on international bandwidth, revenue and investment. Helpful inputs and suggestions were received from Joan Calzada Aymerich from the University of Barcelona (Chapter 4), Jake Kendall from the Gates
1. 4 Revenue and investment in the telecommunication sector...13 1. 5 Use of ICTS...
1. 14 Annual investment by telecommunication operators, world and by level of development 2007-2012, total in USD (left) and annual growth (right...
trends in terms of investment and revenue in the telecom sector. Then, a number of key indicators
investment in backbone infrastructure in all parts Chart 1. 7: Fibre and microwave routes, share of route kilometres (left)
1. 4 Revenue and investment in the telecommunication sector In 2012, total telecommunication revenue stagnated at around USD 1. 88 trillion,
Chart 1. 14 shows the evolution of investment in telecommunications, which is fundamental to supporting ICT uptake and innovation.
investment grew by 4 per cent to USD 307 billion globally. Despite the progression seen in global
investment since 2010 (6 per cent compound annual growth rate), the 2008 investment levels have not been restored
The recovery of investment levels has been hampered by the situation in developed countries where the downturn experienced in 2008 was
strongest(-16 per cent) and the reduction in telecommunication investment persisted in 2009 -2 per cent.
The overall economic environment of restricted access to capital markets and the efforts of some operators to reduce debt exposure
explain the sluggish investment levels seen in 2011 and particularly in 2012.13 In developing countries, investment in
telecommunication infrastructure and services has been more stable, with a smaller drop in 2008(-4 per cent) and moderate growth in the
to the 2008 investment levels being restored by 2011, and an all-time high of USD 121 billion
total investment was almost 40 per cent in 2012 which is compared relatively high with the
The investment-to-revenue ratio in the telecommunication sector stood at 17 per Chart 1. 14:
Annual investment by telecommunication operators, world and by level of development 2007-2012, total in USD (left) and annual growth (right
investment-to-revenue ratio was somewhat lower in developed countries (15 per cent) than in developing countries (22 per cent.
words, the investments made in developing countries were larger relative to the revenues they generated.
capital investments are delivered by global equipment providers, resulting in only limited investment cost reductions across countries. 14
On the other hand, revenue per user in several developing countries is constrained by low income levels, which limit the margin for
make the investments necessary to bridge the infrastructure gap between developing and developed countries 1. 5 Use of ICTS
•Sustained investment in national statistical capacity both technical and institutional, is essential and needs
also include investment in the development of concepts measurement frameworks, classifications and standards •New, nontraditional data sources should be explored
service provider (ISP) TDC is making investments to provide access to ultra-fast speeds for over
this investment by up to five times. 13 European top performers stand out when it comes to ICT access at home.
Given the large investments that are required when deploying ICT infrastructure private operators assess the profitability of
a return on their investment. This points to other important factors, apart from service availability
suggests the need for more investment in broadband network equipment and network roll out to enable the take-off of fixed-broadband
drivers for investment and competition. In addition, regulation can promote efficiency, e g infrastructure and spectrum efficiency, which
market to private and foreign investment The scores of each cluster are combined into a single value for the Regulatory Tracker.
networks requires large investments that operators evaluate depending on the demand for the service and the specific
investments, and yet enjoy a stronger position than resellers have fixed in-broadband markets This could explain the dynamism observed in
Wind turbines represent a major investment and have a typical lifespan of 20 to 30 years.
accuracy of the customer†s return-on-investment estimates Source: ITU, based on IBM (2012 a speed that are unprecedented.
requires major investments of time. All the parties to such agreements have to address the necessary parameters as to how data are to
1. 4 Revenue and investment in the telecommunication sector 1. 5 Use of ICTS 1. 6 Emerging ICT measurement issues
something beneficial from investment in new tech -nologies. Corporate leaders need to leverage metrics to help make digital transformation happen
hard to gauge a return on investment for emerging technologies. â€oeit is still difficult to compute ROI
digital investments. Digirati do much bet -ter, at 66 %Incentives One obvious way for executives
1. 3 Need of investment...32 2 Field of Action I-egovernment, Interoperability, Cyber security, Cloud computing, Open Data, Big
Targeted and prioritized investments in ICT are essential in meeting the specific targets set by Digital
programming period, the investments in the field of ICT€ s will proceed under the umbrella of the National
will ensure ICT investments create a positive impact in the social context ï Field of action 3-ecommerce, Research & development and Innovation in ICT †builds on the
ICT infrastructure in Romania will lead to total investments of around 3. 5 billion Euro.
