[Ecommerce] New York Times: Brazil: Free Software's Biggest and Best Friend

[Thiru Balasubramaniam]

http://www.nytimes.com/2005/03/29/technology/29computer.html


          March 29, 2005


    Brazil: Free Software's Biggest and Best Friend

*By TODD BENSON
<http://query.nytimes.com/search/query?ppds=3DbylL&v1=3DTODD%20BENSON&fdq=
=3D19960101&td=3Dsysdate&sort=3Dnewest&ac=3DTODD%20BENSON&inline=3Dnyt-per>
*

S=C3O PAULO, Brazil, March 28 - Since taking office two years ago,
President Luiz In=E1cio Lula da Silva has turned Brazil into a tropical
outpost of the free software movement.

Looking to save millions of dollars in royalties and licensing fees, Mr.
da Silva has instructed government ministries and state-run companies to
gradually switch from costly operating systems made by Microsoft
<http://www.nytimes.com/redirect/marketwatch/redirect.ctx?MW=3Dhttp://custo=
m.marketwatch.com/custom/nyt-com/html-companyprofile.asp&symb=3DMSFT>
and others to free operating systems, like Linux. On Mr. da Silva's
watch, Brazil has also become the first country to require any company
or research institute that receives government financing to develop
software to license it as open-source, meaning the underlying software
code must be free to all.

Now Brazil's government looks poised to take its free software campaign
to the masses. And once again Microsoft may end up on the sidelines.

By the end of April, the government plans to roll out a much ballyhooed
program called PC Conectado, or Connected PC, aimed at helping millions
of low-income Brazilians buy their first computers.

And if the president's top technology adviser gets his way, the program
may end up offering computers with only free software, including the
operating system, handpicked by the government instead of giving
consumers the option of paying more for, say, a basic edition of
Microsoft Windows.

"For this program to be viable, it has to be with free software," said
S=E9rgio Amadeu, president of Brazil's National Institute of Information
Technology, the agency that oversees the government's technology
initiatives. "We're not going to spend taxpayers' money on a program so
that Microsoft can further consolidate its monopoly. It's the
government's responsibility to ensure that there is competition, and
that means giving alternative software platforms a chance to prosper."

Microsoft has offered to provide a simplified, discounted version of
Windows for the program. Though a final decision on which software to
install has been delayed several times, as has the program's rollout,
Mr. Amadeu and some other government officials have publicly criticized
Microsoft's proposal, calling the version's abilities too limited.

Still, Microsoft has not given up just yet. The company, which declined
to make an executive available for an interview, said in a statement
that it was still "working with the PC Conectado project to see if
there's a way Microsoft can help."

Under the program, which is expected to offer tax incentives for
computer makers to cut prices and a generous payment plan for consumers,
the government hopes to offer desktops for around 1,400 reais ($509) or
less. The machines will be comparable to those costing almost twice that
outside the program.

Buyers will be able to pay in 24 installments of 50 to 60 reais, or
about $18 to $21.80 a month, an amount affordable for many working poor.
The country's top three fixed-line telephone companies - Telef=F3nica of
Spain; Tele Norte Leste Participa=E7=F5es, or Telemar; and Brasil Telecom -
have agreed to provide a dial-up Internet connection to participants for
7.50 reais, or less than $3, a month, allowing 15 hours of Web surfing.

The program aims at households and small-business owners earning three
to seven times the minimum monthly wage, or about $284 to $662. The
government says seven million qualify, and it hopes to reach a million
of them by year-end.

That may seem ambitious in a developing country of 183 million people
where only 10 percent of all households have Internet access and just
900,000 computers are sold legally each year. (Including black-market
sales, the number is closer to four million, still a small fraction of
the number sold in the United States last year, according to the
International Data Corporation, a technology research firm.)

"We're well aware that we're talking about doubling the domestic market
for personal computers," said Cezar Alvarez, the presidential aide in
charge of the PC Conectado program. "But it's absolutely feasible."

Some analysts have questioned the effectiveness of such programs, noting
that some similar projects in Asia have become bogged down in red tape
and, in some cases, have ended up favoring the elite. In Malaysia, for
instance, the government is introducing a second affordable-computer
program after its first attempt failed because of poor planning and
fraud - something Brazilian officials say they are working hard to prevent.

Others say the government should focus its technology initiatives
elsewhere, especially in schools. Only 19 percent of Brazil's public
schools have computers.

The government says it plans to complement the PC Conectado program with
stepped-up efforts to put more computers into schools. It is also
investing $74 million to open 1,000 community centers in poor
neighborhoods by year-end with computers that run free software programs
and offer free Internet access - supplementing similar programs by local
governments and nongovernmental organizations.

The drive to bridge the digital divide has drawn widespread praise
throughout the technology industry. But the preference for open-source
software has been controversial, with critics inside and outside the
government saying Mr. da Silva's administration is letting leftist
ideology trump the laws of supply and demand.

"The government shouldn't be the one who decides what hardware and
software will go into these computers," said J=FAlio Semeghini, a member
of Congress from the opposition Social Democratic Party. "That's
undemocratic."

The open-source route, however, has support beyond the da Silva
administration. Walter Bender, the executive director of the Media Lab
at the Massachusetts Institute of Technology, whose opinion was
solicited by the Brazilian government, replied in a recent letter that
"high-quality free software" has proved more effective in stimulating
computer use among the poor than scaled-down versions of proprietary
software.

Though he said he did not oppose giving consumers a choice, he concluded
that "free software provides a basis for more widespread access, more
powerful uses and a much stronger platform for long-term growth and
development."

Whatever the government decides, most industry analysts agree that the
program will probably help combat software piracy, which is widespread
in Brazil.

And by wooing new consumers, "even if the program doesn't reach its
goals, it's going to end up stimulating the computer and software
markets," said Jorge Sukarie, president of the Brazilian Association of
Software Companies. "It's not perfect, but it's certainly better than
nothing."