>> Thompson: IF YOU FILED YOUR INCOME TAXES AT THE LAST MINUTE THIS YEAR, YOU NO DOUBT KNOW THAT THE I.R.S. PAYMENT SITE CRASHED. YOU GOT AN EXTRA DAY TO FILE, AND THE I.R.S. GOT A LESSON IN THE PITFALLS OF E-GOVERNMENT. TONIGHT WE TAKE A LOOK AT A NATION THAT HAS PUT NEARLY ALL OF ITS GOVERNMENT SERVICES ONLINE. TINY ESTONIA, A MEMBER OF BOTH THE EUROPEAN UNION AND NATO, IS MAKING A NAME FOR ITSELF AS A WORLD LEADER IN DIGITAL TECHNOLOGY, EDUCATION AND CYBER SECURITY. NEWSHOUR WEEKEND SPECIAL CORRESPONDENT CHRISTOPHER LIVESAY RECENTLY TRAVELED THERE TO FIND OUT HOW IT WORKS. >> Reporter: WINTERS IN TALLINN, THE CAPITAL OF ESTONIA, CAN BE LONG AND COLD. BUT IT'S HARDLY A PLACE FROZEN IN TIME. IN FACT, IN LESS THAN 30 YEARS, ESTONIA HAS GONE FROM BEING AN IMPOVERISHED MEMBER OF THE SOVIET UNION TO ONE OF THE MOST TECHNICALLY ADVANCED COUNTRIES IN THE WORLD. IT'S THE FIRST COUNTRY TO DECLARE THE INTERNET A SOCIAL RIGHT. THE GOVERNMENT CLAIMS HIGH-SPEED BROADBAND COVERS 88% PERCENT OF THE COUNTRY AND 99% OF ITS SERVICES ARE EASILY ACCESSIBLE ONLINE. >> A COUNTRY WHERE YOU CAN DO YOUR TAXES IN THREE MINUTES. WHERE YOU CAN VOTE ONLINE FROM ANYWHERE IN THE WORLD AND IT'S STILL SECURE AND SAFE. >> Reporter: ANNA PIPERAL IS MANAGING DIRECTOR OF ESTONIA'S E-SHOWROOM WHICH PROMOTES THE COUNTRY'S DIGITAL SOCIETY TO THE WORLD. SO THIS IS YOUR I.D. CARD? >> YES, IT'S ACTUALLY A PLASTIC CARD WITH MY UNIQUE I.D. NUMBER IN IT AND A CHIP. >> Reporter: THE KEY TO IT ALL? ONE CARD. IT'S A DIGITAL I.D. WITH ENCRYPTED FILES USED TOGETHER WITH A PIN CODE. 94% OF ESTONIANS HAVE A DIGITAL I.D. LIKE THIS ONE. >> FIRST OF ALL, I HAVE TO PLUG IN MY I.D. CARD IN ORDER TO LOG INTO THE STATE PORTAL WHICH WILL BE A ONE STOP SHOP FOR DIFFERENT SERVICES. >> Reporter: VIRTUALLY EVERYTHING, SHE SAYS, CAN BE DONE ONLINE. INCLUDING ACCESSING MEDICAL RECORDS. >> IN 2008 WE OBLIGED HOSPITALS TO DIGITIZE THE DATA AND MAKE IT AVAILABLE TO THE PATIENTS. >> Reporter: TAXES TOO ARE DONE ONLINE. THE GOVERNMENT FILLS IN ALL THE FORMS WITH INFORMATION AS REPORTED TO IT. TAXPAYERS JUST NEED TO REVIEW AND APPROVE. TWO CLICKS, AND WITHIN THREE MINUTES IN MOST CASES, TAXES ARE DONE. >> MY LAST TIME TO THE BANK WAS LIKE FOUR YEARS AGO. I DON'T MISS THE GUYS. >> Reporter: SO BANKING, HEALTH CARE, VOTING? ALL DONE DIGITALLY. >> YES. IT'S ALSO ENERGY COMPANIES, TELCO COMPANIES. BUYING THINGS ONLINE OR SEEING JUST YOUR BILLS OR YOUR ENERGY CONSUMPTION. THIS IS ALL AVAILABLE WITH A CARD. >> Reporter: AND THERE'S