IT Problems, Opportunities Await a Free Cuba

For businesses looking at the retirement of Fidel Castro asa telltale sign ofCubaopening up to foreign investment, two words: slow down.

Even ifCubaloosens its economic grip and theU.S.drops the five-decade-old embargo, the first businesses entering theCaribbeanisland will find it lacks the technology infrastructure required forcontemporary business operations and service delivery.

Dr. Jose Azel, senior research associate at the Institutefor Cuban and Cuban American studies at theUniversity ofMiami agrees the island is ripefor foreign investment in a post-Castro, post-embargo world. But while thepeople are ready, the island?s crumbling, outdated infrastructure presents amajor hurdle

?There is no modern infrastructure to support business theway we think of it in terms of technology, power, telecommunications, etc.,?Azel says. ?There is very limited Internet access and only the government hasthat. The people, by and large, have no dependable access to the Internet,though some find ways.?

While this presents a problem for major corporations lookingto set up shop in Cuba, it also spells opportunity for IT vendors, integratorsand solution providers who can fulfill the IT needs of an island many peoplehas pent up entrepreneurial and innovative demand.

In 1994, the Cuban government, in a rare move, startedissuing licenses for private ?paletes,? small privately owned restaurants andcafeterias. Almost overnight,Havanawas flooded with brightly painted kiosks under technicolor umbrellas. Scentsand flavors absent from the public squares since the 1968 RevolutionaryOffensive suddenly abounded.

Porches were stuffed with chairs and tables and young Cubansgot their first real taste of native delicacies such as mamey sapote shakes andguava pie.

It was proof, Cubans say, that communism never completely stifledthe entrepreneurial energy on the island. The enthusiasm and spirit so evidentin Cuban-run businesses inSouth Florida, for example,still flickers beneathHavana?sgray surface, waiting for a chance to blossom.

?A stroll of my nativeCentral Havanawas confirmation that the previous scarcity hadn?t been born of an innateincapacity to produce,? says 32-year-oldHavanaresident Yoani Sanchez, a prolific Cuban blogger. ?It was caused by theironclad state controls to private ingenuity.?

While most Cuban expatriates greeted the retirement of81-year-old Cuban strongman Castro this week as a victory for openness andbasic human rights, many also wondered what a softening of Cuba?s hard-linecommunism?and warmer relations with the West?might do for business there.

?All of those energies to produce are just waiting,crouching, for the restrictions to loosen –even one millimeter–to conqueragain our streets and porches,? Sanchez insists.

According to the International Telecommunication Union, Cubahas the lowest rate of Internet usage inLatin Americaat 1.7 users per 100 residents. Cubans wait for hours in line to use PostOffice computers that can send e-mail but not access the Web. The country lastyear embarked on a high-profile technology project that resulted in thedevelopment of a search engine that can crawl through the full text of allspeeches by Castro and other government figures, but cannot search informationfrom the Internet at large.

Azel says that beforeU.S.companies can rush in to take advantage of what many expected to be a tourismboom in the early days of a post-CastroCuba,basic infrastructure needs to be addressed. The needs include not just networkand utility infrastructure, but also roads, bridges and houses, he says.

Thegreenfield thatisCuba couldprovide opportunity for technology vendors and services providers, but eventhat requires some careful consideration, he adds.

?They have to know who are they going to partner with,? Azelsays. ?Under Castro–either Fidel or Raul–you partner with the state, period.You don?t get to choose your employees. The state picks your employees. You paythe state and they pass on 10 or 15 percent of that to the workers.?

Azel advisesU.S.companies to continue monitoring the situation inCuba.While he doesn?t feel markets will open or theU.S.embargo will be lifted any time soon, he says it?s important for businesses tounderstand how things are changing day to day.

He also says companies interested in investing inCubashould line up experienced legal counsel, and organize Cuban-Americans in theircurrent workforce into task forces that can strategize and develop new businessopportunities.

?Technology is going to be incredibly important, ultimately,inCuba,? Azelsays. ?There?s a very talented, very creative workforce there. They may nothave the traditional skill sets we think of in high tech in theU.S.,but they have a lot of experience with a wide variety of Soviet and Chinesetechnologies. They are there and they are ready to supportU.S.companies who invest there.

?But I must reiterate, I don?t see this happening verysoon,? he says. ?We have a long, difficult way to go.?

Sanchez is equally guarded in her optimism.

?Maybe things will change now,? she wrote after Fidel Castro stepped down.?For me and the young generation, this news comes as a great relief. We’venever had another president, and we saw him as an obstruction to our country’sdevelopment.

?But honestly, the question of a new head of state is notpeople’s greatest concern right now. We’re too preoccupied with the problems ofdaily life,? she says. ?Fidel’s brother has made plenty of speeches aboutmuch-needed reforms for the country, but nothing’s really changed. Raul’s onlymade cosmetic changes which don’t help the population at all.?