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India’s Digitalization: Big Data is the New Oil

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Over the last few years, India has travelled the path of rapid digitalization. Not only has the current crisis failed to stop this process, on the contrary, it has served to accelerate it in many areas and make some trends more evident.

Government efforts, active work of India’s business and joint steps undertaken by India’s public bodies and private entrepreneurs who are equally cognizant of the digital transformation’s significance, difficulties and prospects for India’s economy and society as a whole have advanced the process of shaping India’s new digital realities.

In 2015, India’s Prime Minister Narendra Modi announced the launch of the Digital India campaign spanning a series of key government initiatives such as increasing the people’s digital literacy, developing infrastructure and creating an e-government. The most significant achievements include completing and putting into operation the Aadhar digital identification system; a single taxation system covering all Indian states that previously had individual taxation rules; and the Reserve Bank of India, jointly with the association of Indian banks, developing and introducing an instant payment system similar to that created by Russia’s Central bank.

Nandan Nilekani, a well-known Indian entrepreneur and public figure, leads the committee on deepening digital payments at the Reserve Bank of India. An engineer by training, together with Narayana Murthy and several other entrepreneurs, Nilekani co-founded Infosys, one of India’s most famous and successful companies working in software development and IT consulting. In 2009, Nilekani left Infosys and wrote several books about India’s development and the way he sees its future: Imagining India: The Idea of a Renewed Nation (2009); Rebooting India: Realizing a Billion Aspirations (2015). He also headed the Unique Identification Authority of India, the government body that developed Aadhar, a digital biometric identification system, and introduced it throughout the country; Aadhar has already been mentioned; its importance for India is hard to overestimate. Digitalization has already resulted in tectonic shifts within a very short time-span, no more than 5-7 years, in such areas as India’s e-payments and financial technologies, e-commerce, telemedicine and entertainment. The spread of digital technologies has great significance and potential in such areas as agriculture, education, increasing energy efficiency, regulating employment and the labour market, transportation, logistics and further development of e-government.

Yet, none of that would have been possible had government initiatives not been backed up by the ambitions and strategic approach of another Indian entrepreneur, Mukesh Ambani, who swiftly provided Indians with cheap Internet and accessible smartphones. As he advanced his digital business initiatives, Ambani called upon Narendra Modi’s government to achieve maximum localisation of Indian data in India and spoke about the need to fight a new type of colonialism, the country’s informational enslavement by global corporations, so-called data colonisation. He devoted all his resources to developing a new sovereign digital platform; back in 2016-2017, Ambani already said that data are the new oil and smart data are the new fuel of India’s economy.

Following the sectoral liberalisation at the turn of the 20th-21st century, India created a telecommunication services market characterised by high competition among players (both Indian and international companies) that came to the promising area via partnerships with national bodies holding the requisite licences. By around 2010, most companies working in India saw that their revenues coming from traditional services might potentially drop, so they planned to transition to selling data. None of the many telecommunication companies on India’s market have, however, succeeded in the attempt. The failure stems from several factors, including the policies of the regulator (which decided to change the rules of the game and check the terms and conditions of previously issued licences at a crucial time for the sector) and appearance of a new player with the requisite resources, who was willing to spend them on achieving his large-scale goals. That player was Mukesh Ambani and his company called Jio. The history of Ambani’s family business is an integral and characteristic part of India’s economy, and the development track of his companies, including Jio, is regularly discussed in business media and is the subject of several business cases in the world’s leading schools.

