CIAO DATE: 04/01

The Internet in Turkey and Pakistan: A Comparative Analysis

Peter Wolcott
Seymour Goodman

The Center for International Security and Cooperation

December 2000

 

Introduction

The Global Diffusion of the Internet Project was initiated in 1997 to study the diffusion and absorption of the Internet to, and within, many diverse countries. This research has resulted in an ongoing series of reports and articles that have developed an analytic framework for evaluating the Internet within countries and applied it to more than 25 countries. (See http://mosaic.unomaha.edu/gdi.html for links to some of these reports and articles.)

The current report applies the analytic framework to compare and contrast the Internet experiences of Turkey and Pakistan, through mid—2000. Although historically these countries have not been closely related, there are significant parallels between the two that make them well suited for a comparative study of the absorption of the Internet. Turkey and Pakistan are among the largest non—Arab Muslim countries in the world. In contrast to most of their Arab counterparts, their governments were founded as secular, parliamentary democracies. Both countries have had stormy political histories, however, with periodic coups and authoritarian governments. Each country has firmly entrenched bureaucracies with closed and, to varying degrees, corrupt processes.

Their economies have been similarly troubled, with periods of relative hopefulness punctuated by stagnation and decline. Both countries have suffered from erratic growth rates, high inflation, and high deficits. For most of their histories, their economies were rather closed and autarkic. In recent decades, each country has taken substantial steps to move toward a more open, market—oriented economy and made expansion of the telecommunications infrastructure a high priority. Each country has sought, less successfully than had been hoped, to attract foreign investment and integrate itself more fully with the global economy. Each country has a number of national security concerns. Turkey and Pakistan both have histories of serious domestic terrorism and persistent conflict with a non—Muslim neighbor. In spite of the macro—similarities, there are numerous differences between the two countries. Pakistan is considerably poorer and less developed than Turkey; it has had more coups and assassinations, deeper economic troughs, greater heterogeneity within its population, and more endemic corruption. The Internet in Turkey

The first international Internet connection from Turkey (to the U.S. National Science Foundation) was established In 1993. In 1996, Türk Telekom, the national telecommunications services provider, granted a contract for the creation of a national Internet backbone to the GlobalOne consortium. This backbone, TURNET, went online during the fall of 1996 and provided the foundation for private, commercial Internet service providers (ISPs).

The creation of TURNET and a competitive ISP market led to a dramatic expansion of Internet usage in Turkey. During the first two years of TURNET operation the number of ISPs increased by 600 percent. Between 1996 and 1999, the number of Internet users in Turkey grew by approximately 800 percent, reaching over 1 percent of the population by 1999. The rollout of an ATM network called TTNet in 1999—2000 has dramatically increased domestic and international bandwidth capacity and supported continued expansion of the Internet. In 2000, 3—4 percent of Turkish citizens were Internet users.

The Internet in Pakistan The first international Internet service in Pakistan was launched by Digicom in 1995. The licensing of commercial Internet service providers began in 1996. By mid—1999 licenses to provide Internet services had been issued to approximately 100 organizations, of which approximately 40 were offering service. By mid—2000, the number of Pakistani users had grown to 500,000—700,000, or nearly 0.5 percent of the population. Unlike Turkey, Pakistan lacks a proper Internet backbone. Each ISP leases lines for both domestic and international connections. Only in 2000 were developments underway to create a network access point (NAP) at which Pakistani ISPs could exchange traffic. Without such NAPs, traffic from one domestic ISP to another has to travel outside the country and back. Similarities and Differences

The dramatic growth in the Internet user population in both countries has been fueled in part by a highly competitive and expanding community of Internet service providers that have been increasing access, reducing prices, and promoting content attractive to local and expatriate communities. The ISPs, in turn, have benefited from long—term efforts to expand and improve the telecommunications infrastructure as well as periodic price reductions by the national telecommunications providers. Internet use in the health, education, government, and, especially, commercial sectors has grown significantly, although not uniformly.

Turkey and Pakistan share other, less positive features. The vast majority of citizens are still without Internet access. Only in 1999 did Internet penetration reach 1 percent of the population in Turkey; Pakistan may not cross this threshold until the year 2001. For most, the cost and difficulty of accessing the Internet are prohibitive. Neither country has been able to develop infrastructure fast enough to accommodate growing demand. The domestic and international infrastructures are often saturated.

