Preface

Information and communication technology (ICT) has become an indispensable tool in the fight against world poverty. ICT provides developing nations with an unprecedented opportunity to meet vital development goals such as poverty reduction, basic healthcare and education far more effectively than before. Those nations that succeed in harnessing the potential of ICT can look forward to greatly expanded economic growth, dramatically improved human welfare and stronger forms of democratic government.

THE UNIQUE CHARACTERISTICS OF ICT

ICT can be a powerful enabler of development goals because its unique characteristics dramatically improve communication and the exchange of information to strengthen and create new economic and social networks:

• ICT is pervasive and cross-cutting. ICT can be applied to the full range of human activity from personal use to business and government. It is multifunctional and flexible, allowing for tailored solutions—based on personalization and localization—to meet diverse needs.
• ICT is a key enabler in the creation of networks and thus allows those with access to benefit from exponentially increasing returns as usage increases (i.e. network externalities).
• ICT fosters the dissemination of information and knowledge by separating content from its physical location. This flow of information is largely impervious to geographic boundaries—allowing remote communities to become integrated into global networks and making information, knowledge and culture accessible, in theory, to anyone.
• The “digital” and “virtual” nature of many ICT products and services allows for zero or declining marginal costs. Replication of content is virtually free regardless of its volume, and marginal costs for distribution and communication are near zero. As a result, ICT can radically reduce transaction costs.
• ICT’s power to store, retrieve, sort, filter, distribute and share information seamlessly can lead to substantial efficiency gains in production, distribution and markets. ICT streamlines supply and production chains and makes many business processes and transactions leaner and more effective.
• The increase in efficiency and subsequent reduction of costs brought about by ICT is leading to the creation of new products, services and distribution channels within traditional industries, as well as innovative business models and whole new industries. Intangible assets like intellectual capital are increasingly becoming the key source of value. With the required initial investment being just a fraction of what was required in the more physical-asset intensive industrial economy, barriers to entry are significantly lowered, and competition increased.
• ICT facilitates disintermediation, as it makes it possible for users to acquire products and services directly from the original provider, reducing the need for intermediaries. This cannot only be a considerable source of efficiency, but has in fact been one of the factors leading to the creation of so-called “markets of one,” leveraging ICT’s potential to cater to the needs or preferences of users and consumers on an individual basis.
• ICT is global. Through the creation and expansion of networks, ICT can transcend cultural and linguistic barriers by providing individuals and groups the ability to live and work anywhere, allowing local communities to become part of the global network economy without regard to nationality, and challenging current policy, legal and regulatory structures within and between nations.

These characteristics suggest that ICT has the potential, if conceived as a means and not an end in itself, to be a powerful enabler of development. However, the fact that ICT can, in theory, assist development efforts does not mean that it will necessarily do so. In order for ICT to positively foster development goals, it must be employed effectively.

* from: Creating a Development Dynamic: Final Report of the Digital Opportunity Initiative, Accenture, Markle Foundation, UNDP, July 2001

OBJECTIVE

The manuals shall provide guidelines for countries to improve or optimize its e-readiness. Self-assessment of e-readiness is provided on separate document as a framework to determine the level of each country. Various factors were taken into account in this self-assessment. Some of these factors were later becoming key factors, which need to be considered in improving e-readiness. Some were prerequisites and played crucial role, as they had to be available even for the initial level.

STRUCTURE OF DOCUMENT

The prerequisites for each level were discussed first. Later, upgrade path, stages of development and what to focus during improvement will be presented. Lastly, each key factor contributing toward development of ICT shall be identified and analyzed.

Prerequisite, Development stages and Key Factors

PREREQUISITE

These prerequisites are basic requirement to at even initial level of e-readiness. They have to be available before improvement can be made. However, it does not mean that these prerequisites are widely available in the countries. Imbalances of distribution are fact even in developed countries. Therefore these prerequisites need to be available at least on the institution which will become focal point for electronic linkage toward NAM-CSSTC. Each of them shall be discussed below.

Electricity

Basic electricity are necessary to provide power for the IT infrastructure. There are various ways to generate a stable power source of electricity. Depending on the policy of the countries, power plant can be utilize hydroelectric (which is popular and cheapest), geo thermal, fossil fuel (diesel, coal), wind energy, solar energy, or nuclear.

Distribution and reliability are another factors to be considered. Typically to improve these factors, IT infrastructures were equipped with UPS (un-interruptible power supply). The device provides protection against power line noises (surge and spikes) which could be harmful to sensitive electric and mechanic part of the system. UPS also smoothed ripples of voltages coming in from AC power lines. The actual advantage of UPS is graceful shutdown in case of power failure. It works by actually powering the IT system from batteries. The power line is used to charge the batteries and output of batteries is fed to an inverter to convert it to AC voltage again.

Computers

Of course the basic of all IT infrastructure are computers. Nowadays, PC or personal computer are ubiquitous and can provide almost all computing-power necessary for any requirement. Other more specialized computers are workstation, servers, mini computer and super computer. PC and these other type of computers are discussed further in separate document describing ICT system.

Internet connection

Next step of computers is interconnection. Local interconnection can be achieved using LAN (local area network). Global interconnection requires Internet connection. Typically, this requires an ISP (Internet service provider) or connection to global backbone Internet. The latter are more costly and usually available to ISP or with subsidy to university or research institution.

Various types of Internet connection are available. The most common and slowest is dial up connection using telephone lines. It requires a simple dial up modem for computers to connect to Internet POP (point of presence). The charge for dial up is based on time of connection and volume of data.

Other type of connection is ‘always on’ type which mean the computer is continuously connected to Internet. The charges are usually flat rate on monthly basis. Some also counts volume of data as on top of basic charge. This type of connection includes leased line, cable modem, DSL, wireless broadband and satellite. Detail description of each access media is provided in separate document.

Software

The computer forms the part, which is called hardware. It cannot function without the other part or software. The most important software is operating system (OS) which provides basic function of computer such as initial setup when it first powered on. Another function of OS is connecting peripheral such as monitor, keyboard, mouse, printer, etc. Popular OS now is Windows by Microsoft. Another open system OS that is popular lately is Linux, which has similarity with Unix.

Other software on top of OS and required for connection to Internet is browser. Typically, it combines function of surfing World Wide Web, email and newsreader. Newest browser also integrated with streaming video function. Netscape and Internet explorer are popular browser.

Web server is software that runs to provide basis for homepage of World Wide Web. Popular one is IIS (Internet information system) by Microsoft or Apache the open system alternative. These software are discussed in details in separate document titled ICT system.

Human resources

Obviously all of the infrastructure would mean nothing if the human resource side was not ready to utilize it. First and foremost is skill in using these ICT basic infrastructures such as computers. Effort has been made to ease human interface of computers of what so called ‘user friendly interface’ but so far operating a computers require training and adaptation as most of the command has to be issued with keyboard. Second is the cultural adaptation of society toward ICT infrastructure. Telephone as basic means of communication has been widely adopted. Computer literacy and adoption of it as means of communications are still in infancy even in developed countries. In USA there is a domain dedicated to bridge the gap of digital divide among its citizen particularly ethnic groups and minor.

FOCUS

There are four areas that should fall within government attention particularly to develop e-readiness and country’s competitive position in global electronic linkage.

Firstly, welfare is everything. Without a proper per capita income, it is difficult for the public to adopt the Internet. True that Internet may help alleviate poverty and provide support toward development but basic public’s need for food, housing, health facilities and security are still priority. As illustrated above, even in developed country like USA, there is still gap in the society in adopting Internet, let alone in developing countries.

Second, connectivity is the goal. Penetration is still considered as critical factors in Internet revolution. Disparity of telecommunication services between rural and urban areas are fact, thus he provision of telecommunication infrastructure become a major factor here. Creative alternatives to provide access in cost-effective ways are available by utilizing advanced in technology.

Third, competition is the engine. Various examples have proven that competition promotes greater investment, lower prices, stimulate growth in subscribers as well as technology innovation. Therefore regulation which are becoming barrier to competition must be wisely and gradually eliminated.

Last factor is education, which becomes enabler. As always-human resource skill are important to maximize use of Internet. Unlike telephone, Internet present higher social barrier as it requires literacy and IT knowledge as a minimum. Therefore to prevent exclusion even if the infrastructure is in place, education to the people is important either formal or informal.

STAGES OF DEVELOPMENT

The following is typical stage of development for e-readiness and actually also shown adoption level of Internet in the society. Note however that there are no clear and distinct boundaries among each level. Rather an overlap and gradual migration is actually what is happening. Therefore a countries might well in the all stages of development at various location in the country itself.

Searching and publishing information

Internet was initially meant to provide alternatives to collaboration among scientist and researcher. They were ranges from simple text messaging to more elaborate peer review and joint authoring, which involved complex and inter-linked document. In the adoption by the society, this heritage is still valid and mostly the first use of Internet is searching and publishing information. At this level, there should be a coherent vision by the government to support and later guided the development toward another level.

