Anthony J. Pennings, PhD

WRITINGS ON DIGITAL ECONOMICS, ENERGY STRATEGIES, AND GLOBAL COMMUNICATIONS

Five Stages of ICT for Global Development

Posted on | February 19, 2020 | No Comments

Summarized remarks from “Five Stages of Global ICT4D: Governance, Network Transformation, and the Increasing Utilization of Surplus Behavioral Data for Prediction Products and Services,” presented at the 27th AMIC Annual Conference on 17-19 June 2019 at Chulalongkorn University, Bangkok, Thailand.

This presentation will explore and outline the following stages of economic and social development utilizing information and communications Computerization and Development in SE Asia technologies (ICT). The ICT acronym has emerged as a popular moniker, especially in international usage, for the digital technology revolution and is often combined with “development” to form ICT4D. Development is a contested term with currency in several areas. Still, in global political economy, it refers to the process of building environments and infrastructure needed to improve the quality of human life and bridge equity divides. Often this means enhancing a nation’s agriculture, education, health, and other public goods that are not strictly economy-related but improve well-being and intellectual capital.

Of particular interest is the transformation of public-switched networks for Internet Protocol (IP)-based services and then WiFi and mobile use. Data-intensive solutions are beginning to address many development issues. However, a growing concern is that data is being collected extensively and used intrusively to manipulate behaviors.

The stages are categorized as:

1) Containment/Development/Modernization; 2) New World Economic and Information Orders; 3) Structural Adjustment and Re-subordination, 4) Global ICT Integration, and; 5) Smart/Sustainable Mobile and Data-Driven Development.

Using a techno-structural approach, the explication of these stages will provide historical context for understanding trends in ICT innovation and implementation. This approach recognizes the reciprocal effects between technological developments and institutional power and a “dual-effects hypothesis” to illustrate the parallel potentials of ICT4D as both a democratizing and totalizing force. This research will also provide insights into the possibilities of ICT diffusion in developing environments.

1) Containment/Development/Modernization

The US emerged as the primary economic and military power in the aftermath of World War II. Arms and materiel sales before the war had transferred much of the world’s gold to the US, which was wisely transferred inland to Fort Knox, Kentucky. Franklin Delano Roosevelt (FDR) had sought to limit finance in the aftermath of the “Crash of 1929” and continued it globally with the initiative at Bretton Woods Hotel in New Hampshire. “Bretton Woods” created the International Monetary Fund (IMF), the World Bank, the International Trade Organization (rejected by Congress), and also instituted a dollar-gold standard that tied the US dollar to gold at $35 an ounce (oz) and other international currencies to the US dollar at set rates. This system was designed to “contain” financial speculation and encourage trade and development.

The other aspect of containment, more widely known, is the containment of Communism. The painful success of the USSR in World War II in countering the Nazis on the eastern front and their appropriation of German atomic and rocketry technology presented an ideological and military threat to the US and its allies. The USSR’s launch of Sputnik satellites in 1957 resulted in the US’s formation of NASA and ARPA. The Communist revolution in China in 1949 and their explosion of an atomic bomb on Oct. 16, 1964, spurred additional concern. The resultant Cold War and Space Race spurred technological development and competition for “developing countries”worldwide.

“Development” and “modernization” characterized the post-World War II US prescription for economic development around the world, and especially in newly decolonized nation-states. Modernization referred to a transitional process of moving from “traditional” or “primitive” communities to modern societies based on scientific rationality, abstract thought, and the belief in progress. It included urbanization, economic growth, and “psychic mobility” that could be influenced by types of media. Scholars talked of an eventual “takeoff” if the proper regiment was followed, particularly the adoption of new agricultural techniques termed the “Green Revolution.”[1] Information and Communications Technologies (ICTs) were rarely stressed, but “five communication revolutions” (print, film, radio, television, and later, satellites) were beginning to be recognized as making a contribution to national development.

Communication technologies were beginning to spread information about modern practices in agriculture, health, education, and national governance. Some early computerization projects continued population analysis, such as the census that had started with tabulation machines, while mainframes and minicomputers were increasingly utilized for statistical gathering by government agencies for development processes.

