Emerging Estonian Technologies

E&T visits Estonia, a former province of the Soviet Empire, to find one of the most technologically advanced and IT-savviest nations in the world.


What a curious substance, human memory! It can be compared to an overflowing rubbish-bin, which our brain, this amnesiac dustman, chronically forgets to empty. Having forgotten many useful addresses, I still remember this one in Tallinn: 12, Sakala Street. It was there that the city's only camera repairs shop was located in 1966, when our family was spending summer holidays in the Tallinn's suburb of Pirita. At the age of twelve, I was already a keen amateur photographer and kept snapping right and left, especially on vacations, with my crude "Smena" photo-camera. When it started malfunctioning - due to over-exploitation, I assume - my mother and I had to have it repaired.


Back in Tallinn in 2009, I constantly felt like pinching myself.

From a backward province of the Soviet Empire Estonia has become one of Europe's technology-savviest nations, with 75 per cent percent of the population using the Internet and 1160 Wi Fi networks available for public use. The tiny country of 1.3 million people is now boasting the same level of Internet penetration as Germany. Immediately after achieving their coveted independence in 1991, Estonia began prioritising IT development and backed it by real government resources. Whereas elsewhere in Europe they only experimented with e-voting; in Estonia it was actually happening: in 2007 parliamentary elections over 30,000 votes were cast online - from privately owned computers and laptops I what became known as the world's first e-elections.

The Estonian government is about to issue a decree declaring free access to the Internet for every citizen a basic human right, alongside freedom of expression. It is spreading its e-achievements worldwide via its own E-Governance Academy.

In 2009, almost anything in Estonia can be done online. 91 per cent percent of annual tax returns are submitted on the Internet. I was repeatedly assured it only takes five minutes to fill and submit all the forms which can be partially due to the fact that the first independent government under Prime Minister Mart Laar, who liked to refer to Estonia as "a little country that could", established the same flat tax rate for everyone - 26 per cent - in 1991.

All city transport tickets can be bought on the Internet too; a bus or tram controller then sticks in your ID card in his portal and validates your fare.

To park your car anywhere in Tallinn, all you have to do is send a text message with your car number plate, confirmation arrives in seconds and the fee is added to your mobile phone bill, which, like all other bills, can be paid online too using one's ID card, mobile ID or a password. Estonia was the first country in the world to introduce m-parking.

Planning applications in Tallinn are also done online. One can electronically access the city's planning register and an e-map of Tallinn with available spaces clearly marked. Legal documents can be prepared, quotes received and applications submitted - all on the Internet. Incidentally, objections to planning permissions are filed online too: insert your ID card, register, file an objection - bingo!

One can even register a company online. Says James Oates, a veteran of London Investment Banking, who currently runs a financial company in Tallinn:

"I set up my company in 15 minutes on the Internet, all the rest that was left was to sign some documents in the Notary office - that was it!"

No wonder the letter "E" has now become the most frequently used one is Estonian - a tongue-breaking Finno-Ugric language with 14 case endings, no future tense, two different infinitives, yet just one word for "he" and "she"; and, to cap it all, something called "the partitive plural" ("Our language has neither sex nor future," runs a popular Estonian joke). While in Estonia, one keeps constantly coming across such neologisms as e-government, e-banking, e-health, e-school, e-society, even e-police (see Box 4). No wonder the country itself is often referred to as "E-stonia".


It took us hours to find the shop. Tallinn passers-by, whom we repeatedly stopped for guidance (due to an inexplicable Soviet paranoia, city maps were non-existent), would politely direct us elsewhere. We ended up criss-crossing the whole town before accidentally stumbling upon the blasted shop in Sakala Street. Unbeknown to us, we had found ourselves on the receiving end of the so-called "passive protest" - the only way the natives of the Baltic republics of the USSR (Lithuania, Latvia and Estonia) could voice their angst at what they rightly perceived as the Soviet occupation: the three republics were forcibly "annexed" by the Soviet Union in 1940 in the wake of the treacherous Molotov - Ribbentrop Pact.