Communication at this level are indirect and mostly one ways. Small feedback or e-mail contact is typical but these are not interactive communication. There might be some creative person pushing the boundaries by providing some kind of chat facilities using text messaging.

Intranet

At this level, collaboration within an organization is done using the intranet. Organization is not limited to government institution but includes also business entities. Intranet allows data to be gathered, processed and shared in new form therefore ensuring efficiency. Although part of the process is sometimes handled offline, the implementation of intranet are improving the quality and efficiencies of the overall process. Apart from the speed factor, intranet also guarantees transparency as everything runs on online basis so concerned parties can monitor the progress directly.

Extranet

This is the most advanced state whereby services and process are conducted online. Almost all of the information and data are exchanged over the cyberspace. Only physical goods that can not be transported over Internet are delivered offline. It also the most interesting as it open up a limitless opportunity to explore the usage of Internet and electronic linkage. In fact, at this level electronic community can span a global reach beyond time and geographical limitation.

KEY FACTORS

We have identified the following key factors which is essential in effort to improve e-readiness and ICT development in the countries. They are grouped in four categories below:

a)     Infrastructure and connectivity

This part will discuss improvement of prerequisite infrastructure of ICT namely telecommunication and information technology. Later, connectivity as a goal mean that increase the penetration of infrastructure is important. This would translate into improving availability of telecomm and IT through various creative and unique ways.

b)     Financial assistance and business or private entity participation

Obviously funding availability shall play major role in any development effort. Therefore this part will discuss the subject. Next, participation of business and private entities is another alternative to funding the project. However, there should be clear incentive to stimulate participation from these parties. Some illustrations of the project conducted in various countries with participation from business sector are provided in this section.

c)     Regulation, law and applicable IPR (intellectual property rights)

Government influences and directs the effort of a nation through law and regulation, which is under their control. Similarly in ICT, law and regulation, which is conducive toward advancement, need to be identified and enacted. In the mean time regulation and law which inhibit ICT must be gradually and wisely eliminated. Another subject that has been proven to be important is intellectual property right (IPR) which would later spur research and development (R&D) activities.

d)     Human resources, education and public opinion building

Last but not least is the human resource aspect. Education is closely related in improving human resource skill and knowledge. Other important aspect is how to disseminate information and bring participation from whole society. Therefore effort for public opinion building is also discussed.

Infrastructure and connectivity

INFRASTRUCTURE

Current advanced and modern ICT has enabled innumerable global-flows in information, products, people, business opportunity, capital and ideas, which offer great potential for radical improvements both in human development and environments. Since ICT can be a powerful tool for development nowadays, the readiness of ICT infrastructure plays a very critical role in delivering the development program into national goals. Its extensive characteristics allow ICT to be the most useful tools among others development imperatives for enhancing and speeding up a society development among huge disparities in the quality of human livings among countries. Several countries have already put the ICT-infrastructure-program bigger role to contribute a great deal to their development goals. Moreover, ICT infrastructure can be useful at both the micro and national level, such as allowing the effectiveness and reach of development interventions, enhancing good governance, and providing business opportunity for the private sectors.

ICT is already being used highly effectively to directly address development goals. In Gambia, for example, it is being used to achieve better health outcomes. In Chile, it is starting to reap significant results in primary school education. In Bangladesh, it has led to the creation of direct employment for thousands of local women and men, while in parts of India new Internet-enabled centers mean better access to different government services for remote communities. In Indonesia, too, ICT is enabling local citizens’ groups to monitor compliance with environmental standards. (Creating a Development Dynamic – Final Report of DOI  – July 2001)

Government of developing countries should learn from other country’s experience that ICT could provide a dramatic impact on achieving specific social and economic development goals, moreover, play a key role in broader national development strategies. They also have to take appropriate and effective strategies to improve ICT infrastructure into their national development goal. The strategies chosen should be realistic, flexible and sensitive to local conditions, and should be backed by strong public and private institutional support. Above all, there should be a strong commitment to local participation and the fulfillment of local needs, and last but not least, government express political will as clear as possible.

A framework proposed by the DOI, suggest that the government should consider several keypoints in formulating their strategies for maximizing their effort and budget to obtain their goals. The framework consists of five related areas; one of them is infrastructure. In infrastructure area, the strategies should be taken into account are as follow:

• Deploying a core ICT network infrastructure. ICT is very pervasive in the global world today, the features are very excessive and the price soon will be very competitive. An ICT-based network or solution will have advantages in term of interoperability and cost compared to other development imperatives.
• Achieving relative ubiquity of access. Access for ICT service should be available everywhere in urban or rural area, and every people should deserve it. Unlike policies focused on export expansion or on international positioning, this mass-oriented policy will consume much cost and, therefore, should be complemented by government interventions through universal access funds and support of community networks and public access points
• Investing in strategically-focused capacity to support high development priorities. The strategy should focus on developing appropriate and strategic network infrastructure capacity for key sectors to take advantage of leading edge technologies. To take advantage of global positioning possibilities, such focused capacity should also include a reasonable level of global connectivity
• Addressing ICT infrastructure as an enabler to enhance the achievement of development goals and national long-term targets. ICT can be a powerful tool for development, both because of ICT’s inherent characteristics and the mounting empirical evidence in many countries show that it can contribute a great deal to development goals.

In many developing countries, the role of government in providing telecommunication service is very deterministic. Government or state-owned company(s) has dominated all telecommunication service from provisioning and maintaining core network infrastructure, as well as providing universal access. However, some privatization and liberalization policies aimed at increasing competition in the sector, has already provided a greater involvement of the private sector in infrastructure provision.

Ubiquity and the move toward universal access are becoming more and more feasible due to rapidly declining costs for networking and telecommunication technologies. These declining costs allow developing countries to leapfrog ahead through the use of cutting-edge technologies. In most developing countries, the information network is composed of an all-digital microwave and fiber-optic system with digital exchanges at the main centers. The involvement of the private sector has hastened the adoption of these technologies, particularly in the case of wireless and mobile.

The strategy(s) should also focus on the complementarities and synergies between stakeholders and coordination among stakeholders. Infrastructure is rolled out as part of an overall program that includes simultaneous actions in other areas. These stakeholders could involve regulator with adaptive and supportive framework, NGOs, private enterprise and non-profit community as partners, and SMEs and public as service users/customers. The stakeholders should have the same initiatives to expand ICT access and services, and to strengthen demand as a beneficial side effect of addressing development imperatives through a public infrastructure strategy.

Achieving Greater Penetration of ICT Infrastructure

Infrastructure is basic requirement for promoting ICT as enabler of development program. When the infrastructure exists, the pace of development will be faster. However, the infrastructure irreadiness is a very general problem in most developing countries, and it is responsible for poverty problem and huge disparities between the rich country and the poor.

1. Electricity

ICT infrastructure requires telecommunication network, and telecommunications requires electricity. Electricity is basic infrastructure just as roads for transportation. The development of an area is depending on weather electricity is available or not. While the electricity is available, other infrastructures and facilities will follow, such as TVs, telephone, and entertainment. All populated area should have equipped with electricity, no matter how small and poor the population is. Electricity network should have been available to every districts, sub-districts, villages and rural area in NAM member countries.

2. Community Centre

Every village or district must have a community center. It commonly is the most developed place in a village or rural. It could be a local government office, district cooperative, marketplace, religious places (mosque, church or temple), gas stations, or sea or river ports. Establishing community center equipped with telecommunication infrastructure such as telephone, postal service and PCs, is an entry point to open up this village or rural to the world. The villagers could also take benefit of this facility by adopting the knowledge, know-how and information available to their daily living. 

3. Provisioning Telecommunication Access to Rural Area

Government should achieve universal service to cover all villages, rural or sub-districts as early as possible. This universal service should involve all telecom operators, PSTN or mobile, employing any cheap, cost-effective telecommunications solution for certain basic telecom service at affordable and reasonable prices for the rural people. The solution is most likely wireless, both terrestrials and satellite system, to cover bigger area. Rural telecommunication system has widely been studied since 1970-es by ITU, to promote developing countries catching the development gap to industrial countries.

4. Improving the copper wire quality of local access network

The quality of telecom services should be of world standards. The quality of copper wire determines the voice quality and amount of bandwidth of data carried. The good copper wire quality can carry up to 33.6 – 56 kbps of data transmission via dial-up modem. The bad copper wire quality will cause cost-per-kbps of dial-up connection more expensive.

5. Digitalization of Telecommunication Equipment

Switching equipment, transmission equipment (microwave radio system, optical cable network) and local cable network should be “digital ready’, since the Internet and other networking system is in form of digital world. Migrating process from analog system to digital system should be addressed carefully since it will bear huge cost for developing countries.

