This is my presentation for CODE 2011 in Japan (4MB download, PDF). It's about why digital literacy is a useless concept because of the nature of technology and how it evolves. Basically, digital technologies change too much, too fast and there's too many of them for the concept of literacy, at least in the sense that we have previously used it, to have any meaning at all. Worse, skills that we did learn in the past actively block our abilities to learn new ones. 

I suggest a different way of looking at the problem in terms of technology design, soft technologies and hard systems as part of a strategy to help people come to terms with digital technologies. We need to join in the dance by being able to participate in shifting the soft to the hard and vice versa.

The biggest issue remains access, of course: learning to use most commonplace digital technologies today is not too hard and getting easier and easier all the time (though constantly opening up needs for new skills and presenting new and unexamined consequences), but finding them, paying for them, replacing them, dealing with the side-effects, understanding the challenges and so on are huge challenges.