NO NEED TO EVER SIGN PAPERWORK. >> AND NOW MY SIGNATURE STAMP. >> Reporter: EVERYTHING IS CONFIRMED INSTANTLY USING YOUR I.D. CARD AND PIN CODE TO CREATE WHAT AMOUNTS TO A DIGITAL SIGNATURE. IT'S A SERIES OF NUMBERS WITH A TIMESTAMP. ESTONIA IS SERIOUS ABOUT CYBER SECURITY. A MAIN WAY IT PROTECTS DIGITAL INFORMATION IS WITH TECHNOLOGY CALLED BLOCKCHAIN. IT'S A WAY OF DECENTRALIZING AND AUTHENTICATING DATA TO PREVENT HACKING. IT'S MOST FAMOUSLY USED BY THE CRYPTOCURRENCY, BITCOIN. ESTONIA IS THE FIRST COUNTRY TO USE IT ON A NATIONAL LEVEL. IT JUST SOUNDS LIKE SO MANY THINGS COULD GO WRONG. >> POTENTIALLY IT COULD BUT WHEN THE DATA IS CORRECT AND YOU ONLY HAVE CORRECT DATA IN ONE PLACE AND EVERYONE IS RESPONSIBLE FOR KEEPING THEIR DATA CORRECT THEN IT'S MUCH EASIER. >> Reporter: AND MAKING LIFE EASIER IS EXACTLY THE GOAL OF THIS E-SOCIETY. ESTONIANS WE TALKED TO SAY THEY LIKE AND TRUST IT. >> I DON'T NEED TO REMEMBER A LOT OF NUMBERS OR ANYTHING SO IT'S EASY TO USE. >> FOR ME I THINK IT'S SAFE TO USE THIS. >> Reporter: YOU HAVE FAITH IN THE SYSTEM. >> YES. >> Reporter: AT LIFT 99, WHERE ENTREPRENEURS CAN RENT OFFICE SPACE AND NETWORK, WE MET AMERICAN YURIY MIKITCHENKO. HE MOVED FROM OREGON TO ESTONIA FOR LOVE, HIS FIANCEE IS ESTONIAN, BUT HE'S ALSO QUITE SMITTEN WITH HOW THE GOVERNMENT ENCOURAGES BUSINESS. DO YOU THINK IT'S EASIER TO DO BUSINESS HERE THAN IT IS IN THE UNITED STATES? >> TECHNOLOGY, FOR SURE MAKES IT'S EASIER TO DO BUSINESS HERE. I CAN SEND AN INVOICE DIGITALLY AND GET A BANK TRANSFER IMMEDIATELY. NO SIGNING CHECKS. NO CUTTING ACTUAL CHECKS. PEOPLE HERE LAUGH AT THE IDEA OF CHECKS. >> Reporter: TO APPRECIATE HOW FAR ESTONIA HAS COME, IT'S IMPORTANT TO LOOK BACK TO WHEN ESTONIA WAS PART OF THE SOVIET UNION. WE GOT A CHANCE TO DO JUST THAT VISITING THE REPOSITORY OF ESTONIA'S MUSEUM OF OCCUPATIONS WITH DIRECTOR MERILIN PIIPUU. >> BUT I GUESS IN MODERN COUNTRIES YOU HAD ALREADY BETTER EQUIPMENT THAN THIS ONE. >> Reporter: ESTONIA WAS PART OF THE COMMUNIST U.S.S.R. FROM 1944 TO 1991. BY THE TIME IT GAINED ITS FREEDOM, ABOUT 20% OF AMERICANS WERE ALREADY USING PERSONAL COMPUTERS, BUT HERE IN ESTONIA THERE WERE VIRTUALLY NO COMPUTERS. >> TYPEWRITERS WERE THE LAST THING. WE DIDN'T HAVE THE FIRST COMPUTERS. AND WHEN WE TALK ABOUT CONNECTIONS AND YOU KNOW, MOBILE PHONES WE DIDN'T KNOW ANYTHING ABOUT. WE STILL HAD THE BASIC LANDLINES AND EVEN THE LANDLINES WERE ALWAYS OVERHEARD. PEOPLE WERE ALWAYS LIKE, SURVEILLANCE WAS THE THING. LOOK AT THE PHONES FROM