6. Providing Digital Transmission / Backbone Network

Digital transmission system is built across the country, connecting all cities, provinces, and municipalities throughout the nation. Digital terrestrial radio network is deployed as country’s telecommunication backbones, as well as digital satellite system to cover bigger area in short time. VSAT system is considered to provide rural telecommunication system for spread, low-dense rural area.

7. Providing High-speed Data Network for Urban and Metro Area

Demands for data telecommunications is getting enormous in the city, demanded by business, academic or young people. Every existing telecommunication infrastructure available should be upgraded to bring more and more bandwidth. Telephone wireline network should adopt xDSL technology to go beyond 2 Mbps data stream. Coaxial cable should introduce cable modem, to provide data capability on top of TV cable network. Optical fiber network should go to every building, serve business with higher speed of the Internet access. Other access system such as wireless technology  (LMDS, MMDS, and wireless-LAN) should be deployed to expedite the network deployment.

8. Adopting Advanced Telecommunication Network

Telecommunication technology is evolving during certain period. The digitalization of switching equipment and transmission system had already started by early 1980. Several years later, some improvements took place repetitively. The telecom operator and government should keep their eyes on the technology development, and adopt it whenever they need. Current advanced telecommunication network has gone far compared to the old-fashioned analog telecommunication system. It can now deliver several services via single network, such as ISDN, IN and xDSL.

9. Establishing an intra-University Network

This network is connecting all buildings, faculties/departments, laboratories, libraries, statistic centers, student centers, via a high-speed network such as coaxial cable, Ethernet cable or even optical fiber network. The internal network will provide free-of-charge data communication service, so that it will promote better relationship among resource center in the university. 

10. Establishing an Inter-University Network

This network will connect several universities, campuses, libraries, via a private, low-cost network, instead a commercial public-switched network. Since traffic flow among universities is predicted high and continuous, it will be more efficient to build a permanent connection among them rather than using a commercial service.

The wireless solution called Broadband Wireless Access or Wireless LAN operating at low frequency band could be ideal. ITU-R has recommended several frequency bands is dedicated as non-commercial band, called ISM (Institution, Science, Medical), such as 1.5 GHz, 2.4 GHz, 5.8 GHz frequency bands. These frequency bands can go travel a long distance, thanks to its lower band, and the implementation cost is getting cheaper since more and more non-commercial institutions around the world using this make the economy of scaling of this technology.

11. Establishing Distance Learning Facility

Government should provide telecommunications facilities available for distance learning to overcome not only the problem of illiteracy, but also education at higher level. The distance learning infrastructure such as video-conferencing, question and answer session, could be facilitated by TV broadcast, satellite system / VSAT, or other wireless solution, having cooperation with open universities or other local educational agencies. Teaching and course contents can also be recorded as multimedia CD-ROMs. This technology can be widely used in the entire spectrum of education: primary, secondary, colleges and higher learning institutes. Moreover, educational institutions from different countries can come together and have programs for getting the best out of their teaching and learning experiences.

12. Establishing Tele-Medicine Facility

This telecommunication system will interconnect rural hospitals and clinics to public hospitals and physician in cities, in order to penetrate to further area in short time as well as cutting down the cost of medical infrastructure and doctors. The network will link to several online sites in hospitals and clinics in national and even regional level, to cutting edge medical information and assistance.

13. Establishing A Private Network

A private network is sometimes required to achieve a specific development goal, such as to penetrate to under-develop communities, or to envoy regional autonomy and tax collecting program, or to monitor the border line area. This private network is via a dedicated network rather than commercial PSTN network due to some reasons from strategic, politic, security or even economical reasons. It should be established to interconnect all stakeholders in the program. For developing a region, it should connect central government institutions (National Planning Body, Statistics Bureau), universities, regional government offices, and NGOs. For autonomy and tax collection program, it should be available on every regional tax offices, state-owned banks, and ministry of finance and tax.  The private network should utilize wireless network such as ISM-wireless-LAN network or satellite system using VSAT system in order to get better coverage and quick penetration to certain areas. Other private network called virtual private network (VPN) could be established by utilizing intelligent system of public switched network. This network utilizes commercial wireline and terrestrial network, with deeper accentuation on security issue.

14. Establishing a Power-Line-Based Telecommunication Network

Other alternative to get immediate solution for rural telecommunication system is utilizing power line network as transmission or backbone for telecommunication system. This is an opportunity to penetrate more, since electricity network usually has further penetration in rural areas.

The latest technology with such capability is called PLC (Power Line Carrier). A modem is put at transformator to modulate a carrier with operating frequency up to 30 MHz. The low-voltage power-line delivers this carrier to the destination. At the end side, a demodulator converts the carrier into data streams and sends it to telecommunication equipment (switching or router). Every single power line can deliver up to 2 Mbps data streams in TCP/IP format. The high-voltage power-line can deliver higher speed, up to 10 Mbps, and the very-high-voltage power-line can goes beyond that numbers.

Other technology for supplying transmission backbone is optical fiber cables installed at the core of the very-high-voltage power-line. One high-voltage power cable can carry one or more optical fibers.

15. Upgrading National Bandwidth Capacity to the Internet Backbone

The most expensive expenditure in Internet business in developing countries is having connection the Internet backbone. Most of the Internet big hosts and information resides in developed countries. The distance between “north” and “south” region makes the backbone cost is keep high. On the other hand, national demand is keep growing due to Internet becomes more popular everywhere. Strategic steps should be addressed to overcome lack of bandwidth and other potential problem related to multi-lateral involvement.

A regional backbone and the Regional Inter Exchange (RIX) should be established to convey Internet traffic among countries in the region. The physical network could be optical fiber network, under-sea cable network (regional or international) or Intelsat Satellite System. Multiple connection to international backbone (mainly to industrial countries) should also be maintained: such as USA-node, ASPAC-node, AUS-node and EUROPE-node. The bandwidth to the Internet backbone should be increased regularly. The incurred cost can be shared among the members of the RIX.

Establishing NAM-CSSTC Program Office in Member Countries

The NAM-CSSTC was already established in Jakarta, Indonesia in 1997, as a center or main hub for promoting ICT role in the developing countries. In order to disseminate the study, plan and recommendation already made, as well as bringing a better involvement of the NAM members in promoting ICT for their development, a program or liaison office should be established in every country. The Program Office is to address all networking and connectivity issues, monitoring nation capacity and capability, web preparation and content development, as well as promoting ICT and the Internet awareness among high-level officers and other national stakeholders. Several national pilot projects on selected pilot locations could be undergone under monitoring of this program office. 

Every country should also establish a national gateway or focal point, which will bring several technical tasks as follow:

• Connecting the national gateway to other resources within country: Government Institutions (such as Research, Development Planning Bureau, Statistical Bureau, Ministry of Trade and Industry), National Chambers, Universities, Research Institutions, and other interested Private/Business Institution
• Conducting human resource development, training in ICT program and networking, and disseminating the progress to other pilot locations. The involvement of local/native human resource should be promoted and prioritized.
• Preparing contents associated at every resource center. Every important resource centers within nation should be promoted, and the resources such as research institutions, labs, skilled persons, and other natural resources should be available to other member countries. The presentation can be websites, links, downloading files or other popular media in Internet world.
• Managing several important/substantial websites or portals that contains strategic information and sensitive resources. Although the resource should be available for every member countries, as mentioned above, some strategic and sensitive information could be an exception. The sensitive resources such as national security policy, national research bureau, banking, native political issue, native religions, etc should be managed carefully.
• Conducting language translation if needed. (translation from national language to international language, and vice versa). Several international languages should be chosen, in order to reach as much reader as possible. English, French and Spain language could be chosen as the most popular international language nowadays.
• Preparing coordination with other regional countries via Regional Gateway. Regional gateway should also be established by the member countries within region (Southeast Asia, Mid-east Asia, North Africa, etc.). Several national gateways can elect one of them to be Regional gateway, and conducting coordinating and supervising role to promote better improvements among regional countries. 

Both program office and national gateway tasks could be carried out by the same institution in order to get better coordination and efficiency in term of operational cost.

Connectivity

Connectivity will provide more people to interact each other over the distance. Telecommunication and connectivity has played very dominant roles in the worldwide nowadays. Promoting connectivity means providing more computers connect to others via networking technology or system, especially via the Internet. The strategies consist of providing more affordable computers to the people and providing more Internet access available to the computer users, including bandwidth, IP address and domain name. Last but not least, is developing websites, contents and other web applications, make the national information or resource being available to other people in the world.

Promoting PC Penetration

Computer has experienced a paradigm shift from the stand-alone mainframe computers to PCs in the 1990s and, now, with the explosive growth of the Internet, multimedia, and the emergent network-centered computer, the role of PCs becomes more and more dominant.

