July 12, 2007 6:35 AM PDT

Index ranks IT industries by nation

An IT competitiveness index has ranked more than 60 countries, based on factors such as business environment.

The United States grabbed the top spot, followed by Japan, South Korea, England and Australia, according to the Economist Intelligence Unit of The Economist Group, publisher of the eponymous magazine.

The countries were scored on a scale of 1 to 100 for factors such as a country's business environment, IT infrastructure, and efforts in research and development.

Denis McCauley, EIU director of global technology research, said there is a strong link between the presence of these so-called "competitiveness enablers" in countries and the strength of their IT sector.

World's most competitive IT industries

All but 4 out of the top 22 countries in the competitiveness index are also among the world's top countries in terms of IT labor productivity.

"Governments and industry leaders must pay close attention to these enablers if they wish to boost the global competitiveness of their IT industries," McCauley added.

Countries must also balance open competition in IT and protection for intellectual-property rights, according to the report, titled The Means to Compete: Benchmarking IT Industry Competitiveness (PDF).

"All in all, there remains a large gap between the gold standard of countries with the most effective legal regimes, such as the U.S. and U.K., and the approach of many emerging economies," the EUI report said.

Gemma Simpson of Silicon.com reported from London.

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unjustified bias towards IP
It contributes nothing and is in fact a circular argument for a entity such as the Economist Intelligence Unit to say that IP laws are crucial to a healthy IT sector based on a study that TEY THEMSELVES create and which THEY THEMSELVES have engineered to weight very heavily the importance of IP laws.

Here are the specifics:

The study rates countries on six categories. The score each country garners in each category is weighted.

So for instance one of the categories is Overall business environment and it is worth 10%. Another category, infrastrucutre is worth 20%. Etc etc through all six categories, with a cumulative of 100%.

Within each category, there are subcategories. Each subcategory contributes some percent to it's category.

Here is the problem: the weighting they gave to IP laws is nothing more than an expression of the Economist's pre-existing attitude towards IP law.

No correlation between strong IP laws and a strong IT sector is demonstrated by this study. Instead, it is merely presumed to exist and therefore given a huge weight- fully 20%.

This is called assuming the consequent.

No serious student or professional is going to accept this as proof of anything other than the Economist "really believes" that IP law is important to the IT sector, which fact most people were already aware of.

Here is the details of how they incorporated a strong weighting in favor of IP laws. Remember that this doesn't demonstrate the importance of IP to IT, it PRESUMES it.


From Category 1, (worth 10% of overall score):
Overall business environment

subcategory:
Degree to which private property rights are guaranteed and protected

weight given:
40% (of 10%)

RUNNING TOTAL:
4% given to IP



Category 4 (worth 10% of overall score):
Legal environment

subcategory 1:
Comprehensiveness, transparency of IP legislation; adherence to treaties
weight given: 35% (of 10%)

RUNNING TOTAL 4% + 3.5% = 7.5% given to IP

subcategory 2:
Enforcement of IP legislation
weight given: 35% (of 10%)

RUNNING TOTAL 4%+3.5% +3.5% = 11% given to IP


Category 5 (worth 25%):
R&D environment

subcategory 1:
Number of new domestic patents registered by residents each year (per 100 people)

weight given :
65% (of 25%)
RUNNING TOTAL 4%+3.5% +3.5% + 16.25% = 27.25% given to IP


subcategory 2:
Receipts from royalty and license fees (US$) per 100 people
weight given:
15% (of 25%)

RUNNING TOTAL 4%+3.5% +3.5% + 16.25% + 3.75%= 31.00%



So at least 31% of this "study's" PRESUMES that IP is an IT enabler and promoter.

Now that they've "proved" that, broader assertions are made. This from the report:

"The legal regime is an important differentiator.
Open competition in IT must be supported by robust
protection for intellectual property rights (IPR). The US and west European countries?thanks partly to the galvanising efforts of the European Union?stand heads above the rest in the degree of protection afforded and in enforcement. A vigorous IPR regime is not incompatible with an ?open approach? to
innovation in IT. "


So in other words, Open Source is incompatible with a robust IT sector. This is nothing more than their pre-existing belief dressed up as proven fact.

But don't doubt that this "study" will be quoted around the world in legislative bodies in the UK EU and US as "proof" that strong UP is "necessary" and OS is, at best, to be tolerated.

This is exactly the kind of bought-and-paid-for "study" puked out by "think tanks" with a ideological and or financial or political motive whose only purpose is to steer public discourse and thinking in the direction which serves their interests as opposed to what science and studies SHOULD be - an impartial inquiry into reality in a search for something called the truth.

This report doesn't need "truth".. it has "truthiness" galore.. it's a sorry simulation of the scientific process and it's authors, participants and funders have done nothing but bring shame and discredit to themselves, their reputations and their organization.

As Mark Twain said, there are lies, damn lies and statistics. Unfortunately, nothing much has changed since his time.
Posted by asdf (241 comments )
Reply Link Flag
Unjustified bias? Obviously not.
>> So in other words, Open Source is incompatible with a robust IT sector. <<

Your statement above directly contradicts the study?s statement as quoted by you.

>> But don't doubt that this "study" will be quoted around the world in legislative bodies in the UK EU and US as "proof" that strong UP is "necessary" and OS is, at best, to be tolerated. <<

Again, the quote from the study contradicts your above statement. There is no basis in fact for your conclusions.

It is obvious that you are an open source supporter, but it is equally obvious that your position on open source is a minority position confined to open source extremists. You apparently don?t like the idea of intellectual property rights because you identify those rights with proprietary software. There is in fact no contradiction between IPR and open source. Open source and proprietary software exist side by side. Both incorporate some degree of intellectual proprietary rights in that even open source relies on licensing to a degree.

Being an open source supporter is fine. Being an open source fanatic is something else. The latter only makes you look foolish.
Posted by gmcaloon--2008 (72 comments )
Link Flag
correction- it's 31%
I correct my earlier post- the sum weighting they gave IP- for no justified reason- is 31% not 20% as earlier stated.
Posted by asdf (241 comments )
Reply Link Flag
what was the source
I see India being 46 on the list and we contribute a great amount to the IT industry business.
Posted by murali10 (1 comment )
Reply Link Flag
They cite the sources in the paper , some UN data and other handpicked data
This is NOT a study- it's a position paper on the Economist's belief of importance of Intellectual Property (IP) to the IT industry.

This is completely unacceptable as a news story.
Posted by asdf (241 comments )
Link Flag
Media Hype?
Here a large difference can be seen between countries that consistently appear on the IT news (India, China, Russia, Romania and Brazil) and their position in this ranking. Which fault? The ranking is wrong or is it media hype?
Posted by kjbfsjkdvb (9 comments )
Reply Link Flag
The report is at fault
to say the least.

The report embeds a prejudice for very strong IP laws; if your country doesn't have those, then it gets very heavily penalized.

Read my first post for an analysis then the criticism of my post, then my rebuttal.
Posted by asdf (241 comments )
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Posted by t0wood (2 comments )
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