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by S erge Morell (‘ 10) Serge Morrell comes from New York, he is a senior in the Huntsman Program at the Wharton School and the College of Arts & Sciences, majoring in Finance and International Studies.

Gerschenkron’s Backwardness:

Drilling rig in the Caspian Sea.

e-Commerce in Frontier Markets C entral Asia, a region tucked away

region attracting both private and public

between China, India and Russia, has

investments from abroad to support either

been a source of contention over the

military or commercial interests of major

past two centuries. From the intrigues of the


S PRIN G 2 0 1 0

superpowers in the region.

Great Game of the 19th century between the

China Mobile, a relatively unknown

British and Russian Empires for control over

company in the west when compared to

the famed Silk Road region to the current day

the likes of AT&T and Verizon, can claim

struggle, known as the New Great Game, to

more subscribers than all of the American

secure the vast fossil fuel reserves buried in


the Caspian Sea, this region remains a frontier

revolution is indeed upon us, with some

market. However, most fail to recognize the

predicting close to 1 billion devices to be

potential the region has in areas other than

online by 2013. Chinese telecoms are signing

natural resources. With more and more

up some 10 million customers per month

talk of the wireless providers loosing their

and Central Asia seems as the most logical

importance in the next decade with players

next step. Mobile web has officially taken off




such as Google and VOIP coming online the

in Central Asia and telecoms in the entire

chase after growth in the telecom sector is

region -- Kazakhstan, Uzbekistan, Tajikistan,

shifting to frontier markets such as Central

Turkmenistan and Kyrgyzstan -- are rolling

Asia. There are two major trends that are

out mobile broadband. Amazingly, these

being witnessed today in Central Asia. The

countries got started with next-generation

first is the advent of cheap and accessible

wireless services even earlier than Russia,

technology that will allow these developing

which is usually first in the former Soviet

nations to access the web from their mobile

Union to adopt new technologies.

devices and skip over the “desktop and

This phenomenon may be in part

dialup” phase which lasted for 2 decades

explained by the “backwardness model”,

in the developed world. The second is the

a theory of economic growth developed











International Business Review - Spring 2010  

The Spring 2010 edition of the IBR.