Dhirubhai Ambani, the father of Mukesh Ambani and Anil Ambani, launched his business empire in 1957 with a small Bombay-based company importing synthetic fibers and exporting spices. In 1977, following its successful IPO, Dhirubhai Ambani’s Reliance Group became synonymous with business success and guaranteed financial investment for many Indians. The company did not confine itself to the textile business and became a diversified holding that also worked in exploring and developing hydrocarbons, in oil processing, petrochemicals, as well as energy, finances, trade and other areas. In fewer than 30 years, Reliance Group became a fixture of Fortune Global 500 and India’s biggest private company, rivalling such famous family holdings as Tata, Birla, Godrej, Mahindra. Dhirubhai Ambani died in 2002, leaving his sons a multibillion fortune. The brothers Anil and Mukesh engaged in a series of high-profile and unrestrained quarrels that resulted in Reliance Group’s assets being split in 2006. The telecommunication company Mukesh Ambani formed in 2002 had to be transferred, among others, to Anil, but Mukesh had the powerful oil processing business left under his control. His company was now called Reliance Industries. Its assets included the famous high-tech complex in Jamnagar (Gujarat State) processing up to 1.4 million barrels of oil a day. 2010 marked an important stage in this story, when the brothers agreed on revising the terms and timeframe for the non-compete agreements, and subsequently, Mukesh had a chance to announce openly his intentions to embark on a qualitatively new approach to the telecommunication business.

It took Mukesh Ambani about six years to create a new company named Jio (Hindi for “live”). It was officially launched in September 2016. Back then, its telecommunication rivals realised that their already difficult situation would become far worse following the emergence of a powerful new player, but hardly anyone could imagine the cardinal and radical changes in store for the sector. India’s normally very active anti-monopoly agency, as well as other supervisory bodies, were prepared to close their eyes to many controversial points, since Ambani’s goals of swiftly spreading accessible Internet coincided with the course for digitalization steered by the government, while his statements that Indians’ data must be kept in India were very appealing for India’s political leadership. As of today, there are only two big players left in India’s telecommunication sector besides Jio, and these two are in a deep financial crisis. India’s government had to bail out both these companies by allowing large-scale foreign investment and by permitting all players to raise the prices for their services slightly, which had, over the last few years, fallen to an unprecedented low (between 2013 and 2017, the cost of 1 GB of data in India fell by 95%).

Today, Reliance Jio is part of the Jio Platforms holding company formed in 2019 as part of Reliance Industries. Mukesh Ambani’s two elder children hold top managerial positions in the family business. His son Akash, a graduate of Brown University, is in charge of strategy in Reliance Jio, while his daughter Isha, who graduated from Yale University, is on the board of directors in Reliance Jio and Reliance Retail.

The infrastructure and entire digital ecosystem of Reliance Jio was created and put into operation in under 2–3 years. The estimated costs of creating Reliance Jio vary between USD 20 and 45 bn., which is approximately the amount of Reliance Industries’ debt increase over the period of creating Jio. At the time of the company’s IPO in 2016, two-thirds of India’s population of over 1.3 bn. had no Internet access. The company set the goals of deploying an efficient 4G network throughout India, including its remotest areas, while securing a large tech margin for future improvements, and of providing its clients with cheap smartphones and access to various contents and services through its own apps. In the first few months of its operations, while the equipment and all systems were being checked, cheap mobile devices under Jio’s own brand were literally handed out to customers free of charge. Later, minimal tariffs were introduced that immediately made India the leader in mobile operator accessibility for both voice services (phone calls were essentially free) and high-speed data transfer. Once sales took off, the company endeavoured to achieve 100 million new clients in the first 100 days, and did not slack off later: in the first two years, Jio had 250 million subscribers, and today it has 388 million. The company plans to reach 500 million users by 2021.

Jio has a large number of apps and services that have quickly become fixtures in the lives of Indians. They include JioTV, JioCinema, JioSaavn (a music service), JioMoney, JioCloud, JioFiber (broadband Internet access service). Jio rather efficiently provided digital functions to the conglomerate’s commercial line: Reliance Retail, which is also the leader in its segment in India. JioMeet, a video call service, is the latest addition to this extensive range of services. Reliance Jio’s contribution to increasing India’s per capita GDP is estimated at 5.65% in 2018.

Internet access is, indeed, changing India’s image and lifestyle before our very eyes. Largely owing to the decisive actions of the Indian businessman Mukesh Ambani, India has, in just a few years, made a qualitative leap in many digitalization-related areas while avoiding many intermediary stages that other countries spent years on. Only Indonesia outstrips India in its digitalization pace. In 2018, only China exceeded India’s number of digital consumers (560 million users). A survey McKinsey conducted in 2019 showed that the pace of data consumption per user in India grew twice as fast as in the US and China, increasing by 152% annually. Various estimates put an Indian user’s average data consumption at up to 9.8 GB of mobile Internet a month (this indicator is 5.5 GB in China, 8–8.5 GB in South Korea, and the 2019 figure in Russia is about the same). The number of Internet users in India was expected to grow by about 40% by 2023, to 750–800 million people, and the number of smartphones is expected to double, reaching 650–700 million (as of 2018, India had 1.2 bn. mobile subscribers). We can be sufficiently confident that new conditions arising from the pandemic will speed up these trends significantly.