European countries who have made similar investments may be translated into GDP growth by 13 %increasing the number of jobs by 11
impact of public policies and to look at the investment in ICT as a way to transform the Romanian
4. Pillar IV †Fast and ultra-fast Internet access †targets investments for broadband infrastructure
Public investment in ICT R&d Energy use of lighting %1. 4. Efficient public administration and
Public investment in ICT R&d Energy use of lighting 3. 2. Increasing the number of jobs in the
Investments in infrastructure Target: To be defined based on Appendix 5 Methodology #of households with access to internet
Principles for Digital Agenda in Romania †Investments should correlate with the objectives Guiding Principles for Digital Agenda in Romania,
order position Romania as a solid ground for investments and retain the advantage of highly educated
All investments should be based on establishing or improving at least one of the criteria described in Annex 1 (for example
an investment should improve at least the security of a public service. All initiatives should describe tangible and quantif iable
The order of decisions for investment in information systems is: Buy, Customize, Build. This means that generally, an entity
All investments will take all the appropriate measures for ensuring security for services, data, and processes.
This principle should be applied foremost on new investments, which are first -of-a-kind for the Romanian Government, to safeguard against initial significant investments that bring only
reduced added value. Additionally, this should be applied in a continual manner to all running initiatives
all investments in ICT sector need to be sustainable †that means self -funding themselves or with a solid Return on Investment plan for the Government, even if not financially
This principle will ensure that all initiatives in Romania are prioritized with respect to their costs (initial and recurrent for the entire lifespan of the initiative) and will not bring significant burden to the budget
without clear results, in detriment to other planned or strategic investments which can yield additional
Entities should secure funding for the investment for a period up to 5 years for all recurrent costs of that investment
objective (including initial investment, maintenance, upgrades etc..For all decentralized initiatives, a centralized system needs to be
Maximize initial investment All investments need to make sure they achieve their full potential Examples: Entities should break down barriers of adoption by incentivizing the use of the service (for example reducing the time
needed to interact with that public service and/or reducing fees. Entities should put in place a mechanism for evaluating and
In the ICT sector in 2011, the investments was around 3 billion RON significantly lower than in other countries with a total number of employees of 128.000 in the field of ITC
and projects it for the 2014 †2020 period as a target for future investments.
1. 3 NEED OF INVESTMENT A full implementation of the strategic vision for ICT sector in Romania that will meet the specified targets
for Romania will require a total investment of 3. 5 billion Euro. Direct and indirect impact on the economy
investments may be translated into GDP growth by 13, %increasing the number of jobs by 11%and reduce
From a methodological perspective, the investment requirements were assessed for each line of action through comparison with similar investments for the same objective done by other countries and
adjusting them to take into account the specific Romanian social-economic context. The estimated impact for each Field of Actions was derived from statistical analysis of historical data in countries which
The assessed investment calculation for each line of investment was performed based on the following ï Values estimated at the level of the European union for the implementation of the Digital Agenda
ï Values published for investments which are identified comparable at the level of other countries â€
it refers to investments with the same perimeter, performed under comparable conditions ï Values resulted from the statistical analysis performed based on the figures recorded in countries
which finalized similar investments ï Similar investment rates These values were adjusted afterwards with relevant indicators for Romania
ï The number of inhabitants †ex. Total estimated investments for the computerization of the public