Information and Communications Technology (ICT) as a whole has been making dramatic breakthroughs in the last thirty years. Computer have seen, every 24 months a doubling of the number-crunching capacity and a simultaneous reduction in prices by 50 %, according to the Moore’s Law, one of the founders of Intel, the dominant processor manufacturer of silicon chip in the world.

However, the digital divide can easily be seen by comparing penetration of PCs and host computers between developed and developing countries. UNDP reports that 96 percent of Internet host computers reside in the highest-income nations with only 16 percent of the world’s population. There are more Internet hosts in Finland than the whole of Latin America and the Caribbean, more in New York City than on the entire continent of Africa. (UNDP Agenda, October 2000). There is a linear correlation between GNP and amount of income versus Internet and PC penetration as depicted in Figure 1. The more income of a population, the more penetration of Internet users and PC usage happens. 

Promoting ICT development means promoting PC penetration among people living in developing countries. PC density over population is clearly low, therefore shared-access usage such as in Internet kiosks or telecommunication center could reduce digital divide in a short time. However, the strategies to add up number of PCs from other resources rather than commercial should be addressed. These strategies requires multi approaching from several stake holders :

• Establishing strategic partnership between Government and leading PC manufacturers, in form of donation, endowment fund or relocating the obsolete technology
• University-to-university cooperation (U-to-U), shifting the Research & Development facility, including computer laboratory facility, to universities in developing countries
• Holding a dissemination program to provide tele-centre facilities in rural areas, funds is coming from soft-loan from international financial institutions (World Bank, ADB, IDB) 
• Establishing research and development facility and manufacturing facility at certain regional focal points. These facilities are funded by governments/countries among the region. This cooperation is expected to spread the hardware cost and to achieve the economic of scale of PC production by increasing the volume.
• Encouraging B-to-B (business to business) cooperation between countries in the region.
• Bringing down the tariff level (import duty, luxury tax, value added tax) on all IT-related product, especially PCs.
• One interesting breakthrough nowadays is developing a supercomputer by networking or clustering several old-fashioned PCs. For example 16 PCs of 486 type can create a supercomputer with 70 megaflops capacity, and 16 PCs of Pentium Pro type can create supercomputer 1 gigaflops capacity.
• Promoting Linux operating system and Ethernet /LAN networking system to reduce cost of software among individual/household PC owners.

Promoting Internet Penetration

Internet is one large network connecting many smaller networks, based on packet switching. The protocol used is TCP/IP, requiring hardware such as router and server. The Internet is made up of components or applications that allow communication takes place rather than as protocol. Those components are : world wide web, e-mail, file transfer, telnet, etc.

One important aspect in the Internet is IP address and its associated called domain name. Every country should have plan to regulate how IP address and domain name is structured and how its development in the future. One domain name can be associated with one host, so that the progress of the Internet penetration in one country can be monitored by number of domain names already registered. The government should target domain name penetration regularly as well as encourage companies or institutions to connect to the Internet by registering their domain names. Last but not least, government should establish a National Network Information Center (NIC) for top-level domain name registration in each country.

One important issue in bringing the Internet down-to-earth is the software, both for web developer and web browser. Java language and HTML should be available and treated as shareware in order to help companies or other institutions create their websites. In the website, they can provide or share resources or information they have to others. The web browser should also available with reasonable price, allowing as many people as possible surf and collect information from the Internet. Other free software or shareware, such as Linux for operating system, should be considered to eliminate software-dependency to certain product.

Other important application is electronic mail or email, which allows users to send or receive information in plain text or file attachments, resulting in decreasing the amount of time and bandwidth required for acquiring certain information rather than browsing. This application is suitable for rural location where bandwidth capacity is limited and telephone charge is expensive due to long distance tariff.

Developing Content and Web Applications

The Web (or more properly, the World Wide Web) was developed at CERN in Switzerland as a new form of communicating text and graphics across the Internet making use of the hypertext markup language (HTML) as a way to describe the attributes of the text and the placement of graphics, sounds, or even movie clips. Since it was first introduced, the number of users has blossomed and the number of sites containing information and searchable archives has been growing at an unprecedented rate.

The Web requires a client program (such as Netscape, Internet Explorer, or Lynx) and a server (http) to send information to the client. The client program allows the local user to run an application program to connect to the server, provide a graphical interface for the Web and allow the user to view pictures. Client programs are available in any operating system from UNIX, Windows, to Macintosh. Servers contain files full of information about courses, research interests, map, etc. All of this information is formatted in a language called HTML (hypertext markup language). HTML allows the user to insert formatting directives into the text, with a specific style and format, and convert it into HTML documents.

In order to popularize the Internet among the people and to open up their countries to the world, NAM member countries should encourage their people, especially business sectors, universities and R&D bodies, government institutions and SMEs, to providing demand-driven information they are competence in the web. The information should be relevant to the needs and conditions experienced by local people. The information should be in HTML format and should follow rules such as compatibility, language and etc.

Several key factors should be considered by every country in order to have successful web developing program and to make the information available and useful to other people.

Relevance and Usability. The contents and information delivered in the websites should be responsive to user needs and local conditions. It should be commonly understood, and should comply with technical specifications that are sensitive to the actual use and working environment of users. Partnerships between community networks and the private sector are key in this area, as are consultation mechanisms that facilitate bottom-up approaches and inclusiveness.

Language Compatibility. In many developing countries, problems also arise because standard fonts for local languages are unavailable. For such countries, translation into international language and international characters (Latin characters) is an important step, otherwise only very few people can take benefits from the contents. External partners (public, private and citizens in diaspora) can play a key role in this area. For other Latin-character countries, dual-language presentation (international language and native language) will be useful for most people in the rest of the world.

Affordability. Unaffordable access is probably the single most important reason for low use of ICT in developing countries. National ICT strategies can facilitate mechanisms for subsidized use and can support reform measures that would lead to the reduction of costs and access charges.

Development Applications. In addition, there is a need to build applications that are focused on achieving development goals. These range from those that enhance e-government and e-governance processes, to those that apply ICT to specific development goals, including health, education, empowerment, environmental sustainability and support of employment and enterprise creation.

Academic Assistance Program, is proposed to target to help institutions to create websites with low cost. Government institutions, education institutions, NGO, Cooperatives and SMEs can take part of this program by submitting their competence and planned contents. The academic IT experts than will create websites that meet with people’s needs.

Financial and Business sector participation

FINANCIAL ASSISTANCE

The most crucial tasks burdening all governments on promoting ICT development are fund provisioning and budget allocating to finance all necessary components, especially funding for infrastructure and education program. Although some countries are rich, due to their very abundant natural resources, most of the developing countries are suffering lack of funds, while on the other hand, they have plenty of development tasks and targets to accomplish and perform. Financial assistance in any form therefore is an absolute prerequisite for many countries to be overcome before they design and formulate the development stage. ICT will compete with other development’s imperatives, and, therefore, a clear and consistent direction from the government as well as prudent budget allocation are required in order to putting ICT on the national development path. 

Government should formulate a complete and sustainable program in order to involving all stakeholders take part in disseminating the ICT development. Government should also establish an environment, allowing development programs, such as financial assistantship program, are carried out by not only government and state-owned enterprise, but also private and international business institutions.

In banking sector, an appropriate regulation is needed, such as incentive, small-scale protection policy and deregulation, which will allow healthy banks to have more roles in giving opportunities for under-served communities and small-to-medium enterprises. In some developing countries, several banks are concentrating on providing credit and assistance to the farmers and they are enjoying a very small number of non-performing loans.

Other government’s task is formulating strategies to promote venture capital facilities and attracting venture capital. Venture capital is very popular in industrialized country, and their contribution to national economics is very big. Therefore, they should be invited, with several appropriate strategies, in order to getting interested in doing business in developing countries, such as relocating their business line, putting their capital in the pioneering business and providing business opportunity to the communities.

In order to provide more incentives to attract business opportunity in ICT field, government should explore the potential of using the dramatic cuts in transactions costs offered by ICT. In some countries, government already brings the tariff level down on all IT-related products. This policy is expected to find new ways of expanding micro-finance initiatives for the poor, ranging from credit for small and medium enterprise to incentive for the pioneering company.

For promoting private participation in ICT business activities, government should take active initiative in realizing a partnership of private and public stakeholders. This program is aimed at establishing the enabling environment to attract major investment in ICT infrastructure and matching information technology to the basic development needs of health, education, environment, trade and others. Government should also promote private sector entities on crafting the appropriate strategies, such as competition, public policy to support Internet and electronic commerce growth, and enabling entrepreneurial environments.

For promoting ICT awareness among NAM member countries, several strategic, pilot projects should be implemented in several regions, providing more equal opportunities among members. The source of funds should be secured and sustainable. A long-term cooperation with developed country(s) such as US, Japan, or multinational organizations such as G8, European Community, should be established, based on mutual benefit scheme for both parties.

