Jakarta's top executives discuss the Internet in detail

Jakarta's top executives discuss the Internet in detail

By Dean Carignan

JAKARTA (JP): When 90 of Jakarta's top executives gathered
last Monday to discuss the future of Information Technology, the
result was a shock: no discussion of databases, financial
software, or even management information systems. Rather, the
entire dialogue focused around a single recurring theme: the
Internet. So pervasive has the Internet phenomenon become that no
discussion of computers, communications, or business in general
can escape it.

Last Monday's seminar, part of the Dow Jones Asian Dialogues
series, was led by Nicholas Negroponte, founder of Wired magazine
and Director of the Media Lab at the Massachusetts Institute of
Technology. Negroponte opened by providing a surprisingly simple
model for understanding the Internet. The Internet's tremendous
impact on society, he explained, lies in the fundamental
distinction between "atoms" and "bits".

Traditionally, most communication of information has employed
atoms; information is printed into books made of atoms,
distributed on newspapers made of atoms and stored on video tapes
made of atoms.

With the arrival of computers, more and more information is
being handled as "bits". Bits are the digital elements that
reside in computer memory chips. They have the power both to
store information (e.g. on a hard disk or floppy disk) and to
transport it (e.g. over the Internet).

The difference is that bits manage information enormously more
effectively than atoms. Atoms, for example, take up space, are
costly to produce (think of the cost of printing a book), and are
difficult to transport (consider shipping your personal library
overseas). Bits, on the other hand, take up virtually no space (a
few micrometers on a computer chip), cost nothing to modify and
reuse (we change them every day on our computers), and can be
transported over telephone lines at tremendous speed for almost
nothing.

It is the remarkable efficiency of bits that underlies the
growing interest in the Internet as a commercial and business
tool. Consider the example of a company seeking to promote itself
internationally. Traditionally the company would print and mail
hundreds of reports at a cost of thousands of dollars and a
delivery time of several weeks. To send the same information over
the Internet -- that is, as bits -- would cost less then US$100
and would require only a few hours delivery time.

"The profound difference between bits and atoms", Negroponte
concluded, "marks a radical change in the way people will store,
organize, and distribute information". In the future, more and
more communication will assume the form of bits, just as e-mail
is already replacing physical letters and faxes.

After Negroponte's optimistic prelude, the questions came hot
and fast on the Internet's much-publicized shortcomings. The most
common inquiries concerned government censorship of the Internet,
particularly Singapore's efforts to moderate content in
Cyberspace.

Negroponte responded candidly that such efforts are ultimately
futile. The Internet, which began as an American military
experiment, was originally designed to ensure unbroken
communications even in the event of natural disaster or all-out
war. "Each message traveling the Internet is programmed to
attempt every possible route to its destination," he explained.
"Even if you censor every ground line in Singapore, transmissions
will still find their way in via cellular phones."

The key is not to censor the Internet but "to make it self-
policing, to encourage Internet Service Providers to monitor the
content of what is placed on their servers." Only this strategy
of 'decentralized' policing can moderate an entity as
decentralized as the Internet.

Another recurring topic was the security risk of transmitting
financial information like credit card numbers over the Internet.
Negroponte responded by pointing to the comparative insecurity of
the physical credit cards themselves. "People go to a restaurant
and hand their credit card to a waiter they've never met before,
who makes a copy of it and then disappears to the back room for
several minutes. To be honest, I'm more comfortable typing my
number into a computer!"

Financial information, it turns out, is actually safer in the
form of bits than it is as atoms. As evidence Negroponte pointed
to Swift, a European firm dealing in Internet financial
transactions. "Swift has 19 levels of human security to protect
the paper part of their transactions. They actually need less
security once the information becomes bits and enters the
Internet; they say that's the easy part to protect."

There is, however, one factor preventing perfect security of
Internet transactions. "The greatest single impediment to secure
transactions is the United States Government's ban on the export
of encryption technology." Encryption tools, which encode
Internet transmissions so they can be read only by the intended
recipient, cannot currently be exported under a U.S. law. The law
was intended to prevent encryption capability from falling into
the hands of terrorists and drug-runners. But, Negroponte was
quick to point out, "terrorist and drug runners already have this
technology. They simply visit the U.S. and take it out with
them." The real losers are the thousands of struggling Internet
businesses worldwide that need to secure their transmissions
through encryption.

A final topic running throughout the dialog was the impact of
technological advances on developing countries. Will the growing
influence of technologies like the Internet increase the gap
between developed and developing nations?

Negroponte responded that the Internet could actually increase
developing countries' access to information and technology. An
Indonesian school, for example, would need only the simplest PC
and a US$90 modem to access the full content of Cyberspace. The
real obstacle these countries face is the inflated
telecommunications costs endemic to the developing world. "This
is a problem that can only be fixed by governments, not by
technology."

The seminar closed with the elusive question of who would be
the big winners and losers of the "digital revolution". Here even
Negroponte was reluctant to venture a guess. The only certain
thing, he concluded, is that the brightest future belongs to
those who can embrace the brave new world of bits.

The writer works for International Communication Associates
(ICA), a multimedia communications firm based in Jakarta.