services were estimated at a total level for the European union; Romania†s rate was estimated based on the average cost per inhabitant, the population of Romania and the country†s level of
ï The Gross domestic product †the estimated investments for Romania were adjusted at the total economy value expressed through the Gross domestic product
Also, the calculations performed both for the estimation of the future investments which will be performed by Romania within the Digital Agenda strategy,
The table below depicts the necessary investment for each field of action in order to meet the specific
Operational Program Need for Investment (EURO %egovernment and Interoperability 247,487, 375 EUR 6, 2 %Cloud computing and Social media 70,187, 239 EUR 1, 8
%Additionally, in order to bridge the significant gap of investments required between the Operational Programs 2014-2020 and the necessary budget for achieving the target indicators,
Public Private Partnerships, self-funded investments, national budget etc. Below you can find a mapping of
-All investments will need to calculate and secure the necessary budget for 5 years (coming from mixed financing sources
that investment objective or securing additional funds for incremental periods of 3 years This model will apply to all the systems
which they need major capital investments The adoption in private sector of Cloud technologies within the European union exceeds 64%,however
ï Shifting IT investments to more efficient computing platforms ï Ability to use shared applications for common Government functions (ERP, HR, SCM, GIS etc
If the investment plan will focus on a balance between rural and urban areas, in the long term the quality of
In the last years, the focus of e-health investments was on e-health services
This investment has led to an unprecedented period of technical research and development in the European cultural heritage sector,
In order to estimate the necessary ICT investment in culture, one considered the estimations published on European union level concerning the digitalization of digital content.
targets undertaken by Romania, the estimated value of ICT investment in Culture amounts to 37,5 million
investments within the two key-objectives ï Consolidation of research, technical development and innovation (the Research & Innovation target
Investment in research, development and innovation in ICT and application of accomplished results through said investment are key factors to improve competitiveness of our companies and Public
Institutions At Romanian level, the development of the smart specialization strategy †intelligent specialization â€
The increased investments in the wide range connections and infrastructure, as well as in the e -commerce investments connected to the ITC products
and services innovation will have as direct implication the increase of the number of available working places, both in the ITC sector as well as in other sectors of
Out of the net investment performed in Romania19 in the past few years, approximately 10%come from the
In the ICT sector, in 2011, investments were performed in the amount of 3 bil. RON, which is approximately 8%of the turnover of the sector for this period
stimulate the private investments. They can help the regions to concentrate resources upon a few essential
priorities, more than to spread, less intense, the investments within all the fields and sectors of activity
efficiency of public investment in the Innovation, Research & development in ICT; encourage the research of the infrastructure development at regional level
also be considered for investments A virtual cluster is a concentration of SMES distributed geographically but grouped together by common
We propose a tiered investment strategy from the Government in ICT start-ups that can bring
-Tier 1 †Small investments in new technologies with market potential which are not yet proven to bring
investment -Tier 2 †Medium investments in new technologies/start-ups which have a proven market potential and
have demonstrated the return on investment -Tier 3 †Large investments for technology innovation in proven
models that have received funding from multiple credible sources Any project can apply for funding and the criteria for qualification in
each tier will be defined by the Ministry for Information Society Page 96 of 170 5 FIELD OF ACTION IV-BROADBAND AND DIGITAL SERVICES
to facilitate broadband investment The rolling out of high-speed fixed and wireless electronic communications networks across the Union
requires substantial investments a significant portion of which is represented by the cost of civil engineering works.