Ironically, Sakala Street is a rather well known Tallinn address these days, for it is now home for the Estonian Ministry of Defence. I am here to see Heli Tiirmaa-Klaar - an Executive Director of the recently formed National Cybersecurity Council.

From 27th April to 18th May 2007 Estonia became target of large-scale denial of service cyber attacks from Russia. They came in response to the decision of the Estonian government to relocate the WWII Soviet memorial from the city centre to a military cemetery. At peak moments, the amount of cyber traffic from outside Estonia targeting governmental institutions was 400 times higher that its normal rate.

Ms Tiirmaa-Klaar is a small young woman with steel-grey eyes on an open, yet resolute, face.

"Russia's cyber attacks were beneficial not just for Estonia but for the whole world," she tells me quietly and explains: "As a result, Estonia now has national strategy for electronic security. Our cyber security model is based on co-ordination of all relevant government bodies (see Box 2). We are protecting not just against Russia, but against financial fraudsters too… The cyber attacks have also facilitated opening of NATO's Cyber Security Research Centre in Tallinn."

The conclusion is obvious: totalitarian regimes - communist or other - always end up shooting themselves in the foot.

"Was it a cyberwar?" I ask her.

"We stop short of calling it that. Russia has never faced up to the attacks, but we have identified sources on its territory and demanded extradition, which was refused…"

For a number of years, Estonia has been regarded in Russia as enemy number one. This is a shame, for, as they assured me at the new Biotechnology Park in Tartu, the country's second-largest city, genetically Russians and Estonians are closer to each other than Estonians and their nearest neighbours Finns.

There are, however, much sadder relics of the tempestuous Russian-Estonian relationships. A memorial plate on the face of the Stenbock House carries the names of several dozen Estonian prime ministers, heads of state and other senior politicians who fell "victims of the Communist terror". Most of them were killed by the Soviets in the 1940s-50s when thousands of Estonians were deported to Siberia or ended up in Soviet labour camps. President Lennart Meri became the first Estonian head of state ever to die of natural causes in 2001.

The Stenbock House is now home to the world's first working E-government.

I enter the empty Cabinet meeting room, with portraits of 8 heads of state (7 of them murdered by the Soviets) on its walls. The ministers are due in about 10 minutes. Laptops with open lids are on the ready, and there's not a single shred of paper anywhere.

Contrary to what many think, there is no webcam in the Cabinet room (unlike, however, in the office of the Mayor of Tallinn), but there's one in the press conference room downstairs: one doesn't have to be a journalist to follow the weekly PM's briefings.

Two minutes before the meeting the ministers start turning up one by one. Estonians are punctual.

I say good-bye to an IT engineer who is always on duty in the Stenbock House during Cabinet sessions and walk out into the streets of the Old Town where Russian and Estonian speech mingle freely.


Despite this obvious downside of holidaying in Estonia, we used to do so often. It was the closest we could come to the West, still firmly out of our reach. In defiance of blatant "russification", the small nation was desperately clinging to its national identity, language and culture and kept surprising visitors from elsewhere in the USSR with higher living standards, civility and style they had somehow managed to preserve. It was in Estonia, in the late 60s, that I had my first experience of a self-service "supermarket" - an establishment unheard of in the rest of the Soviet Empire. The thing that baffled me most was a special shopping basket for every customer. "How come the baskets don't get stolen?" I was wondering.


I seem to be the only person in Estonia carrying cash. A couple of coins, however, prove handy for a cup of coffee in a clean and cosy café in Parnu Maante, Tallinn's main thoroughfare, before visiting a branch of Swedbank next door.

I am greeted by Jaan Priisalu, head of one of the bank's departments.

"In Estonia, 98 per cent of all banking is done on the Internet, with ID cards, mobile IDs and pin calculators for passwords," he says.

"How about safety?" I enquire.

