Introduction
ICT Framework for Business and Industry
Survey Background
Industry Classification and Coverage
Sampling Design
Issues and Problems

 
The role of information and communication technologies (ICT) as one of the driving forces of economic and social changes in the global economy has brought considerable demands for ICT-related statistics. Reliable and internationally comparable data on ICT are needed by policy makers for planning and monitoring ICT policies and strategies. While a number of initiatives have been launched at the international level particularly by developed countries, many developing countries are as well preparing policies and strategies for the deployment and expansion of ICT usage in their societies. They realize ICT could provide businesses and individuals with powerful tools to alleviate poverty, improve health conditions, generate more employment opportunities, enhance market access of products, and improve competitiveness, among others.

Development work on ICT measurements was initiated in the middle of 1990s by member countries of the Organization for Economic Cooperation and Development (OECD>^1/), mainly through the Working Party on Indicators for the Information Society (WPIIS). Substantial work has been done by OECD WPIIS in a span of few years which includes policy-relevant and statistically feasible concepts and definitions, i.e., ICT sector, electronic commerce, ICT commodities, etc., methods and model surveys for the compilation of ICT statistics. Another development was the establishment of set of core indicators for non-OECD countries that would measure the supply and demand of ICT infrastructure, related services, content and application, electronic commerce, among others.

In 1998, OECD members agreed on a definition of ICT sector as a combination of manufacturing and services industries, and this accepted definition was the first step towards having internationally comparable statistics.

In 2000, OECD member countries also endorsed two (2) definitions of electronic commerce transactions, the broad and narrow definitions, which are based on communications infrastructure. To date many countries, developed and developing alike, have already adopted many of OECD’s recommendations and the suggested list of ICT indicators for their e-measurement work. A model questionnaire on ICT usage and e-commerce was also developed to stimulate the conduct of national ICT surveys for enterprises, governments and households.

Regional measurement initiatives

To address the issue of e-measurements, collaboration among countries of the Association of Southeast Asian Nations (ASEAN) was forged in 2000 with the formulation of e-ASEAN Framework Agreement under the five Flagships:

• Establishment of ASEAN Information Infrastructure;




• Growth of electronic commerce;




• Liberalization and facilitation of trade and investments in ICT products and services;




• Capacity building and e-society; and




• Establishment of ASEAN Information Infrastructure;

One of the other e-measurement initiatives in the region was the conduct of the ASEAN e-Readiness Assessment Study by the ASEAN Secretariat in early 2001. The stage of development of information economy in each of the ten countries comprising the ASEAN was measured in terms of the following : infrastructure, e- society, e-commerce and e-government.

The four (4) stages of Development on E-Readiness are shown below:

The results of the study classified the Philippines to be in the Evolving stage, along with Thailand, Brunei and Indonesia. Singapore stands out in all areas as it was classified to be in the Extending stage, followed by Malaysia which was in the Embedding stage. CLMV countries (Cambodia, Laos, Myanmar and Vietnam) were classified to be in the Emerging stage.

The score card for the four (4) different measures of e-readiness is shown by country:

Scoreboard on E-Readiness Assessment
 

 
There are three (3) primary components of ICT for business and industry. These are ICT Infrastructure, E-Commerce Transactions and E-Business Processes.

1. ICT infrastructure includes machines, knowledge (software) and ICT human capital that are used to support electronic business/manufacturing processes. Machines include computers and peripheral equipment, network channels, telecommunication equipment, routers, satellite and other ICT hardware. Knowledge, on the other hand, includes system and application software, ICT support services and other ICT components.

   Network channels include the internet, intranet within the organizations, extranet and electronic data interchange (EDI) networks linking trading partners, and telecommunication networks.

2. E-commerce transactions include e-selling and e-buying/purchasing. The OECD WPIIS provides a broad definition for electronic transaction as …

the sale or purchase of goods and services, whether between business, households, individuals, Governments and other public and private organizations, conducted over computer-mediated networks. The goods and services are ordered over those networks, but the payment and ultimate delivery of the goods and services may be conducted on- or offline.

In its narrow definition, it may refer to e-commerce transactions conducted over the internet. Customer orders of goods and services received or placed by telephone, facsimile or e-mail are not considered as e-commerce transactions.

Computer-mediated networks are electronically linked devices that communicate interactively over network channels. Electronically linked devices include computers, personal digital assistants, web TV, internet-enabled cellular phones, and telephones linked with interactive telephone systems.

