• The first step in restructuring the telecom sector in 1980 when the postal service was separated from then Department of Posts and Telecommunications. But it was only in 1991, after the department was transformed into a government owned corporation called Sri Lanka Telecom (SLT), that the pace of development accelerated. In 1997, Nippon Telegraph and Telephone Corp (NTT), the Japanese telecom giant, bought 35% of SLT shares for US$ 225 million, and also took over all of SLT's management.
• Drastic changes have occurred in the telecommunications sector since 1990. The wire-line telephone connections have grown from 121,388 in 1991 to 829,282 in 2001 - an increase of almost 700%.
• The number of cellular connections, which stood at 1,800 in 1991, increased to 667,662 in 2001. During 2001, the cellular services expanded by 55%, making the ratio of mobile phones to fixed access telephones to 81 (Central Bank, 2002, p. 105).
• The overall tele-density has increased from 0.7 in 1991 to 8 phones per every 1,000 persons by 2001.
• In 2001, there were 9,324 pay phone booths and 6,535 radio pagers in Sri Lanka. However, the PDA usage was still extremely limited.
• Commercially available satellite phone services were introduced only in early 2002, and the number of users remains very small, mainly due to the high cost of the hardware and operation.
• The computer population started growing in the late 1980s with the introduction of Personal Computers (PCs).
• The International Telecommunications Union (ITU) has estimated the current PC density to be 7.9 PCs for every 100 persons.
• According to the Telecommunications Regulatory Commission of Sri Lanka (TRCSL), the total number of Internet accounts was 61,532 in 2001.
• ITU data for 2001 gives the total number of Internet users in Sri Lanka as 150,000. (However, these figures are based only on the Internet accounts provided by licensed ISPs, and does not count the Internet accounts provided by corporate servers and unlicensed ISPs. Factoring all these, the total number of Internet accounts in Sri Lanka in mid 2002 can be estimated to be around 100,000. Using a conservative number of 3 users per account, there are approximately 300,000 regular Internet users in Sri Lanka.)
• Industry data shows that subscribers to internet and email services grew by 52% during 2001 (Central Bank, 2002, p. 106).
• Similarly, 70% of the country's communication infrastructure is concentrated in the Western Province where Colombo is located. ICT proliferation outside Greater Colombo is still limited.
• The telecommunication and Internet access charges in Sri Lanka are relatively high compared with developed countries. One major factor is the 20% Value Added Tax (VAT) applicable on telephone charges.
• An Internet user in Greater Colombo has to pay between US$ 1.80 and US$ 2.15 per hour (including all taxes) for Internet access; the exact amount depends on the kind of package and the number of hours used. A resident outside Greater Colombo pays between US$ 2.45 and 3.45 per hour. Cyber cafes in Colombo charge US$ 1.20 - 1.50 per hour of access (Wattegama, 2002a, p. 44).
• One study among 560 Internet users in Sri Lanka (Shrestha and Amarasinghe, 2001, pp. 7-8) provided the following insights:
  • 71% respondents were male, and 17% were female. (12% did not indicate their gender.)
  • The largest number of Internet users was aged from 26 - 35 years (23%), followed by 36 - 45 years group (21%) and 19 - 25 years group (19%).
  • Nearly 6% of the users were 18 years or younger, while users above 56 years accounted for only 8%. the users.
  • More than a third of users had completed at least a basic degree; 13% were still engaged in full-time studies.
• A locally assembled entry level PC now costs between US$ 500 and 750, while a branded machine with comparable features costs between US$ 900 and 1,000. The locally assembled PCs achieve this cost advantage partially by installing pirated copies of the operating system software. They have become popular especially among the domestic and individual users. An estimated 300 companies are engaged in this trade in Colombo alone.

Software Origination

• Sri Lankan software exports which stood at around US$ 5 million in 1996 increased to US$ 58 million in 2000. This figure was expected to hit the US$ 75 million mark in 2001, but the recession in global markets had an adverse effect.
• Sri Lankan software industry has shown an average annual growth rate of around 40% during 1996 to 2001.
• According to the Board of Investments (BOI), there were around 50 Sri Lankan software development houses with an employee strength of 25 or more. Some of these firms are housed at Colombo's World Trade Centre, where the first software park was established in 1999 (Wattegama, 2002d).
• A software company that exports more than 70% of its output is given an eight-year comprehensive tax holiday, followed by a 12-year 15% concessionary tax holiday. A software company that mainly caters to the local market gets a five-year tax holiday.
• Past experience shows that annual GDP growth has to be at least 10% to ensure a healthy growth in ICT industries. With lower rates, ICT developments will either not show appreciable growth (as happened in the past few years), or might actually decline.
• The present growth in the telecommunication services, both in fixed-line and mobile, will continue. The number of mobile phones will increase more rapidly. The tele-density will go up to at least 25, maybe even 40, per 1,000 persons by 2010.