Finance Institutions and Credit Availability

Access to credit and financing is fundamental for the dissemination of the ICT development. In most developing countries, the availability of capital funds is very poor, and the pioneering enterprise, as an agent of change, is very few. One of the major reasons for the lack of pioneering enterprise in developing countries is the shortage of affordable credit and investment to support them in capital infrastructure. This is sometimes as the result of adverse macroeconomic policies and a lack of appropriate financing channels and mechanisms suited to developing market conditions. On the other hand, the development of local banking and venture capitalist, the two keys of public financial sectors, is very sluggish, due to unclear government direction and support.

A good learning from developed country’s experience shows that the banking sector is successful agent-of-change in channeling resources across geographic zones and economic sectors. It is also ICT-intensive and provides niche opportunities for local enterprises. As financial institutions proliferate deeper into the different areas of the country, banking can also help to expand opportunities for under-served communities and businesses. At the same time, by adopting appropriate solution including ICT, banking can provide financial services more cost-effective and affordable for poor communities and small enterprises.

Other financial resource very popular in business activities nowadays is venture capital. It is a key engine of enterprise growth in industrialized countries. However, venture capital sector plays a minor role in developing countries with transitional economies, since it is not an attractive business and bearing a lot of threat. Many factors account for this; the lack of patent regulations, unstable political situation, inconsistent regulation for asset-ownership by foreigners, for example, can be held as partially responsible for the shortage of venture capital. A small-scale venture capital such as business incubator and accelerator, involving both local and overseas capitalist, should be introduced and should play a pioneering role in this field.

Other source of funds widely utilized in developing countries in past days is subsidy, such as soft funds or low-interest loans provided by international multilateral donors. Long-term loans with low interest rate are suitable for infrastructure sector, such as transportation, electricity and rural telecommunication. Several developing countries have enjoyed this kind of facility for years, and they showed a great improvement in their development activity. However, this source of funds is getting limited nowadays and only available for the poor-developing countries.

Role of the Government for Funding ICT Development 

The roles of the government are, on one hand, obtaining sufficient funds for financing the development program, and on the other hand, creating climate and environment in order to giving opportunity to the private sectors to take part in development activities. In order to obtain adequate and sustainable source of funds for developing ICT strategies, government should take active role in multilateral cooperation with developed and developing countries in the region, as well as allocate some portion of its national budget for infrastructure and education program of ICT, especially in rural area. While in creating supportive business environment, government provides regulation, policy, incentive or even facility. Several sources of funds are listed below but not limited to, and some countries may have different scenarios.

1. Government to provide budget allocation from national budget plan. Government should allocate certain ratio of its annual budget for education, health and development of rural areas. Certain amount of those activities will be ICT-related and responsible for ICT dissemination program. 
2. Soft loan or long-term credit from major-international financial institutions, such as World Bank, IMF, Asian Development Bank, or multinational creditors, such as CGI. Such multi-national organizations will provide funds suitable for any infrastructure development and reconstruction, with generous grace period and longer payback time. Poor, developing countries with certain criteria are eligible to get the aid, however, the amount of funds are getting less and less over the years. 
3. Developed country(s) to have a long-term cooperation with NAM member countries, acting as donors to fund infrastructure. Developed countries could donate some equipment or system of telecommunication, IT or electricity network for example, in a form of pilot projects or G-to-G (government to government) grant. The recipients could take benefit of donated system and in turn, should expand the system when the market is growing and demanding more capacity / features.
4. A strategic partnership of major international institutions, such as UNDP supports World Bank to build a Global Development Gateway and promote on distance learning. Distance education has been a particularly successful model in developing countries where affordability and geography have been real barriers to access. The partnership will invite other countries’ involvement in order to disseminating the program and making the partnership successful. The six largest distance-learning universities in the world are located in developing countries: Turkey, Indonesia, China, India, Thailand and Korea—all of which offer expanding virtual campuses.
5. Encouraging private sector involvement to support international program, such as cooperation between UNDP and Cisco. Several multi-national companies (MNC) have regular program of disseminating and campaigning the use of technology they are competence with. They are willingly helping people or countries with their knowledge and provide solution for several problems. The program usually involves many countries, such as Cisco/ UNDP Networking Academy Program involves more than 100 countries. This course trains more than 155,000 students or workers in developing countries in designing, building, and maintaining computer networks, enabling students to obtain jobs in the local IT industry.
6. Encouraging private or business sector to provide fund for local, specific, short-term project related in disseminating the ICT infrastructure to rural area. Some business stakeholder or big corporate is willing to take part in upbringing the pace of development. They have responsibility as well as business strategy for improving quality of human living in rural areas. When the quality of living is improved, the business opportunity is bigger. On the other hand, government should prepare adequate facility for attracting more and more private sectors involving in such program.
7. Encouraging partnership of private and public stakeholders, in order to establishing the enabling environment to attract major investment in information infrastructure and matching information technology to the basic development needs of health, education, environment, trade and others.
8. Promoting governments and private sector entities on crafting the appropriate strategic mix of telecommunications competition, public policy to support Internet and electronic commerce growth, and enabling entrepreneurial environments.
9. Inviting developed country(s) to relocate the R&D facility and manufacturing facility to developing countries. The principal countries will get benefit of lower R&D and production cost, while recipient countries will harvest the technology-know-how, job opportunities and source of funds for surroundings area. 
10. Inviting developed country(s) to transfer obsolete equipment or system (486-type PCs, analog microwave radio transmission for example) to developing countries. Digital divide is happened when the penetration of ICT over geographical area is very lame. PC penetration in US or Japan is very big compared to condition in Asia or African countries. The transferring or relocating program is aimed at providing greater penetration of ICT in the developing countries, especially for under-developed community, without jeopardizing normal ICT business transaction in those countries.
11. Proposing multilateral funds for the Internet backbone provisioning (national or regional backbone). Affordable access to the Internet is one key factor for disseminating the Internet to the community. People currently are demanding more and more bandwidth – at reasonable price – due to rapidly increasing information exchange. Government should promote strategies to bring the Internet access’ price down, by facilitating mutual cooperation among countries in the region, as well as involving business private sectors to subsidy the access charges.

BUSINESS PRIVATE PARTICIPATION

One important aspect of economic development in the last century is the increasing shift towards global-market-oriented economic policies. For such global-market trade, information and telecommunication facility is a very vital infrastructure. Today competition in the world market is time-based and the velocity of business is vital to success. A state-of-the-art information and telecommunication system therefore is a necessity. 

Business or private sector can take active participation in promoting ICT whenever they identify business advantages in this activity. New business opportunity or cutting cost aide can motivate private sector to make benefit of ICT network throughout country. They can also get benefit by improving access to financial capital, facilitating access to global and local markets, enforcing appropriate tax and property rights regimes, enabling efficient business processes and stimulating domestic demand for ICT.

ICT for the Developments and Private Sectors

Investments in ICT infrastructure can lead to improved access by reducing costs and extending coverage to additional areas. This can have a catalytic impact on enterprises and provide additional incentives for increased adoption of ICT. For example, it can help SMEs improve their competitiveness and expand market access. This in turn can create a feedback effect, as demand for additional and faster access will entice additional investments in ICT infrastructure. The increase in both infrastructure and SMEs can lead, through spillover effects, to an increased demand for skilled labor and knowledge workers. This increased demand for labor can then trigger additional investments in human capital. Such a combination of effects illustrates the connection between the different components that characterize the dynamic. To the extent that these interconnections are foreseen and addressed through complementary interventions, multiplier and feedback effects are realized and the emergence of bottlenecks is avoided.

Business Opportunity for Private Sectors

ICT can contribute to income generation and poverty reduction. It enables people and enterprises to capture economic opportunities by increasing process efficiency, promoting participation in expanded economic networks, and creating opportunities for employment.

There are a number of ways ICT is enhancing rural productivity. ICT enables solution sharing between local people and communities, providing access to practical information on small business accounting, weather trends and farming best practices, for example. Timely access to market information via communications networks also helps farmers make astute decisions about what crops to plant and where to sell their produce and buy inputs. In Chile, for example, an Internet network among farmer organizations has dramatically increased farmers’ incomes by providing information about crop status, weather, global market prices and training. ICT is also providing unprecedented access to rural finance. The financial and information service network provided by Pride Africa offers micro-finance opportunities for local people and small enterprises that previously had no access to flexible financing due to rigid banking regulations and the information monopolies of government and large businesses.

ICT enables improved business process efficiency and productivity. Businesses can reduce operational costs by decreasing material, procurement and transaction costs, resulting in lower prices for intermediate and finished goods, and they can also use more and better information to improve the value of their output.

ICT facilitates global connectivity, resulting in new ways of creating and delivering products and services on a global scale. New business models and market configurations enabled by ICT, including business process outsourcing, value chain integration and dis-intermediation, provide developing countries with access to new markets and new sources of competitive advantage from which to drive income growth.

