WinDays 9: Forbes Forum weighs in on economical crisis and recovery

THe WinDays conference is usually one of those best-kept secrets in the business. Every year at the end of April, a small Mediterranean town of Opatija gets over-run by couple of thousand of tech professionals who usually enjoy good weather – not this time around, unfortunately. The Forbes Forum was particularly interesting this year, with the chairmen of Croatian Telecom, EuropaPressHolding, SenseConsulting, Microsoft Croatia and e-Croatia division of Croatian government.  

Our American readers may need to take a good food for thought in the following statement by head of Croatian Telecom, Mr. Ivica Mudrinic: "At the start, I need to say that Croatian Telecom (HT) is not owned by the state of Germany or Croatia, but Deutsche Telekom. As such, we are not biding for governmental subsidies, but carry all the infrastructural work by ourselves. Out of each earned USD, 11 cents or 11% goes for the infrastructural development in Croatia. We are like aircraft carriers and it is good that we exist".

In case you didn’t know, you can get truly unlimited, uncapped, uncensored flat-rate Internet in Croatia with speeds of 4Mbps [$31/month], 10Mbps [$48.46/month] and 20Mbps [$74.68/month]. You can download bit-torrent and other connection up to 1.01 TB/month [4Mbps], 3.2TB/month [10Mbps] or 6.4 TB/month for the 20Mbps option. Yes, truly uncapped and more importantly, uncensored access. This does not include MAXtv, SDTV and HDTV – native 1080p IPTV service [downscale to 720p for users without FullHD TVs], that adds just an additional $10 to your monthly bill.

When provoked by a political journalist Mr. Miroslav Bago, who said "it was easy to start a business with sufficient capital", Telco Chairman and CEO answered that, ten years ago, Croatian national power supplier, HEP, was established with the same amount of capital and is now operating with losses ("and is under investigation for corruption", Bago added). A state with a clear strategy invests into its ICT sector for the benefit of all others, he explained. According to Mudrinic, "the ICT sector is one of the pillars of our society although he sees potential in agriculture, tourism and energy sector as well".

"We [Croatia] are a country which builds a highway to drive in old carriages. When we look at the healthcare reform – what kind of reform is it? It is founded on what used to be and fails to revolutionize the healthcare sector in its entirety! We drive in carriages and could own, for example, BMWs", Mudrinic said laughing, to which Bago commented how they do not need to be bullet-proof [Croatia is one of Top 10 hardest recession-struck countries, while the Croatian PM ordered himself a bullet-proof BMW for $730.000]. A question of many times mentioned candidacy for president of the state was mentioned, which Mudrinic commented by saying he "was engaged in politics and it was an interesting experience".

EPH, T-Com Chairmen and CEOs, Ninoslav Pavic and Ivica Mudrinic

The chairman of Croatia’s leading newspaper publisher, EPH, Ninoslav Pavic, said that journalism has been worst hit by recession. "These two processes are not related yet everything that happens is in itself bad. The main question is how new media can replace the older ones when they are not able to meet the costs of content production. Croatian PM is right, we are in an unfavorable situation, but every crisis is challenging, which is why we appeal to the state to leave the private sector to struggle on its own!", he said.

As a side note, general consensus in Croatia’s private sector was "NO WAY!" to any sort of governmental bailouts. Croatia is a former communist country [as a part of Yugoslavia] – and a lot of western governments went to bailout their banks in a way reminiscent to socialists and communist times.

Pavic also stressed the fact that EPH is not allowed to participate on equal footing in the project called "Digital TV", expected at the start of 2011. This will change the paradigm of our reality, which is why EPH is ready to alter its strategy. "The media sector will change significantly and EPH is not allowed to have its own television network or even a radio station. That is why we expect the legal basis to be amended and adjusted to the 21st Century we all live in. The state must not restrict journalistic freedom by defending interests of the public TV. Both TV and radio business are now considered to be a political issue and not entertainment, which is their primary aim", Pavic concluded.

Even though this Forbes Forum was oriented on local issues, you can pull a lot of parallels to both bigger and smaller market. Croatian Telecom constantly invests 11 cents of every $ the company makes in infrastructure, and implementation of VDSL is planned for late 2009-10, with speeds exceeding 50Mbps. All this build on a copper network – with plans to start using existing and future optical networks with 1-10Gbps/per household in 2012. All out of 11 cents of revenue per each dollar. Go figure that, Time Warner Cable.