Digital Rankings: U.S. Gains; Europe Flat

In the race to stay competitive in the emerging digital economy, Nordic nations continue to rule the roost. The U.S. has gained ground, and Asian countries are on the rise. That’s according to the latest findings from the Economist Intelligence Group’s annual “e-readiness” rankings, which have been renamed the Digital Economy Rankings this year as they enter their second decade.

The EIU study measures 70 countries on 100 criteria, ranging from their business, cultural, and legal environments to the price and penetration of broadband and wireless services. The data come from sources including the U.N., World Bank, Pyramid Research, and the EIU’s own proprietary numbers. The purpose of the study—similar to an annual ranking from the World Economic Forum—is to help policymakers assess how ready their countries are to face the changing demands of the 21st-century Internet economy.

Perennial leaders Sweden and Denmark again topped the list, but they swapped places this year, with Sweden narrowly edging out its Scandinavian rival to grab the top spot. Finland ranked No. 4, jumping six places from 2009, and Norway ranked No. 6, down two places. The Netherlands came in at No. 5, down two spots.

One surprise was the performance of the United States, which rose two notches to rank No. 3 in the world. The U.S. used to lag many other countries in mobile and consumer broadband infrastructure, but both have improved markedly in recent years. What’s more, the U.S. has seen a surge in use of the wireless Web thanks to the Apple (AAPL) iPhone and other smartphones.

The balance of the top 10 includes Hong Kong and Singapore, ranked 7 and 8, respectively (swapping positions from last year), Australia (No. 9, down three places), and New Zealand (No. 10, up one). Some European countries were flat or rose slightly—Portugal, Slovenia, the Czech Republic, Greece, Hungary, Latvia, and Poland (among others) were unchanged, while Ireland, Spain, and Estonia nudged up one place each. Others fell drastically, including France (down five places, to No. 20) and Switzerland (down seven places to 19), while Germany, Austria, Belgium, and the U.K. all fell by one place.

The biggest gainers were primarily Asian countries. Taiwan rose four places to No. 12; Japan rose six to No. 16; and South Korea—famous for its speedy and affordable broadband—also rose six spots to No. 13. The EIU notes that Asian countries score especially highly on the quality of their wired and wireless broadband services.

This year’s EIU study finds two other positive trends. First, broadband access is becoming more affordable around the world, especially in emerging economies such as Vietnam and Nigeria. Two years ago, the cost of broadband amounted to less than 2 percent of median monthly household income in just 33 of the countries studied. This year, 49 of the 70 countries had broadband services at that price or below.

In part thanks to this trend, the global “digital divide” is waning. Last year, the gap between the top- and bottom-ranked countries on the EIU’s list came to 5.9 points on a scale of 1 to 10. This year, the gap has narrowed to 5.5 points, a welcome sign that poorer countries are gaining ground in the new digital economy.