E-books and e-publishing by Samuel Vaknin (essential reading .TXT) 📕

- all the rage.

The IRC was (and is) used mainly to exchange political views

and news and to engage in interpersonal interactions. The

media in countries in transition is notoriously unreliable.

Decades of official indoctrination and propaganda left people

reading between (real or imaginary) lines. Rumours and gossip

always substituted for news and the Internet was well suited

to become a prime channel of dissemination of conspiracy

theories, malicious libel, hearsay and eyewitness accounts.

Instant messaging services also led to an increase in the

number (though not necessarily in the quality) of interactions

between the users - from dating to the provision of services,

the Internet was enthusiastically adopted by a generation of

alienated youth, isolated from the world by official doctrine

and from each other by paranoia fostered by the political

regime. The Internet exposed its users to the west, to other

models of existence where trust and collaboration play a major

role. It increase the quantity of interaction between them. It

fostered a sense of identity and community. The Internet is

not ubiquitous in the countries in transition and, therefore,

its impact is very limited. It had no discernible effect on

how governments work in this region. Even in the USA it is

just starting to effect political processes and be integrated

in them.

The Internet encouraged entrepreneurship and aspirations of

social mobility. Very much like mobile telephony - which

allowed the countries in transition to skip massive

investments in outdated technologies - the Internet was

perceived to be a shortcut to prosperity. Its decentralized

channels of distribution, global penetration, “rags to riches”

ethos and dizzying rate of innovation - attracted the young

and creative. Many decided to become software developers and

establish local version of “Silicon Valley” or the flourishing

software industry in India. Anti virus software was developed

in Russia, web design services in former Yugoslavia, e-media

in the Czech Republic and so on. But this is the reserve of a

minuscule part of society. E-commerce, for instance, is a long

way off (though m-commerce might be sooner in countries like

the Czech Republic or the Baltic).

E-commerce is the natural culmination of a process. You need

to have a rich computer infrastructure, a functioning

telecommunications network, cheap access to the Internet,

computer literacy, inability to postpone gratification, a

philosophy of consumerism and, finally, a modicum of trust

between the players in the economy. The countries in

transition lack all of the above. Most of them are not even

aware that the Internet exists and what it can do for them.

Penetration rates, number of computers per household, number

of phone lines per household, the reliability of the

telecommunications infrastructure and the number of Internet

users at home (and at work)- are all dismally low. On the

other hand, the cost of accessing the net is still

prohibitively high. It would be a wild exaggeration to call

the budding Internet enterprises in the countries in

transition - “industries”. There are isolated cases of

success, that’s all. They sprang in response to local demand,

expanded internationally on rare occasions and, on the whole

remained pretty confined to their locale. There was no

agreement between countries and entrepreneurs who will develop

what. It was purely haphazard.

Very early on, the denizens of the countries in transition

have caught on to the “great equalizer” effects of the Net.

They used it to vent their frustrations and aggression, to

conduct cyber-warfare, to unleash an explosion of visual

creativity and to engage in deconstructive discourse.

By great equalizer - I meant equalizer with the rich,

developed countries. See the article I quoted above. The

citizens of the countries in transition are frustrated by

their inability to catch up with the affluence and prosperity

of the West. They feel inferior, neglected, looked down upon,

dictated to and, in general, put down. The Internet is

perceived as something which can restore the balance. Only, of

course, it cannot. It is still a rich people’s medium.

President Clinton points out the Digital Divide within America

- such a divide exists to a much larger extent and with more

venomous effects between the developed and developing world.

the Internet has done nothing to bridge this gap - on the

contrary: It enhanced the productivity and economic growth

(this is known as “The New Economy”) of rich countries (mainly

the States) and left the have-nots in the dust.

The concept of intellectual property - foreign to the global

Internet culture to start with - became an emblem of Western

hegemony and monopolistic practices. Violating copyright,

software piracy and hacking became both status symbols and a

political declaration of sorts. But the rapid dissemination of

programs and information (for instance, illicit copies of

reference works) served to level the playing field.

Piracy of material is quite prevalent in the countries in

transition. The countries in transition are the second capital

of piracy (after Asia). Software, films, even books - are

copied and distributed quite freely and openly. There are

street vendors who deal in the counterfeit products - but most

of it is sold through stores and OEMs.

I think that intellectual property will go the way the

pharmaceutical industry did: Instead of fighting windmills -

owners and distributors of intellectual property will join the

trend. They are likely to team up with sponsors which will

subsidize the price of intellectual property in order to make

it affordable to the denizens of poor countries. Such sponsors

could be either multilateral institutions (such as the World

Bank) - or charities and donors.

Leapfrogging Transition

Technology and Development in Post-Communist Europe

Also published by United Press International (UPI)

In many countries in transition cellular phones are more

ubiquitous than the fixed-line kind. Teledensity is

vanishingly low throughout swathes of Central and Eastern

Europe (CEE). Broadband and e-commerce are distant rumors

(ISDN is available in theory but not so in practice - DSL and

ADSL are not available at all). Rare phone lines - especially

in urban centers - are still being multiplexed and shared by

4-8 subscribers, greatly reducing both quality and usability.

Terrestrial television competes ferociously with satellite TV,

though cable penetration is low. Internet access is

prohibitively expensive and intermittent. Many technologies

rely on network effects (i.e., a critical mass of users). CEE

is far from reaching this elusive point.

