a report by AlphaBeta Advisors, commissioned by CSIRO’s Data61

Digital innovation can deliver $315 billion in gross economic value to Australia over the next decade, making it a critical ingredient in the nation’s ongoing economic success.1 The economic opportunity is great. However, there is a risk Australia will not fully realise it. New analysis shows that in the past, aside from some pockets of success, Australia has failed to capture the same economic value from digital innovation as other countries. The productivity gain from technology in our economy has been below that of our peers, and we have not managed to build our own digital industries at the same scale.

To ensure Australia achieves the full economic benefit of digital innovation in the future, we need a new vision for digital success. This means actively developing new digital opportunities in industries where Australia is already globally competitive, and improving the innovation system’s ability to support Australia’s areas of competitive advantage.

The next wave of digital innovation will be driven by technologies that collect, manage, analyse and use large amounts of data. These big data technologies are set to transform a wide range of industries from mining to agriculture and health – much like personal computers and the internet have transformed the retail, information, and media sectors over the past two decades.

Australian businesses will become more productive if they adopt these new technologies.

At the same time, the rising demand for data technologies is a growth opportunity for Australia’s own digital industries. Australian firms could build on existing strengths in agriculture or healthcare and develop new digital products and services, such as remote monitoring of infrastructure or crops, or improved diagnostic methods for genetic diseases, for domestic use or for export.

However, as a mid-sized market, it is critical that Australia defines its own path to success at digital innovation, rather than attempting to emulate the breadth of Silicon Valley or the scale of China. Australia is most likely to succeed if it focusses on producing new digital products and services for industries in which it already has a global competitive advantage – thanks to its natural resources endowment, strong institutions, diverse and highly skilled workforce, and existing infrastructure and customer base.

This is an excerpt from the Digital Innovation: Australia’s $315b Opportunity Report”




Digital innovation has contributed to Australia’s growth story in the past, although it never took centre stage. Now, digital innovation offers Australia the opportunity to drive the next wave of economic growth. This is because the next wave of digital innovation – the Fourth Industrial Revolution – plays to many of Australia’s existing competitive strengths and economic imperatives.

The 4th Industrial Revolution will create new markets, products and services in industries where Australia has a significant presence. Digital innovation over the next decade will have a broader economic impact because the core technologies, such as autonomous systems, remote sensors, machine learning and artificial intelligence, can be applied across many industries. The latest wave of digital innovation will now revolutionise traditional industries from mining to agriculture just like past waves of innovation have reshaped the information and media industries.

The next wave of digital innovation demands Australian attention now. There is global evidence that some firms are already reaping the productivity benefits of digital innovation. Leading firms, especially in ICT-dependent industries, are increasing their productivity at a much higher rate than the rest of the economy (Exhibit 2).9 Australian firms must embrace the kinds of digital innovation that will allow them to keep up with global leaders – or risk falling far behind.