner. Michael Connors, managing director of BZW Asset Management, is the latest to try to project an analysis of the effect of information structure on developed as well as developing countries. He attempts to provide an "antidote to the overly optimistic predictions" of some futurologists, and focuses on some of the accompanying problems and imbalances such as white collar unemployment in developed economies and the evolution of "two nations" (wired urban pockets and isolated rural areas) in countries like India. Case studies of four countries feature prominently throughout the book: the U.S., Japan, India and Thailand. An index ranks the "infostructure" (information structure) of 147 countries depending on rates of literacy and penetration of newspapers, radio, television and telephone. Reliable statistics for diffusion of computers and data networks were not available for all countries, and hence were not used in the index. The U.S. ranks first with an index score of 309.3; Japan is third (after Bermuda) with a score of 268.8; Thailand ranks 85th (index score: 60.9) and India is 120th with a score of 25.2. The ability to access and manage information is becoming an increasingly important determinant of economic and social success for a country. "Low abstraction societies" are characterised by activity mainly in agriculture and simple industry; in "high abstraction societies" the primary and secondary sectors interact with an ever growing service sector with more and more sophisticated information systems and "abstract" occupations. The U.S. and Japan are at the forefront of most aspects of information technology, and provide most of the information equipment worldwide. The U.S. has a clear lead in microprocessors and integrated circuit logic as well as software and entertainment markets; the Japanese lead in most memory chips and consumer electronics, with stiff competition from the Koreans. "Those whose products and processes become industry standards in information technology naturally tend to refer to one another when developing new products," explains Connors. The giants of the industry - such as Microsoft and Intel - thus "feed off one another's success." Professional and technical specialisation in the pursuit of excellence has been developed to the highest degree in the U.S., says Connors. In this regard it has also been helped by immigrants from Europe and Asia; the U.S. has thus "benefitted from brain-drains from everywhere." Enhanced choice, mobility, social care, control, and opportunity are perceived as the main fruits of the information revolution in the U.S. Japanese official pronouncements on infostructure are more predictive and prescriptive than those of U.S. government departments. From the 1980s, the Japanese Ministry of International Trade and Industry (MITI), Nippon Telegraph and Telephone (NTT) and other governments bodies began to offer their visions of "informatisation," "intelligent cities," "teletopia" and even information-based "greentopia" in the coming years. Japan expects network businesses and software to show the highest growth rates in the coming decade. In addition to the two information technology superpowers, Connors focuses on the opportunities and challenges for developing nations like Thailand and India. "Non-OECD countries have 85 percent of the world's population but less than 30 percent of the telephone lines. In Asia as a whole the gap is even larger; 50 percent of the world population depend upon only 5 percent of its telephone lines," he notes. "India's heroic efforts to upgrade the infostructure are typical of a pattern which is being seen across most of the developing world," Connors observes. The story of communications media in India has interwoven strands of "planned development, profit-oriented capitalism, and power politics." Newspapers and cable TV are concentrated in urban areas, but broadcast media play an important role in the rural areas where three quarters of India's 900 million people live. The urban-rural divide is particularly stark when it comes to access to telephone lines. "India's industry and commerce will continue to suffer a significant competitive handicap as long as the nation's communications network continues to fall well below the standards of the developed world," says Connors. India also has relatively one of the lowest installed bases of PCs in the world (about 1.2 million in 1996). The growth of advanced information infrastructure in India has been and will be a largely localised affair, in places like Bangalore. Such urban centers have developed a life of their own, whereas rural population will see change come about only gradually. India is thus an example of a relatively new phenomenon - the "info-tiger economy," one which "exists within the broader economy but depends relatively little upon it; it operates according to its own rules and transcends national borders with unprecedented ease." Thanks to its large English-speaking scientific workforce (second in size only to the U.S.), higher education institutions, specialist computer institutes, and low costs of software talent (11 to 13 times cheaper than in the U.S., Japan and Germany), India will have more software companies with ISO 9000 certification than any other country by 1997. "A study commissioned by the World Bank in 1995 showed that India was the most favoured nation for outsourcing of software development among vendors in the U.S., U.K., and Japan," Connors notes. All this has caused the Indian software industry to grow a hundredfold in the space of ten years, with the turnover rising from $10 million in 1986 to $850 million in 1995. However, the growth of the Bangalore "technopolis" and others will be hampered by inadequate access to water, power and roads. India has less than 1 percent of the world software market, so its claims of becoming a software superpower or "the software development center of the world in the 21st century" may be "aggressive talk indeed." In contrast to India, there is much greater cultural and social homogeneity among the 58 million people of Thailand, about 8 million of whom live in or around Bangkok. Basic literacy is claimed for about 94 percent of the population, and the country appears headed for near population stability. The urban-rural gap in lifestyle is not as wide as in India. Information accessibility also improved nationwide, thanks to a more balanced pattern of development of communications links. "Bangkok and Bangalore are both at the center of information revolutions of a kind but, whereas the Bangkok version shows signs of spreading to the rest of the country, Bangalore is likely to continue to occupy a special position in a country whose real information revolution is still some way off," Connors observes. In the infostructure race between nation states, it will be not just corporate strategy but government initiative, educational systems, and their broader cultures that will make the crucial intellectual difference. Other relevant factors are the decreasing costs of basic hardware and the role of migrant populations. "Migrants are very prominent in the leading technological centers of the world and returnees have already changed the economic landscape of countries like Taiwan, Korea, and Thailand," Connors observes. While information technology is thus accelerating the process of globalisation, it may also be the battleground for confrontation between developed and developing countries, particularly over issues like software copyright, intellectual property rights, and transfer of technology. Among developing countries, those whose sheer size or economic problems render them incapable of upgrading their entire infostructure will adopt the kind of technolopolis approach typified by Bangalore in India. Other "info-tiger cubs" may be lurking in China, Hungary, Ireland, Mexico, the Philippines, Russia and Singapore. In sum, "The Race to the Intelligent State" is a sweeping and thought-provoking overview of the socio-economic forces underlying infostructure evolution and competition in developed and emerging economies. The references include some valuable material translated from Japanese. The book is definitely a useful addition to the literature on information futures. Some more material on infostructure in countries like Singapore, Brazil and South Africa would have rounded off the analysis very well. Concerns of countries ranging from France to China over issues like cultural and political threats from technologies such as the Internet also play an important role in their perceptions of infostructure; these should have been addressed as well. And a list of online resources (mailing lists, Web sites) along with an online companion (with updates and pointers to new resources) would have greatly extended the shelf-life of the book. |