The development prospects of India’s digital economy and primarily its consumer segment stimulated an explosive growth of entrepreneurship that also relies on the traditionally strong stratum of Indian IT specialists. In 2017, Indian developers participated in creating over 100 000 apps for the App Store alone, while the total number of such apps is far higher, given that Indian specialists mostly create apps for Android. In the entrepreneurs’ major league, 30 Indian digital high tech companies are unicorns (their capitalisation is over USD 1 bn., and they are still owned by their founders). In 2017, there were ten such companies. The crucial thing is that would-be unicorns in India are also quite numerous: in 2019, there were over 50 potential future champions.

There have always been many difficulties in working on the Indian market. Suffice it to say that, today, the majority of new Internet users in India do not speak English and need interfaces and content in regional languages. The country has 22 such principal languages. WhatsApp, for instance, supports 11 of them. Still, international investors bank on Indian tech companies, which is greatly helped by government bodies constantly working to stimulate the sector’s investment appeal. Companies working in e-commerce, digital payment services, and tourism have long been the leaders in attracting investment among India’s tech startups. A telling recent example of the international capital race for digital India was the USA’s Walmart acquiring Flipkart, one of India’s many digital e-commerce platforms, in May 2018. Walmart had long tried to gain access to India’s offline market, all to no avail, and it finally came to India by buying 77% of Flipkart for USD 16 bn.

Several investment funds of Russian origin are among those making big investments in India. They continue actively selecting new projects for investment and for strategy adjustment, as do other investors.

Companies that appear not to have any tangible assets, not to make any money, and to accrue debt abound not only in developed countries but now in India as well and still continue to increase their investment potential, thus greatly befuddling traditionally-minded financiers. Yet, analysts increasingly have to admit that high-tech digital companies have unique sets of their clients’ big data, which allows these companies to increase their market share and make correct managerial decisions while constantly improving the functions or services they provide.

Big data is becoming more and more important for governments as well. The quality of analytical materials, development of AI technologies and efficiency of modelling processes depend directly on data volume used as learning material; it can be used, among other things, to manage processes and resources in smart homes and cities efficiently. This is the purpose of Smart Cities, one of India’s government programmes. By late 2020, Jio planned to present commercial solutions for the Internet of Things. The company’s technical capabilities make this possible. While the Indian government is only preparing to make the decision on deploying 5G, Mukesh Ambani says that he has already built a new infrastructure capable of working with 6G and he is now striving to make India one of the principal beneficiaries of the 4th industrial revolution. Jio has no rivals in India in its capacity for collecting up-to-date data of Indian consumers and it plans to improve its technologies for their most prompt and precise processing and further use, while simultaneously developing cloud computing, smart devices, blockchain, augmented reality and more.

The current crisis arising from the pandemic is both shaping new consumer habits and bolstering demand for qualitative changes in approaches to the future economic development of many countries. This is also important for Russia, where, despite all the efforts to diversify its economy, there still remains the threat linked to dependency on commodity exports and the high energy intensity of other Russian exports. And it is also important for India, where 80% of its economy depends on imports of coal, oil and gas.

It was previously announced that 20% in Reliance Industries’ petrochemical business would be sold to Saudi Aramco, Saudi Arabia’s oil giant, for USD 15 bn. With oil prices falling to record lows, however, in March the deal fell through.

Instead of the Saudi Aramco deal, Jio Platforms finalised three different sales: 9.99% was sold to Facebook for USD 5.7 bn., 2.32% of Jio Platforms is now owned by the Vista Equity Partners investment fund (the stock is worth USD 1.5 bn.), and an additional 1.15% of the company’s stock was purchased by investors at Silver Lake Partners for USD 747 m. Mukesh Ambani still holds 86.54% of the company. Other deals with other investors are likely to follow, which will allow the Indian businessman finally to pay off Reliance Industries’ debt (about USD 8 bn.) by March 2021, without losing control of Jio Platforms, just as he planned.

