Network Economy

Denmark is widely regarded as a highly developed, vanguard Information Technology (IT) nation. It is among the countries of the world that has the highest computer usage per capita with a correspondingly high Internet and telecommunications usage. Denmark is also described as the No. 1 European broadband nation, possessing the greatest number of high-speed Internet connections when proportioned to the size of any given population. In the so-called Digital Access Index (DAI) prepared very recently by the International Tele-Communication Union (ITU), Denmark moreover takes a noteworthy second place, only narrowly outperformed by Sweden.

Somewhat surprisingly, the efforts of Danish trade and industries to increase their performance in IT terms have not yielded results of any major significance. For instance, Internet sales still play a minor part in Danish retail. Valued at DKK 1.4 Billion in CY 2002 (approx. US$ 240 Million), Internet sales accounted for just 0.5% of total retail sales in Denmark in that year. The 2002 figure does represent a 36% growth rate over the previous year, however.

Employment Opportunities:
Denmark is rapidly developing its technological, telecommunication and wireless networks. Internet access and mobile phones are accessible and widespread, but broadband communication networks are only slowly gaining ground. Historically an agricultural and industrial-based society, Denmark is playing a quick game of catch-up, investing a great deal in technological development, economic globalization and digital commerce. The Danish Ministry of Information Technology and Research is politically responsible for research, information technology and telecommunications. Digital Denmark provides information on the strategies and objectives for the country's IT infrastructure.IT certification and education requirements in Denmark are much the same as with any industrialized nation. Most employers do not require degrees in computer science or computer engineering, but programmers and IT specialists should have a broad-based knowledge of computer languages (such as Java and C++) and technical experience. Private firms such as Microsoft and Oracle offer certification programs. Management positions typically require a university degree. The average computer programmer working in Denmark now earns a salary of 210,102 DKK or $25,893 USD.

B2C e-commerce is consequently unlikely to capture any noteworthy share of Danish consumer retail buying in the near future, although an increasing number of Danes have begun to place orders with international vendors such as Amazon, Barnes & Noble, etc. The widespread lack of enthusiasm among customers may be ascribed partly to their anxiety about security aspects when remitting payments, etc., and partly to the literal smallness of Denmark, where few people need to drive more than ten minutes to reach a physical retail outlet. Historically, mail order was never big business in Denmark, and many people see B2C as a modern form of mail order.

B2B is the e-commerce sector believed to display the best growth potential in Denmark. B2B is estimated to account for 80% or more of all Danish Internet trade. Still, volumes are quite low. In 2001 - its first year of operations, the e-market place ‘Gatetrade’ owned jointly by Danske Bank (Denmark’s largest banking group), Maersk Data, Post Denmark, and TDC – Tele Danmark barely achieved a turnover of DKK 5 Million – or less than one tenth of the competing Nordic e-market place IBX (Integrated Business Exchange) owned by, among others, Ericsson and Novo
Nordisk. Gatetrade’s management has not been willing to reveal the turnover figures for calendar years 2002 & 2003, although it reports that 1,500 buyers & suppliers and 500,000 different products can be found on its e-market place. It is known, however, that the company’s annual accounts for 2001 and 2002 resulted in deficits of DKK 51 Million and 44 Million respectively.

E-Government should, indeed, represent a large potential area for growth. It is thus estimated that 35% of the Danish public sector’s annual purchases valued at DKK 100 Billion (US$ 17 Billion) could very well be implemented through e-trade. Following a ministerial tender, a public purchase portal named ‘DOIP’ was established in Denmark, Gatetrade assuming responsibility for its day-to-day operations. So far, the
interest of Danish ministeries and other government offices in trading through DOIP nevertheless seems most limited.

Financial Services are used quite widely on the Internet by the Danish population, on the other hand. Practically all Danish banks now offer on-line banking programmes, stock trading, and other financial services. The sector has also witnessed the entry of all major real estate agencies, which advertise houses and apartments for sale and provide the customers with direct access to financing. The insurance sector is also moving into web-based online services, just like the Danish equivalent of the IRS, Told & Skat offers on-line service for tax return filing.

Virtual Market Places actually enjoy a certain success in Denmark. Opportunities exist mainly in strategic alliances with existing sites. Some of the most promising segments found within the Danish Internet/e-commerce scenario may well consist of theatre booking systems as well as airline and other ticketing systems.