Massive Chasm In Asia's Public Sector IT Spending

IT_Sleep_Bag writes "A recent study by Springboard Research shows a massive chasm between countries in the APAC region, with countries like New Zealand and Australia investing up to USD 200 per capita on IT, while India and China spend a dismal USD 1. SDA Asia speaks to Dane Anderson of Springboard Research to explore the reasons for the wide gulf and why he believes India and China will grow the fastest in this regard."

Comments

Duh?

[toby]

"What is the reason behind this chasm?"

(!!??) Look at the math: India has 1.2 billion, many of which are at subsistence level; Australia, a "developed" country, has 20 million fattening middle class aspirants. A 200:1 ratio reflects that reality.

And of the $200 spent per head in lazy republics, 90% of it goes down the drain (FBI's Keystone Cops IT fiasco; name-your-favourite-boondoggle; even Russia caught quickly on to the overspend-and-underdeliver game, it's a great way to embezzle). Raising indigent populations to Western standards of waste is not really helpful, is it.

Anyway, if you didn't get Carr's memo: IT's a commodity now. The industry's shrinkage can't be blamed on nine-whatever or the "War on Common Sense"; the gold rush days are OVER. Spend less and spend better (hint: not on *cough* MS junk; hint: don't reinvent - unless it's to take business from MS :)

Re:Duh?

[HMC CS Major]

Not MS, and don't reinvent unless it's to take business from MS? Is this an anti-MS rant or real IT advice?

Spending less and transferring entire enterprises to new platforms are mutually exclusive. Face it: retraining 10,000 employees on alternative operating systems won't be nearly as cost effective as maintaining the existing Windows installs, so the desktops will remain Windows for the foreseeable future. You keep AD, but you can roll in Exchange and SQL Server alternatives, perhaps Office alternatives for specific departments where interacting with the outside world isn't necessarily a requirement.

Remember: it's a company, not a religion. Being anti-MS may be popular on slashdot, but it's not always the smartest (or cheapest) in real business.

Re:Duh?

[eggstasy]

Since when does Linux require any training? It's not any different from Windows. You must be used to dealing with megacorps where unionized people refuse to do anything outside their job specification and there's lots of money to spend on frivolous "training" courses, which are usually just an excuse not to be at the office and work.
Training? What training? How about "If you're too dumb to work with what we give you then RTFM on your own time or we'll find someone with a bit more initiative"?
My non-technical girlfriend installed Mandrake Linux on her own as far back as 2001, simply because she liked the cool wallpapers, screensavers and minigames she saw on my computer...

Ok, per capital is fine, but gimme actual numbers

[davevt5]

So basically that means that China is spending over one billion USD -- $1,306,313,812 according to Google. Whereas Australia is spending $4,018,087,400 (assuming 20,090,437 people again, according to Google). And this means that New Zealand, with 4,035,461 people is spending $807,092,800. Lastly, India with 1,080,264,388 people (thanks Jeeves... um, I mean ASK.com) is spending just over one billion as well.

To summarize:
China: $1,306,313,812
India: $1,080,264,388
Australia: $4,018,087,400
New Zealand: $807,092,800

The actual numbers are more helpful.

Sure, it looks like Australia is outspending China nearly 4:1. My guess is that looking at per capita is irrelevant.

Re:Explore the reasons for the wide gulf

[queenb**ch]

How about industrial espionage? Ask Cisco, Nortel and Juniper how much Huawei gear violates their patents...

Why spend when you can steal?

2 cents,

QueenB

Massive chasm?

[Zouden]

What the hecks? Australia and NZ are completely western and the only way we can be considered part of Asia is by some vague geographical classification. We certainly associate ourselves much more closely with the US and UK than any country in Asia.

This is like saying "massive chasm in public sector IT spending between the US and Mexico!!" - well... yeah, what do you expect?

Re:Massive chasm?

[CrankyOldBastard]

And who is this "We" you are talking about? I'm Australian and I certainly associate much more closely with people from South East Asia and the Pacific Island Nations than I do with the US. The few people I do associate with from the North American continent try to disassociate themselves from the US as well.

Open your eyes, we are an Asian nation. Our largest growth markets are China, Malaysia, India and Indonesia. The biggest buyer of our steel (our biggest export in dollar terms) is Japan.

