Several factors as foundation of the network economy are connectivity, innovation, participation and efficiency. Many years before, because of geographical place and no certain connection tools have make difficulties for people to reach other people in other societies. The invention of mobile phones, facsimiles, internet and the rapid development of computer technologies have remove the barriers. The world now is connected and companies easier to maintain their business. The connectivity promotes business not only for local area but also for entire global area.
The rapid development in ICT also promotes the new innovation of economic activities way. For example, in education area people who live in other continent can get diploma without the obligation to attend the class which location in the different continent. They can have on-line courses and on-line exams in process of getting the bachelor. Another example, someone who lives in Dubai can easily buy a bottle of expensive wine from seller in French via e-bay because new innovation way of business transaction.
Furthermore, the economy will become a network because the presence of participation of people who involve in the economic activities. The company such as You Tube, Face Book and Google were established from participation of small amount of people who had bright innovations to make new way of business. Participations and collaborations in Small Business Enterprises are the key factors for company to extend their business globally.
Finally, the efficiency is the last factors that build the network economy. The new way of handling activities in business result in cost reduction of materials and times. Using of compact disc, flash disk and soft copy form of data as external storage have decline the cost of paper materials in business. Video conferences through the internet reduce the time of exchange information as compare using of mail in past years.
Although the network economy system seems to be applied in all business activities in the world today, does the network truly global? Dr. Pekka Tarjane, a secretary of general International Telecommunication Union (ITU) in his paper “Is the Network Economy Truly Global?” stated that there are three steps of network economy to reach actually the global world space. First is the communication must be able to across geographical space in certain speed of time. Second is the network economy have to walk on connectivity and inter-operability which mean that people can reach the world, and finally to meet the criteria of global, network economy have to give availability and affordability for people which mean that the world must have ability to reach people in everywhere and every place.
According to those steps, to establish a truly global network economy is not an easy way. The different absorption and development of information and technologies among countries in the world provoke several problems of implementation of global network economy. Based on data of Dr. Pekka Tarjane’s paper, there was unequal distribution of utilization of internet technologies in the world. He stated that almost 97 percent internet hosts are located in the high income countries which their population just contribute 16 percent from total world’s population. In almost 6 billion of people population in the world, there is just small numbers of people have access to the internet. This situation makes the perspective that the network economy is not truly global.
As conclusion of his paper, Dr. Pekka Tarjane stated that if people can reach the world then the world has to reach the people too. This argument stand for the several reasons which are social justice that people have right to communicate, market potential lies in the emerging economies and information technologies are freedom technologies. It is fact that the network economy is not apply globally in recent era, however the process of continuing of the application this new economy will bring bright results in the future for the people.
References:
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www.itu.int/itudoc/osg/ptspeech/theme/env/icc97.pdf
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