Telegraphy and telephones were strangely absent from much of the discussion but were important for government activities as well as large-scale plantations, mining operations, transportation coordination, and maritime shipping. Because of their large capital requirements and geographic expanse, countries uniformly developed state-controlled Post, Telephone, and Telegraph (PTTs) entities. Organized with the help and guidance of the International Telecommunications Union (ITU), the oldest United Nations entity, PTTs struggled to provide basic voice and telegraphic services. However, they provided needed jobs, technical resources, and currency for the national treasury.

Wilbur Schramm’s (1964) book Mass Media and National Development made crucial links between media and national development. Published by Stanford University Press and UNESCO, it examined the role of newspapers, radio, and television. Its emphasis on the role of information in development also laid the foundation for the analysis of computerization and ICT in the development process. I had an office next to Schramm for many years at the East-West Center’s Communication Insitute that he founded while I worked on the National Computerization Policy project that resulted in the ICT4D benchmark study Computerization and Development in Southeast Asia (1987). Herbert Dordick, Meheroo Jussawalla, Deane Neubauer, and Syed Rahim were key scholars in the early years of ICT4D at the East-West Center.[1]

2) New World Economic and Information Orders

Rising frustrations and concerns about neo-colonialism due to the power of transnational corporations (TNCs), especially news companies, resulted in a collective call by developing countries for various conceptions of a “New World Economic and Communication Order.” It was echoed by UNESCO in the wake of OPEC oil shocks and the resulting Third World debt crisis. The issue was primarily news flow and the imbalanced flow of information from North to South. Developing countries were concerned about the unequal flows of news and data from developing to developed countries. In part, it was the preponderance of news dealing with disasters, coups, and other calamities that many countries felt restricted flows of foreign investment. The calls caused a backlash in the US and other developed countries concerned about the independence of journalism and the free flow of trade.[2]

It was followed by concerns about obstacles hindering communications infrastructure development and how telecommunications access across the world could be stimulated. In 1983, UNESCO’s World Communication Year, the Independent Commission met several times to discuss the importance of communication infrastructure for social and economic development and to make recommendations for spurring its growth.

The Commission consisted of seventeen members – communication elites from both private and public sectors and representing a number of countries. Spurred on by the growing optimism about the development potential of telecommunications, they investigated ways Third World countries could be supported in this area. They published their recommendations in The Missing Link (1984) or what soon was to be called the “Maitland Report” after its Chair, Sir Donald Maitland from the United Kingdom. This report brought recognition to the role of telecommunications in development and opened up resources by international organizations such as the World Bank.

The transition from telegraph and telex machines to computers also resulted in concerns about data transcending national boundaries. The Intergovernmental Bureau for Informatics (IBI) that had been set up as the International Computation Centre (ICC) in 1951 to help countries get access to major computers, began to study national computerization policy issues in the mid-1970s.

They increasingly focused on transborder data flows (TDF) that moved sensitive corporate, government, and personal information across national boundaries. The first International Conference on Transborder Data Flows was organized in September 1980, followed by a second held in 1984; both were held in Rome (Italy). The increasing use of computers raised questions about accounting and economic data avoiding political and tax scrutiny. The concern was that these data movements could act like a “trojan horse” and compromise a country’s credit ratings and national sovereignty, as well as individual privacy.

3) Structural Adjustment and Re-subordination

Instead, a new era of “structural adjustment” enforced by the International Monetary Fund emerged that targeted national post, telephone, and telegraph (PTT) agencies and other aspects of government administration and ownership. Long considered agents of national development and employment, PTTs came under increasing criticism for their antiquated technologies and lack of customer service.

In the early 1970s, Nixon ended the Bretton Woods regulation of the dollar-gold standard, resulting in very volatile currency markets. Oil prices increased, and dollars flowed into OPEC countries, only to be lent out to cash-poor developing countries. The flow of petrodollar lending and rising “third world debt” pressured PTTs to add new value-added data networks and undergo satellite deregulation. Global circuits of digital money and news emerged, such as Reuters Money Monitor Rates and SWIFT (Society for Worldwide Interbank Telecommunications). These networks, the first to use packet-switching, linked currency exchange markets worldwide in arguably the first virtual market.

