New Trend: From Broad Digital Economy to Digital Economy Core Industries

On August 23, the 12th Media Development Forum and the “China Media Industry Development Report (2021)” conference was held at the Social Sciences Literature Publishing House. The event was jointly sponsored by the School of Journalism and Communication of Tsinghua University, Social Sciences Literature Publishing House, CCTV Market Research, CTV Sofrey Media Research, and the Media Economics and Management Research Committee of China Journalism History Society. The blue book covers the development reports of various industries such as film and television, newspapers and periodicals, books, broadcasting, advertising, online games, and online audio-visual. Forward-looking prediction from perspective. “China Media Industry Development Report” has been certified as a CSSCI source collection since 2012. It is an authoritative reference book for researching and analyzing China’s media industry and understanding the global media industry.

Liu Jinhe, a researcher at the Digital Development Research Center of Fuxi Think Tank and a postdoctoral fellow at the Internet Governance Research Center of Tsinghua University, attended the press conference as a member of the research group. His sub-report “2020 Global Digital Economy Development Report” is included in the Blue Book, focusing on new trends from the generalized digital economy to the core industries of the digital economy. The article believes that in 2020, the digital economy has played an important role in the fight against the new crown pneumonia epidemic in various countries, and will also play a key role in the recovery of the global economy. The development of China’s digital economy is bucking the trend and has huge potential. The understanding of the digital economy from all walks of life has gradually changed from the generalized digital economy to the core industries of the digital economy, and the statistical methods of digital economy calculation have been further improved.

The development trend of the global digital economy

With the deepening of digital transformation, the digital economy continues to develop globally. The scale of the global digital economy has grown from $31.8 trillion in 2019 to $32.6 trillion in 2020.[1] Global exports of ICT services and digitally delivered services have grown much faster than overall service exports over the past decade. In 2018, the total value of digitally deliverable services exports reached US$2.9 trillion, accounting for about one-half of global service exports.[2] Behind the continued growth of digital trade is the continuous growth of the world’s Internet population over the past few years. By the end of 2019, the number of Internet users in the world exceeded 51% of the total population (or 4 billion people)[3], and with the further rapid growth of social isolation brought about by the global epidemic in 2020. However, with the development and popularization of mobile communication technology, the coverage of the current global mobile Internet is also becoming saturated, and the old and new mobile communication technologies are in a critical period of intergenerational replacement. According to estimates by the International Telecommunication Union (ITU), by the end of 2020, 4G networks will cover nearly 85% of the world’s population, and more than 90% of the population will be able to use mobile broadband networks (3G or above).[4] As of September 2020, 113 operators in 48 countries have announced commercial use of 5G. These operators have 40% of the global market share and have a huge potential audience. The deployment and popularization of 5G will accelerate in the future.[5]

The epidemic has accelerated the connection process of the global Internet. During the epidemic, people’s reliance on the Internet has increased significantly. Relevant data show that in 2020, the global Internet bandwidth will increase by 35% to 618Tbps, which is the largest growth rate since 2013, and the compound annual growth rate in the past four years has also increased to 29%.[6] In 2020, the amount of newly produced data globally is 64.2ZB. Over the next five years, digital storage will generate more than twice the amount of data that has existed since the advent of digital storage.[7]

The development of infrastructure construction has also made the digital economy centered on digital connectivity, online economy, remote services, etc., an important starting point for countries to fight the epidemic and restore the economy in 2020. By the end of 2020, there were 76 digital platform companies with a global market value of over US$10 billion, an increase of 7 from 2019, with a total value of US$12.5 trillion, a year-on-year growth rate of 57%.[8] However, due to the impact of the epidemic, global IT spending in 2020 fell by 3.2% to $3.7 trillion. However, according to Gartner, global IT spending will rebound in 2021 and is expected to reach $3.9 trillion.[9]

From the broad digital economy to the core industries of the digital economy

Understanding and measuring the digital economy is still a world problem. According to the United Nations report, according to the difference in the definition of the data economy, the scale of the digital economy in various countries in the world generally accounts for 4.5% to 15.5% of their GDP, with a large difference.[10] However, with the deepening of the practice and exploration of the digital economy, countries around the world continue to propose new calculation schemes, and there is more and more consensus on the core components of the digital economy.

China’s mainstream digital economy definition and measurement method is represented by the definition and measurement of the China Academy of Information and Communications Technology. The measurement scope mainly includes two parts: digital industrialization and industrial digitization. According to its calculation method, in 2019, the scale of China’s digital economy already accounted for 36.3% of the total GDP, and the digital economy of Germany, the United Kingdom, and the United States accounted for 63.4%, 62.3%, and 61.0% of GDP, respectively.[11] In 2020, the scale of the global digital economy will account for 43.7% of GDP, of which the scale of the digital economy in developed countries will reach 24.4 trillion US dollars, accounting for 54.3% of GDP.[12] However, this calculation method exaggerates the scale of the digital economy, especially including the integration and spillover of the digital economy on a large scale.[13] Industrial digitalization is the spillover effect produced by the integration of digital technology and traditional industries. Therefore, the economic scale of the digitalized part of the industry should belong to their respective industrial categories, and the digital economy should be calculated in a narrow sense. The U.S. Bureau of Economic Analysis (BEA) has always adhered to the narrow definition of the digital economy, dividing the digital economy goods and services into the following three categories, namely digital infrastructure (Digital-Enabling Infrastructure), digital media (Digital Media) and e-commerce (E-commerce). ‐Commerce). According to its latest calculations released in August 2020, the size of the US digital economy in 2018 was US$1.8 trillion, accounting for 9% of the total GDP. In recent years, with the deepening of understanding, the Academy of Information and Communications Technology has gradually separated the narrow digital economy part in its digital economy calculation, and concluded that the added value of China’s digital industrialization accounts for 7.3% of the total GPD (2020).

