Digital Economy And Society. A Cross Country Comparison Of Hungary And Ukraine
UUDK O35, R11.SZABOLCS NAGY DIGITAL ECONOMY AND SOCIETY – A CROSS COUNTRY COMPARISON OF HUNGARY AND UKRAINE
У даній роботі я вперше проаналізував стан цифрової економіки та суспільства в Угорщині, потім порівняв його з Україною та зробив висновки щодо майбутніх тенденцій розвитку. Використовуючи вторинні дані, надані Європейською комісією, я досліджував п'ять компонентів Індексу цифрової економіки та суспільства Угорщини. Я провів аналіз крос - країни, щоб з'ясувати суттєві відмінності між Україною та Угорщиною щодо доступу до Інтернету та використання пристроїв, включаючи смартфони, комп'ютери та планшети. Виходячи з моїх висновків, я зробив висновок, що Угорщина більш розвинена з точки зору значущих параметрів цифрової економіки та суспільства, ніж Україна, але навіть Угорщина є новою цифровою нацією. Враховуючи високі темпи зростання інтернет - прояву планшета та смартфонів в обох країнах, я очікую більш швидкого прогресу у розвитку цифрової економіки та суспільства в Угорщині та Україні. Ключові слова: цифрова економіка, цифрове суспільство, DESI, Інтернет, використання пристроїв, Угорщина, Україна, порівняння між країнамиВ этой статье я сначала проанализировал состояние цифровой экономики и общества в Венгрии, затем сравнил ее с Украиной и сделал выводы относительно будущих тенденций развития. Используя вторичные данные, представленные Европейской комиссией, я исследовал пять компонентов индекса цифровой экономики и общества Венгрии. Я провел кросс - анализ, чтобы выяснить существенные различия между Украиной и Венгрией в плане доступа к Интернету и использованию устройств, включая смартфоны, компьютеры и планшеты. Основываясь на моих выводах, я пришел к выводу, что Венгрия более развита с точки зрения значительных параметров цифровой экономики и общества, чем Украина, но даже Венгрия является новой цифровой нацией. Учитывая высокие темпы роста проникновения Интернета, планшета и смартфонов в обеих странах, я ожидаю более быстрый прогресс в развитии цифровой экономики и общества в Венгрии и Украине. Ключевые слова: цифровая экономика, цифровое общество, DESI, интернет, использование устройств, Венгрия, Украина, сравнение по странам
We live in the Digital Age in which both economy and society have been transforming significantly. The Internet and the connected digital devices are inseparable parts of our daily life and the engine of the economic growth. In this paper, first I analyzed the status of digital economy and society in Hungary, then compared it with Ukraine and made conclusions regarding the future development tendencies. Using secondary data provided by the European Commission I investigated the five components of the Digital Economy and Society Index of Hungary. I performed cross country analysis to find out the significant differences between Ukraine and Hungary in terms of access to the Internet and device use including smartphones, computers and tablets. Based on my findings, I concluded that Hungary is more developed in terms of the significant parameters of the digital economy and society than Ukraine, but even Hungary is an emerging digital nation. Considering the high growth rate of Internet, tablet and smartphone penetration in both countries, I expect faster progress in the development of the digital economy and society in Hungary and Ukraine.Keywords: digital economy, digital society, DESI, Internet, device usage, Hungary, Ukraine, cross country comparison © Szabolcs Nagy, 2017
ISSN 2519-4461 (print)
Вісник НТУ «Харківський політехнічний інститут» th in this component, compared to16th in 2016. Hungary has made progress both in the supply and the demand side. Fast broadband coverage increased to 81% from 78%. The Hungarian government launched two initiatives to increase demand. Primary, a preferential VAT rate is applied to broadband subscriptions in 2017. Secondly, the government created a "digital welfare basic tariff" for non-users. Consequently, a basic broadband package (fixed or mobile) with a 10-15% price discount is available from 2017. 95% of homes in Hungary can now have access to fixed broadband services. 4G coverage is also very high (92%) butmobile broadband penetration is still quite low, only 43 subscriptions per 100 people, which was even lower in the previous period (34 subscriptions per 100 people). This is because mobile broadband prices are significantly higher than in the rest of Europe (Figure 3).Figure 3 mobile broadband prices on handsets, Hungary Source: EC (2016)As for Human Capital component of DESI, Hungaryranks 18th among EU countries slightly below the EU average. Its position in the ranking remained unchanged but progressed 0.05 point in a year time (Table 3.). The country shows a diverse picture in digital skills as only slightly more than the half of the population have at least basic digital skills (51%), whereas ICT specialists represent slightly higher share of the labor force than in EU (3,6% compared to 3.5% in the EU). Table 3. Human Capital scores Source: EC (2017)It’s a significant improvement that the number of internet users has been gone up to 78% from 72%. Економічні науки . №