"We have calculated that Internet banking is 6000 safer than conventional one. All Estonian banks share their info security data - no competition here. Cash is limited in branches. Daily limit of online transactions is 200 euros only, for larger sums you'd need an ID card, so thieves are not interested in stealing passwords - it is simply not worth their while; it also makes money laundering difficult… Believe it or not, but hackers - mostly from Russia, Lithuania and Brazil - only steal about 2,000 euros a year from Estonian bank accounts - peanuts! Also, had it not been for online banking, we'd have to employ 15 times more people…"

"But what if the system is down?" I persist.

"Then everything stops of course. Luckily, it doesn't happen often."

"Are you completely at ease with Internet banking?" I ask Anneli Teas - a young Tallinn woman who works for Enterprise Estonia.

"In the beginning, people were prejudiced against it, but now we are totally comfortable about it. We never carry cash and have no cheque books. Besides, only small amounts can be transferred online without an ID card…"

She refuses to believe me when I say that it takes between 3 and 5 working days to clear a cheque in the UK.

But how about that magic Estonian ID card?

It appeared in 2002 as a result of many a heated discussion. It was decided in the end that the advantages of a national ID card greatly outweighed its disadvantages. Today over 90 per cent of Estonians carry such cards, and many have their digital signatures electronically affixed to it. Estonia boasts Europe's highest percentage of people with electronic identity. A number of different services requiring such identity (like voting on the Internet, say) have already been developed and many more are to come. In 2007, a new solution for electronic identity -"Mobiil ID" - was introduced. It offers the same security and proof of identity as an ID card with a chip, but doesn't require the card reader: all necessary certificates and keys are handled through one's mobile phone.


Among few "Western-looking" products in that store in a small South Estonian town of Elva (where we also holidayed once or twice), they sold jam in tubes. And although the jam, when squeezed (or, in my case, sucked) out, had a distinct taste of lead, I could not have enough of it and kept walking around with the tube protruding from my mouth cigar-like - as once captured on film by my mother, when I inadvertently allowed her to hold my faithful "Smena".   


A boy is riding a bicycle through the forest in the outskirts of Elva. He is about 12, just like I was in 1966. I liked riding to the shop (in search of the irresistible tube jam, no doubt) alongside the railway line chasing smoke-belching steam-engines and waving to the engine drivers. These days, however, it is not jam but high-quality electronic components for lifts and switches that are manufactured here by Enics - southern Estonia's largest employer. The factory's modern assembly lines are all but hidden in the thick forest which - until late 1970s! - used to harbour the "forest brothers", Estonia's resistance fighters. And not far from Elva is Tartu, the small nation's answer to Cambridge, with its famous old University and its brand-new Biotechnology Park.

Back in Tallinn, I am standing on Toompea Hill and looking down at Tallinn's impressive panorama, mentally comparing it with my long-lost photo, taken from the same spot 35 years ago. At the first glance, little has changed, and the main landmarks: tiled Gothic roofs; church-spires; the guard towers Fat Margaret and Kik in de Kok (Peep into the Kitchen); the medieval Town Hall, topped with the weather-vane figure of Vaana Toomas (Old Toomas), Tallinn's main mascot, are still in place - as is the Soviet-style railway station (railway stations all over the world are resistant to change). Yet something is definitely missing.


At this point, I recall that my old photo was largely ruined by three tall ugly masts sticking out of the ground and spoiling the view. Those were special jamming towers built by the KGB to interfere with "corruptive" radio and TV broadcasts from neighbouring Finland - just 8 miles away across the gulf (the fourth one was hidden inside the spire of the magnificent 12th century St. Olaf's Church!). The town's tallest structures, they were eye-sores in more than one sense: the over-intensive round-the-clock jamming was also affecting the quality of reception of the politically correct programmes from Moscow, and the picture on the locals' TV screens was constantly blurred and jumpy.


