Today, Ericsson released the third edition of its Networked Society City Index and report, which analyzes ICT-driven benefit creation in 25 of the world’s largest cities. Whereas the two previous editions focused on the benefits that ICT generated for cities and citizens respectively, this edition explores the benefits for businesses. By covering additional indicators used to analyze business life in these cities, a correlation was drawn between ICT maturity and the ability to use ICT to benefit business.
In addition to the top-three ranking cities, New York, Stockholm and London, the following cities are also part of the index: Beijing, Buenos Aires, Cairo, Delhi, Dhaka, Istanbul, Jakarta, Johannesburg, Karachi, Lagos, Los Angeles, Manila, Mexico City, Moscow, Mumbai, Paris, São Paulo, Seoul, Shanghai, Singapore, Sydney and Tokyo. 28 indicators have been used to measure the total benefits in the index for each city: The indicators can be categorized into two dimensions: cities’ ICT maturity and benefits from ICT investments from both a social, economic and environmental point of view.
- Business benefits from ICT investment – There is a continued correlation between ICT maturity and triple bottom line benefits. For example, in a report issued by the Stockholm School of Economics in 2012, it was concluded that a 1 percentage point increase in broadband penetration increases new business registration by 3.8 percent.
- Individuals embrace innovation first – Benefit creation starts with and is initially driven by individuals. For example, In Delhi, citizens can engage in entrepreneurial activities and receive payment for their work through Eko, a low-value financial transaction service completed using a mobile phone or through a retail outlet.
- ICT strategy drives entrepreneurship – Successful business cities all share well-developed ICT strategies and implementation programs. New York City’s business incubators encourage entrepreneurial activity in that city while London’s business boot camp teaches start-ups the skills necessary to build successful business.
- Predictable conditions are good for business – Businesses benefit from clear legal and fiscal frameworks. New York’s open data initiative and São Paulo’s digital tax filing program for business transactions are creating more open and transparent city governments.
- Global reputation is important – Top performing cities are competing to attract the best brains and entrepreneurs from around the world. Cities with higher concentrations of colleges and universities are more likely to encourage entrepreneurial activity – Maddock and Viton 2008.
- Transformation still lies ahead – Current ICT benefits have been constrained by existing industry boundaries. Real transformation will demand radically different solutions to city challenges. The Skolkovo innovation center, outside of Moscow, aims to modernize Russia’s industry through R&D activities and Singapore is launching its ICT-enabled intelligent energy system to encourage economic development.