Latvia connects, at a cost

  • 2004-01-15
  • By TBT staff
RIGA - With more affordable programs for purchasing personal computers and a newly flourishing variety of Internet service providers, Latvia looks ready to log on to the World Wide Web at a rapidly increasing rate, but the country still lags behind its Baltic neighbor to the north. A Phare report released in December reveals that Estonia still leads in the Baltic region when it comes to Internet access.

Still, experts in Riga say that Latvia is catching up with great speed.
Viesturs Pless, director of the information technology market research firm IG Komunikacijas (IG Communications) views consumer's readiness for high-speed, non-dial-up connections a result of Latvian telephone companies charging for local connections. A person in Latvia dialing-up to connect to the Internet using a modem must pay the minute-by-minute cost of using the telephone line as with any other local phone call. In contrast, broadband connections consisting of either cable, optical or wireless connections usually offer customers limitless time surfing the World Wide Web for a fixed monthly fee.
Pless sees the number of people opting for unlimited high-speed access to the Internet as increasing, and believes that this has an impact of the demographics of users in Latvia. With infinite online access, family members such as children now have a chance to log on.
"At home only one person used it [the Web] because it was expensive. Now younger users have access because broadband is cheaper," he explains.
Large-scale industry changes are also boosting Internet usage, with the breakup of the telecommunications monopoly previously held by Lattelekom. The selection of Internet service providers is blossoming, with big names such as TeliaMulticom and BaltkomTV competing with the likes of Apollo, the Lattelekom brand of DSL connection offered to home users.
"This year and next year there'll be user growth in Latvia," says Pless, adding that Estonia saw an increase in the number of people going online following a dip in prices and a more open market with new Internet service providers.
Pless, who also serves on the board of Latvia's Internet Association, emphasizes that accessibility ranks high on the list of factors that contribute to making a society more active online.
"In Estonia front end usage of PCs increased because it became easier for people to lease them and buy them. If people get PCs, it automatically generates new Internet users," he says.
But according to the Phare report - a study that collected information on the availability of the Internet in the 10 countries set to join the EU this coming may - personal computers appear outrageously expensive for the average Balt. In Latvia, a PC at the average price of 425 lats (620 euros) costs 204 percent of the average monthly income. The situation in Estonia is similar, with a computer costing on average 184 percent of monthly income; but in Lithuania the figure stands at 366 percent.
The authors of the report find these numbers "surprising" in light of what the Internet could offer, though they added that a computer costing less than twice a monthly salary appears to make the item affordable.
"It would seem that the decision to buy a PC in order to access the Internet in those countries where the relative cost is much higher would require significant justification in terms of "added value" provided by the services on the Internet. The availability of 'online government services' or the ability to 'purchase goods and services online' hardly seems to justify such a major investment," they state.