Different understandings of the digital economy lead countries to adopt different measurement methods, and the scope of the digital economy is the premise of measurement. Based on the existing knowledge base, this report believes that: the digital economy is a new economic form developed after the agricultural economy, industrial economy and service economy; economic activities based on network communication technology and data as the core production factors; digital economy The basic structure consists of the ICT industry, the digital media industry, and the network platform industry (see Figure 1). These three parts form the core industries of the digital economy; the development of the digital economy will have an integrated spillover effect on other industries, and is an important component of the broad digital economy.[14] The digital economy is clearly limited to its unique economic sector, and the concept of “core industries of the digital economy” is scientific, and it also makes the digital economy itself have a clear and independent status, avoiding generalization and loss of focus.

This shift has moved from academic research into policy-making, where there is growing consensus. The latest major development plan of the central government also gives corresponding direction instructions, and clearly proposes the concept of the core industry of the digital economy. The “14th Five-Year Plan” and the outline of the long-term goals for 2035 propose that the added value of the core industries of the digital economy will account for 10% of GDP in 2025. In the part of digital industrialization, that is, the part of digital economy in the narrow sense, it is proposed to “cultivate and expand emerging digital industries such as artificial intelligence, big data, blockchain, cloud computing, network security, etc., and upgrade industries such as communication equipment, core Electronic components, and key software. level”, “encourage enterprises to open up search, e-commerce, social networking and other data, and develop a third-party big data service industry”, and “promote the healthy development of the sharing economy and platform economy”.

This shift in thinking is also reflected in the latest national economic statistics methodology. On May 27, 2021, the National Bureau of Statistics released the “Statistical Classification of the Digital Economy and Its Core Industries (2021)”, proposing that the core industries of the digital economy, that is, the digital industrialization part, are the basis for the development of the digital economy and refer to the provision of digital economy development. Digital technologies, products, services, infrastructure and solutions, as well as various economic activities that are completely dependent on digital technologies and data elements, mainly including computer communications and other electronic equipment manufacturing, telecommunications, broadcasting, television and satellite transmission services, Internet and related Services, software and information technology service industries are divided into four statistical categories: digital product manufacturing, digital product service, digital technology application, and digital factor-driven industries. This statistical classification also takes industrial digitization as a separate part, which refers to the increase in output and efficiency improvement brought by the application of digital technology and data resources to traditional industries. Efficiency improvement industry, this part covers smart agriculture, smart manufacturing, smart transportation, smart logistics, digital finance, digital commerce, digital society, digital government and other digital application scenarios, corresponding to 91 categories in the “National Economic Industry Classification”, It reflects the deep penetration and extensive integration of digital technology with various industries in the national economy.[15] It is worth noting that the digital media industry and the network platform industry, as the core industry components of the digital economy, are classified into the fourth category of digital factor-driven industries in the classification of the National Bureau of Statistics.

Figure 1 The connotation and scope of the digital economy

Source: Cui Baoguo, Liu Jinhe, “On the Definition and Measurement of the Digital Economy”.

China’s digital economy is gaining momentum

The new crown epidemic has brought a major impact on the Chinese economy, but it has also brought an opportunity to accelerate the digital transformation of the economy and society. Since the domestic epidemic was brought under control in the second half of 2020, various indicators of China’s digital economy have gradually improved. In 2020, the added value of China’s broad digital economy will reach 39.2 trillion yuan, and the growth rate will still reach 9.7% in the context of the epidemic and global economic pressure. 7.8%.[16]

In terms of 5G, China is already the world leader. In 2020, Chinese operators have deployed about 600,000 new 5G base stations, and the number of 5G connections will reach 202 million, accounting for 87% of the global number of 5G connections, and will reach 820 million in 2025. , penetration increased from 12% to 47%.[17]

As the core industry of the digital economy, the ICT industry is developing well. In 2020, the added value of China’s information transmission, software and information technology service industries increased by nearly 17% compared with 2019.[18] From January to November 2020, the cumulative mobile Internet traffic across the country reached 149.5 billion GB, a significant year-on-year increase, with a growth rate of 35.1%.[19] In 2019, the total scale of China’s data output was 3.9ZB, a year-on-year increase of 29.3%, accounting for 9.3% of the total global data output (42ZB). By the end of 2019, China’s total data stock was about 332EB, accounting for 11.9% of the global total (about 2,800EB).[20] In 2020, the state clearly proposed to speed up the cultivation of the data element market, and data, as the core element of the digital economy, has received further attention from all walks of life.

Chinese Internet companies are developing rapidly, especially under the influence of the epidemic, platform-based companies are developing rapidly. As of December 31, 2020, the total market value of Chinese Internet-listed companies at home and abroad reached 17.8 trillion yuan.[21] In 2020, there will be 197 platform-based companies with a market value of over US$1 billion in China, an increase of 23 from 2019, with a value of US$3.5 trillion, a year-on-year increase of 56.3%. Globally, the platform economy between China and the United States is in a leading position. In 2020, there will be 64 Chinese and American platform companies with a value of over US$10 billion, accounting for 84.2% of the global total, with a total market value of US$12 trillion, accounting for 96.3% of the global total. Even so, there is still a gap in the development of the platform economy between China and the United States. In 2020, although the number of digital platforms with a market value of over US$10 billion in China surpassed the US for the first time, reaching 36, the total value is only 1/3 of the US, about US$3.1 trillion.[22] From this perspective, developing a high-quality platform economy is still an important task in the development of China’s digital economy in the next stage. It is necessary to exercise restraint in the ongoing anti-monopoly of the platform economy and to step up its assessment of its comprehensive impact on innovation. .

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