It could be illegal if Indonesia does. The visit by Bill Gates and Craig R. Barrett to Indonesia a few months ago to offer Indonesia cheap processors and free software may invite Corruption Eradication Commission (KPK) curiosity.

The Jakarta Post, May 16, 2008, noted behind the US$200 PC program was the goal to improve the PC-to-student ratio from 1:3,200 to 1:20. According to figures from the National Education Ministry website, there are approximately 53 million students from kindergarten through senior high school. It means the government must buy 2.65 million new computers at $200 a piece. This is the point where the KPK should start nosing around.

First, since the education budget for next year is Rp 244.4 trillion ($26.6 billion), the cost of buying the computers is very small compared to the proposed budget.

Second, Intel and Microsoft are not the only processor and operating software producers on earth. Accepting the offer may run contrary to Presidential Decree 80/2003 on the procurement of goods and services.

For cheap computers, there are currently many options starting as low as $100. The One Laptop Per Child (OLPC) program sells a wireless laptop, called XO, to students in underdeveloped countries. It may look like a toy, but it was designed according to the needs of the user. It has a crank so children in areas with no electricity can still run it. Its basic functions allow children to read, write, calculate, browse the Internet, draw and even learn programming.

OLPC's XO is not the perfect cheap computer. The online science and technology magazine The Register noted some of its downsides. However, learning from OLPC's experience, the government should think strategically and consider asking vendors to design a computer to meet specified needs.

Should the government be cash-strapped, it can give incentives. The city of Manningham, Australia, offers a good case in point. City officials wanted to build and maintain a road for 20 years. It set out a wish list and calculated the cost, which turned out to be A$160 million over 20 years. It put out a tender for the project. The tender winner proposed a project for $140 million for 20 years, a $20 million saving.

The city will pay the tender winner monthly for 20 years plus some tax incentives should they achieve service targets. This is a win-win agreement. The city saves costs and pays less monthly while the company is guaranteed liquidity for 20 years. By handing over the operation to contractors, the city is steering not rowing. That is the role of government.

For 2.65 million new computers specially customized to meet Indonesian needs, many vendors, local and international, would be interested in the bid. Moreover, if production is located in Indonesia, it would help energize the IT industry here at home. Indonesia could create a niche market for the computing needs of underdeveloped countries. Indonesian software could go international with the penetration of this new breed of computers. In this scenario, Indonesia could become a giant in the internet and communication technology industry.

Industry giants like Microsoft and Intel are capable of helping Indonesia realize this dream. Intel is offering its Classmate laptop in stores for US$225. The Classmate runs Linux or Windows with classroom collaboration software. It is strong competition for OLPC's XO.

The second generation of Classmate PC is even better, with built-in webcam, wider screen and larger storage. According to the Post report, Intel is going to build the latest generation of cheap processors for these cheap computers for Indonesia. What Intel is going to give Indonesia for $200 remains a secret.

There is no such thing as a free lunch. Both giants are betting on future market security. For Microsoft it means securing 53 million students as Windows users and for Intel, a 2.65 million new Classmate PCs deal could leave OLPC's XO or other competitors in the dust. It is vital the government take more initiative in shaping the offer.

President Susilo Bambang Yudhoyono was expected to tell Gates and Barrett he really appreciated the offers. However, accepting the $530 million deal would be breaking the law. Moreover, in the name of free market competition, Indonesia must not join with one players to beat the others.

Indonesia must make use of this free market competition for its own benefit. Who would turn down such a deal? If both Gates and Barrett are serious about helping Indonesia, they can help this country become the new giant in ICT. In return, Indonesia would help them in producing cheap but powerful computing machines for underdeveloped countries.

The government needs to see this as an investment opportunity to build its ICT industry not just as an opportunity to get one-time price discounts from the giants.

The writer is an educational technologist. He can be reached at jaha@fulbrightweb.org

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