Black Code: Inside the Battle for Cyberspace (11 page)

The information and technology sharing that goes on through RATS and SCO demonstrates a clear trend: the global surveillance industry is reaping the benefits of regimes with intense cyber-security anxiety. American, Israeli, and Canadian companies, as well as their Russian and Chinese competitors (with close associations to ruling elites), are all inserting their surveillance products and services into the systems of control that SCO is helping to propagate across the region.

To think that the Internet embodies some kind of magical formula to resist the full weight of these pressures, let alone dissolve them upon contact, is ludicrously idealistic. The more sensible question to ask is: What will the Internet look like when the next billion users, most of whom are located in the global South and East, come online?

Somalia has not had
a properly functioning government since 1991, when the country began tearing itself to shreds in a brutal civil war. More than twenty years later, warring factions continue to fight over territory, people, foreign aid, and revenues from illicit activities. This quagmire has made the country one of the world’s most dangerous places, and yet Somalia also has one of the most efficient and affordable cellphone infrastructures in Africa, if not the world. In the midst of this hardscrabble, anarchic place, there is not one but four independent and thriving cellphone providers: Hormuud, Golis, Nationlink, and Telesom. Though competitors, they connect seamlessly and offer access to most areas of the country. Somalia has the lowest international call rates in Africa, a monthly fee of just $10 gets you unlimited local calls, and the wait time for a new land line is typically only a couple of days, compared to as much as three years or more in other African states. Launched in 2010, Somalia’s mobile banking service, ZAAD, allows users to transfer funds, make purchases, pay bills, and share airtime credits with friends and family. Not surprisingly, the number of Somalis connected to the Internet has exploded from virtually nil twenty years ago to almost 40 percent of the population today.

How to explain this paradox? There are places in the world where the darker sides of human nature seem to roam free:
Mogadishu, Grozny, Ciudad Juarez, Karachi, to name a few. Here, life can seem tenuous and cheap, the hallmarks of civility and the social glue that Westerners take for granted illusive. Violence is pervasive, and gangsters fill the void left by the absence of legitimate public authority. In Chechnya, a nation of roughly 1.3 million, there are eighty-four murders a day. The UN ranks Somalia 181st out of 194 countries for life expectancy, a mere forty-eight years. But while the bursting cities of the developing world – flush with
favelas
, with streets that reek of diesel and are littered with garbage, with omnipresent poverty and crime just around the next corner – may seem inhospitable to the digital world, they are not. Although the digital divide still exists, it’s shrinking, fast: cheap and easy-to-use means of communication are as irresistible here as anywhere on Earth, and as digital networks approach 100 percent saturation in the global North, the South and East have become the next frontiers of rapid expansion. Somewhat counterintuitively, the persistent chaos, corruption, and crime might facilitate, rather than retard, their wider development.

While these new digital natives love their smartphones and apps as much as the rest of us, the uses to which they are often put are dramatically different, and this difference is affecting cyberspace itself. If cyberspace in the 1990s was a result of the collective dreams of Silicon Valley upstarts, today it is increasingly the unfulfilled aspirations of teenagers growing up in the endless grey apartments of Moscow, the cramped cubicles of Guangzhou, the teeming slums of Rio de Janeiro that are its principal drivers. It is a Western conceit to think that just because we invented the technology its uses will conform to our original design. As Somalia and many other cases show, human ingenuity is never so predictable, nor is the path of social evolution so linear.

•  •  •

There are at least three reasons
for Somalia’s robust cellular infrastructure, all of them directly related to the disastrous civil war. When the country’s central government collapsed, so did “rent seeking,” a term coined by the economist Anne Krueger in 1974 to describe the actions of companies and/or governments to extract revenues by using their positions of market authority to raise prices (“rents”). State-owned telecommunications companies have been particularly prone to rent seeking: artificially inflated rates applied to long-distance calls have been used by governments the world over to extract revenues for the state. In developing countries, the situation was dire. For decades – with the exception of those countries that underwent privatization in the 1990s – laws were passed to keep out competition because the telecommunications sector, it was argued, constituted a “natural monopoly.” In Somalia, when the central government collapsed, so did the underpinning for regulations, approvals, permits, and taxes, and into this void leapt private telecommunications entrepreneurs.