46 (1267)175elecommunication plays a fundamental role in the family lives of the Hungarian Internet users who are convinced that the more telecommunication device a family uses, the better informed it is. Hungarian users are doing a lot of things on the Internet outstripping the EU average on the use of the internet. Internet makes it easier to get along in life (eNet, 2015). The most popular device in Hungary is the mobile phone including basic mobile phones and smartphones, followed by TV. 96% of the population use mobile phones currently, and 93% have TV. The use of multiple screens (two or three) is on the increase in Hungary. The ratio of STEM (Science, Technology and Mathematics) graduates per 1000 individuals aged 20-29 is quite low (11/1000). In response, the Hungarian Government implemented a new Digital Competences Strategy to increase the ratio of STEM graduates and to address lifelong learning.The use of Internet is the best performing component of DESI in which Hungary scores above the European average(Table 4). On the one hand, Hungarian Internet users are veryactive in reading news (88% of the individuals who used the Internet in the last 3 months) but they also like using social networks (83%) and making video calls (54%). The use of social networks is the highest here in Europe, outperforming the EU average by 20%. On the other hand, Internet users in Hungary are less engaged in online banking and shoppingand only 8% pay for Video on Demand (VOD) services, which is significantly lower than the EU average (21%). It is also unfavorable that the number of online banking users dropped by 2% in a year.Table 4. Use of Internet scores Source: EC (2017)Integration of digital technology by businesses is the biggest problem in Hungary as Hungarian firms should better exploit the possibilities offered by online business, social media and cloud-based applications. With 0.52 points, on the Integration of Digital Technology by businesses, Hungary's ranks 24th, significantly below the EU average (Table 5.). However, Hungary progressed in all indicators and advancedthree ranks compared with 2016. Only 13% of enterprises use social media (11% in 2015), 8% send eInvoices (6% in 2015), 8% use cloud services (6% in 2015), 12% of SMEs sell online (10% in 2015) and even less 4.5% sell online cross-border. nevertheless, the e-Commerce turnover went up to 7.6% from 7.0%. The Hungarian government launched two initiatives to boost integration of digital technology by business. Table 5. Integration of digital technology Source: EC (2017) The objective of Modern Businesses Programme is to raise awareness, whereas the Programme called “Support ofbusiness digital developments” will offer grants and loan financing opportunities.Digital public services are one of the most challenging areas of the digital economy and society in Hungary where there is room for improvement. With 0.35 points Hungary ranks only 27 th on this dimension (Table 6.)Table 6. Digital Public Services scores Source: EC (2017)Hungary ranks only 23rd on the pre-filled forms, which is the re-use of information across administrations to make life easier for citizens and even worse, 25th on the online service completion. However, the ratio of eGovernment users in Hungary (30%) is not too low considering the low service level of online public service. It is favorable that Nemeslaki, Aranyossy & Sasvári (2016) found high-level of on-line voting intent amongst young Hungarian internet users and that perception of on-line voting would enhance voting desire. Open data is also an issue, where Hungary performed significantly worse - dropped by 7% - compared with the previous year.All things considered, DESI of Hungary scores above the EU average in the use of internet and is somewhat below the average on connectivity and human capital. Still there are two serious areas to improve: the integration of digital technology by businesses and digital public services. Hungary surpasses the European average in the obtainability and take-up of fast broadband as well as in the use of social networks. 4.After investigating the status of digital economy and society in Hungary, I decided to examine thoroughly the components of DESI by using Consumer Barometer Graph Builder. To make this investigation more interesting, I performed cross country analysis to find out the significant differences between Ukraine and Hungary. Unfortunately, as Ukraine is not a EU member state, Ukraine is not included in DESI. However, Consumer Barometer contains data of Ukraine, too.81% of Hungarians use the internet as of 2017, which is 1% drop compared with the previous year. However, there was a leap in the percentage of people who access the internet from 73% in 2015 to 82% in 2016. Although the number of Internet users in Ukraine is growing rapidly and steadily, it is still significantly lower (66%) than it was in Hungary five years ago (Figure 4.) As far as the device use concerned, the mostly used device is the mobile phone in Hungary (96%), while the television in Ukraine. It can be concluded that almost everyone has got a mobile phone and/or a TV set in both countries. The computer, smartphone and tablet penetration are significantly higher in Hungary and the same applies to other digital devices such as digital devices to save or record TV programs, digital devices to stream Internet-content on ISSN 2519-4461 (print) Вісник НТУ «Харківський політехнічний інститут» кономічні науки . №
46 (1267)177SSN 2519-4461 (print)
Вісник НТУ «Харківський політехнічний інститут»
Бібліографічні описи / Библиографические описания / Bibliogra phic descriptions
Цифрова економіка та суспільство в Угорщині / Szabolcs
Nagy/
Вісник
НТУ “Харківський політехнічний інститут” (економічні науки). – Х.: НТУ „ХПІ ”. - № С. . Бібліогр. назв. – ISSN 2519-4461.
Цифровая экономика и общество в Венгрии / Szabolcs
Nagy/
Вестник
НТУ “Харьковский политехнический институт” (экономические науки). – Х.: НТУ „ХПИ”. - № С. . Библиогр.: названий. – ISSN2519-4461.Digital Economy and Society in Hungary / Szabolcs Nagy/
Bulletin of NTU "Kharkiv
Polytechnic
Institute" (economicsciences). –
Kharkiv.: NTU "KhPI". - № P. 174-179 . Bibliogr.: 16 names. –
ISSN 2519-4461.
Відомості про авторів / Сведения об авторах /
About the
Authors
Szabolcs Nagy, Associate Professor, University of Miskolc, Faculty of Economics, Institute of Marketing and Tourism;3515 Miskolc-Egyetemváros, Hungary, +3646/565-111/17-30, [email protected]
Економічні науки . №. №