A new techno-economic imperative emerged that changed the relationship between government agencies and global capital. PC-spreadsheet technologies were utilized to inventory, value, and privatize PTTs so they could be corporatized and listed on electronically linked share-market exchanges. Communications markets were liberalized to allow domestic and international competition for new telecommunications services, and sales of digital switches and fiber optic networks. Developing countries became “emerging markets,” consistently disciplined by the “Washington Consensus” stressing a set of policy prescriptions to continue to open them up to transborder data flows and international trade.[3]

4) Global ICT Integration

Packet-switching technologies standardized into the ITU’s X.25 and X.75 protocols for PTT data networks, transformed into ubiquitous TCP/IP networks by the late 1990s. Cisco Systems became the principal enabler with a series of multi-protocol routers designed for enterprises, governments, and eventually telcos. Lucent, Northern Telecom, and other telecommunications equipment suppliers quickly lost market share as the Internet protocols, mandated by the US military’s ARPANET, and later by the National Science Foundation’s NSFNET, were integrated into ISDN, ATM, and SONET technologies in telcos around the world.

The Global Information Infrastructure (GII) introduced at the annual ITU meeting in Buenos Aires in March of 1994 by Vice President Gore targeted national PTT monopolies and government regulatory agencies. He proposed a new model of global telecommunications based on competition, instead of monopoly. He stressed the rule of law and the interconnection of networks to existing networks at fair prices. Gore followed up the next month in Marrakesh, Morocco, at the closing meeting of the Uruguay Round of the GATT (General Agreement on Tariffs and Trade) negotiations which called for the inclusion of GATS (General Agreement on Trade in Services) that include everything from ciruses, to education, radio and television, and telecommunications services. And, at this meeting, they called for the creation of the World Trade Organization (WTO).

Formed in 1995, the WTO had two meetings in 1996 and 1997 that created a new era of global communications and development. Members party to the new multilateral arrangement met quickly in Singapore in 1996 to reduce tariffs on the international sales of a wide variety of information technologies. The Information Technology Agreement (ITA) was signed by 29 participants in December 1996. The agreement was expanded at the Nairobi Ministerial Conference in December 2015, to cover an additional 201 products valued at over $1.3 trillion per year. A agreements allowed Korea to successfully market early CDMA mobile handsets and develop a trajectory of success in the smartphone market.

In 1997 the WTO met in Geneva and established rules for the continued privatization of national telecommunications operations. Sixty-nine nations party to the WTO, including the U.S., signed the Agreement on Basic Telecommunications Services in 1997 that codified new rules for telecommunications deregulation where countries agreed to privatize and open their own telecommunications infrastructures to foreign penetration and competition by other telcos.

The agreements came at a crucial technological time. The World Wide Web (WWW) was a working technology, but it would not have lived up to its namesake if the WTO had not negotiated and reduced tariffs for crucial networking and computer equipment. The resultant liberalization of data and mobile services around the world made possible a new stage in global development.

Hypertext, Ad Markets, and Search Engines

The online economy emerged with the Internet and its hypertext click environment. Starting with advertising and the keyword search and auctioning system, a new means of economic production and political participation based on the wide-scale collection and rendition of surplus behavioral data emerged for prediction products and services.

As Shoshana Zuboff points out in Surveillance Capitalism (2019), the economy expands by finding new things to commodify, and the Internet provided a multitude of new products and services that could be sold. When the Internet was privatized in the early 1990s and the World Wide Web (WWW) established the protocols for hypertext and webpages, new virtual worlds of online media spaces were enabled. These were called “inventory.” Or you can can them ad space.

Behavioral data is the information produced as a result of actions that can is measured on a range of devices connected to the Internet, such as a PC, tablet, or smartphone. Behavioral data tracks the sites visited, the apps downloaded, or the games played. Cloud platforms claims human experience as free raw material for translation into behavioral data. Some of this data is applied to product or service improvements, the rest are declared as proprietary behavioral surplus, and fed into advanced manufacturing processes known as ‘machine intelligence.’ Automated machine processes can capture knowledge about behaviors but also shape behaviors.

Surplus behavioral and instrumental data is turned into prediction products such as recommendation engines for e-commerce and entertainment. These anticipate what people will do now, soon, and later. Prediction products are traded in a new kind of marketplace for behavioral predictions called behavioral futures markets. These are currently used primarily used in advertising systems based on CTR, Pay-Per-Click (PPC), and real-time bidding auction systems.