A second reason involves the competing armed factions and tribal groups. Although viciously competitive, the one thing that all of them could agree on was the need for a working telecommunications infrastructure. Militants needed a functioning Somali-wide cellphone system to operate their enterprises, issue threats through text messaging, make payments for drugs and weapons, and coordinate their tribal factions. Mobile phones were also less easy to intercept than land lines and provided a degree of anonymity, as the phones and their SIM cards could be recycled and exchanged. With disposable phones and SIM cards, there is not the same registration process that fixes one individual to a specific phone (in the way that there would be with a land line), making tracking of communications more of a challenge (though not impossible). Some Somalian cellphone companies are rumoured to be tied to militant factions, in particular one of the biggest
providers, Hormuud, and the al–Qaeda–linked Somali jihadist group al-Shabaab. (The latter has a curious relationship to telecommunications: it has accused those who use cellphone scratch cards of being un-Islamic.)

Hormuud, it turns out, profits when attacks are on the rise in areas that al-Shabaab controls. When fighting erupts, people are afraid to go out and call friends and relatives at home or abroad to reassure them about their safety. In al-Shabaab–controlled areas, young men and women are forbidden from socializing, and tend to text each other instead. With danger lurking outside, people stay in and use their phones. The thriving mobile banking service is also partly a function of the perennial violence in Somalia: being able to make purchases, deposits, and transfers electronically is much safer than carrying hard currency in a place where theft and kidnapping are daily occurrences. In all, Somalia’s functioning telecommunications system defies conventional political economic theory: a public good that works without a central authority and that provides a degree of security.

Finally, as the country was being devastated from the inside out, Somalis fled to other parts of the world in droves, and there is now a huge Somali diaspora population in Europe and North America. As a rule, Somalis abroad tend not to forget their friends and relatives, and
Somali cab drivers, nurses, teachers, engineers, and so forth routinely send remittances to their home country through the informal
hawala
banking network. Estimated at $1 billion annually, remittances are critically important to the Somali economy, representing as much as 50 percent of GDP, making Somalia the fourth most remittance-dependent country in the world. Somalia has no central bank, nor many functioning commercial banks, and thus
hawala
firms are the only real vehicles of economic exchange and income for many households and businesses. Telecommunications is essential to
hawala
networks.

How does it work? A Somali in, say, Toronto visits a local
hawala
broker, a
hawaladar
, and gives him an amount of money destined for a relative in Mogadishu. The
hawaladar
, in turn, communicates this transaction to a Somali-based
hawaladar
, who brokers the deal and keeps track of the amount, usually by email or Skype. The transactions are entirely based on trust and the promise of repeat business. A small percentage fee is charged to the sender, who authorizes the transaction by communicating a password to the intended receiver. For years, the
hawala
network relied on telephone land lines and telegraphs, but today it is the Internet and devices used to connect to the Internet, like cellphones, that are central to
hawala
exchanges. Indeed, the final part of the transaction is almost always done online, and one of the primary uses of cellphones in Somalia is mobile banking.

•  •  •

In 2012
, when the U.S. attempted to shutter
hawala
financing because of suspicions it was funnelling funds to al-Qaeda, the sanctions had a direct impact on Somali communications and inadvertently helped to establish one of the biggest cellphone providers, Hormuud. One of the owners of Hormuud, Ahmed Nur Ali Jim’ale, was also once a part-owner of the al-Barakat money transfer company targeted by U.S. and UN sanctions. Prior to setting up Hormuud, Jim’ale ran both al-Barakat and its subsidiary, Barakat Telecommunications, and he and both companies were placed on the Special Designated Terrorist Group list by the UN Security Council in 2001. In response, Jim’ale was part of a group that founded Hormuud Telecom in April 2002.