In their official statements concerning the deals, all the participants, including Mukesh Ambani and Mark Zuckerberg, emphasize their confidence in the promising Indian market and in Jio Platforms’ potential. In full accord with the expectations of the Indian government and regular Indian citizens, they say that the new collaboration does not entail data exchange between partner companies. Jio, Facebook, Vista and Silver Lake also say they intend to use their technologies for the benefit of India’s small and medium-sized businesses by connecting such entrepreneurs more actively to e-commerce platforms. They are talking street trade and the so-called kiranas, typical Indian “neighbourhood” grocery stores; they will be able to find a more efficient digital way to meet their customers’ demand. Facebook-owned WhatsApp, which is very popular in India, is expected to play an important role in this process. If talks with the regulator concerning granting WhatsApp payment-making functions are successful, then, by pooling efforts with JioMart, the company will be able to expand both sellers and buyers’ capabilities significantly and compete with India’s most widespread fintech service PayTM, whose investors include Alibaba Group (the Chinese company owns 40% in PayTM).

India, with its 300 million users, is Facebook’s biggest market. WhatsApp has over 400 million users in India. As for the two other investors in JioPlatforms, Vista Equity Partners is noted for its major presence in India’s tech sector: its Indian companies have over 13,000 employees, while its co-founder Brian Sheth is a native of Gujarat, like Mukesh Ambani and Narendra Modi. Like Vista, Silver Lake is based in Silicon Valley and has already invested over USD 40 bn. in tech companies such as Airbnb, Alibaba, Ant Financial owned by Alphabet Verily and Waymo, and also Dell Technologies and Twitter.

Observers with a lively imagination have long since noticed that the company’s name, Jio, is a mirror image of the word “oil.” It is not known for certain whether this is by its founder’s design, but the events of the last few months and transactions around Jio Platforms confirm that, instead of demand for oil, the world is demonstrating a growing demand for innovations. Consequently, compared to other countries, India has every chance of becoming part of the process and a big-time winner. Russia’s business cooperation with India needs, like never before, to have its current realities supplemented in new formats, be it financial technologies, information security, artificial intelligence, sustainable energy infrastructure, advanced materials or other innovative areas.

From our partner RIAC

Ph.D. in History, Head of India Studies at the SKOLKOVO Institute for Emerging Markets, Research Fellow at RAS Institute of Oriental Studies, RIAC Expert

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First Quantum Computing Guidelines Launched as Investment Booms

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National governments have invested over $25 billion into quantum computing research and over $1 billion in venture capital deals have closed in the past year – more than the past three years combined. Quantum computing promises to disrupt the future of business, science, government, and society itself, but an equitable framework is crucial to address future risks.

A new Insight Report released today at the World Economic Forum Annual Meeting 2022 provides a roadmap for these emerging opportunities across public and private sectors. The principles have been co-designed by a global multistakeholder community composed of quantum experts, emerging technology ethics and law experts, decision makers and policy makers, social scientists and academics.

“The critical opportunity at the dawn of this historic transformation is to address ethical, societal and legal concerns well before commercialization,” said Kay Firth-Butterfield, Head of Artificial Intelligence and Machine Learning at the World Economic Forum. “This report represents an early intervention and the beginning of a multi-disciplinary, global conversation that will guide the development of quantum computing to the benefit of all society.”

“Quantum computing holds the potential to help solve some of society’s greatest challenges, and IBM has been at the forefront of bringing quantum hardware and software to communities of discovery worldwide,” said Dr. Heike Riel, IBM Fellow, Head of Science and Technology and Lead, Quantum, IBM Research Europe. “This report is a key step in initiating the discussion around how quantum computing should be shaped and governed, for the benefit of all.”

Professor Bronwyn Fox, Chief Scientist at CSIRO, Australia’s science national agency said, “the Principles reflect conversations CSIRO’s scientists have had with partners from around the world who share an ambition for a responsible quantum future. Embedding responsible innovation in quantum computing is key to its successful deployment and uptake for generations to come. CSIRO is committed to ensuring these Principles are used to support a strong quantum industry in Australia and generate significant social and public good.”