ICT can contribute to better employment opportunities in developing countries both through improved labor market facilitation and direct employment. Using electronic job marketplaces, employers and employees can match labor skills and availability to satisfy their demands. For example, TARAhaat, a portal designed to serve villages in rural India, provides job opportunity information on local web sites in local languages. In addition, the establishment of local tele-centers in countries such as Bangladesh, India and Senegal has created direct employment for thousands of local women and men.

ICT connects individuals and local communities with information and resources beyond their geographic boundaries, encouraging information dissemination, information exchange and communication, which enable participation in wider public opinion forming. This is especially relevant for marginalized communities and groups such as women, youth and ethnic minorities: they can share and exchange information of mutual interest, strengthen their collective power and shape their own development solutions. This could be extended markets for business people, both at national and international level.

Organizations in developing countries also find it increasingly feasible to participate in information sharing that strengthens governance and collective power, allowing them to influence political and institutional decision-making processes. Trade unions, for example, have used the Internet as a campaigning tool to organize labor globally in the fight against exploitation.

Village Pay Phones, Bangladesh

Application Model:Village Pay Phones is an initiative of the Grameen Bank aimed at reducing poverty through the economic empowerment of women in rural Bangladesh. The Grameen Group manages the entire phone system, operating the GSM network and loaning money to village women to purchase GSM cellular phones. Phone owners rent the phones out to village farmers and other community members for a fee and also provide messaging and incoming call services.Illustrative Impact:Phones have been placed in 1,100 villages. The 6–7 year goal is to serve 500,000 subscribers, including 68,000 phones dedicated to serving rural areas.Village Phones have increased incomes and savings accumulation among phone owners, mostly women.Phone users, mainly local farmers, have increased their productivity through access to market information, weather reports and pest and disaster alerts.Farmers in phone villages receive up to 10 percent higher prices for farm products and improved security of supply for inputs.A significant portion of phone owners’ profits has been spent on paying for improved education and health services for their families.The phone service has also contributed to improvements in disaster response, crime rates and livestock mortality through better access to public services.

Sources: ZEF Bonn-Center for Development Research, Insights from a Grameen Bank Initiative in Bangladesh, June 1999; Iqbal Z. Quadir, Connecting Bangladeshi Villages (www.devmedia.org/documents/ACF1055.htm), February 2000; Allen Hammond, CIO and Senior Scientist at the World Resources Institute.

ICT and Business Enabler for Private Sectors

The global networked economy offers opportunities for developing countries not only to respond to market opportunities in developed economies, but also to develop national capacity and create domestic spillover effects and niche opportunities for nationally located enterprises, including small and medium enterprises (SMEs).

Several studies mention that development of ICT provides private sector business opportunity for leveraging ICT for export opportunities (Costa Rica) and building national capacity for domestic market development (Brazil). 

In many developing countries, the government is one of the major consumers of ICT products and services. Governments can therefore lead by way of example in the use of ICT and can also implement best organizational practices—some involving the use of ICT—to ensure that public funds are spent in the most optimal way. Procurement of services by the government via ICT channels can generate a strong demand for ICT services.

Governments can also encourage ICT deployment by enterprises to make them more competitive and efficient. The Chinese government, for example, believes the Internet can help to reform inefficient state-owned enterprises (SOEs) and is encouraging SOEs to adopt e-commerce. The “Enterprise On-line” initiative aims to put seven million Chinese businesses, including many SOEs, on the Internet by the end of 2002.

Costa Rica: Focusing on ICT as an Engine of Export Growth

Like many other Central and South American countries, Costa Rica has focused on developing its export sector and on increasing foreign direct investment (FDI) as a means of generating employment and foreign exchange. However, instead of concentrating in labor-intensive industries like some of its neighbors, Costa Rica focused its attention on the high-tech sector.In 1996, faced with declining prices of its primary source of exports and growth, Costa Rica saw the need to develop alternatives to coffee production. The government recognized the potential of the emerging ICT sector and the importance of attracting a global corporation such as Intel to locate in the country. Today, the Costa Rican factory is Intel’s second largest for final assembly and testing of computer microprocessor chips. One-third of all Intel microprocessors used in computers around the world come from the Intel plant in Costa Rica.Costa Rica’s location vis-à-vis North and South American markets, its peaceful and stable political environment, the business-friendly policies it adopted in the 1980s, its excellent infrastructure, and its educated and skilled workforce have all made it an attractive location for high-tech, export-oriented firms and other IT-enabled industries. Once the success of Intel in Costa Rica was demonstrated, other major US companies followed, including consumer products maker Procter and Gamble, medical devices manufacturer Abbott Laboratories and money transmitter Western Union.Costa Rica’s export focus is being broadened to include software and IT services exports. Over one hundred software development companies currently operate in Costa Rica, employing more than 1,000 professionals and exporting to countries in Latin America, the Caribbean, North America, South East Asia, Europe and even Africa. The total exports of the six largest software development companies in 1997 surpassed US$25 million. The target for 2001 is to export over US$200 million. According to the Costa Rican government, “software is destined to become in the coming century what coffee represented for the Central American country for over two centuries.”To encourage demand, computer duties were removed in the 1980s. The falling computer prices stimulated usage and Costa Rica now has one of the highest rates of usage in Latin America.

Source: Creating a Development Dynamic – Final Report of the Digital Opportunity Initiative (DOI ) – July 2001

Participation of Cooperatives and SMEs in Promoting ICT Development 

District cooperatives and SMEs are expecting to have a significant contribution in stimulating business activities in rural areas. As a community center and agent-of change, they can make benefit of ICT development and can actively take part in the business activities employing local resource or person. ICT can be an enabler of the business activities as well as a product to be delivered. Some of the business opportunities for the SMEs and cooperatives are:

• Community Facility Center, i.e. tele-center (telecommunication center) or public payphone service for village people
• District focal point, serving as gateway of resources within the district to outer world, or bringing information required by the village people
• Postal service, News service (Bulletin Board Service), Telephone kiosk, Internet kiosk, renting PCs

Cooperatives and SMEs can also take benefit of ICT to improve the efficiency, broaden the market and reach of local businesses to make the entire local economy more productive, globally competitive, and better connected to local and global markets. This requires that businesses can use both newer trading platforms (such as business-to-business exchanges) and, where appropriate, more traditional business software supporting efficient logistics, good accounting practices and high levels of customer service. Local businesses need to acquire a strong awareness and understanding of the business opportunities these technologies make available. Artificial obstacles to the purchase and use of such software should be removed and steps taken to attract appropriate inward investment from providers of world-class software. It is important that providers take care to price appropriately for local marketplaces.

Other important stakeholder is foreign investor interested in assisting local resources as suppliers or native resources. These foreign direct investments are specifically targeted their arm at local shops, cooperatives or SMEs, providing them cost cutting and more reliable suppliers. Large, multinational companies have the resources (financial capital, personnel, expertise and technology) to capitalize on the opportunities to global market and investment. While the local SMEs have the natural resources, raw material, and cheap manpower to provide the MNCs cost-cutting solutions for their business. MNCs can employ SMEs in a sub-contracting scheme, promote cost-efficient technology to improve SME productivity and provide supports and consulting services. Their cooperation is important to upgrade local business activities and their presence is depending on the local community readiness and information dissemination activity.

There should be a vehicle to allow SMEs from developing countries and MNCs from industrialized countries to look for and form a partnership. This facility should be cost-effective to use and maintain, and easily accessible to all interested parties. Such facility is providing information exchange such as : availability and easy access of useful information, linkage between SMES and large enterprises both locally and international, IT providing information accuracy and timeline, and Internet website facilitating SMEs business opportunities. Cooperatives can be promoted to bear the tasks, with a clear direction from the government. Therefore, the dissemination activity of local capacity and resource is critical, and cooperatives as district focal point can be a determinant key success factor.

Regulation and Law

ROLE OF GOVERNMENT REGULATION

The ‘Information Age’ represents a clear opportunity for increased intra-regional trade. Information technology and telecommunications are regarded as essential to the economic success of countries and expenditure in this area is continuing in spite of the economic difficulties. Better communication leads to better business relationship.

Competition is essential to reduce costs and accelerate the introduction of new technology. Governments should stimulate this by promoting increased liberalization, harmonization of regulations and standards for the best practice. On a general level, the stability of political, social and economic condition is the very important pre-requisite for the better competition.

The more transparent and non-discriminatory regulation will stimulate the competition rate in this sector. The high competition rate will give many choices to end customer and the other side it will be improving the quality of product or service offered.

A regulatory challenge in increasing the competition rate is to develop consistent and relevant regulation that can promote growth of the sector, actively encourage innovation and serve the best interest of community. Regulatory monitoring is desirable to remove barriers to ICT development, which is including the cost of service, basic infrastructure, service and transmission supply.

