"Development’s False Divide"

["Irfan Khan" <khania2@super.net.pk>]

FOREIGN POLICY
January/ February 2003

Development’s False Divide
By Charles Kenny

Giving Internet access to the world's poorest will cost a lot and 
accomplish little.


Politicians, business people, donors, and the press have all 
proclaimed the digital divide between the developing-world poor and 
the wealthy West as one of the century’s most significant development 
challenges. In fact, 99.6 percent of the populations of Africa and 
South Asia did not use the Internet in 2000. “The digital divide 
threatens to further marginalize the economies and peoples of many 
developing countries,” concluded the U.N. General Assembly in June 
2002. The Group of Eight declared at Okinawa in 2000 that “everyone 
should be able to enjoy access to information and communications 
networks.”

The best of motives may drive a concern to equalize global Internet 
access, but not the strongest of logic. True, tools of communication 
are important to the world’s poorest, and one can also find many 
examples of effective Internet use in developing countries. For 
instance, the Internet has been used to inform farmers of crop prices 
in Argentina, to register deeds in India, to educate children in 
rural Uganda, and to sell woodcarvings and sandals in Kenya. But it 
is a large leap to conclude that global Internet access is a sensible 
goal. Uplifting anecdotes are not enough to justify the high costs of 
universal Internet access, costs that would be at their highest in 
the least developed countries.

One reason for the high cost of providing widespread Internet access 
to low-income countries is that about 69 percent of their population 
is rural. Providing networked services like electricity and telephony 
to rural areas is expensive—and because rural people are largely 
poor, it is hard to justify that cost in terms of potential revenues. 
Solar power and satellite connections are a potential alternative, 
but such technology further increases the cost of Internet access. In 
Costa Rica, for example, one off-grid telecenter carried an 
annualized cost per Internet-enabled computer of about $10,000. By 
way of comparison, the average person living on $1 a day (and there 
are 1.5 billion such people worldwide) spends about $10 per year on 
communications when he has access to it.

Subsidized public access is one answer. The subsidies would have to 
be large, however. Ensuring one hour a week of access at a telecenter 
such as the one in Costa Rica might cost as much as $50 per year per 
capita—or about 10 times public spending per capita on health in low-
income countries and 10 times discretionary spending per primary 
student. On this basis, the worldwide subsidy for everyone living on 
$1 a day to get one hour of access a week might reach $75 
billion—considerably more than the global total of aid flows each 
year. Given that providing widespread Internet access will be complex 
and expensive, attempting to provide ubiquitous service will be a 
costly mistake.

Some argue that access could be provided more cheaply—perhaps at 
levels that only equal average health expenditures in low-income 
countries. Nonetheless, costs of access would probably still outweigh 
benefits because the digital divide encompasses far more than a 
physical lack of access; it also relates to deficits in skills and 
the broader economic environment.

Lack of education is a major barrier to productive Internet use, for 
example. In Ethiopia, 98 percent of Internet users in 1998 had a 
university degree, yet 64.5 percent of the overall population is 
illiterate. Worldwide, most people living on $1 a day are illiterate. 
Further, they usually speak a minority language in their own 
country—few speak a major global language. For example, about 17 
million people in Nigeria speak Igbo. My search for Web pages in Igbo 
turned up only five sites: a translation of the Universal Declaration 
of Human Rights, a translation of a document called “The Four 
Spiritual Laws” (theological provenance undetermined), a translation 
of the food pyramid, a two-page Igbo phrase book, and a prayer 
manual. There isn’t an Igbo translation service on the Web, so an 
Igbo speaker would be limited to these five. None involved sound or 
video, so the illiterate Igbo speaker would gain nothing. Bridging 
the gaps in language and technical skills as well as basic literacy 
will be difficult, considering the small per-student spending 
available in the poorest countries’ primary schools, where the 
discretionary budget per student is as little as $5 a year.

Even if poor people are lucky enough to be literate and conversant in 
a major world language, their use of the Web for activities such as e-
commerce is likely to be limited by their lack of credit cards, not 
to mention the challenge of persuading FedEx and UPS to start 
delivery services in their neighborhoods. Limitations in relevant 
content and ability to use that content perhaps best explain why only 
2.2 percent of India’s Internet users have ever engaged in buying or 
selling over the Web. Similarly, a survey of Tanzanian firms found 
that among the 30 percent of companies with access to the Internet, 
less than half use it frequently and only 9 percent rated it as a 
very effective tool for promoting products.

Communications matter to the poor. A system of well-regulated, 
competitive communications services will reduce costs and extend 
access. In many cases, it may well be worth extending access to 
telephony with limited, targeted, carefully designed subsidy 
programs. But pursuing universal access to the Internet would be a 
misallocation of considerable resources. To draw an analogy, another 
technology boasts a 70-fold difference in access rates between the 
United States and India, and economists link that technology to 
increased productivity as well. But no one is setting up a U.N. task 
force to overcome the Air Conditioner Divide.

Poor countries face many serious divides, including those in 
education, healthcare, and transportation. The relevant question for 
the poorest is, does the lack of access to a particular good provide 
a significant barrier to becoming more wealthy? The answer is yes for 
the tools of communication in general but no for the Internet in 
particular.


Charles Kenny is an economist at the World Bank. This article was 
adapted from “Should We Try to Bridge the Global Digital Divide?” 
(Info, Vol. 4, No. 3, 2002). The views expressed are his own.

source: http://www.foreignpolicy.com/issue_janfeb_2003/kenny.html