In adapting to the coming hybrid model of classical, multi-cloud, and soon quantum computing, the Forum’s framework establishes best-practice principles and core values. These guidelines set the foundation and give rise to a new information-processing paradigm while ensuring stakeholder equity, risk mitigation, and consumer benefit.

The governance principles are grouped into nine themes and underpinned by a set of seven core values. Themes and respective goals defining the principles:

1. Transformative capabilities: Harness the transformative capabilities of this technology and the applications for the good of humanity while managing the risks appropriately.

2. Access to hardware infrastructure: Ensure wide access to quantum computing hardware.

3. Open innovation: Encourage collaboration and a precompetitive environment, enabling faster development of the technology and the realization of its applications.

4. Creating awareness: Ensure the general population and quantum computing stakeholders are aware, engaged and sufficiently informed to enable ongoing responsible dialogue and communication; stakeholders with oversight and authority should be able to make informed decisions about quantum computing in their respective domains.

5. Workforce development and capability-building: Build and sustain a quantum-ready workforce.

6. Cybersecurity: Ensure the transition to a quantum-secure digital world.

7. Privacy: Mitigate potential data-privacy violations through theft and processing by quantum computers.

8. Standardization: Promote standards and road-mapping mechanisms to accelerate the development of the technology.

9. Sustainability: Develop a sustainable future with and for quantum computing technology

Quantum computing core values that hold across the themes and principles:

Common good: The transformative capabilities of quantum computing and its applications are harnessed to ensure they will be used to benefit humanity.

Accountability: Use of quantum computing in any context has mechanisms in place to ensure human accountability, both in its design and in its uses and outcomes. All stakeholders in the quantum computing community are responsible for ensuring that the intentional misuse of quantum computing for harmful purposes is not accepted or inadvertently positively sanctioned.

Inclusiveness: In the development of quantum computing, insofar as possible, a broad and truly diverse range of stakeholder perspectives are engaged in meaningful dialogue to avoid narrow definitions of what may be considered a harmful or beneficial use of the technology.

Equitability: Quantum computing developers and users ensure that the technology is equitable by design, and that quantum computing-based technologies are fairly and evenly distributed insofar as possible. Particular consideration is given to any specific needs of vulnerable populations to ensure equitability.

Non-maleficence: All stakeholders use quantum computing in a safe, ethical and responsible manner. Furthermore, all stakeholders ensure quantum computing does not put humans at risk of harm, either in the intended or unintended outcomes of its use, and that it is not used for nefarious purposes.

Accessibility: Quantum computing technology and knowledge are actively made widely accessible. This includes the development, deployment and use of the technology. The aim is to cultivate a general ability among the population, societal actors, corporations and governments to understand the main principles of quantum computing, the ways in which it differs from classical computing and the potential it brings.

Transparency: Users, developers and regulators are transparent about their purpose and intentions with regard to quantum computing.

“Governments and industries are accelerating their investments in quantum computing research and development worldwide,” said Derek O’Halloran, Head of Digital Economy, World Economic Forum. “This report starts the conversation that will help us understand the opportunities, set the premise for ethical guidelines, and pre-empt socioeconomic, political and legal risks well ahead of global deployment.”

The Quantum Computing Governance Principles is an initiative of the World Economic Forum’s Quantum Computing Network, a multi-stakeholder initiative focused on accelerating responsible quantum computing.

Next steps for the Quantum Computing Governance Initiative will be to work with wider stakeholder groups to adopt these principles as part of broader governance frameworks and policy approaches. With this framework, business and investment communities along with policy makers and academia will be better equipped to adopt to the coming paradigm shift. Ultimately, everyone will be better prepared to harness the transformative capabilities of quantum sciences – perhaps the most exciting emergent technologies of the 21st Century.

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Closing the Cyber Gap: Business and Security Leaders at Crossroads as Cybercrime Spikes

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The global digital economy has surged off the back of the COVID-19 pandemic, but so has cybercrime – ransomware attacks rose 151% in 2021. There were on average 270 cyberattacks per organization during 2021, a 31% increase on 2020, with each successful cyber breach costing a company $3.6m. After a breach becomes public, the average share price of the hacked company underperforms the NASDAQ by -3% even six months after the event.