K.G.B. OFFICES. IT'S REALLY HEAVY. >> Reporter: WHEN THE COUNTRY BROKE AWAY FROM THE U.S.S.R., ESTONIANS HAD TO BUILD THEIR NEW COUNTRY FROM SCRATCH. THAT MEANT THEY COULD TAKE ADVANTAGE OF SOMETHING THAT WAS BRAND NEW THEN, THE INTERNET. WITHIN A FEW YEARS ESTONIANS JUMPED FROM TYPEWRITERS TO THE LATEST WEB-CONNECTED COMPUTERS. >> THEY MANAGED TO ACTUALLY HAVE AN IDEA, A VISION OF HOW THEIR COUNTRY SHOULD BE RUN. >> Reporter: DR. ROBERT KRIMMER IS A PROFESSOR IN THE SCHOOL OF BUSINESS AND GOVERNANCE AT THE TALLINN UNIVERSITY OF TECHNOLOGY AND AN EXPERT ON WHAT HAS COME TO BE KNOW AS E-GOVERNMENT. HE SAYS NECESSITY WAS THE MOTHER OF INVENTION IN THIS TINY COUNTRY. >> THERE IS NOT ENOUGH HUMANS THAT CAN DO ALL THE JOBS AND THERE IS JUST NOT ENOUGH MONEY TO PAY FOR ALL THE SERVICES IF YOU HAVE TO DO IT THE TRADITIONAL WAY ON PAPER SO ESTONIA DIDN'T HAVE A CHOICE, RIGHT? IT DECIDED INFORMATION TECHNOLOGY IS THE ONE THING THAT HELPS THE COUNTRY ORGANIZE ITSELF. >> Reporter: AND ONE OF THE MOST AMBITIOUS THINGS THEY ORGANIZED WAS I-VOTING IN 2005. CITIZENS CAN VOTE ONLINE IN EVERY ELECTION. >> IT WAS THIS BOLD DECISION. WE ARE GOING TO BE THE FIRST TO VOTE ONLINE. >> Reporter: HEARING HOW MUCH PEOPLE TRUST THEIR ONLINE GOVERNMENT SERVICES, ONE MIGHT GET THE IMPRESSION THAT THE ENTIRE SHIFT TO BECOMING AN E- SOCIETY WAS A BREEZE. IT WASN'T. IN FACT, ESTONIA FACED A MAJOR CRISIS IN 2007 WHEN IT BECAME THE FIRST COUNTRY TO EXPERIENCE A MASSIVE CYBER ATTACK WHICH TOOK DOWN ESTONIA'S EMAIL, BANK, AND NEWSPAPER SERVERS. >> THE STATE PORTALS, THE PRESIDENT'S PORTALS, THE BANK'S PORTALS, THE NEWSPAPERS THEY WERE JAMMED, BASICALLY. THEY WERE NOT AVAILABLE ANYMORE AND THIS CREATED A LOT OF PANIC. >> Reporter: BUT WHO WAS BEHIND IT? IT'S WIDELY BELIEVED TO BE CONNECTED TO THIS SOVIET-ERA STATUE. IN APRIL, 2007 THE ESTONIAN GOVERNMENT MOVED IT FROM THE CENTER OF TALLINN TO THIS MILITARY CEMETERY IN THE OUTSKIRTS. PRO-RUSSIAN ESTONIANS SAW THIS AS AN INSULT. THEY TOOK PART IN VIOLENT PROTESTS AT THE EXACT SAME TIME THE CYBER ATTACK OVERWHELMED THE COUNTRY'S SERVERS. MANY HERE THOUGHT THAT WAS NO COINCIDENCE. >> AND THE ASSUMPTION WAS THAT OUR NEIGHBORS WERE RESPONSIBLE FOR THIS. >> Reporter: YOU MEAN RUSSIA? >> YES. >> Reporter: WHILE PIPERAL ACKNOWLEDGES IT HAS NEVER BEEN CONFIRMED THAT THE RUSSIANS WERE BEHIND THE ATTACK, SHE SUSPECTS THEY WERE AIMING TO UNDERMINE ESTONIANS' TRUST IN THEIR GOVERNMENT. INSTEAD THE COUNTRY CAME TOGETHER. THE GOVERNMENT WENT PUBLIC DESCRIBING