Taking the podium in the State Department’s Ben Franklin Room one last time on Thursday before stepping down, Secretary of State Hillary Clinton thanked lots of people, offered reminiscences, and announced a flurry of last-minute initiatives. “We’re all like one millisecond away from just collapsing here, because of the emotion and the feelings that are coursing through all of us,” Clinton said.
One of those new initiatives, the Alliance for an Affordable Internet, barely got a mention in Clinton’s speech. But it merits attention. If successful, the project—a public-private partnership among the State Department, the World Wide Web Foundation, and tech companies such as Cisco Systems (CSCO), Google (GOOG), Microsoft (MSFT), Yahoo (YHOO) and Intel (INTC)—could end up helping many people in poor countries get onto the Web. It could also cement long-term ties between the State Department and the companies—while opening new markets and reaching new customers for Silicon Valley. “We’re going to help the next billion people come online,” said Clinton, quickly announcing the project before going on to talk about clean cook stoves for women in the developing world.
Only a quarter of people in developing countries are online, compared to three-quarters of those in developed nations. If the U.S. is to play a role in changing that equation, credit will go in part to a State Department employee named Ann Mei Chang.
Chang, a 25-year veteran of Silicon Valley—most recently she was a senior engineering director at Google—joined the State Department in November 2011 to be an adviser on technology and women’s issues. Now she lives in Nairobi, Kenya, a city recently billed by Google Executive Chairman Eric Schmidt as Africa’s soon-to-be Silicon Valley. Chang has been spending her time studying Kenya’s technological success and teaming up diplomats with U.S. tech companies to figure out how other countries can follow its example.
Chang says that in most developing countries, an entry-level Internet connection costs the equivalent of the average person’s monthly income. One reason is high taxes. In many places, computers, mobile phones, modems, and other software are taxed as luxury goods. “It’s one of the few things they can tax,” says Chang. The effect is that fewer people can afford to log on. “That’s short-sighted,” she says.
Another barrier is that many poor countries lack the physical infrastructure that’s the backbone of the Web. In most developed countries, Web traffic moves between service providers through hubs called IXPs, or Internet exchange points. In the U.S., there are dozens of these hubs. Many poor countries lack even a single hub, which means they have to send their Web traffic over international fiber optic cables to hubs in developed countries. That slows down service. Kenya, Chang says, has invested in IXPs.
A third obstacle are the monopolies that control telecommunications in many developing nations. “They can refuse access to critical infrastructure, or provide access at an above-market rate,” says Chang. “They can exert their power to influence government to create regulations that favor them, prevent entry of new competitors, and hoard critical resources such as spectrum.”
Here Chang is echoing her departing boss. One of Clinton’s major diplomatic goals has been to put U.S. companies on level fields with foreign competitors.
Over the past year, Chang has brought together Silicon Valley technicians, diplomats, and nonprofit groups to discuss the problem. Those talks culminated in the partnership Clinton announced. The idea behind the Alliance is to use corporate and diplomatic power to push foreign governments to change laws and policies—in this case, the obstacles that governments put up to wider Internet penetration.
The Alliance is still new, and at this point, it’s not entirely clear how it will do this. As the diplomats press foreign governments to make changes to their technology policies, the companies will provide technical expertise. They have provided seed capital, too, though State won’t say how much. Google confirmed its membership in the group but declined further comment. Microsoft declined to comment and Intel did not a return a call seeking comment.
“We want to go in with a unified voice and say, ‘There are things we think you can do so the Internet will flourish and will cause your economy to thrive,” says Chang. If the effort is successful, the U.S. companies have a lot to gain for themselves.
