A Would-Be Wi-Fi Paradise

By Jenna Jolie

Mar 28 (Bloomberg) Sri Lanka has enjoyed an era of strong economic growth since its bloody, 26-year civil war ended in 2009. To keep it going, the government is trying to make the island nation a technology hub.

It's investing in new undersea Internet cables, putting money behind startups, and working with Microsoft to embrace cloud computing. It's also been wooing Google and Facebook to host tests for some of their most ambitious experiments, from self-driving cars to drones. First up: the balloons.

Google's Project Loon is an effort to develop high-altitude balloons that can bring Internet connectivity to remote areas. The technology has been tested over the past couple of years, but not at scale. Rama, a quasi--public company controlled by venture capitalist Chamath Palihapitiya and the Sri Lankan government, aims to do just that. Google sent the first Loon balloon above Sri Lanka in February, and the government says it's working with the company to blanket the country with coverage from another dozen.

Within a year, Palihapitiya says, Loon balloons will turn the Indian Ocean country, which is about the size of West Virginia, into one big Wi-Fi zone, giving Google the first real sense of whether Loon can be commercially viable. "This is really a profound thing the government has sponsored and is really pushing," says Palihapitiya, an early Facebook employee who runs Silicon Valley venture firm Social Capital. "If we can do this in Sri Lanka, that sets the tone for the rest of the world."