THE ATTACK AND THE STEPS IT WAS TAKING TO THWART IT. THE NEXT YEAR THE COOPERATIVE CYBER DEFENSE CENTRE OF EXCELLENCE, A MULTI-NATIONALLY FUNDED THINK TANK, OPENED IN TALLINN. HERE THEY TRAIN MILITARY AND CIVILIAN EXPERTS FROM 21 COUNTRIES HOW TO PROTECT AGAINST CYBER-ATTACKS ON GOVERNMENT SYSTEMS, BANKS, AND UTILITIES. MERLE MAIGRE, ITS DIRECTOR, SAYS THE CRISIS ACTUALLY INCREASED PEOPLE'S TRUST IN THE GOVERNMENT. >> ESTONIA UNDERWENT THIS EARLY WAKE-UP CALL FINDING A WAY TO FIND SOLUTIONS TO THE SITUATION BUILT UP PEOPLE'S TRUST IN DIGITAL SERVICES AS SUCH. >> WE CAN'T STOP THE CYBER- ATTACKS. IT'S LIKE, THE NUMBER IS INCREASING, BUT WHAT WE CAN IS DETECT THEM AS SOON AS POSSIBLE, MEANING THE NEXT SECOND, SO WE CAN PREVENT THE BIGGER DAMAGE. >> Reporter: AS YET ANOTHER LINE OF DEFENSE AGAINST CYBER-ATTACK, THE COUNTRY IS CREATING A BACKUP SYSTEM, WHAT THEY CALL "DIGITAL EMBASSIES," IN WHICH ESTONIA STORES A BACKUP COPY OF ALL ITS DIGITAL ASSETS IN ANOTHER COUNTRY. THE FIRST ONE WAS ESTABLISHED IN LUXEMBOURG LAST JUNE. >> WE WOULD LIKE TO BUILD A BIGGER KIND OF NETWORK OF DIGITAL EMBASSIES WHERE WE CAN PUT OUR DATA AND, OF COURSE, USING BLOCKCHAIN WITH IT FOR INTEGRITY PURPOSES SO IF ANYTHING HAPPENS TO ESTONIA, IF ANYONE ATTACKS ESTONIA THE GOVERNMENT WILL NOT LOSE ANY DATA OR CONTROL OVER DATA, AND THEY COULD SERVICE PEOPLE EVEN IF WE ARE NOT IN THE COUNTRY. >> Reporter: AND THE NEXT STEP FOR THIS SMALL COUNTRY IS TO EXPAND BEYOND ITS BORDERS BY OFFERING WHAT IT CALLS E- RESIDENCY TO EVERYONE IN THE WORLD. IT'S A PROGRAM MEANT TO ATTRACT ENTREPRENEURS. PAY A FEE OF ABOUT $120, PASS A BACKGROUND CHECK, AND ESTONIA ISSUES YOU A DIGITAL I.D. WHICH YOU CAN USE TO ESTABLISH A COMPANY IN ESTONIA MAKING IT EASIER TO ACCESS THE E.U. MARKET. >> YOU CAN CREATE A LEGITIMATE EUROPEAN BUSINESS WITHOUT ACTUALLY COMING TO ESTONIA NOR COMING TO THE E.U. WITHIN A FEW HOURS AND YOU HAVE ACCESS TO ALL THE E-SERVICES FROM ESTONIA. >> Reporter: CASTAIGNET SAYS EVERY DOLLAR INVESTED BY THE GOVERNMENT SETTING UP E- RESIDENCY GENERATES $100 FOR ESTONIAN COMPANIES. HOW MANY PEOPLE HAVE SIGNED UP SO FAR? >> RIGHT NOW WE HAVE MORE THAN 30,000 E-RESIDENTS COMING FROM 140 COUNTRIES AROUND THE WORLD. >> Reporter: HOW BIG DO YOU WANT THIS THING TO GET? WHAT'S THE LIMIT? >> SKY'S THE LIMIT, YOU KNOW. >> Reporter: OF COURSE, THERE ARE LIMITS. BUT FOR ANNA PIPERAL, THE COUNTRY'S E-AMBASSADOR, THE ANSWER IS CLEAR. ESTONIA HAS A LOT TO TEACH THE WORLD ABOUT BUILDING A DIGITAL SOCIETY.
