CLOSING THE DIGITAL DIVIDE - WHAT DO WE KNOW ABOUT THE DIGITAL DIVIDE IN NEW ZEALAND?

Introduction

1. On 26 June 2000, Cabinet confirmed the following vision for the "social and economic inclusion and ICT" (aka closing the digital divide) area of work that had been agreed by the Cabinet Economic Development Committee on 21 June:

   All New Zealanders, either as individuals or as members of communities, have the opportunity to access and effectively use current and emerging information and communications technologies. This will enable individuals and communities to participate fully in the economic, social, educational, cultural and democratic opportunities available in an information society.

2. By agreeing to this vision, the Government has established a signpost for where they want to see New Zealand heading. While many New Zealanders already make good use of information and communications technologies (ICTs) to avail themselves of the opportunities available, there are others who for one reason or another are not able to.

3. The purpose of this stocktake is to establish whether there is a digital divide in New Zealand, and if so, who is on the wrong side of it. Where there is a need for further information, this is also noted.

Summary of existing information

4. There is a significant overseas literature that suggests that certain groups are more likely than others to be left behind by the "information revolution". While there has not been the same level of research done into the issue in New Zealand, it seems reasonable to assume that similar groups will be on the wrong side of the divide in New Zealand as in other developed countries. In June, Cabinet noted that the groups most likely to be disadvantaged in terms of ICT access and skills in New Zealand are:
   1. Maori and Pacific peoples;

   2. those on low incomes;

   3. sole parents;

   4. older people;

   5. people with low or no qualifications or poor literacy;

   6. the unemployed and underemployed;

   7. people in locations lacking a sound telecommunications structure, such as rural areas;

   8. women and girls; and

   9. people with disabilities.

5. It is easy to think of the digital divide as being simply about providing more computers, and indeed, some programmes overseas have focused on just this. However, there are actually several dimensions to the digital divide, all of which need to be considered in developing policy that is going to close the divide:
   1. Physical access to ICT, which can be further split into
      1. Infrastructure (i.e. is the telecommunications network adequate to ensure access?); and

      2. Financial (i.e. is ICT affordable?).

   2. ICT skills and support - do people have the necessary skills and technical support to allow them to make use of ICT once they have access?

   3. Attitudes - do people have a favourable attitude towards ICT, and can they see the relevance and the possibilities it holds for them?

   4. Content - can people see content online that is relevant to them, or takes into account their particular needs?
6. As noted above, the New Zealand evidence on the digital divide is sparser than in other developed countries. The remainder of this note summarises what is known about ICT access, skills, attitudes and content in New Zealand, and distils the key findings in relation to the "at risk" groups identified above.

Physical access

7. There is a reasonable amount of information available about access to information and communications technology, including how access differs by age, ethnicity, income level and location.

Telephones and the telecommunications infrastructure

8. Telephone connectivity is currently vital for accessing the Internet from home. While not strictly ICT in the same way that computers and the Internet are (being analogue rather than digital technology), currently most people who access the Internet at home (the most common place for access) do so through a landline telephone connection.

9. While the 1996 Census data on telephones shows telephone penetration rates are 96 percent overall (97 percent in the 1998 HES), telephones are not constant across income levels, ethnicities and locations. Only 86 percent of Maori aged over 15 normally resided in private dwellings with a telephone, as did only 85 percent of Pacific Island peoples.

10. As the graph below shows, between 16-19 percent of Maori in Northland, Waikato, Bay of Plenty and Manawatu regions did not have access to a telephone, (Statistics New Zealand): rising to between 65%-75% for Maori with incomes under $15,000 (as per second graph). However, competition in provision of telephone services since the mid 1990s has made it easier for those on lower incomes to maintain a telephone compared to the difficulties people had in the earlier part of the decade when the economy was in recession and competition was limited. In addition Statistics New Zealand report that lower income people are using cell phones for incoming calls, but resorting to landlines for outgoing calls.

Source. Statistics New Zealand 1996 census

11. As reported further on, AC Nielsen and NetRatings have conducted international surveys of Internet usage. Commenting on New Zealand and Australia's relatively high rates of usage, NetRatings' Allan Weiner suggested that "this is likely due to Australia and New Zealand's recent efforts to institute decentralization of phone services, which leads to competition, driving phone prices down and overall usage up"¹.

12. Research into the 1996 census data for Northland by a MAF analyst revealed that a high proportion of homes in the Far North District Council area do not have a telephone, compared with the national average (Table 1). This is likely to be related to income levels in this district. Some other rural districts also have a high percentage of dwellings without a telephone, eg, Wairoa (13.6%), Buller (12.3%), Gisborne (8.8%) and Kaikoura (8.5%).

