What’s this about?
Meanwhile, mobile-phone services were mysteriously available in Baghdad yesterday, bringing cellular service – banned under Saddam Hussein – to ordinary people in the Iraqi capital for the first time.
Officially, a tender for the three mobile-phone licences the US-led administration plans to offer across Iraq has yet to take place.
A US military spokesman could not explain why the lines turned on or what that meant for the tender.
Users of foreign mobile phones were able to make and receive calls and send text messages. Currently, few Iraqis have suitable phones. Foreign workers in Baghdad, who have widely relied on expensive satellite telephones to stay in touch, were greeted with the words: “MTC-Vodafone wishes you a pleasant stay in Kuwait.”
Those are the concluding paragraphs of a Scotsman story, a story that is mostly about happy reactions in Baghdad to the Uday/Qusay killings.
David Masten of Catallarchy, to whom thanks for spotting this twist at the end of this story, thinks it’s the free society doing its thing.
In other words while occupation forces are trying to set up the new addition to their mercantilist empire, some people are just doing what is necessary to make life and society better, without any centralized direction or even permission. In a land where landwire communications infrastructure has been little more than rubble for over a decade, cell phones are a quick and easy way to build up communications networks.
If licensing and nationalized services are the US government’s idea of ‘freedom and democracy’ for Iraq, bring our boys and girls back home.
Well that could be the story. But couldn’t it merely be that one bit of the new administration (the bit that was setting up this auction) was operating in ignorance of what another bit (a bit that was just setting a system up regardless) was doing? Much as I’d love to praise this as free market anarchy in action, I have my doubts. It could surely just as easily be the other anarchy, state anarchy. Anyone who has ever worked for a state will know that anarchy never goes away.
Michael Jennings knows everything about portable phones, but he’s in Provence right now, and so may not comment as quickly as he would normally. But eventually he’ll clarify everything for us.
Meanwhile, the general point that portable phones are great news for the poorer and less stable parts of the world is reinforced once again. In that sense this is definitely yet another for the Samizdata Triumphs of Capitalism collection.
Regular phones depend on wires. And not just on any old wires – on wires that have to stay connected throughout their entire length. Portable phones rely on only a few fixed installations, which can be defended against marauders and can therefore stay in business. They are also, even in a totally law-abiding place, quicker to get started. I recall how they were able to crack ahead fast with the reconstruction of East Berlin, immediately after the Wall came down, thanks to the magic of the portable phone.
I do love a good technical fix. Just who presided over this one I for one am not clear about, but a technical fix this nevertheless is.
Salam Pax commented about one service that was working with a New York City area code, which was particularly enticing to a lot of Iraqis with relatives in the USA.
I have a suggestion for any US administration honchos who happen to read Samizdata:
If you want to build an Iraqi infrastructure very very quickly, make a lot of anti-Black Market regulations; enforce them very weakly; then in about 6 months, repeal them all. You will have an in place, working infrastructure.
This is happening anyway, apparently. Trying to regulate and license it effectively is just slowing it down. Once the Iraqi’s have a government of their own, they can cripple their economy for themselves.
Just as long as free capitalism doesn’t get so free as to resemble the Russian version, where you respond to competition in your industrial sector not through improving your service or cutting your prices, but by straightforwardly killing your competitors.
I can still remember the puzzled shrug of a young Russian restauranteur when I asked why a friend of hers in Krasnodar had been murdered. She said “Business” as if I was a bit dim. Isn’t that why all killings happen? What else was I thinking??
Mark is of course correct. Legitimate economic regulations are those limiting behavior which decreases competition. Murder, aside from its moral aspect, unquestionably decreases competition.
mark,
Good point and I do see that as a possibility. I think that ‘gangsterism’ in these circumstances can be ascribed to despotic governments which despoil civil society and plant the idea in the minds of ambitious people that if you want something you must get it by force.
The presence of corrupt government, especially corrupt cops, is what makes for Russia’s “gangsterism”. The corrupt state blocks any sensible anarchic solutions, while failing to provide any law itself. Blaming it on the capitalists is just buying into the lefty propaganda.
“In ther words while occupation forces are trying to set up the new addition to their mercantilist empire, some people are just doing what is necessary to make life and society better,”
I couldn’t let this pass. I wasn’t aware that the US operated a mercantilist empire (whatever that is). I like the subtle dig at “occupation forces,” – one half expects him to lunch into a paean to theoble Iraq resistance at this point. Perhaps he should ask the Iraqis if they feel more “occupied” by teh coalition or by the Baathists. Finally, I like hte reference to “some people” improving life and society, implying that the “occupation forces” aren’t improving anything in Iraq.
FInally, if he thinks that licensing and nationalized services are inconsistent with democracy, he should look around whatever country he lives in. Any of them, I am sure, are chock full of all three.
The need for licensing of cell phone spectrum in a free market is legitimate question for debate, but by the time I get to legitimate issue in this post after wading through cheap shots and uninformed twaddle, I really don’t care.
I suspect David Masten is right, and if so the people providing the service now will probably get shut down by order of the Proconsul. Then, at some later date, the scheduled “bidding” will be carried out and in due course won by whichever service provider has the best political connections.
My guess based on the report is an enterprising soul from Kuwait (MTC Vodafone) has brought in some portable base stations of the type you see in Glastonbury (and other public events), found a stable wired connection back to the core network in Kuwait and is running Iraq as a part of the Kuwait network.