the identification of the volume of investments necessary in the development of the next generation access infrastructure for the purpose of the attainment of the objectives
identification of the geographical areas where the current rate of investments in broadband next generation access infrastructure impose the taking of certain public
identification of investment models compliant with good practices and European recommendations with respect to the financing of the development of next generation
stimulating the investment in the next generation access infrastructure in Romania through the identification of the measures to cut costs and increase the efficiency of
Investments in infrastructure 537m â (2012 Source: ANCOM †Market of services of electronic communications, 2012
Investment in â€oewhite†spots In the underserved (â€oewhiteâ€) areas, as there were defined in Broadband Guidelines, where the inherent
profitability of investment in broadband infrastructure is low, neither ex ante regulation nor demand-side
-balanced areas-from economic/investment perspective-that were put out for Design-Build-Operate concessions (public tender
by private investments Strategic Lines of Development Lines of Action Comments Deployment of Next Generation
investment in NGN Broadband infrastructure Implement Monitoring Mechanisms Operational Responsible: Ministry for Information Society The providers of the New
Investments in the NGN Infrastructure Encouraging Access to the Existing Passive Infrastructure. Strategic Responsible: Ministry for
Investments performed (mil. lei) 3016,3 2983,0 Share of turnover of enterprises in the TIC field of the overall turnover
increased investments in broadband connections and infrastructure, as well as the investments in innovation of TIC products and services type e-commerce will have as direct implication the increase of
the number of available jobs, both in TIC sector, and in other sectors of economy pursuant to externalities
significant investments for reaching the far points/dwellings geographically speaking. The rural fixed broadband coverage scored in 2013 a 78%.
The lack of certain investment programmes with a unitary vision in the public sector The lack of coordination with respect to adequate
Low level of investment and innovation in the field of research The free migration of the researchers within the European
private investments and require public intervention especially in rural areas This low take-up is applicable both to fixed access networks as
investments driving unavailability of financing both for start -ups and existing operators Opportunities Threats and constraints
Deployment of 4g networks requires significant investment and operators are prudent in coverage plans (Romania has
architectural guidelines which the agencies will use for ICT initiatives and investments. Key outcomes of this initiative that will be prioritized before all other lines of actions are
ï Evaluating the ICT investments in Romania on following and meeting the Guiding Principles and
EVALUATE ICT INVESTMENTS BENEFITS: OVERSEE ALL ICT INVESTMENTS IN ROMANIA ARE IN LINE WITH THE GUIDING PRINCIPLES, PUBLIC SERVICE
CRITERIA AND ROMANIA€ S STRATEGY TIMELINE: END 2014 IN PLACE, CONTINUOUS IMPROVEMENT ï Issuing and overseeing the implementation of the National Interoperability Framework that will
sustain a rapid growth of investments in this field, while making sure that all these initiatives are coherent
investments in Romania. The public bodies will inform the owner of this system for any changes in the
ï Rationalizing investments In the rural area, with a low density of the population, where there are limited broadband services
imposing all the types of access products might disproportionately increase the investment costs, without obtaining significant benefits as far as the stimulation of the competition is concerned.
Investments in infrastructure direct direct direct direct direct direct direct direct direct direct direct #of households with access to
and works through a combination of research, investments networks, grant funding and practical support to innovators
In some cases substantial investment will be needed to achieve this 5. Expand the European DSI network
While massive commercial investment and business models fuelled the web†s incredible growth, the use of platforms like Facebook to serve social good has
difficulty finding investment The future of the Internet should remain pluralistic, so that there is space for DSI
Europe could provide an alternative model in the form of investment in open infrastructures on
more investment in fundamental research to promote net-neutrality, strong encryption, banning of trivial patents, open standards and free software together
of investment. It is crucial for successful crowdsourcing to design the activity properly to prevent excessive demands and frustrations.
INVESTMENT AND FUNDING 152 26 13 7674 70 32313030 0 Pr oj ec t T
support, investment advice and funding oppertunities for SMES and young compa -nies are also available through the Startup
government investment and subsidies in the USA than the EU. Approximately eight times as much public as private business invest
In the EU investment in research and technological development is more market-based †and demonstrably less
Investment Fund. They combine investments in new hardware and software with experi -ments to discover better ways of delivering healthcare or reducing carbon emissions
PUBLIC/DIRECT FUNDING President Obama set up an office for social innovation in the White house, with a fund for supporting NGOS.
Seed funding is a very early-stage investment, meant to support the business until it can
or until it is ready for further investments. Seed money options include friends and family funding, angel funding andâ crowdfunding.
One important objective is to provide infrastructural investments such as broadband de -ployments and pan-European digital services that underwrite robust, equal, society-wide
INVESTMENT ON ENABLING INFRASTRUCTURES Community and bottom-up networking is an emerging mode of the Future Internet,
it needs investment in alternative archi -tectures that favour new players and allow for bottom-up innovation.