My kids are taught Asian languages at school, not Spanish. They spell "colour", measure in metric, and share time zones with the Phillipines, Japan, Korea, Indonesia, Malaysia and Vietnam.

Culturaly, Geographically and Economically we are part of Asia. This is not the White Australia age anymore, and Pauline Hanson is not Prime Minister.

Re:Massive chasm?

[Anonymous Coward]

And who is this "We" you are talking about?

The 95% of people of Australasia, including the native peoples, who are not Asian.

I'm Australian and I certainly associate much more closely with people from South East Asia and the Pacific Island Nations than I do with the US.

There would be a similar percentage of people in Australia who associate much more closely with people from Africa, but that doesn't make Australia an African country either. The south Pacific islanders are highly distinct from the S.E. Asians and don't consider themselves to be a part of Asia in any way either.

The few people I do associate with from the North American continent try to disassociate themselves from the US as well.

Which is probably why they're in Australia, and the other 290 million Americans are in North America.

Open your eyes, we are an Asian nation.

Australia is:
Culturally Asian? - No
Continentially Asian? - No
Linguistically Asian? - No
Racially Asian? - No
In an identity chasm because of previous political issues? Yes

Our largest growth markets are China, Malaysia, India and Indonesia. The biggest buyer of our steel (our biggest export in dollar terms) is Japan.

By that, China is a European country.

My kids are taught Asian languages at school, not Spanish.

By this, learning European languages like English places the world in Europe. And almost nobody is taught Spanish as a second language at school outside of the US.

They spell "colour", measure in metric,

As does almost everyone outside America.

and share time zones with the Phillipines, Japan, Korea, Indonesia, Malaysia and Vietnam.

Europe and Africa share time zones too, and are as similar distance away from each other.

Culturaly, Geographically and Economically we are part of Asia. This is not the White Australia age anymore, and Pauline Hanson is not Prime Minister.

I say call a spade a spade.

Re:Massive chasm?

[CrankyOldBastard]

I'd like to point out that my post was in reply to the claim that we here in Oz are more closely associated with the US and UK than Asia. It is the opinion of many (probably close to 40%) that the clinging to the USA as currently demonstrated by Bonsai Howard (Bonsai - a little Bush) and the UK as demonstrated by Menzies in the 50's are no longer appropriate or helpful to Australia's future growth and security.

Your post does a great job of attacking my points in isolation, but in no way addresses the thesis that "we" do not unanimously "associate ourselves" with the US and UK, and many of us (particularly those of us from the left side of politics) believe we are an Asian nation.

You do raise a good point with In an identity chasm because of previous political issues? Yes, although I would contend that the "identity vaccuum" is more due to the promotion of predjudice and bigotry by the extreme right in the last 15 years in this country.

Re:Massive chasm?

[identity0]

But that still doesn't change the wrongness of the original post, which was an assertion that "Australia and NZ are completely western and the only way we can be considered part of Asia is by some vague geographical classification."

The attempt to make Australia and NZ out to be "not Asian" based on cultural measures and ignore geography is odd, at the very least. He implies that one can be geographically be part of Asia but not Asian based on culture alone.

It's like Americans claiming they're not Americans because they're western, not native American. There seems to be an Au/Nz tendency to pretend they are a European country. Perhaps because they didn't have a war with the British? But then, Canada didn't, either, and they don't seem so self-concously "not North American" (though they like to point out they are not the U.S.).

Maybe Au/Nz are just afraid of Asia?

If you don't consider Pacific islanders or native Australians Asian, I'd like to hear what your definition of Asian is. Do you include Israel? India? Russia?

Comment removed

[account_deleted]

Comment removed based on user account deletion

Doesn't talk about purchasing power

[starkravingmad]

The article doesn't mention whether costs are calculated at Purchasing Power Parity or not.. $1 in India goes a lot further (e.g., labour costs) than in Australia or New Zealand. I think (look up the CIA world factbook to verify) that Real US $1 = about $6 at PPP in India. Also IT systems have very low marginal costs to usage - e.g., it costs a little more to serve 1 billion people than to serve 20 million - the relationship is not linear. Here's an example of what your IT dollars will bring you in Australia - my company accepts customer applications online - what actually happens is that your form gets emailed to a person on the fifth floor whose job it is to fill an aplication form using the details in the email and then put it through the normal fulfillment process. We spent tens of thousands of dollars on that 'system'.