According to the World Economic Forum’s new annual report, The Global Cybersecurity Outlook 2022, 80% of cyber leaders now consider ransomware a “danger” and “threat” to public safety and there is a large perception gap between business executives who think their companies are secure and security leaders who disagree.

Some 92% of business executives surveyed agree that cyber resilience is integrated into enterprise risk-management strategies, only 55% of cyber leaders surveyed agree. This gap between leaders can leave firms vulnerable to attacks as a direct result of incongruous security priorities and policies.

Even after a threat is detected, our survey, written in collaboration with Accenture, found nearly two-thirds would find it challenging to respond to a cybersecurity incident due to the shortage of skills within their team. Perhaps even more troubling is the growing trend that companies need 280 days on average to identify and respond to a cyberattack. To put this into perspective, an incident which occurs on 1 January may not be fully contained until 8 October.

“Companies must now embrace cyber resilience – not only defending against cyberattacks but also preparing for swift and timely incident response and recovery when an attack does occur,” said Jeremy Jurgens, Managing Director at the World Economic Forum.

“Organizations need to work more closely with ecosystem partners and other third parties to make cybersecurity part of an organization’s ecosystem DNA, so they can be resilient and promote customer trust,” said Julie Sweet, Chair and CEO, Accenture. “This report underscores key challenges leaders face – collaborating with ecosystem partners and retaining and recruiting talent. We are proud to work with the World Economic Forum on this important topic because cybersecurity impacts every organization at all levels.”

Chief Cybersecurity Officers kept up at night by three things

Less than one-fifth of cyber leaders feel confident their organizations are cyber resilient. Three major concerns keep them awake at night:

– They don’t feel consulted on business decisions, and they struggle to gain the support of decision-makers in prioritizing cyber risks – 7 in 10 see cyber resilience featuring prominently in corporate risk management

– Recruiting and retaining the right talent is their greatest concern – 6 in 10 think it would be challenging to respond to a cybersecurity incident because they lack the skills within their team

– Nearly 9 in 10 see SMEs as the weakest link in the supply chain – 40% of respondents have been negatively affected by a supply chain cybersecurity incident

Training and closing the cyber gap are key solutions

Solutions include employee cyber training, offline backups, cyber insurance and platform-based cybersecurity solutions that stop known ransomware threats across all attack vectors.

Above all, there is an urgent need to close the gap of understanding between business and security leaders. It is impossible to attain complete cybersecurity, so the key objective must be to reinforce cyber resilience.

Including cyber leaders into the corporate governance process will help close this gap.

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Ethical aspects relating to cyberspace: Self-regulation and codes of conduct

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Virtual interaction processes must be controlled in one way or another. But how, within what limits and, above all, on the basis of what principles? The proponents of the official viewpoint – supported by the strength of state structures – argue that since the Internet has a significant and not always positive impact not only on its users, but also on society as a whole, all areas of virtual interaction need to be clearly regulated through the enactment of appropriate legislation.

In practice, however, the various attempts to legislate on virtual communication face great difficulties due to the imperfection of modern information law. Moreover, considering that the Internet community is based on an internal “anarchist” ideology, it shows significant resistance to government regulations, believing that in a cross-border environment – which is the global network – the only effective regulator can be the voluntarily and consciously accepted intranet ethics based on the awareness of the individual person’s moral responsibility for what happens in cyberspace.

At the same time, the significance of moral self-regulation lies not only in the fact that it makes it possible to control the areas that are insufficiently covered, but also in other regulatory provisions at political, legal, technical or economic levels. It is up to ethics to check the meaning, lawfulness and legitimacy of the remaining regulatory means. The legal provisions themselves, supported by the force of state influence, are developed or – at least, ideally – should be implemented on the basis of moral rules. It should be noted that, although compliance with law provisions is regarded as the minimum requirement of morality, in reality this is not always the case – at least until an “ideal” legislation is devised that does not contradict morality in any way. Therefore, an ethical justification and an equal scrutiny of legislative and disciplinary acts in relation to both IT and computer technology are necessary.