Investment for this kind of innovation support programmes can come from public funds but could also be through public private partnerships or
Impact Investment team78, which invests between £150, 000 and £1 million in organisa -tions whose digital social innovations are designed to address key societal challenges
strong public investment that funded general-purpose technologies and basic research. However, noninstitutional actors (hackers geeks, social innovators and activists) are key in this process
Ultimately, just as in science and technology, innovation in society needs carefully crafted investment and support.
In some cases substantial investment will be needed to support innovations through to sustainability †just as in business, where many of the most transformative innovations required many
years of patient, large-scale investment before they delivered returns Alternative socioeconomic models based on trust and their reputations are emerging.
and when investment is needed to migrate and replace legacy systems. In response, the government said it preferred to
3. 1 In this part of the report, we analyse the investment the NHS Business Services Authority (the Authority) has made in the Capacity Improvement Programme (CIP) and
This represents a programme of investment, funded by the Department of health, to improve the CIP system.
ï Analysis of investment and spend data ï Analysis of service performance and service reporting data
optimised, and the value of asset/investments is exploited fully Governance architecture and standards Technical governance Technical governance arrangements provide strong
which inputs to management decisions about future direction and investment There is a tailored organisation wide training programme with clear success
Intangible investments and assets...5 Information...5 Government on-line...6 Competition...6 Intellectual property...7
encourage investment in new technological infrastructure, content and applications; and technology neutrality among competing and developing technologies to encourage interoperability
remote areas could complement private investment where appropriate, provided it does not preempt private sector initiative or inhibit competition. 1
Intangible investments and assets Firms increasingly rely on intangible investments and assets (skills, organisation, software networks) for competitiveness and growth.
However common frameworks to identify, measure and report intangible investments and assets still need to be developed
and be accepted widely. There is a significant role for governments in conjunction with business associations and accounting bodies to encourage
initiative or inhibiting competition, complement private investment with public financial assistance to expand coverage for under-served groups and remote areas
investment and maintenance costs. Commercial considerations and potential returns drive adoption Beyond a certain level of connectivity (PC, Internet access, on-line information or marketing), not all
Use of and investment in ICT requires complementary investments in skills, organisation and innovation and investment and change entails risks and costs as well
as bringing potential benefits. While many studies point to the possibility of market expansion as a major
that complementary investments in skills, organisational change and innovation are key to making ICT work, and that the use of ICT affects firm performance primarily
investments and that without these, the economic impact of ICT may be limited Use of ICT and Internet among SMES
and avoid the risks associated with new investments and new business models. Strong links with customers and suppliers along the value chain as well as the lack of competition
and are less sure of the expected returns on the investment Some SMES cannot afford to adopt sophisticated ICT solutions (e g. a Web site with a secure
Percentage of total investment in Internet e-commerce. N=34 Source: Ernst & young (2001 Logistics services, e g. package collection and delivery, also matter.
For example they were positive about costs of engagement (investment costs) in e-commerce and highly positive about their strategies reducing costs to reach customers,
B2c e-commerce generally does not justify a small retailer†s investment In the form of EDI linkages, B2b e-commerce has existed long between major retail chains and
incentives for new investment in broadband access and drive faster deployment of broadband services OECD, 2001c.
present their investment projects. Third, SMES tend to have a weak equity position, partially due to the late payment culture in Europe
row or even inexistent, meaning investments are made not. Cross-border access to cultural goods and
Justice, the Court of Auditors, the European Investment Bank, the European Economic and Social Committee and to the Committee of the Regions, A growth package for integrated European
expanding their investment in external R&d in order to stay alert to new ideas brought to the market instead of investing only in
returns on research investments. Joint Pathfinding occurs where research laboratories and business groups share resources, risks, and decisions jointly
make this investment) on its own, but together companies are willing to move forward†(5 •The EU Commissioner for Research, Innovâ
masks under-investments in essential drivers of sustainable, broadly-shared growth. It promotes temporary fixes over lasting solutions.