In spite of these similarities, the two countries have significant differences. Turkey’s per capita usage of the Internet is over six times that of Pakistan. While Turkey has been rolling out its second—generation national backbone, Pakistan is still talking about developing its first. While the Internet is accessible from nearly every Turkish village, access in Pakistan is limited to major urban areas. Many major Turkish corporations are embracing the Internet and its new business models. Such activity is much less widespread in Pakistan.

While many factors play a role in shaping the Internet within countries, the analysis of Turkey and Pakistan suggests three factors that play particularly important roles: the state of the overall economy, the state of the telecommunications infrastructure, and the often complicated triangular relationship between the government, the telecommunications service provider(s), and the Internet service providers.

The state of the economy has a powerful impact on a number of key factors, such as the affordability of services and the resources necessary to expand infrastructure and promote innovative economic activity. Unfortunately, this is one of the most difficult factors to improve. While neither country has a particularly strong economy, Pakistan’s economy lags Turkey’s on all major indicators.

While both countries have invested substantially in expanding telecommunications infrastructure, Turkey’s has far greater scope and penetration than Pakistan’s. The quality and extent of Internet access within a country depends directly on the basic telecommunications services available to users and ISPs. While the state of the economy and telecommunications infrastructure set a basic landscape for the Internet, they do not help us understand why the Internet “took off” in these two countries in a relatively short period of time. One of the more interesting aspects of Internet evolution that can help explain this phenomenon has been the relationship between the government, the ISPs, and the telecommunications services providers. While policy—makers as a whole in both countries have been rather indifferent to the Internet, each country has had a number of policy—makers (some with cabinet level rank) and interest groups that have been strong proponents. In contrast, we have not observed any organized, significant opposition to the Internet by interest groups in either country. A turning point in both countries occurred when policy—makers permitted the creation of privately owned ISPs. Once Internet service became available at affordable (for many) costs, the desire to socialize, be entertained, and access information drew hundreds of thousands of individuals in both countries into cyberspace.

The relationship between the ISPs and the telecommunications service providers, on the other hand, strongly differentiates Turkey and Pakistan. While Türk Telekom was somewhat hostile toward ISPs in the early days of the Turkish Internet, by 1996 it had positioned itself not as a direct competitor of, but as a provider of infrastructure to these new companies and their users. While the relationship has not been free of conflict, it is, on the whole, rather supportive and mutually beneficial.

In contrast, the Pakistan Telecommunication Company Limited (PTCL) and the Pakistani ISPs have had a much more confrontational relationship. PTCL views the ISPs not so much as valued customers for high—capacity services but as competitors of its own ISP, PakNet. At the same time, to enhance its privatization prospects, PTCL has sought to maintain its profit margins on basic services. It has dropped prices more slowly than Türk Telekom and has not provided a national backbone the way Türk Telekom has. While the competition with ISPs has caused PakNet to improve its service and lower its prices, the hostile relationship between PTCL and the ISPs has hindered Internet growth overall.

While there are countries that have taken strong measures to counter the perceived negative effects and threats of the Internet, Turkey and Pakistan are not among them. In both countries, the positive perceptions of the Internet as an enabler of economic development and integration have dominated policy—making in this area. The beneficiaries of Internet growth, the ISPs and the commercial interests that are gaining from information dissemination and electronic commerce—related investment and transactions, are increasingly exercising lobbying power to promote support of the Internet. At this point, the window of opportunity for a concerted opposition to dramatically curtail the spread of the Internet is closing.

Each country’s government has a range of measures that can be taken to promote the Internet. Some of these are relatively easy: dropping rates for domestic and international connectivity, promoting legislation establishing a proper framework for electronic commerce, and continuing to invest in infrastructure. Somewhat more difficult are the expansion of IT education and the promotion of a competitive environment for all communications services, including basic ones.

The future of the Internet in both countries is promising. Whether and how quickly the Internet will reach its potential and keep pace with other countries, however, depends strongly on measures taken by the governments and the national telecommunications service providers to remove limiting factors.

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