5) Smart/Sustainable Mobile and Data-Centric Development

The aggressive trade negotiations and agreements in the 1990s significantly reduced the costs of ICT devices and communication exchanges worldwide, making possible a wide variety of new commercial and development activities based on ICT capabilities. We are at the halfway point for the sustainable development goals (SDGs) outlined by the United Nations in 2015. The SDGs are providing an additional impetus for ICT4D as it encourages infrastructure building and support for key development activities that ICT can assist, such as monitoring Earth and sea resources and providing affordable health information and communication activities.

A key variable is the value of the dollar that is the world’s primary transacting currency. A global shortage of dollars due to high interest rates or political risk means higher prices for imported goods, regardless of lower tariffs. The post-Covid crisis in Ukraine has stressed supply chains of key materials and raw Earth mineral from Russia and Ukraine further adding to potential costs and geopolitical risk. ICT4D is highly reliant on global supply chains making digital devices readily available at reasonable prices.

The near-zero marginal costs for digital products make information content and services more accessible for developing countries. Books, MOOCs, and other online services provide value to a vast population with minimal costs to reach each additional person. Platform-based services providing agricultural, health, and other development services provide low-cost accessibility and outreach. They allow new applications to scale significantly with low costs. Incidentally and significantly, renewable energy sources like solar and wind also provide near-zero marginal costs for producing electricity. Like digital products, they require high initial investments but output product at low costs once operational.

Mobility, broadband, and cloud services are three significant technologies presenting positive prospects for ICT4D. Mobile broadband technologies that bypass traditional wireline “last mile” infrastructure have been a major boost to the prospects for ICT4D. They provide significant connectivity across a wide range of the population and with key commercial and government entities. 4G LTE technologies currently provide the optimal service, as 5G towers consume nearly over 60% more power than LTE and also require more stations as their range is lower.

Enhanced connectivity strengthens network effects. Blockchain technologies and cryptocurrencies, the Internet of Things (IoT), and the proliferation of web platforms are some of the current conceptions of how reduced costs for communications and information analysis are enhancing network effects and creating value from the collection and processing of unstructured data.

This project will expand on these stages and provide a context for a further investigation of ICT for development drawing on historical and current research. Of particular concern is the implementation of policies and practices related to contemporary development practices, but commercial and monetization techniques are important as well.

Notes

[1a] Dordick, Herbert S. and Deane Neubauer. 1985. “Information as Currency: Organizational Restructuring Under the Impact of the Information Revolution.” Bulletin of the Institute for Communications Research, Keio University, No 25, 12–13. This journal article was particularly insightful into the dynamics of the PTTs that would lead to pressures on them to adapt IP technologies leading to the World Wide Web.

[1] Rostow, W.W. (1960) Stages of Economic Growth: A Non-Communist Manifesto. Cambridge: Cambridge University Press. See also Rostow W.W., (1965) Stages of Political Development. Cambridge: Cambridge University Press.
[2] An excellent discussion of the various development and new world communication and economic order discourses can be found in Majid Tehranian’s (1999) Global Communication and World Politics: Domination, Development, and Discourse. Boulder, CO: Lynne Rienner Publishers. p. 40-41. Also, see Jussawalla, M. (1981) ) Bridging Global Barriers: Two New International Orders. Papers of the East-West Communications Institute. Honolulu, Hawaii.
[3] Wriston, W.W. (1992) The Twilight of Sovereignty : How the Information Revolution Is Transforming Our World.

Citation APA (7th Edition)

Pennings, A.J. (2020, Feb 19). Five Stages of ICT for Global Development. apennings.com https://apennings.com/how-it-came-to-rule-the-world/planting-to-platforms-five-stages-of-ict-for-global-development/

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AnthonybwAnthony J. Pennings, Ph.D. is a Professor in the Department of Technology and Society, State University of New York, Korea. From 2002-2012 he was on the faculty of New York University. Previously, he taught at Hannam University in South Korea, Marist College in New York, andVictoria University in Wellington, New Zealand. His American home is in Austin, Texas and taught there in the Digital Media MBA program atSt. Edwards University He joyfully spent 9 years at the East-West Center in Honolulu, Hawaii.

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