Small and Medium Enterprises is the important part of economic structure that support other multinational company (MNC). One issue the SMEs face is the lack of time and resources to easily access information, assistance and business partners. An ICT network aim them to increase business information flow and it can provide them with consultancy at business-matching services.

Create a culture and infrastructure which supports the use of modern ICT applications, will stimulate the better business climate and bigger opportunity, including for SMEs. Clear and transparent regulation, as well as legal certainty is important to give private sector the confidence to make long-term investments.

The protection of investment should be assured under applicable bilateral agreements in addition to far reaching transparency of the existing legal system, including legal provisions and regulations of proven confidence.

A comprehensive official web site is needed for both transparency and facilitating investment. It will include information or links to information concerning the promotion agencies, investment climates, key industrial sectors, recent investment news and bilateral investment treaties in force.

Tax reducing for high technology equipment and also promoting Internet café will stimulate the investment rate and accelerate the ICT penetration program, particularly to rural area.

Procedures and legal framework to protect Intellectual Property Rights (IPR), copy right and customers, that avoid disputes concerning the reach of national laws take on a new dimension and also challenge the potential effectiveness of Internet Laws.

Effective interconnection regulation is key for bridging the digital divide. It is cited as vital to ensure the goals of maximizing the productivity and efficiency of rapidly growing networks and extending those networks. Effective interconnection frameworks also provide benefits to a host of other key actors. Network operators benefit from increased demand. Workers benefit from increased employment. Economies expand, and governments benefit from the tax revenues. Societies overall benefit from new applications that would increase their welfare.

The very first challenge is to expand access to the ICT media at affordable tariff. The high cost of service in many developing countries remains one of the main barriers to Internet diffusion in addition to that of the shortage of phone lines. Legislative or regulatory measures as well as suitable pricing / tariff policies must be adopted so that the ICT media can be made available for all segments of society. The tariff monitoring system should be developed to keep the reasonable tariff that is based on cost orientation. Low cost Internet access should be provided to schools, universities, libraries, multipurpose community tele-centers or public service institutions to stimulate wider usage and ‘wire’ rural communities.

Strong programs should be developed to increase technology and computer skills among young people to fulfill the demand of ICT operators. Besides that, access to education will determine the wealth of nations and individuals. In the digital economy, people who do not know how to use electronic information networks and services will have difficulty facing the high competition, no matter what other skills they have.

Greater awareness of the benefits of on-line access to information, especially in this information and globalization age must be actively pursued throughout society and in particularly SMEs. Using the Internet access, traditional economic activities can be made more efficient and more profitable cause people can sell their product or service directly to other countries.

In general the roles of government are:

• Improve the better education program to fulfill the demand of ICT operators / investors of skilled employee. Without good education system there can be no growth in ICT industry. The government should prepare the strong education program to educate their people in the skills required in the information economy.
• Increase private sector participation to accelerate the ICT deployment program to rural areas. Promote dissemination of Internet café by private players to strengthen the ICT presence. The involvement of private sector will stimulate the spreading of ICT public usage.
• Open up the basic telecommunication to the wider range of players and investors and the competition climate to increase the competition level that can improve the service level to the end user. This is an effective way to improve the better service and price to community to serve the efficient price with the best quality.
• Monitor the tariff structure that must be cost oriented to avoid unreasonable tariff by the main operator / producer while the number of ICT players is still small and the structure of the industry is still oligopoly. This monitoring system will keep the efficient price to consumers.
• Ensure reasonably priced access for schools, universities, libraries, and other public service institution to improve public awareness and utilities.
• Consider providing grants and demonstration projects to aid local content production at initial stages. Local content is needed to spread important information in local language. It also can be an effective media to promote local resources to global market.
• Prepare the implementation program of legal framework to protect IPR, copyright, domain name and disputing problems for protecting the producers and authors, as well as for protecting the consumers for rising the usage rate of ICT as an effective media for business and commerce.
• Reduce tax for high technology equipment, which is categorized in expensive products to avoid higher tariff for the end consumers and to accelerate the ICT development program to all community.
• Extend the ICT infrastructure and access to rural area. Strong infrastructure is needed for spreading the ICT usage in public.
• Extend the connectivity with other countries for sharing information and knowledge among people and stimulating the local industries to catch greater market.
• Reduce some bans, such as call back ban and IP telephony restriction in order public have some choices.
• Promote the development of ICT access for SMEs, in particularly to offer better connectivity to global market and resources for rising their competitive advantage.
• Set up the effective interconnection regulation to promote growth of universal access among countries.

INTELLECTUAL PROPERTY RIGHTS AND COPYRIGHT

The foundations and goals of copyright are, on one hand, to encourage creation by granting exclusive rights to the creator for a limited period of time and, on the other, to support and regulate the spread of cultural goods, knowledge, and ideas. Copyright therefore relies on balancing the interests of protecting original works and their creators and guaranteeing public interest and fundamental freedoms (such as access to culture and freedom of speech).

Present development in intellectual property, especially in the field of copyright and neighbouring rights, could threaten this balance. It is also true however that new technologies represent a threat for the normal exploitation of copyright-protected works. The preservation of this balance between the legitimate interests of the right holders and the equally legitimate interests of users to have access to information and culture are of crucial importance in the framework of the Information Society.

Items to be stressed:

• Intellectual property rights are in essence based on the protection of creative works and technological innovations and are not intended to protect investments. Copyright should be limited to the protection of creative works.
• The importance of copyright exemptions (such as Fair use and equivalent exemptions) must be reasserted in the digital environment. Exemptions are an essential part of the necessary compromise between private and public interest.
• Reviews of existing national and international intellectual property rights legislation should include an assessment of the social and economic implications of any new extension of intellectual property rights and should re-affirm the Fair use doctrine. In particular, the extension of copyright periods may have a more adverse effect, especially in developing countries, than the actual suspension of certain limitations.
• Protection of technical means must be sought in common law, not in intellectual property law. The neutralizing of technological means should not be sanctioned by intellectual property law, or especially by copyright.
• Although the improvement of the copyright system will not solve all the problems of the developing countries moving towards the Information Society, it should be encouraged as it will stimulate local creativity and entrepreneurship and increase the capacity for competition in developing countries, thus reducing the influence of the industrialized countries.
• The copyright exemptions system could be detrimental to investments in the developing countries. If there is not sufficient copyright protection, the return on investments (and thus the investments themselves) related to the spread of cultural goods and information in the developing countries could be threatened.

Role of the Government

• Prepare and legislate the implementation program of the intellectual property right, copyright law and consumer protection law. Discuss and draft the laws with related national institutions, universities, non-governmental organizations, and international partners.
• Socialize the importance of the laws to the people, particularly to creative workers, manufacturers, ICT operators, and consumers. Legislate the laws after the final draft is agreed.

Peru: Rural Trading Networks In Peru, a small rural village named Chincheros, village leaders formed an Internet-enabled partnership with a national export company to trade rural produce in overseas markets. This establishment resulted in a huge improvement among the villager. The results are:Village income has increased five-fold to US$1,500 per month.The village vegetables are now sold daily in New York.

Indonesia: Bio-diversity A national computer-based information initiative in Indonesia combines the databases of various agencies and contributes to a global bio-diversity network. This databases will provide greater environment awareness among the people while at the same time will promote additional academic activities such as:Sharing information strengthens the capabilities of existing data providers.Improved information access promotes public awareness.Networking encourages interest and participation in bio-diversity issues.

Brazil: National Approaches Building on a legacy of technological capabilities and an early emphasis on ICT infrastructure, Brazil is positioning itself to participate more fully in the global network economy. The Brazilian Government has emphasized controlled privatization and deregulation in order to provide the business sector with an environment in which it can grow and adapt quickly to the changing economic and business climate, while at the same time still be subject to competition. The recently-launched Information Society Program is a first step in making technology-based services and job creation available to every citizen. Public-private partnerships are helping to identify innovative solutions to overcome barriers to universal access, such as the high-cost of personal computers and lack of financing options for low-income citizens.Brazil began its pioneering approach to leveraging ICT for development in the 1980s, when it began implementing policies to promote the development of national enterprises in selected segments of the computer industry. By the end of the decade, a set of diversified IT corporations with significant presence in the local market had been built.In the 1980s, a so-called market reserve policy was established to create a “greenhouse” environment to nurture locally-owned companies and protect them from import competition attracted to Brazil’s relatively large and fast-growing market. This policy initially focused on mini-computers and was later expanded to include micro-computers. By restricting technology transfer agreements, the government encouraged companies to undertake R&D locally. The government also restricted the importation of technology when local capabilities were available, so local firms developed their own products based on reverse-engineering or in-house design.As the country proceeded to building on this strong base of technological capabilities and infrastructure, the 1990s brought accelerated growth in the ICT sector. The government began abandoning protectionist policies and opening its economy. The first step was a constitutional amendment abolishing the telecommunications monopoly, followed by legislation to allow private enterprise to bid for cellular licenses. This process of privatization and deregulation resulted in dramatic improvements in the quality, service and price of phone services. In 1995, Brazil opened the telecommunications sector to private investment, and also announced a plan for achieving open Internet services in the country.Strategic collaboration between public and private sector organizations has been instrumental in Brazil’s Information Society Program and other specific initiatives. For example, international computer manufacturers such as IBM, Hewlett-Packard, Compaq and Acer stand to gain substantially from a government program to increase PC penetration with the development of a prototype for low cost PCs (US$200-250 per PC). Indeed, the low-cost PC formula is a result of a study in which all the major computer companies participated on how to reduce the cost of PCs in Brazil. To support the program, the government will provide loans to lower income households to purchase the computers.Source: http://www.opt-init.org/framework/onepage/onepage.html

Human Resources, Education and Public Opinion Building

Facilitating education about, and access to, telematics networks and services, such as the Internet service connection, must become a high priority on the development agendas of governments, especially in developing countries and countries in transition, as they are essential prerequisites for ensuring equitable access to information.

