The concept of a 'digital divide'-inequality in access to modern information and communication technologies (ICTs) between industrialised and developing countries, and between urban and rural populations-has attracted much attention from policymakers, aid organisations, media and the general public. This paper places discussion of the digital divide in a broader economic context, linking it with the theory of economic growth and technological change. The network effects of diffusion of the Internet are related to the possibility of leap-frogging by latecomers. This is seen as a 'digital opportunity' presented to developing countries by the 'new economy'. This paper discusses the appropriate policy environment for bridging the digital divide, and concludes that the East Asian region has much to gain from the complementarities of its economies, their openness to trade in ICT products, and policy cooperation.