Global equipment makers should adopt a different business model and lower their prices in developing economies or the digital divide will never be closed, an ITU Telecom World forum was told yesterday.Dr Sofyan A Djalil, the Indonesian Minister for Communication and Information Technology, told a forum on "Building Digital Communities" that the current business model was creating a "one-sided dependency" that risked trapping developing economies into a "vicious cycle of greater and deeper" dependence.
Not only is the development of a sustainable ICT industry in developing countries being stifled by the current model, it is also preventing the growth of connectivity in the developing world. Internet penetration in Indonesia, for example, is less than 1% of the population.
"It is not a kind of sustainable information society if developing and least-developed economies keep being net-consumers of pricey telecommunication equipment or exorbitantly expensive application software," Dr Djalil said.
"If multi-national companies are shortsighted and just want to reap the huge profits right now, they can do it as we see currently, but then the market will dry up before achieving its potential value, and the objective to create a world digital community will be hindered."
Dr Djalil said that while software, for example, might be affordable in developed economies, it was often "simply unaffordable" for users in the developing world. "It is no wonder then that piracy is rampant and the discontent is accumulating," he said.
"By observing sensitivity of price and by simply adjusting the price into the most affordable level, software companies will come up with the same or even bigger revenue and profit."
Dr Djalil called on infrastructure providers to build networks reaching remote and currently under-serviced regions, and make them available to local operators on a "pay as you go basis."