Australian economy leads as a disruptor
- 29 February, 2016 06:44
Australia is ranked as a disruptor economy based on its readiness to thrive in today’s digital world, according to an ainaugural APJ study commissioned by CA Technologies and carried out by research consulting firm, TRPC.
The Application Economy Index (AEI) 2016 provides a snapshot of how conducive APJ’s economies are for application development and market entry.
Singapore and Australia lead the rankings, while India and Indonesia are considered the least prepared for the new digital economy.
The index evaluates three main pillars that are critical for a vibrant application economy:
- Government use and support of technology and innovation – To develop sound technology policies and promote innovation, governments should understand and use software and applications.
- Internet and mobile infrastructure – Without the necessary infrastructure and enabled access to technology, an application economy cannot fully develop. Basic connectivity and network backbones must be in place, along with an environment that supports business growth and transformation.
- Business agility – The ability to move nimbly and quickly in driving – and capturing – market disruption. For agile businesses to thrive, countries need to have an environment conducive to entrepreneurship and new forms of commerce.
“Regardless of whether they are in the disruptors, challengers or mainstream group, markets will still need to focus on creating conditions for businesses to thrive in the application economy. They can do so by continuing to do well in their key success characteristics, while mitigating current and potential weaknesses,” TRPC managing director, Lim May-Ann, said.
Australia achieved consistently high scores in eight of the 10 key parameters “possibly due to its strong government use and support of technology such as the ‘Cloud first’ procurement policy announced in 2013”.
It rated high in mobile and internet infrastructure accompanied by high level of user penetration. In terms of business success, Australia ranks number one in having the shortest period of time needed to set up a business, excellent debit and credit card penetration, and in effective cyber security.
“Australia’s ranking is not surprising, especially when it comes to the use of technology and business agility,” said CA senior vice president and managing director A/NZ, Hope Powers, said.
“However, it is important that businesses in Australia and across the region continue to embrace the application economy and it is vital that governments and service providers alike are aligned in addressing the needs of digital business to ensure the country remains competitive.”
The study went on to look at rankings throughout the region in terms of market potential accelerator factor which provide more insight into market opportunity. Here Australia’s small population and older demographics meant it dropped to a number eight ranking. The study found that countries with larger populations have greater market potential
While Australian smartphone penetration is high, in absolute terms Australia’s smartphone user base is not large. In fact, only Singapore and Hong Kong are smaller. Secondly, the delay in the conversion from landline to mobile internet use meant Australia ranked number nine for daily mobile Internet use and eighth for daily use of apps.
Given that mobile is the primary platform for the application economy, this delay will directly impact the effectiveness of Australia as a viable player in the application economy.
Of greater concern is Australia’s demographic score – essentially the ratio of young people in the total population – which shows an ageing population when compared to its closest neighbours.
However, Australia has advantages to ensure it will remain competitive despite these challenges. For example, the private and public sectors can work together to ensure Australia has some of the best infrastructure in the region. Australia is predicted to have a national 5G network by 2020, ensuring business development is achievable and competitive advantage remains. This, combined with Australia’s high usage rate of virtual social networks, will ensure the economy is in good stead to compete in the application economy.