I can’t imagine its all that stable but it should do the job, obvious the problem for locals won’t be the phones, but getting provisioned SIM cards which have an agreement and billing arrangement with the mother network. I’d assume somebody is selling a pre-paid solution somewhere, if they are really entrepenureal.
It can’t last, not least of which because its not a particularly stable way to try and run a network.
To my knowledge there is only one native GSM cell in Iraq and that was an experimental one which never got deployed in Baghdad. I’d therefore put money on somebody driving this one in over the border.
If the US is so mercantilist, then why do we have such large trade deficits and why have we allowed the Dollar to weaken against the euro. Because, Gee Whiz, WE aren’t mercantilist, unlike the EUrocrats. People shouldn’t throw around words they don’t understand.
Dave O’Neill – this was the conclusion I came to. There’s this idea that celphones are like walkie-talkies. They’re not. They need base stations and the base stations are connected to the POTS (plain old telephone system).
It doesn’t actually take all that much time to install celphone infrastructure, at least for a single city. AT&T or Alcatel could probably get rudimentary GSM coverage in Baghdad in three months’ time. It’s more a question of money than time/
Mobile phones seem to be much more common in areas that had a rigidly controlled communications infrastructure. I remember that in Hungary and Croatia in 1997-98, cellular phones were so common that it was rare to see any working person without one. Apparently the reason was because it was so difficult, expensive and time consuming to get a “wired” phone, courtesy of the leftover bureacracy from the Communist era. The mobile phone providers looked at that as a market vacuum and moved in. So at a time when a cell phone was still something of a luxury in the US, they were more common in the not-at-all wealthy Eastern European countries.
I believe that people in other parts of the world will confirm the same phenomenon.
Martin
Yes, of course, I agree – the overbearing state Russia has had for seven or eight centuries is a big part of the current rather frightening version of capitalism they do.
Having done one of the world’s nastiest versions of feudalism [I just noticed the word ‘feud’ is in there….], Russia then followed up with one the world’s nastiest versions of socialism, and their take on capitalism is unpleasant too, though with no gulag it’s clearly not worse. Definitely a society brutalised for a solid millennium, one way or another.
On the cheerful side, one Russian entrepreneur [in wallpaper] tells me it is not hard to avoid criminal business in Russia. “Just stay in the lower-profile businesses with narrower margins” she advises, adding there is plenty of money to be made without ever having to go near the gangsters’ turf.
Martin,
That’s not unique to the old Communist areas, but to anywhere where the wired world is just plain expensive or difficult. China, Rural Spain, Ireland – putting up a GSM basestation and wiring it into the backbone is pretty straight forward. The growth in China, for example, where wiring up the homes is impractical has been astounding.
David,
Putting in a GSM infrastructure to serve Iraq should be relatively straight forward. Even in some of the worst parts of Africa the cellphones are the one things you seem to be able to rely.
I recall a British military force who got cut off in the jungle with a broken radio who managed to borrow some batteries from a local tribe, powered up a mobile and the senior officer called his wife to tell her where to send the helicopter.
I can’t imagine its all that stable but it should do the job, obvious the problem for locals won’t be the phones, but getting provisioned SIM cards which have an agreement and billing arrangement with the mother network. I’d assume somebody is selling a pre-paid solution somewhere, if they are really entrepenureal.
I was going to post something on this, but Dave has more or less covered it. My conclusions as to what is going on are much the same as his. (The tricky part may be maintaining the connection to Kuwait. I wonder whether it is being done by landline or satellite). The question is whether the US officials knew about it or had anything to do with it (“Mr Bremer, we can have cellphones working next week, on an unofficial basis. Do you mind if we do it”?) or whether Vodafone just did it, realising that everybody would be so happy when it was done that nobody would complain.
The question is whether they really care about local users at all. There are lots of government and NGO types in Baghdad who are no doubt delighted that their phones are working. They are being charged whatever they are normally charged to roam to Kuwait, which is probably quite a lot, so Vodafone could presumably make a fair amount of money just from them. Presumably if you want to sell the service to locals, you just have to buy a whole lot of prepay sims in Kuwait City, put a few hundred dollars on them, and drive them up to Baghdad where you can sell them on the black market. However, Vodafone will only get local rather than roaming charges for people using phones like this and if their network capacity is limited they may want to discourage this.
My thought though is that if there is unofficial cellular service in Baghdad now, it will last at least until there is some official service. If NGO types have service now, and it vanishes next week for no good reason, they will then scream like there is no tomorrow until they get it back again.
It can’t last, not least of which because its not a particularly stable way to try and run a network.
Stable in what sense?
There are lots of government and NGO types in Baghdad who are no doubt delighted that their phones are working.
Well that depends. We are assuming that the USians have tri-band phones. It will be good for RotW NGO people.
Stable in what sense?
Well there’s the big question mark over the fixed line connection, I am assuming it is a wire connection to Kuwait which can’t be all that stable at the moment.
Next is the actual “topology” of the network. I’m guessing this will be a single base station or base station controller. Without engineers there to tune the network, I can’t seem them being able to put in multiple Base Stations and have them working sensibly as Cellular networks don’t like that sort of thing.
Of course, they could have a team on the group doing it properly, but that would be a fair to middling amount of work if you don’t know you’re going to get an operators license.