Telephone ownership and income levels in Northland
District Council	% of dwellings with no telephone	Male median personal income	Female personal median income
Far North	13.3	13,930	10,753
Whangarei	6.2	18,682	12,033
Kaipara	8.0	16,635	11,378
Rodney	3.6	22,276	12,461
New Zealand	4.9	22,040	12,609

Source: 1996 Census, Statistics New Zealand

13. Recent research commissioned by MAF into rural telecommunications² to inform their submission to the Ministerial Inquiry into Telecommunications found the following:
    • Over 99% of respondents had land-based telephones, while 70% had mobile phones.

    • 54% of respondents reported telephone line problems including noise, electric fences, and exchange overload. These problems are particularly of concern for Internet access.

    • Telephone line infrastructure problems are worse in more remote areas. Of those living 0-5km from the nearest village, 44% reported problems, compared with 82% of those living over 30kms away.

    • A small number of respondents reported 111 problems associated with exchange overloading.

    • 76% of respondents reported problems with mobile phone coverage. For 41% the problems are bad enough to affect their ability to do business properly with them.

14. The other rural-based submissions to the Inquiry also identified issues relating to the telecommunications network:
    • Federated Farmers of New Zealand undertook a survey of members who had expressed an interest in telecommunications - there was a 15% response rate. Of the respondents, 15% replied that their phone lines went into overload over the peak evening period. The same group considered that the quality of their phone lines was marginal to poor. Fax services were not universally available, and of those who had fax machines, 30% said the service was of poor quality. Sixty percent of the respondents had home or business access to the Internet, and of this group, 60% experienced problems including slow speeds, long delays, especially with down loading long documents, and difficulties in sustaining a linkage. The respondents thought that these problems were due to problems inherent in microwave links, old exchanges, exchange overload and electric fence interference.

    • Rural Women New Zealand (previously Women's Division) also surveyed their members for the Inquiry. Seventy percent of respondents were dissatisfied with telephone services, and 7% had experienced difficulties with the 111 service. Of those with telephone problems, specific issues included overloading (21%), fax problems (15%), Internet access (14%) and cell phone coverage (9%).

    • Telecom New Zealand's submission said that 95% of access lines transmit a 14.4 kbps or better. Federated Farmers in their submission note that they were disappointed to see the draft report "blithely repeat Telecom's statement that only 5% of lines do not have reliable data speed of 14kbps. The 47,500 subscribers that make up this 5% represent a very large proportion of rural subscribers".

Televisions

15. In contrast to the differences that emerge around telephone penetration, television penetration is fairly constant between income groups and ethnicities being highest for Pacific Island peoples at 97.2 percent and on average 96 percent.³ This may be because television is considered "better value for money" for income-constrained households: telephone use being less frequent and easier to obtain elsewhere when needed.⁴

16. It may also reflect the fact that Maori and Pacific Island peoples value face to face communication more than voice-only communication. Some within these groups may also value technology more for its entertainment value than for other purposes, being sceptical about how computers and the Internet are going to add value to their lives for the economic sacrifices they would have to make to obtain them.

Computers

17. Nearly 30 percent of New Zealand households had computers as at the 1998 HES survey. However, there was a marked difference between households along ethnicity and income lines. Only 23 percent of Maori households and 17 percent of Pacific Island peoples households had computers. While 57 percent of households with incomes over $71,600 had computers, this dropped to just over 50 percent for households with incomes from $31,400 to $48,999, and 16.6 percent for households with incomes below $20,000. It is estimated that 50 percent of Maori and around 60 percent of Pacific Island people are in households in the bottom two income quintiles compared with only 37 percent of Europeans.

18. An AC Neilsen Market Research study for Xtra conducted in the third quarter of 1999⁵ found that 47% of surveyed households had a computer, and 54% of surveyed people had access to a computer (a 20% increase on a year previously). The survey reported that the most common access points were home (27%), friends and relatives (21%), work (17%), school or polytechnic (15%) and library/other (9%).

19. The MAF commissioned research into rural telecommunications found that 61% of the respondents had computers, compared with 43% in a 1998 Lincoln University survey⁶. The comparable rates of computer ownership in 1986 and 1993 were 6.0% and 24.4% respectively. This illustrates the rate at which farmers are taking up this technology. The Lincoln study found that farmers with computers tended to have larger farms, were younger, and more involved in off-farm businesses.