OPINION: The Digital Solidarity Fund and The Economist

On March 10, 2005, The Economist featured reports and an editorial on the digital divide in which it derided the Digital Solidarity Fund (DSF), which had been welcomed by governments at the WSIS Prepcom 2 in Geneva in February and was due to be launched on March 14 2005.

In its editorial on `the real digital divide’, The Economist made the following claims about the Digital Solidarity Fund:

* That on March14th the United Nations will launch a "Digital Solidarity Fund”.

* That waving a magic wand to cause a computer to appear in every household on earth is just the sort of thing for which the UN’s new fund is intended.

* Technology firms operating in poor countries will be encouraged to donate 1% of their profits to the fund.

None of these claims is true.

The DSF is not a United Nations (UN) fund. It is an independent foundation established under Swiss law.

The DSF has modest aims and financial resources and has no plans to put a computer in every household on earth.

The DSF’s 1% financial mechanism is not 1% of the profits of every technology company operating in poor countries. It is a 1% levy on IT procurement contracts that municipalities may impose on winning bidders for such contracts. The difference between the two is massive.

Why has The Economist got its facts so wrong?

The degree of hyperbole in its claims around the DSF’s putative aims to place a computer in every household on earth and to raise the funding to do so by massive taxation on IT companies is curious to say the least.

It could be a deliberate action, designed to destroy the credibility of the DSF at its inception. Of itself, this may be a minor matter. But The Economist links its derision of the DSF with the trumpeting of mobile telephony as the REAL solution to the digital divide.

The Economist opines that the internet is of no use to the poor who are illiterate and have other needs to meet. It cites the Bill and Melinda Gates Foundation’s funding approach as one that puts health care above the extension of computers. It posits research put before an unnamed conference by Vodafone.

So there you have it – the world’s biggest computer software company and the world’s biggest mobile phone company think that mobile phones are more useful to poor people than computers and the internet.

Just for good measure, The Economist throws in some World Bank figures that ‘show that poor people in developing countries spend a larger proportion of their income on telecommunications than those in the rich world. Yet this is all merely indirect evidence for the impact of mobile telecoms on economic growth. After all, as people become richer, they have more money to spend on things like phone calls.’

However, forthcoming research by the South African-based Link Centre shows that in Uganda, the showcase for mobile telephony in Africa, 95% of those surveyed said the cost of calls prevented them from making more phone calls from their mobile phones.

Basically The Economist is spinning a propaganda line.

The ideological work performed by The Economist seems aimed at reasserting the dominance of market forces as a solution to the problems of development. This seems to be an increasing feature of developed country media. See, for example, the New York Times’ investigation into the Bush administration’s use of video news releases and the acquiescence of network television in this deception (coincidentally published on March 13, 2005).

Surely The Economist could have made the case without calumny against the UN and the DSF? Or is this a sign of a mild hysteria in the ideological mechanisms of developed countries that developing countries are losing patience with market fundamentalism and that the goals of development require more than just the deployment of Vodafone and Microsoft to achieve?

There are other ways of ‘bridging the digital divide’ in which the use of market forces is but one mechanism and not the only one.

A new paradigm is emerging for information and communications for development that draws on a new approach of open access to ICT networks and services for all service providers and people using new technologies such as wireless internet access. It seeks new ways of linking public and private sector finance to maximise the use information and communication for development. It also leverages the network effects of the internet as a global public good to deliver ICT-enabled services to the poor and to create just the kind of synergies between local government and citizens that the DSF is keen to promote.

The DSF with its focus on cities and the local level has a vital role to play in mobilising partnerships and resources, and directing attention to the importance of extending ICT services to the poor. The Economist’s claim that ‘the digital divide that really matters is between those with access to a mobile network and those without’ is one-dimensional and hollow. The digital divide will not be bridged by one technology alone. It requires more than this. Another world of communications and development is possible.