Ten long years later, Jim’ale and the entire al-Barakat conglomerate were finally removed from the list of al-Qaeda-related terrorist organizations. But a separate UN Security Council committee then
put Jim’ale on a new list, one that imposed a travel ban and froze his assets, the suspicion this time being that he was an arms trafficker. In its decision the Security Council noted that “Jim’ale established ZAAD, a mobile-to-mobile money-transfer business and struck a deal with Al-Shabaab to make money transfers more anonymous by eliminating the need to show identification”; that his company, Hormuud, is “one of the single largest financiers of Al-Shabaab”; and that Hormuud “cut off telephone service during Al-Shabaab attacks against pro-Somali Government forces.” Regardless of whether and to what extent Jim’ale and Hormuud have ties to al-Shabaab – or, in the past, had ties to al-Qaeda – the case shows the depth and complexity of Somalia’s cellphone system. A country wracked by civil war for over two decades nonetheless has extraordinarily sophisticated and innovative online banking and cellphone services: so sophisticated that the security-obsessed are watching, watching closely.

•  •  •

The Somalia case defies
conventional wisdom about technical innovation in failed states. Precisely because of Somalia’s chaotic and violent character, along with its people’s adaptive culture of trust and information sharing, an efficient cellphone infrastructure took root and flourished. It also demonstrates how the evolution of cyberspace is highly contingent on local circumstances. How and to what end a cellphone is used in Manhattan or Berlin can be entirely different from how it’s used in Mogadishu or Lagos, or the countless other cities of the global South and East from which the majority of future digital natives will emerge.

We may not know exactly what the impact of the next billion users is going to be, but one thing is certain: they’re coming online fast. According to a 2011 International Telecommunication Union
(ITU) report, developing countries increased their share of the world’s Internet users from 44 percent in 2006 to 62 percent in 2011. Asia alone now has nearly half of the world’s Internet-using population, with North America and Europe combined at less than one-quarter. The gap in penetration rates between the developed and developing world – how much of their respective populations are online – is also closing. New broadband penetration in the North is down to about 5 percent a year, the ITU report states, while in the South the annual growth rate is 18 percent. At the same time, only roughly one-quarter of the developing world was online by the end of 2011 : that is, there is a still a huge percentage of the population yet to be connected there, and connect they will.

Some of the fastest growth rates in social media usage are in the Middle East and North Africa, no doubt inspired by the prominent role played by Facebook, Twitter, et cetera during the Arab Spring.
According to the
Arab Social Media Report
series, which counts users of social media in the Arab World, the number of Facebook users nearly tripled in one year, from 16 million in June 2011 to 45 million by June 2012. Egypt alone constitutes one-quarter of all Facebook users in the region, and Arabic is the fastest-growing language used to communicate on Twitter. The 2011
Arab Social Media Report
revealed that there were sixty-seven tweets a second in the Arab region.

The vast majority of Internet users in the global South and East are young. The market research firm Nielsen found that Chinese between the ages of fifteen and twenty-four are the heaviest mobile Internet users, with 73 percent of them reporting having used mobile Internet connections in the last thirty days, compared with only 48 percent of their U.S. counterparts, and 46 percent in the U.K. Youth comprise approximately 70 percent of Facebook users in the Arab region, and the UN estimates that the number of youth living in developing countries will grow by 90 percent by 2025. (Over 65 percent of the Middle Eastern and North African
population is under thirty-five.) Young people are early adopters everywhere, but in the developing world they face much higher rates of unemployment – as high as 25 percent in the Middle East and North Africa.
The combination of youth, unemployment, and radicalism is a well-documented concern, one that some analysts (such as the former managing director of the International Monetary Fund, Dominique Strauss-Kahn) have called a “time bomb” that will soon ignite. To this mix we must add another ingredient: instant connectivity to global computer networks.