Analysis

Austria

Analysis: National IT Strengths and Weaknesses

Executive Summary

Culture is a significant aspect of life in Austria and the fear of erasing its cultural heritage may be a factor in the country’s slow adoption of technology. Though the country recognizes the importance of ICT to be competitive in a global marketplace, the government will need to do more to replace the fears and to spur growth in the ICT sector. It will need to increase its spending on ICT as a percentage of GDP (currently it is far behind most of its European colleagues). Education in research and technology need to be improved but also English language skills. Austria’s primary strength though is that it recognizes its weaknesses and has taken steps towards revitalization.

Strengths

Austria’s primary strength is that it recognizes its weaknesses and has aspirations of moving beyond just improvement.

The country’s leaders acknowledge that in order to compete in a global economy, Austria must strengthen its research and technology sectors. In response, Austria introduced its Vision 2005: To be the Best Through Innovation in 2000, which outlines the country’s long-term strategy to improve its competitive position. With this renewed focus on technology and innovation, Austria plans to improve its ranking among European nations for its ICT sector from ninth (2000) to fifth place in 2005. It also intends to rank among the top third states of the Organization for Economic Co-operation and Development in all significant areas (i.e. research output, innovation performance, education and use of telecommunications).

The programming provided by the government is another strength for Austria. Though it has not been perfect in its endeavors, the Austrian government has provided training opportunities for all citizens, such as K_plusand K_ind. In response to e-commerce and e-business issues, the government implemented programs such as Internet Ombudsman and Triple A. In terms of e-government, the government has made tremendous strides in instituting a ministry-wide electronic file system (ELAK). In the benchmarking conducted by the European Commission of twenty basic e-government services in January 2004, Austria ranked fourth out of the eighteen European countries studied. This is an improvement from its previous ranking of eleventh. Austria ranks second in terms of the number of services that can be fully transacted online. It scored a 68 percent (the European average is 45 percent).

Weaknesses

Primarily, Austria has to manage several weaknesses.

As a highly educated society, Austria should be more apt to embrace new technology, but it has lagged behind its European comrades. The country spent approximately $9 million or 7.2 percent of its GDP ($245.3 billion) on ICT in 2001 (21). This figure is noticeably lower than that of Switzerland, which spent 10.2 percent of its GDP ($239.3 billion) on ICT in the same year. Further examples of sluggish growth can be seen in computer and internet usage by its citizens. By the June 2004, only 53 percent of Austrian households had a computer (an 8-10 percent increase from 2002). In 2001, approximately 55 percent of U.S. households had a computer.

The Council for Research and Technology Development (the Council), which oversees the implementation and monitoring of the Vision 2005, has identified that Austria education system is inefficient in terms of research and technology. One subject area that will be revamped and/or promoted further is information and communication technologies (multimedia technologies, e-business, digital content, micro-electronics, telecomm).

One weakness of the Vision document is the absence of improving English language skills among its citizens. Though Austrian students are required to have 800 hours of English lessons to complete the pre-vocational year (in the United States this would be the final year in high school), many Austrians lack the proficiency necessary to carry on a simple conversation. This is a disadvantage for the country since English is the language of technology.

The business and government sectors, which generally lead the way for technology diffusion in a country, reported only a little more than a million PC units in business or government offices in 2001.
Austria is not a country of hardware manufacturing or software development, and it is not a destination for offshore outsourcing.

Wages in Austria’s IT sector are not competitive with other countries. According to PayScale.com, it is more lucrative to have a career in marketing than one in information technology.