3. E-business processes include production processes and control, processing customer’s orders and payments, electronic payment, auditing/financial information system, budget preparation, human resource information system, automated employee services, electronic selling, inventory management, purchasing, research and development, ICT education/training, software development for business and engineering applications, internet service provider, web-hosting, website management, animation, project management, data management, and others.

 
With the increasing use of ICT in businesses and industries and the emerging demands of ICT statistics in the country, the Philippines National Statistics Office (PNSO) responded to the challenge by launching the first ever ICT survey in August 2002 – the 2002 Survey of Information and Communication Technology (SICT) of Philippine Business and Industry. The SICT was a nationwide acitivity undertaken in collaboration with the Information Technology and E-Commerce Council (ITECC) of the Office of the President. This survey was a rider to its regular annual survey, the 2002 Annual Survey of Philippine Business and Industry.

1. Objectives of the 2002 SICT

   The 2002 SICT aimed to collect and generate benchmark information on the availability, distribution and utilization of ICT among businesses and industries. Specifically, it aimed to measure the following:

• component of ICT resources and where these resources were being used by businesses and industries;




• diffusion of ICT into businesses and industries from various sources;




• e-commerce transactions from data on e-commerce revenue and e-commerce purchases;




• ICT workers and compensation paid to these workers;




• investment/capital expenditures in ICT resources; and




• possible barriers to the adoption of ICT by businesses and industries.

2. Reference Period

   All information collected in the 2002 SICT refer to the year 2001, except for data on employment and compensation which had December 2001 as the reference period.

3. Frame

   The updated 2001 List of Establishments (LE), which is being maintained by NSO, served as frame for the 2002 SICT.

4. Items of Data Collected

   The following items of information were collected in the survey:

• Economic activity or business




• Types of ICT resources used




• Types of network channels used




• Capital expenditures on ICT resources




• Usage of ICT resources




• Sources of ICT resources




• Type of ICT workers




• Compensation by type of ICT worker




• Percent E-commerce sales to total sales




• Percent E-commerce purchases to total purchases




• Barriers to adoption of ICT.

1. Industry Classification

   For the 2002 SICT, industries were categorized into two (2) types, namely: ICT industries and Non-ICT Industries. Each category was further classified into Users of ICT Resources and Non-Users of ICT Resources.

ICT industries were further classified into three sub-groups using the underlying principles for the inclusion of the industries based on the definition provided by OECD, as follows:

• ICT Producers (Manufacturing) – The products must be intended to fulfill the function of information processing and communication including transmission and display; or, the products must use electronic processing to detect, measure and/or record physical phenomena or to control a physical process.


 

• ICT Distributors (Wholesale and Retail Trade) – The goods sold through wholesale and retail must be intended to enable the function of information processing and communication.


 

• ICT Services (Telecommunications, Computer and related services, Education, Motion picture, TV and Radio) – The products and services must be intended to enable the function of information processing and communication by electronic means.

The National Statistical Coordination Board (NSCB) Executive Board approved on January 2002 the amendments to the 1994 Philippine Standard Industry Classification (PSIC), which took into major consideration the emerging state of ICT industries in the country. The following tables show the composition of ICT industries in the Philippines compared to OECD and North American Industrial Classification System (NAICS).

Table A.   Industry Composition of ICT Producers (Manufacturing)
 

1994 PSIC	Industry Description	Philippines	OECD	NAICS
D22110	Publishing of books, brochures, musical         books and other publications	/		/
D22120	Publishing of newspaper, journals,         and periodicals	/		/
D22130	Publishing of recorded media	/
D22210	Printing	/
D22300	Publishing and printing activities	/
D22401	Reproduction of video and computer       tapes from master copies	/		/
D22402	Reproduction of floppy, hard       and compact disks	/		/
D22403	Film and video reproduction	/		/
D30002	Manufacture of electronic data processing       equipment and accessories	/	/
D31300	Manufacture of insulated wire and cables	/	/
D32100	Manufacture of electronic valves and tubes	/	/
D32200	Manufacture of semiconductor devices       and other electronic components	/	/
D32300	Manufacture of electronic valves and tubes	/	/
D32100	Manufacture of television and radio transmitters       and apparatus for line telephony       and line telegraphy	/	/
D32400	Manufacture of television and radio receivers,       sound or video recording or reproducing apparatus,         and associated goods	/	/
D33121	Manufacture of radar equipment, radio remote       control apparatus	/	/

2. Sector Coverage for 2002 SICT

   The 2002 SICT covered all sectors, both with ICT and Non-ICT industries, as shown below:

1994     PSIC	Economic Activity
A	Agriculture, Hunting and Forestry
B	Fishing
C	Mining and Quarrying
D	Manufacturing (Non-ICT industries)
D*	Manufacturing ICT industries, as listed in Table A of Section III.A)
E	Electricity, Gas and Water Supply
F	Construction
G	Wholesale and Retail Trade; Repair of Motor Vehicles, Motorcycles and Personal       and Household Goods (Non-ICT industries)
G*	Wholesale and Retail Trade (ICT industries, as listed in Table B of Section Iii.A)
H	Hotels and Restaurants
I	Transport, Storage and Communications(Non-ICT industries)
I*	Telecommunications (ICT industries, as listed in Table C of Section III.A
J	Financial Intermediation
K	Real Estate, Renting and Business Activities(Non-ICT industries
K*	Computer and Related Services and Business Activities (ICT industries,        as listed in Table C of Section III.A)
M	Education(Non-ICT industries)
M*	Education(ICT industries, as listed in Table C of Section III.A)
N	Health and Social Work
O	Other Community, Social and Personal Service Activities (Non-ICT industries)
O*	Motion Picture, Radio and TV Production (ICT industries, as listed in Table C of Section III.A

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Stratified simple random sampling (ssrs) was used in the selection of sample establishments.

 
Establishments classified in sectors with ICT industries and with ATE of 20 and over were completely enumerated while those with ATE of less than 20 were covered on a sample basis. Establishments in non-ICT sectors and with ATE of 20 and over were covered on a sample basis while those with ATE of less than 20 were excluded in the coverage of the survey.

 
The number of sample establishments in all sectors (with ICT and Non-ICT industries) are shown below:

1. Conceptual definitions

• The definitions for e-commerce revenue and e-commerce purchases include the term computer-mediated network that may have caused confusion to the respondents. In many instances, these may refer to transactions made over the internet or online.


 

• Similarly, the operational definition of e-commerce revenue and e-commerce purchases may have also posed certain difficulties in measuring the actual values accruing to these e-commerce transactions.


 

• Some terms like extranet, intranet, EDI, LAN, WAN, etc. (though definitions are provided in the questionnaire) may also be unfamiliar to respondents.

• The definition of the type of ICT workers also posed problems as to their exact composition.

Data for some items may not be readily available at the establishment level, more likely at the enterprise level.

There was no identified source of expertise on ICT measurements. As the 2002 SICT was NSO’s first survey of this type, some of OECD’s recommendations were adopted in the design of the survey.

Sampling Frame

The NSO maintains a directory of establishments which serves as the sampling frame for establishment surveys. The most comprehensive updating of establishments was done in 1999. Due to limited financial resources, updating activity for the succeeding years was based on secondary sources such as listings from industry associations, data from past surveys, etc.

For the 2002 SICT, the secondary sources utilized were the following:

• List of members of Computer Manufacturers, Distributors and Dealers Association



• National Telecommunication Commission’s (NTC) List of Establishments including Value Added Services Providers


• Security Exchange Commission’s (SEC) List of Registered IT Enterprises


• List of Semiconductor and Electronics Industries in the Philippines (SEIPI) members; and



• List of top 5000 Corporations from SEC.

References:

Mesenbourg, Thomas L. "Measuring the Digital Economy." U.S. Bureau of the Census. Paper presented during the Netcentric Economy Symposium, University of Maryland, 30 March 2001.

Rachman, Zulficar M. "ASEAN e-Readiness Assessment." ASEAN Secretariat. Paper presented during the ASEAN Workshop on Measurement of Digital Economy, 19-20 September 2002, Bangkok Thailand.

Schaaper, Martin. "Defining and Measuring Digital Economy: concepts and methods indicators, data collection and methodology". Economic Analysis and Statistics Division, Directorate for Science, Technology and Industry, OECD. Paper presented during the ASEAN Workshop on Measurement of Digital Economy, 19-20 September 2002, Bangkok Thailand.

Schaaper, Martin. "From an OECD Framework to an ASEAN ICT Measurement Framework." Economic Analysis and Statistics Division, Directorate for Science, Technology and Industry, OECD. Paper presented during the ASEAN Workshop on Measurement of Digital Economy, 19-20 September 2002, Bangkok Thailand.

"Information Society Measurements: The Case of E-Business." Trade and Development Board, United Nations Conference on Trade and Development. Paper for the Expert Meeting on Measuring Electronic Commerce as an Instrument for the Development of the Digital Economy, 8-10 September 2003, Geneva.