New York, Feb 17 2009
The global financial crisis could provide entrepreneurial opportunities for budding information and communication technology (ICT) businesses, which in turn can power economic recovery, according to a new United Nations report.
The report, Confronting the Crisis: Its Impact on the Information and Communication Technology (ICT) Industry, highlights some harsh realities for the industry and explains how it can position itself for recovery in the future.
“Despite difficult times, there are reasons to be optimistic,” said Hamadoun Touré, Secretary-General of the UN International Telecommunication Union (ITU) at the launch of his agency’s report yesterday.
Speaking at the Mobile World Congress in Barcelona, Mr. Touré added that innovation is the key to recovery, stressing that “having contributed consistently as a high-growth sector in its own right, ICTs can now power economic recovery across all sectors.
“Along with stimulus packages put together by Governments, the ICT industry must continue to invest in infrastructure and the roll out of cost-effective services, such as next-generation networks (NGNs).”
The report noted that although credit is now more difficult to come by and more expensive, with financing costs on average 3 to 4 per cent higher year-on-year, savvy businesses can take advantage of the economic turmoil to reposition their services for the upturn.
Funding is still available for firms with sound business models, established demand and early projected cash flows, according to the report. But it stressed that alternative sources of financing are now needed, with a growing role for government and economic stimulus packages.
Responding to the financial pressure facing the private sector, some Governments have stepped in to diminish the impact on the transition to NGNs, which can carry voice, data and media services simultaneously.
Several administrations have also announced commitments to invest in their national infrastructure, while others, such as the European Union, have included the roll-out of broadband networks in their economic stimulus packages.
The report highlighted the soaring growth in the mobile telephone business in developing countries, especially in large emerging markets, including Brazil, India and Nigeria, which registered record additional subscribers in September and October 2008, as an example of opportunity for growth.