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Hungary to go digital, strategically

Who would argue, in 2010, that in order to increase Hungary's competitiveness, we need information and communication technologies and we need to use them on every vertical and horizontal spectrum for the sake of society, businesses and administration? No one. Right. But who would argue that we need resources and timeframes to advance in the digital evolution? No one, again. In spite of this, the draft of the new Digital Hungary Strategy, at the end of its public discussion, has some good news as well as some bad news.

Hold back the obligate yawn when reading the word “strategy” next to digital and ICT – even if it's the umpteenth time such a matter comes into focus without any consequence in the near future. The current document from the current government, entitled Digital Hungary Strategy, is in many ways a better piece of work than its predecessors. Not because of the shocking novelties or elaborated details, but it's elaborated enough to give a broader perspective on the basics of Hungary as not yet a digital economy but how it wants to be one.

As we approach our deadline here at the Budapest Business Journal, the National Economy Ministry closed the public debate on the subject and is working on the evaluation of the comments and proposals, to reveal the final version sometime in December. As for the debate, some details of the document can be contested, and they are, but the real question marks are around financing and timeframes, none of which is explicitly mentioned. Furthermore, the major part of it is just too proper of a compilation. So let's see what we'll be up to in 2014.

Small surprises

The strategy is the most open so far toward open source software, declaring that its proportion should be strongly increased in government IT processes, after a thorough examination of particular segments. This could result in several advantages coming from the economies of scale such as shareability with other public institutions or knowledge transfer between parties of governmental IT. According to the proposal, this would not mean a preference for the open source development, just a possibility for a broader use, prepared by pilot projects. Although no detailed action plan has been set for the transition or the pilots, experts say open source software can be introduced at some of the institutions within the four-year timeframe of the strategy.

On a more concrete note, the number of digital illiterates could be decreased by one million by 2014, by launching motivation and community-oriented programs that are built on local environments, demand and communities and personal relations. At the same time, e-government and e-health services would also be improved. In 2009, 52% of the households had at least one PC, but while the digital literates are feeling more and more comfortable using them, those without access are lagging behind more and more, BellResearch's Infocommunication Report says. Meanwhile, according to another study, conducted by the Association of IT Companies (IVSz) and MeFIT Foundation, in only five years' time, digital literacy will be indispensable in 90% of the jobs in Hungary.

The private sector, with all the inefficiencies of processes and its suspicions about IT in general, is still on the top of the list of digital literacy. But they also need some support from the government, the document says, and boosting sustainable and effective competition is in both the enterprises' and society's interest.

So in 2014, there should be one million more new generation accesses with at least 20 Mbit/s download speed and average download speed to be increased in households to 10 Mbit/s by regulation. Digital TV subscription rates are to reach 80% from the current 52%. Still, for equal competition, all households should have the opportunity to choose from at least six telecommunications service provider's retail offers by 2014. To improve the ratio of properly trained ICT professionals, the retraining of 40,000 experts is necessary in five years' time.

In accordance with EU guidelines, the entire population should have access to minimal broadband with 4 Mbit/s download and 1 Mbit/s upload speed by 2013. A breakout point is also set for Hungary in mobile penetration, of reaching the leadership position in the region by the same time. The most immediate goals, set for 2011, include a new ICT legal regulation and switch to digital terrestrial television broadcast by the end of the year, both in line with EU expectations.

Industry backs digital literacy goals

The importance of the strategy is highlighted by the numerous comments that were made by individuals, businesses and organizations concerned over the future of ICT in Hungary – including parties from other sectors such as health care or education. While the IVSz worked the closest with the government from the part of the industry in elaborating the strategy, the public discussion involved more than one hundred considerable remarks that will probably be integrated into the final version of the strategy.

The organizations asked by the BBJ agreed that there was a real opportunity to make their voices heard this time and that the elements most important for the industry are stressed more than before. IVSz, for its part, highlights three pillars of goals as crucial for future development, said chairman of the association Tamás Laufer. For one, digital literacy is something of prevailing importance for the economy: computer usage and the internet should be familiar to the most people possible, by essentially conducting 'missionary' work in the over-40 age group. Two, people would be more motivated if the proper services were available on the already available infrastructure, and in case of some public services it were mandatory to use the electronic version. Three, IT trainings are of key importance for both industry professionals and the digital society.

“If the IT industry were taken seriously and the government strengthened the training of engineers, for example, then it could even balance out the negative effects of the crisis tax,” Laufer stressed. The use of digital tools should be a basic skill, necessary also for the job creation aims of the government, and it requires the restructuring of adult training as well, where it's easier for service providers to get accreditation. “Besides the areas mentioned in the strategy, we also see great business opportunities in data logistics – namely data centers established near power plants to save on energy costs,” said Laufer.

Rumored to be considered in the final version of the document are the proposals for tax cuts on electronic books and some legal modifications for the benefit of consumers. SzEK, the Association for E-Commerce, besides stepping up against e-books’ current tax discrimination, also proposes further amendments to the Commerce Code that would be proper for the regulation of electronic commerce and offers its expertise for the modifications. The organization advises to support successful businesses in developing non-profit solutions for the improvement of digital consumer culture.

Another very important topic for businesses and their competition is the accessibility of broadband services. Parallel to the digital strategy, Broadband Foundation is preparing its 2011 edition of the Discussion Paper on Broadband, together with BellResearch, following the guidelines of the EU's digital Agenda, and is set to be published for Hungary's EU presidency. While the foundation agrees on the basic principles for broadband development, they, as other organizations, are lacking the details on financing and timeframes in the strategy. (Anikó Jóri-Molnár)