HUMAN RESOURCE DEVELOPMENT AND EDUCATION ON ICT

Education for information and communication technology could begin at early age and continues up to the higher educational level, also including non-formal education, a field in which associations and non-governmental organizations play a major role. The depth of the treatment given to these depends on the educational level concerned and the concepts are imparted following differing teaching approaches.

Formal education is the sector in which the key resources are being promoted in the world of information and communication technology. However it is absolutely essential to link such action to all schemes being carried out in the informal education sector in order to integrate all aspects of the development of ICT skill.

In addition to formal education in which local associations, non-governmental organizations and governments cooperate closely, the authority should introduce other strategy which often result in the implementation of projects aimed at the introduction of information and communication technology, the training of teachers and teacher-trainers at all levels and the production of training materials and teaching aids tailored to the local content. These strategies will vary from one country to another.

The training of teachers and educational personnel at all levels is a key factor in promoting education for information and communication technology. Accordingly, the authority attach paramount importance to such training, which is provided through seminars and workshops in collaboration with national institutions, non-governmental organizations, and international partners working in this field. It may take the form of initial training, and is provided by higher-level teacher training institutes as well as by universities. Its duration may vary from one country to another.

The authority should ensure that all ICT education and training within their national jurisdictions includes training on ethical awareness and standards and not just on technical competence. The focus should be on the pre-requisite of developing and nurturing “human infrastructure”, including integrated education, ICT training, and skill-based programs.

Legislative and social provisions should make on behalf of vulnerable sectors of the population (physically and mentally disabled groups, refugees, immigrants, ethnic minorities, etc.). Ministries of Education, National Commissions, non-governmental organizations, and local associations carry out programs to promote the right to ICT education for the most disadvantaged population categories in order to provide them with the means of becoming integrated in the information society and taking part in all activities. It should however be noted that, in most countries, such provisions are not always reflected in effective implementation measures, and conditions of access to education for such population groups remain difficult.

Networking among the various national and regional institutions for purpose of pooling information and experience is another effective means of promoting education for a culture of information society.

The authority should promote, at every stage of education, an active civic training which will enable every person to gain knowledge of the method of operation and the work of information and communication technology.

More and more local associations and non-governmental organizations should work hand in hand with the authority in order to increase public awareness on ICT and to provide for the training for trainers.

The development of national, regional, and international networking arrangements serves to strengthen information pooling and the exchange of documentation and research findings on different subjects and aspects of education for a culture of information and communication technology society.

Role of the Government

• To prepare such education system to supply the demand of skilled ICT people to run and maintain ICT infrastructure, especially in high education level (technical aspect & multi-language).
• To extend the awareness program of the importance of information and communication technology, up to rural areas.
• Closer cooperation with local association, non-governmental organizations, and international institutions to provide ICT training for all required high education people.

PUBLIC OPINION BUILDING

In order to gain participation from the society toward improving e-readiness and adoption of internet, there should be a conscious and comprehensive effort to educate the public. Various channels can be utilized for public education. Traditional media such as newspaper, radio and television as well as mass gathering are typical. Other more subtle channel is through education institution formally or informally through public seminar or conference. Lastly, internet itself can become a medium for public education in a form that is more interactive than traditional channel.

At this level, the emphasize shifted toward effective utilization of internet and further advancement of e-readiness. People are encouraged to conduct their social transaction online in the cyber-space. The objective is toward community building and commerce. Security and privacy is major issue at this level so the public campaign must address these two issues.

Community building in the cyber-space enables people to conduct social interaction, which is far richer in context, and have wider reach as well. The nature of electronic community also guarantees transparency and democratic climate. Nobody can control the media so opinion building is more of intellectual activity. Voice of the masses can have significant impact as the notion that frees speech is virtually guaranteed in the internet. The downside is of course, bad publicity tend to spread faster and rumors are hard to check. Therefore reliable sources either in form of individual or organization must build or later guard their credential if they would like to become reality check for most people. These reliable sources should be leading the opinion building toward advancement of the whole society by adoption of internet. They should also remind people that the best filter for information in the cyber-space would be themselves.

On the commerce side, business entity will participate willingly once there is enough critical masses to guarantee sales and revenue. Some of the more daring entrepreneurs might even establish their present and experiment with e-commerce long before it is widely accepted and become common. These individual or organization must be encouraged to continue their effort. Positive experience from the customer will feedback and stimulate further growth. Although security and privacy will remain an issue, as with community building, trust of the customer will ultimately differentiate and divert the commerce only to reliable companies.

Conclusion

Understanding the importance as well as the benefit of ICT, the NAM countries must embark in conscious effort and made ICT improvement a priority in their development plan. Infact, ICT present an unprecedented opportunity for the developing countries to equal their more advance counterpart in the developed countries. As reminder, we again briefly list the following characteristic of ICT, which ultimately could enable NAM members, particularly the developing nation to enhance their competitive position on the global scale.

• ICT is pervasive and crosscutting therefore in can meet diverse need.
• ICT is a key enabler in the creation of networks.
• ICT fosters the dissemination of information and knowledge.
• The nature of many ICT products and services allows for zero or declining marginal costs. As a result, ICT can radically reduce transaction costs.
• ICT enable seamless integration, which translate into substantial efficiency gains in production, distribution and markets.
• The combination of the previous benefit enables people to use ICT for innovative business models and whole new industries.
• ICT facilitates disintermediation and reducing the need for intermediaries.
• ICT is global. ICT can transcend cultural and linguistic barriers.

At this level the priority already shifted from introducing ICT for the society to promoting widespread adoption of ICT. Countries at this level range from the ones which is at the verge of leap frog to competing globally and those who just started to reap benefit of the ICT adoption. The focus and key factors discussed in the document should assist the policy maker and government institution as well as various concerned parties in ICT development. Key factors that need to be considered are:

a) Infrastructure and connectivity

b) Financial assistance and business sector participation

c) Law, regulation and intellectual property rights (IPR)

d) Human resource, education and public opinion building

Authors Information

Name	:	Virano Gazi Nasution
Nationality	:	Indonesia
Education	:	Master of Science from Stanford University
Current position	:	President Director of PT. Ratelindo
Professional Experience	:	– Finance Director of PT. Ratelindo- Business Development Manager of PT. Bakrie Electronic Company
E-mail	:	nvn@ratelindo.co.id
Name	:	Aprita Primayuda
Nationality	:	Indonesia
Education	:	Electronic Engineer from Institut Teknologi Bandung
Current position	:	Deputy General Manager of Business Development Department of PT Ratelindo
Professional Experience	:	Deputy General Manager of Operation Department of PT Ratelindo
E-mail	:	prima@ratelindo.co.id
Name	:	Aristo Lystiono
Nationality	:	Indonesia
Education	:	Informatics Engineer from Institut Teknologi Bandung
Current position	:	Executive IT specialist of PT Ratelindo
Professional Experience	:	Manager IT operation of PT Ratelindo
E-mail	:	aristo@ratelindo.co.id
Name	:	Indarti Primora B Harahap
Nationality	:	Indonesia
Education	:	Master of Management from University of Indonesia Telecommunication Engineer from University of Indonesia
Current position	:	Senior Assistance of Corporate Secretary of PT Ratelindo
Professional Experience	:	Strategic Planning Supervisor of PT Ratelindo
E-mail	:	mora@ratelindo.co.id
Name	:	Medwi Swasono
Nationality	:	Indonesia
Education	:	Telecommunication Engineer of Institut Teknologi Bandung
Current position	:	Marketing & Business Manager
Professional Experience	:	Market & Finance analyst of PT. RatelindoSenior Engineer of PT. Ratelindo
E-mail	:	medwi@ratelindo.co.id