In accordance with the deontological approach to justifying web ethics, the ethical foundation of information law is based on the human rights of information. Although these rights are enshrined in various national and international legal instruments, in practice their protection is often not guaranteed by anyone. This enables several state structures to introduce various restrictions on information, justifying them with noble aims such as the need to implement the concept of national security.

It should be stressed that information legislation (like any other in general) is of a conventional nature, i.e. it is a sort of temporary compromise reached by the representatives of the various social groups. Therefore, there are no unshakable principles in this sphere: legality and illegality are defined by a dynamic balance between the desire for freedom of information, on the one hand, and the attempts at restricting this freedom in one way or another.

Therefore, several subjects have extremely contradictory requirements with regard to modern information law, which are not so easy to reconcile. Information law should simultaneously protect the right to free reception of information and the right to information security, as well as ensure privacy and prevent cybercrime. It should also promote again the public accessibility of the information created, and protect copyright – even if this impinges on the universal principle of knowledge sharing.

The principle of a reasonable balance of these often diametrically opposed aspirations, with unconditional respect for fundamental human rights, should be the basis of the international information law system.

Various national and international public organisations, professionals and voluntary users’ associations define their own operation principles in a virtual environment. These principles are very often formalised in codes of conduct, aimed at minimising the potentially dangerous moral and social consequences of the use of information technologies and thus at achieving a certain degree of web community’s autonomy, at least when it comes to purely internal problematic issues. The names of these codes do not always hint at ethics, but this does not change their essence. After all, they have not the status of law provisions, which means that they cannot serve as a basis for imposing disciplinary, administrative or any other liability measures on offenders. They are therefore enforced by the community members who have adopted them solely with goodwill, as a result of free expression based on recognition and sharing of the values and rules enshrined in them. These codes therefore act as one of the moral self-regulating mechanisms of the web community.

The cyberspace codes of ethics provide the basic moral guidelines that should guide information activities. They specify the principles of general theoretical ethics and are reflected in a virtual environment. They contain criteria enabling to recognise a given act as ethical or unethical. They finally provide specific recommendations on how to behave in certain situations. The rules enshrined in the codes of ethics under the form of provisions, authorisations, bans, etc., represent in many respects the formalisation and systematisation of unwritten rules and requirements that have developed spontaneously in the process of virtual interaction over the last thirty years of the Internet.

Conversely, the provisions of codes of ethics must be thoroughly considered and judged – by their very nature, code of ethics are conventional and hence they are always the result of a mutual agreement of the relevant members of a given social group – as otherwise they are simply reduced to a formal and sectorial statement, divorced from life and not rule-bound.

Despite their multidirectionality due to the variety of net functional abilities and the heterogeneity of its audience, a comparison of the most significant codes of ethics on the Internet shows a number of common principles. Apparently, these principles are in one way or another shared by all the Internet community members. This means that they underpin the ethos of cyberspace. They include the principle of accessibility, confidentiality and quality of information; the principle of inviolability of intellectual property; the principle of no harm, and the principle of limiting the excessive use of net resources. As can be seen, this list echoes the four deontological principles of information ethics (“PAPA: Privacy, Accuracy, Property and Accessibility”) formulated by Richard Mason in his article Four Ethical Issues of the Information Age. (“MIS Quarterly”, March 1986).

The presence of a very well-written code of ethics cannot obviously ensure that all group members will act in accordance with it, because – for a person – the most reliable guarantees against unethical behaviour are his/her conscience and duties, which are not always respected. The importance of codes should therefore not be overestimated: the principles and actual morals proclaimed by codes may diverge decisively from one another. The codes of ethics, however, perform a number of extremely important functions on the Internet: firstly, they can induce Internet users to moral reflection by instilling the idea of the need to evaluate their actions accordingly (in this case, it is not so much a ready-made code that is useful, but the very experience of its development and discussion). Secondly, they can form a healthy public in a virtual environment, and also provide it with uniform and reasonable criteria for moral evaluation. Thirdly they can  become the basis for the future creation of international information law, adapted to the realities of the electronic age.

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