Initiatives

Wijeya Pariganaka

This is a monthly Sinhala magazine exclusively covering ICT, published by Wijeya Newspapers Ltd. Since its launch in 1997, the magazine has blazed a new trail in nurturing indigenous traditions and talent to meet ICT challenges. While its editorials offer the perceptive analysis of ICT policies and practices, its combination of journalistic and instructional material have helped clarify and demystify the role of ICTs in economic, social and personal development. Because it does not engage in business promotion of individuals or companies, this magazine comes closest to a chronicle of the emerging ICT culture in Sri Lanka.

Antharjalaya Obe Niwasata (Internet to Your Home)

This was a weekly television programme, broadcast live during evening prime time by the national broadcaster Rupavahini. It took viewers on a guided tour of interesting websites, and provided answers to their questions on Internet and IT. Although targeted at those who had no access to the web, the programme gained a wide following and was instrumental in popularising the new medium among Sri Lankans. It registered the highest audience ratings for a factual programme during 1999-2000, but was discontinued in 2001. It has since been replaced by IT@Rupavahini, in a different format and reduced to half hour.

The Kotmale Internet Radio Project

This project used a rural transmission of the Sri Lanka Broadcasting Corporation to bring the world wide web closer to its listeners. A daily two-hour interactive radio programme allowed listeners to request (by live telephone or the post) specific information on any topic, which the presenters sourced from relevant websites and summarised on air in Sinhala. This helped overcome the twin problems of access and English proficiency. The station also provided Internet access free of charge at two public libraries in its signal coverage area, and operated a cyber café at the station itself. The project ended in 2001 after donor funds ran out.

VillagePDA

This is a portable device that provides real time access to email, contacts, calendar and messaging functions and is an 'end-to-end' solution that is designed to help bridge the digital divide and to address the core communication needs of rural communities. Designed in 2001 by the Sri Lankan company MediaSolv , it is the world's first Bluetooth enabled PDA, and has all the low-cost, wireless, Internet-ready attributes of ETHERchip, an embedded application for personal area networks developed by the same company. The device costs between US$ 25 and 50, and has already been field testes in Kenya and Sri Lanka.

Quotes

Sri Lankan diplomat Ravinatha Aryasinha, who in 2001 studied the development of internet and other ICTs in South Asia, notes that most such empowerment and innovative projects remain as micro level exercises. In most cases, sustainability is a major concern given that they run on grants and subsidies, and have little potential for replication on a broader scale

"There was hardly any opposition to them (the LTTE) in the information war. They campaigned quite early on the Internet, and the general information scene, more or less unopposed; and in this way, they built a bank of international sympathy, leading to misinterpretation of facts about Sri Lanka, the government, its armed forces, efforts towards peace, and so on. They gained much political as well as economic advantages assisted by these international links. There are supposed to be about 25 Internet websites spreading false news and misinformation on behalf of the LTTE, whereas, for a long time, any established counter-action was not forthcoming." - Lakshman Jayawardene, Senior Journalist 1997

"Our aim should be to become an IT hub where East meets West. To do so, we might need to create a strategic authority, somewhere along the lines of Malaysia's Multimedia Development Corporation, which acts as the nodal authority for….the multimedia super corridor. However, our authority should be faster, small and more proactive than the MDC." - Milinda Moragoda, Minister of Economic Reform, Science and Technology , April 2002

"'Unshackle the binding constraints in the area of IT'. Similarly, Minister Moragoda was reported as saying that many existing regulations were acting as an impediment to the future development of IT." - Mission of Government - Prime Minister Ranil Wickremasinghe

"According to the top government official handling media and telecommunications, the partial liberalisation approach adopted thus far has left a number of complicated issues 'which thwart the rapid growth of the ICT industry'." -
Abeysinghe, 2002

"As yet, Internet banking facilities are used only by a small portion of the total banking population in Sri Lanka. The reasons for this include the high cost of Internet access; lack of computer literacy and/or English proficiency; and an overall lack of awareness and appreciation of the benefits of using Internet-based banking. Unless these broader issues are resolved, this activity will remain confined to a few." - Wattegama, 2002a, p. 44

Source: Digital Review for Asia Pacific