I am visiting the headquarters of Skype - the best known Estonian invention. Written by three Estonian-based developers, often referred to as "Skype's founding engineers" (Ahti Heinla, Priit Kasesalu and Jaan Tallinn) in 2003, it now has over 480 million registered users all over the world and is available in 29 languages for Windows and in 15 - for Mac. In 2005, ASI investment company, the co-founder of Skype, sold its stake to eBay which in turn sold a 65 per cent stake in it to an international investor group on the 1st of September 2009 by which time the Estonian-born company was valued at $2, 75 billion. Skype is also one of the world's best known brands and, to my mind, one of the most user-friendly and democratic products of modern technology: one can enjoy it for years at no cost whatsoever. Unlike the horrible jamming towers of yesteryear which used to divide and alienate nations, Skype brings people together.

Ironically, Skype's super-modern offices are located in the disembowelled and fully re-designed interior of the former Institute of Cybernetics in the middle of a drab Soviet-looking suburb, with old squeaky trolley-buses crawling past battered Soviet-looking apartment blocks, the so-called khrushchobi (a peculiar linguistic merger of "Khrushchev" and "trushchobi" - slums).

The Tallinn office of Skype employs 300 people from 25 countries working mostly in engineering and project development areas. The average age of the employers is 30, and Sten Tamkivi, general manager and the former head of software development, is 32. He shows me around the office which resembles the interior of a 5-star hotel: designer lighting, sauna, pool tables, lounges with soft armchairs in which young Skype employees recline comfortably while nursing their laptops. Like many similar organisations, Skype has no office hours: it is all up to a team.

Tamkivi shows me an audio engineering laboratory, where "Hubert" - a head and torso simulator looking like an upper half of a "Dr Who" creature and used for testing the quality of sound which Skype tries to constantly improve, is kept in a small sound-proof cubicle of a room. 

"What Skype has shown is that you can take a great idea, with few resources and conquer the world," he says.

The "great idea" lay in putting together bits of already existing technologies in a clever way - something Estonians are very good at,

Yes, Estonians are as a rule thorough and meticulous. Accuracy is taught at schools as something very important. It is a pleasure to deal with them, for you never have to ask for something twice. Anyone requested to supply additional information would do so pronto and on opening my email box a couple of hours later I would find everything I've asked for. An oasis of diligence and trustworthiness in our slack and unreliable world…

"What makes Estonia different?" I ask Ivar Tallo, member of the e-Governance Academy Management Board.

"Here things actually work," he replies.

Tallinn's Old Town, where my five-star Three Sisters Hotel was located (it was skilfully built into the robust frame of three conjoint 14th century houses) remains one of the best-preserved in Europe. And one of the cosiest too. There are amazingly few cars, and parking is hardly a problem. With proliferation of well-stocked shops and brand-new restaurants of all imaginable cuisines and with prices considerably lower than in London, modern Tallinn has few visible signs of poverty, endemic to most European capitals. Crumbling and neglected in Soviet times - it is now a tourist paradise, a living proof of the creative might of capitalism.

They do love capitalism in Estonia, the country that Neil Taylor, the author of the best-selling Bradt Guide to Estonia, calls "uber-democracy": one can often spot 6-year-olds playing "starting a company" game.

Another new inspiring view can now be admired from Toompea Hill - of Ulemiste City - Tallinn's answer to London Docklands, a brand-new alternative city centre and the hub of innovation and technology.

According to the general development plan, there will be park benches equipped with flaps for working Wi Fi laptops, birdcages with year-round heating, boardwalks, LED-lighting, electrically powered inter-city public transport. A wireless Internet area will span the whole city, pavement will be made of railway sleepers, there will be a symbiosis of old and ultramodern eco-friendly architecture, and much-much more.

Looking at the emerging high-rise buildings from the Hill, I wish I had my old "Smena" handy to capture the view for posterity, for there's little doubt it is going to change very soon.   

Alas, all black-and-white snapshots of my childhood have now been lost for good, yet many of them are so firmly imprinted in my memory that it just takes closing my eyes to bring them back to life. Only after my recent visit to new techno-savvy E-stonia, I no longer perceive those photos as black-and-while: in my imagination, they've gained colours - the dazzling and often conflicting colours of the free world.

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