broadband strategies handbook.pdf - Khazar University

As discussed, broadband alone has limited impact as a technological platform,but instead acts as an enabler. As such, it holds the potential to have asignificant impact on economic and social progress and to transform theeconomy.However, for this potential impact to be unleashed, broadband must beused by businesses, governments, and citizens in a way that increases productivityin the economy. 14 This requires (a) the creation and availability ofbroadband-enabled services and applications that increase efficiency andproductivity and (b) the capacity of businesses, government, and citizens touse broadband-enabled services and applications in a productive and efficientway. These two requirements are critical for achieving the potentialeconomic impact that broadband can produce.The economy’s capacity to absorb broadband depends on how these tworequirements are fulfilled in the economy. In a nutshell, a country’s absorptivecapacity can be thought of as determined by the following:• The capacity of businesses to create broadband-enabled services and applicationsand to use these applications and services to make their businessprocesses more productive and efficient• The capacity of citizens to create and use broadband-enabled servicesand applications to improve their welfare• The capacity of government and other institutions (for example, schools)to introduce and accommodate broadband-enabled services to deliverpublic services more efficiently and transparently to the public.Components of Broadband Absorptive CapacityFour components determine the degree to which a country’s economy isable to absorb broadband and translate it into economic and social development.These components are (a) the economy’s macroeconomic environment,(b) the business environment, (c) the quality of human capital, and(d) the governance structure (figure 1.6). The macroeconomic environmentdetermines the “broadband friendliness” of the economy andwhether the economy and its main actors (that is, businesses, government,and citizens) are open to using ICTs. The business environment, whichincludes access to financing and diffusion of previous technologies, determinesthe ability of businesses and entrepreneurs to create new broadband-enabledinnovations, modify business processes based on theseinnovations, and update existing products, services, and strategies usingbroadband and the broadband-enabled environment. The quality of humancapital depends on the ability of the labor force, businesses, and academicBuilding Broadband 27