Tech firms see opportunities in helping Iraq get connected

By Brian Bergstein
Associated Press

Although Iraq first needs basics like electricity and a government, it is shaping up as a rare opportunity for technology companies. The country is saddled with a tattered phone system, weak Internet access and virtually none of the wireless wonders sweeping other countries.

Even if Iraq never becomes the Silicon Crescent, big money is at stake. Rebuilding the country's telecommunications networks and constructing new facilities from scratch would cost billions.

U.S. officials have not explained how telecom contracts will be awarded, whether deals signed by Saddam Hussein's regime will be honored, or whether U.S. and British companies will be preferred.

American and international companies that want to take part say the biggest beneficiaries would be the Iraqi people, whose connections to the outside world were stunted by Saddam's dictatorship and ravaged by war.

"Iraq is now the land of opportunity," said Loay Abu-Osbeh, who oversees the Baghdad office for Abu-Ghazeleh Intellectual Property, a Jordan-based technology consulting firm. "People who were outside Iraq ... have come back to Iraq to make money in Iraq, and I can see it happening. This is a business everybody is interested in, doing Internet, Internet cafes, connecting to big servers (elsewhere) in the world."

While Saddam's regime had a now-shuttered Web site, Uruklink, Iraqis had little Internet access other than in government centers, which offered slow connections routed through "proxy servers" that tried to filter out content the regime didn't like.

Voice communications haven't been much better. Satellite phones used by journalists and aid workers are too expensive for regular Iraqis, and the country has virtually no cellular phone coverage other than in the Kurdish north.

To compensate, many Iraqis tinkered with their home cordless phones to extend their range to a mile or two, according to Pyramid Research analyst Joseph Braude, author of "The New Iraq."

In 1990, Iraq had 5.3 phone lines for every 100 people, but by 1998 there were only 3 per 100, according to the International Telecommunications Union. Neighboring Iran has 16; Syria has 11. The United States has 67.

Even before the recent war, the cost of rehabilitating Iraq's phone system was estimated at $1 billion over seven to 10 years.

That project now will include repairing bombed Baghdad phone exchanges, although Marines say 95 percent of the networks are intact — they just lack electricity. Some neighborhoods' exchanges are working again, but only for local calls.

All of this could amount to a huge feast for Western telecom and technology companies that have been starving since the 2000 dot-com crash.