When communism imploded in 1989, pundits were quick to spot

the silver lining. The countries in transition, they said,

could now leapfrog whole stages of development by adopting

novel technologies and through them the expensive Western

research they embody. The East can learn from the West’s

mistakes and, by avoiding them, achieve a competitive edge.

In his seminal book, “Leapfrogging Development - The Political

Economy of Telecommunications Restructuring”, J.P. Singh,

examined the acceleration of development through the adoption

of ready-made, off the shelf, technologies. His melancholy

conclusion was that development preferences are the outcomes

of an intricate inter-play between sectoral pressure groups

and coalitions of interest groups - and not the result of

progress ex machina. He distinguished three types of states -

catalytic, near-catalytic, and dysfunctional. Though he deals

exclusively with Asia and Latin America, his typology is

applicable to post-Communist Europe.

I. An Overview

The Central and East European market will double itself (to

$17 billion) by 2003, says IDC. Pyramid Research predicts a

$60 billion communications market by 2005. “Information

Society”, ICT (Information and Communication Technologies),

“leapfrogging”, and “better online than in line” are buzzwords

and slogans oft-used throughout the region. A horde of NGO’s -

local and international - collaborate with domestic government

and local authorities, with foreign governments,

multinationals, and international organizations to make the

dream of a digital Europe come true.

Russia pledged to attract $33 billion in investments in its

telecommunications infrastructure and services by the year

2010 (the “Electronic Russia” initiative). The US Commercial

Service, in the American Embassy in Moscow, predicts an annual

growth rate of the Russian ICT sector of 15-20 percent through

2003. Conferences abound (an important one regarding municipal

collaboration in constructing an information highway is to be

held in the Czech Republic on March 26-27).

Even devastated Armenia succeeded to export $20 million worth

of IT goods in 2001 (its IT sector has grown by 30% last

year). It hosts branches of Silicon Valley household names

such as Credence, HPL, and Virage Logic. More than 4000

professionals are employed in 200 companies. Of 60 software

development outfits - 26 were founded with American capital.

LEDA, a prominent local IT firm, finances IT programs at the

Armenian State Engineering University.

All EU candidates strive to get incorporated in existing

European networks (such as ELANET, Telecities, IDA, and ERISA)

and new, candidate-only, initiatives (such as eEurope+). The

EU has applied its “universal (i.e., also affordable) service”

rule to Internet access. EU members adopted a variety of

measures to increase Internet awareness and usage. Portugal,

for instance, granted individuals with tax incentives coupled

with free e-mail accounts and Web hosting services to

encourage them to purchase PC’s. The Dutch established public

computer literacy centers for the disenfranchised (e.g., the

unemployed) and provided them with discounted and subsidized

hardware and connection time.

In one of its more grandiose moments, the heads of governments

of the EU countries have decided in Lisbon (2000) that “each

citizen should have access to the Internet and the whole

European Union should become computer-literate”, in the words

of the Czech conference organizers.

This is an ambitious undertaking not only because Europe in

general is behind the USA where Internet matters (with the

exception of wireless Internet) are concerned - but because

the countries which used to be behind the Iron Curtain, now

lurch in the Digital Divide.

According to Vasile Baltac from the Information Technology and

Communications Association of Romania (“The Balkan and Eastern

Europe - Digital Divide or Digital Opportunity”), Romania has

invested $25 per capita in ICT in 1999 (compared to Greece’s

$567 and the EU’s average of $1215). There were only 2.5

Internet users per 1000 inhabitants in Romania and Bulgaria -

compared to 56.4 in Westward-looking Slovenia.

New technologies are used mostly by the elites in CEE (as

pointed out by Zassourski and Vartanova in “Transformation in

the Context of Transition”) - and perhaps advertently so.

Still, Baltac fingers the managerial class as the main

obstacle to leapfrogging (i.e., the rapid dissemination and

assimilation of advanced technologies). They pay lip service

to modernization but feel threatened and repelled by it. On

the positive side, Baltac notes the annual yield of qualified

professionals (who mostly find work in the West) and the

emergence of telework and e-commerce. The technological vacuum

makes the CEE countries receptive to state of the art

technologies. GSM penetration in Romania surpassed the level

of fixed line coverage in 1989. The number of cable TV

subscribers in the region is projected to double (to 20

million) by 2005.

But the true picture is often obscured by anecdotal evidence,

wishful thinking, phobias (e.g., the West European fear of

mass migration from East Europe), lack of reliable statistics,

and absence of qualified analysts and investment bankers.

Factors like hostile terrain and climate, cross-subsidies,

lack of real competition, corruption, red tape, moribund

financial systems, archaic legal ones, dearth of credit card

holders, urban-rural gaps, and English language illiteracy -

rarely appear in neat, colorful, presentations.

Pyramid Research is bearish on broadband. “Internet access is

and will remain for the foreseeable future a predominantly

narrowband, dial-up affair, even in the most advanced

countries (in Central Europe)”. This despite plans by regional

operators to offer DSL, FWA (Fixed Wireless Access), cable TV

and leased-line broadband access (already offered in the Czech

Republic by cable networks) and despite a regulatory welcome

in all three CE candidates (Hungary, Poland, and the Czech

Republic).

Luckily, mobile telephony - the other pillar of the

leapfrogging theory - is getting increasingly concentrated in

the hands