risks, as well as decreasing investment needs for SME, micro-organisations and start-ups, since they can share resources without mobilising so much
of investments Figure 1: Rationalizer: emotion awareness for online investors (Phillips and ABN AMRO 2009)( 5
a) smart, through more effective investments in education, research and innovation;(b) sustainable thanks to a decisive move towards a low-carbon
policies, as well as public and private investments While some regions are quickly advancing with the development of an original research and innovation
EU investments in the regions and help channel pri -vate capital into regional smart specialisation niches
investment, to provide interdisciplinary connection between academia, research institutes, businesses local and national authorities, nonprofit sector and
-uct may need a private investment that can reach a level of hundreds of EUR millions †as in the
On the same day, the renowned investment bank Lehman brothers, went into bankruptcy. Meeting for the first time, the founding Governing board
European VC investment continues to lag the US Share of GDP Source: Marston L.,Collins, L.,Bravo-Biosca, A. Lane, H
2013), Unchaining Investment. Barriers to US venture investment in UK Internet and digital businesses, Nesta
Report, June 2013 Some of the questions raised in the debate were as follows: Could entrepreneurship be an integra
-ation investment institute. This novel entrepreneur -ial Institute is seed to trans-European ecosystems 65 where research, business and higher education
Investment Fund. It manages a number of business networking events and has an in-house soft-landing
It is a long investment and there needs to be at least some warranty to the investors.
co-location leverages preexisting large investments to develop national industrial clusters such as Capen -ergies and Tenerrdis
investment and therefore the EIT as an †invest -or†has to accept the logic of private sector to the
2013), Unchaining Investment. Barriers to US venture investment in UK Internet and digital businesses, Nesta
Report, June 2013 8) EIT Call for KICS (2009 9) Taleb, N.,(2010), The Black swan: The Impact of
European union investments in advancing the Euro -pean Knowledge Economy and Single Digital Mar -ket development are by definition longitudinal and
emphasizes the investments not only in corporate R & D and science and technology driven research
innovative investment on physical properties, the Chilean government†s innovation centred on intan -gible process improvement, including transparent
-ened, and direct foreign investments were swiftly withdrawn. As a result, a domino effect was trig
investment, expanding credit access for compan -ies, support to largely low-income people, and employment protection and incentives for worker
households (US$1. 1 billion), investment (US$1. 7 bil -lion), and tax cuts (3). In addition, a law was enacted
focus on direct government investment, are amongst the most effective of all OECD fiscal pack -ages in stimulating activity and supporting employ
From January to August 2012, resource investment in Australia has continued to expand rapidly. Work continued on very large projects, capital imports
to impose sanctions (3). Pension fund investments are ruled also by risk criteria and are supervised by a third regulatory body (3). The soundness of the Chil
Different from Australia†s innovative investment on physical properties, Chilean government†s innov ativeness was manifested through its intan
investment (US$ 1. 7 billion) and tax cuts -Injected US$ 500 million in fresh capital into
investment through a business investment tax break -US$ 970 million (A$ 1. 5 billion) to guarantee a train
services, and insurance and investment products Only about half of Indian households have a bank
important physical artifacts but as investments in the city building process. The history of successful
infrastructure investment is less about the direct impact of technology and more about the inter
on investments are measured in terms of a soci -ety†s economy, health, and social wellbeing. Infra -structure is thus a critical determinant of co-cre
investment reached its lowest level in 35 years Since 1970, one government after another had
business angel and venture capital investment) and access to international markets The Incubator network†s dual missions will be
to expect that all investments will be done from the public domain. By understanding the poten -tial value of innovations for the different stake
-holders, also opportunities for co-investment arise A Changing Business Environment Meaningful applications in public lighting are based
back the investments for the development of the app. and for new investments in the smart lighting
system and related apps in the area This case shows that the technical system en
breadth of investment is certainly impressive, the real power of crowdfunding comes from harness -ing the wisdom of the crowd and creating a com
R & D related investment and the eventual can -cellation of the development of the said technol
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