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Cuban start-ups stalled in the dial-up lane

Cuban start-ups stalled in the dial-up lane

Posted by PanamericanWorld on April 27, 2015

Great technology companies are born in garages, of course, and that is where 31-year-old Bernardo Romero has launched his Cuban startup, Ingenius.

And like Bill Hewlett and Dave Packard in the 1930s, and Steve Jobs and Steve Wozniak in the 1970s, Romero doesn't have Internet access, either. "At least," he said, "we have a garage."

It is no small feat, by Cuban business standards. Romero also has five employees, a sign, printed advertising and a government license to operate his company -- almost none of which was allowed by Communist authorities a few years ago.

What keeps Romero and other similarly aspiring entrepreneurs crippled is a near-total lack of Web access. Raul Castro's limited opening for private business has been good for Cubans in physical trades such as shoe repair and plumbing, but the country's digital laborers are still largely disconnected.

When one of the engineers at Ingenius needs to upload work for a client, he travels by bus or bicycle to a cybercafe run by the state telecom monopoly, ETECSA, paying $5 an hour for mediocre Wi-Fi. The converted garage, like most of Cuba, isn't plugged in.

"If we had Internet, we could really take off," said Romero, who will design and build an entire website from scratch for $150.

That is a wisp of what it would cost in the United States. And as a result of President Obama's recent moves to ease 1960s-era trade sanctions, American companies and clients can now hire private Cuban businesses like Ingenius for services such as translation work, software development and accounting.

The potential bonanza is not lost on Cuba's highly educated, lowly paid professionals, now more eager than ever to hire out their services to U.S. clients. Romero estimates there are at least another 20 small, licensed, taxpaying technology startups like his in Havana. Far more Cuban programmers and software engineers are said to be freelancing for foreign customers off the books.

Nearly all are stuck with the same problem: They can't reliably and affordably get online. That deprives them of the tools essential to work with customers remotely, such as video conferencing, access to software updates and the ability to send and receive large files.

At a business conference in Panama last week before the Summit of the Americas, Cuban trade officials insisted to an audience of global corporate leaders -- including Facebook chief executive Mark Zuckerberg -- that there were no political or ideological obstacles to expanding Web access, only financial and technological ones.

"Cuba today is comparable to India when their software export industry was starting -- both had a lot of smart, trained programmers, but they were working with old technology and had poor Internet connectivity," said Larry Press, a professor at California State University at Dominguez Hills, who writes about the island's Web infrastructure on his blog, The Internet in Cuba.

Almost anywhere else, a government that has invested so much in quality education would be alarmed that its skilled engineering graduates lack the basic building blocks to drive development and spur growth. Cuban authorities have begun to acknowledge as much, but they show little detectable urgency to broaden Web access if it means ceding tight control over the country's data networks.

Their reluctance stems partly from fears, not unfounded, about U.S. schemes to digitally undermine Cuba's one-party state, including a now-defunct "fake Cuban Twitter" service, Zunzuneo, whose unwitting users didn't know they were getting messages sponsored by Washington. Alan Gross, the U.S. subcontractor freed in the Dec. 17 prisoner exchange announced by Obama and Castro, was arrested in 2009 for trying to set up illegal satellite networks on the island.

The Castro government seems especially apprehensive about Arab Spring-style unrest enabled by smartphones, so mobile data plans simply aren't available. Flashy Cubans walk around with dumbed-down iPhones that don't connect to the Web.

The bandwidth deficit may reflect an enduring ideological ambivalence about private business as well. Cuban authorities continue to treat the entrepreneurial zeal of their countrymen as a natural phenomenon that needs to be contained, rather than encouraged, like a wild river. It's an Army Corps of Engineers approach to economic development, not a chamber of commerce one.

Cuba has fallen so far behind in technology that even its problems are obsolete. When manufacturers of laptop computers phased out the 56k modem about 10 years ago as a standard accessory for connecting to the Internet through a phone line, most of the world had gone wireless by then and barely noticed. But for Cubans, it was a hardware crisis.

A generation after Americans dialed into AOL accounts through a series of beeps, squawks and static, many Cuban Web users still connect that way. On a good day, they can achieve download speeds of 4 or 5 kilobytes per second, approximately 10,000 times slower than the U.S. residential service offered by Verizon or Comcast.

"I would not be surprised if Cuba had the highest rate of dial-up among Internet users of any nation in the world," Press said.

Online classified sites such as Revolico -- Cuba's versions of Craigslist -- offer $20 external USB modems for connecting a modern laptop to a phone line.

It might sound like the Web-browsing equivalent of driving around Havana in a 1950s Chevy. But it is much worse than that, as Cuban dial-up users will attest. At least the Chevy gets you to your destination.

Cuba's main link to the global Internet is a single undersea fiber-optic cable that runs across the Caribbean to Venezuela. The state is the lone service provider. But broadband accounts are restricted to government ministries, state businesses and a limited number of foreign residents and diplomats. Ordinary Cubans can't sign up for residential dial-up accounts even if they can afford to pay for it.

Some Cuban engineering graduates take low-paid jobs at state companies to secure high-speed Internet access at work, then moonlight for private customers on the side.

Cubans with the money can purchase prepaid Wi-Fi cards for use in the lobbies of major tourist hotels, or log on at state computer labs, but users must register their names and ID cards with Big Browser.

Cuba's obstacles are not all self-imposed. One of the more contradictory elements of U.S. policy toward Cuba is a stated goal of expanding Web use while U.S. economic sanctions and other measures continue to block Cubans' access to sites and Web tools needed most by entrepreneurs such as Romero.

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