GRAPHIC: Australia is in danger of losing out in the global digital innovation race

The digital evolution index by the Fletcher school at Tufts University in Boston tries to map out the countries poised to take greatest advantage of increasing connectivity in the global economy, especially among the next billion people who are about to start using the internet in emerging markets.

It is grim reading from an Australian perspective, with the country among a handful categorised as “stalling out” when it comes to momentum on digital innovation.

The researchers say the aim of the study is to inform strategic decision-making “among businesses investors and policy-makers in steering innovation and allocating resources”.

The “stalling out” category, where Australia is placed, is for countries that “have achieved a high level of development in the past, [but] they run a risk of falling behind.”

The paper includes this heat map of global economies:

Countries are assessed on four criteria: Demand, Supply, Institutional Environment, and Innovation. It’s a longitudinal study, assessing momentum between 2008 and 2013. Advanced economies generally do not fare well in the report, although only nine countries including Norway and the Czech Republic were judged to have lost more momentum than Australia in the survey period. We first spotted this at HBR.

Digital entrepreneurs and investors have long complained of some of the restrictions on the digital innovation in Australia, ranging from availability of capital and skills shortages to slower internet speeds and unfavourable tax arrangement for startups.

The report isn’t all bad news for Australia because it notes that the country started on a high base. But in recent years other countries have been positioning to outstrip Australia in meeting the demand for the huge business opportunity presented by the rise of the global digital economy from emerging markets.

You can see a full summary of the findings, which has implications for marketers, retailers, and investors, here.

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