Re:Doesn't talk about purchasing power

[Riding Spinners]

It's nice to see someone with at least one semester's worth of economics classes on Slashdot.

Now, let's not kid ourselves here: the poor developers in India are being exploited. The average salary is around $390/mo.; a kid working part-time down at the local McDonald's in the U.S. make far more money than that. Sure, the cost of living is a little lower over there, but things like books and computers (and commodities such as drinking water, electricity, and gasoline) still cost the same or more than they do here.

Convering salaries directly my multiplying or dividing by the exchange rate without taking into account the Purchasing Power Parity is just plain ridiculous. To sum it up for the economically-inept Slashdot crowd:

The PPP measures how much a currency can buy in terms of an international measure (usually in U.S. dollars), since goods and services have different prices in some countries than in others).

Goods and services cost an order of magnitude less in India and China than they do in the United States. For example: a loaf of bread costs about INR 20 (about $0.43). A monthly lease in a nice, spacious house would be about INR 15000 (about $323). That might seem cheap, but consider this: your average non-American software engineer working in India or China would end up spending about 50% on his or her salary on food alone (Americans, on the other hand, barely spend 8% -- and it keeps going down thanks to genetic engineering).

If the exchange rates were to suddenly fluctuate (as they have before), employing people in India and China could become economically unviable. However, that would simply translate to more lower-knowledge work ("shit jobs") in the U.S. -- something that no self-respecting American college graduate would go near. Not much damage to our economy there.

different value

[john_uy]

from the springboard research website, the actual tally is:

Country Per Capital Public Sector IT Spending
  New Zealand $198.78
  Australia $193.82
  Singapore $152.89
  Hong Kong $67.22
  Korea $52.96
  Taiwan $45.22
  Malaysia $21.92
  Thailand $7.41
  China $3.67
  Philippines $2.94
  India $1.29
  Indonesia $1.10

china spends $3.67 and not $1. there is a big difference given their huge population.

all in all

Country Total Spending
China 4,794,171,690.04
Australia 3,893,928,499.34
Korea 2,515,600,000.00
India 1,413,004,073.55
Taiwan 1,035,284,044.48
New Zealand 802,168,937.58
Singapore 676,648,330.80
Malaysia 534,538,007.36
Thailand 478,920,118.95
Hong Kong 463,729,672.92
Indonesia 269,998,012.90
Philippines 258,300,970.62

* population figures from google and cia.

from springboard research: "A key focus of this report was to dive deeper into the Public Sector in each country to measure the Sub-Vertical Industries within the Public Sector such as Defence, Healthcare, Social Services, Taxation/Finance, etc... and to provide granular data on each of these Sub-Verticals." i don't think that you should spend a lot for it in those areas as the money will be better used for doctors, nurses, medical equipment, medicine, equipment and other stuff.

this does not include private it spending that may also complement some items as what the public sector is spending.

* sorry, i don't know much of html and don't want to spend time learning how to format the tables properly as i redid this comment and calculations for a couple of times.

Flawed study criteria

[jkrise]

IT Spending cannot be directly related to the spread of IT and it's benefits. Let's take the case of the Indian Railways (the biggest employer in the World) and the Indian Insurance business (a mammoth organisation).

The ticket reservation system in Indian Railways uses a dumb-terminal front end attached to dot-matrix printers, with Unix systems in the backend... I'm not sure about the databse and the progrmming language though. Now, IT spending-wise, the Railways probably spends about 1% (no kidding) of the money that would've been needed for a Windows-Citirx-thinclient-IBM consulting-broadband-interconnect-firewall-data-ce nter solution for the same performance. IBM's efforts to sell multi-purpose thin-clients and migrate to DB2 on AIX have failed. (The online reservation system allegedly runs .Net and Flash, and is quite slow and clumsy though).

The Life Insurance Corporation of India recently decided to shut down Windows on all their systems and networks (they were fed up with the ServicePack Oriented Architecture) and tied up with RedHat for thousands of PCs. A ten-fold savings on licensing costs (and IT spending) ensued.

So basically, I would reckon the study methodology and criteria were flawed. Asia has a much bigger ratio of Linux and Unix systems (and Lotus Notes as well, surprisingly) compared to the rest of the World. The much higher GDP and purchasing power distorts the study method.

For instance, a licensed version of MS Office Professional would easily be 3-months wages of a middle-class Indian. This is NOT the right way to compare IT penetration and usage.