Category Archives: Observations

Digital Transition

Today, I was very interested and inspired to blog by Mike Gurstein’s post, advocating a move away from the Digital Divide discourse and towards the consideration of a concept called Digital Transition. At the background of the post was glimmering the understanding that not all digital media are alike and some ICTs are preferable to others in terms of the social transformation they enable.

I found Mike Gurstein’s references to mobile phone penetration rates particularly engaging. I agree with him that person-to-person mobile phone communication, be it with high intensity and frequency, could probably not match the efficiency gains experienced in societies which have gone through a Digital Transition, societies which have formalized asynchronous modes of communication and where complex interactions and transactions among multiple parties are enabled by technology.

Still, I think that mobile communication might hold the key to unlocking a Digital Transition in pre-Transition countries. I am largely thinking about the development of the Mobile Web, and continuing efforts in Africa towards the introduction of mobile applications aimed at enabling market transactions (listing services e.g. Trade at Hand, money transfer service e.g. M-PESA, etc).

I strongly believe that in terms of technology development the Mobile Web has the potential of inducing a Digital Transition  in some African countries such as Ghana and Kenya. In saying this I am using the term Mobile Web as it has been defined by the recent “Mobile Web for Social Development Roadmap” published by the W3C.  There, Mobile Web is “understood in its widest sense as accessing and interacting with Web content from a mobile phone. It is not limited to Mobile Browsing.” The roadmap considers different technologies including voice applications, applications using the signaling channel (i.e. SMS, USSD, Cell Broadcast) and services based on data transfer.

Are Mid-Range Phones the “Smartphones 4D”?

I have finally come around to revisiting some of the topics that came up during the days of the CTA ICT Observatory, held in Wageningen, the Neatherlands from 2nd to 4th of Nobember, 2009. One topic in particular that reared its head during the first day, concerned the potential of mid-range mobile phone devices to deliver the benefits associated with mobile services.

The topic came up when all participants were asked by the workshop facilitators Pete Cranston and Christian Kreutz to consider the advantages and disadvantages of different technological channels for access to information. Volunteers were asked to collect views regarding the following channels:

  • Indirect access i.e. information access mediated by another human being.
  • Radio
  • Direct information sharing i.e. CDs, printouts, file sharing.
  • Rural access
  • Basic phones: devices with two-tone displays and basic functionality.  Almost exclusively the functionality is limited to voice and SMS.
  • Mid-range phones i.e. phones with functionality exceeding the basics.  These devices have multi-tone display and a data channel (GPRS) with a high level of usability. Features such as extendable keyboards, cameras
  • Smart phones i.e. phones complete with an operating system and advanced PC-like functionalities such as email and Internet access.

I collected the views of the participants in the workshop on mid-range phones. And after about half an hour we came up with the poster below.

Pros and Cons of Mid-range Phones

The pros of mid-range phones include that they allow for the development of more interactive mobile applications and services. The use of phones and services with basic functionality have proven their worth and usefulness, as in the many deployment examples associated with FrontlineSMS. Still, many of the areas where SMS services are used can benefit from more extensive interactions. That’s why we put interactivity as one of the advantages carried by mid-range phones. The implementations I envisage would fall somewhere on the orange fraction of “social mobile’s long tail”, as explained by Ken Banks in a recent post on his blog. Arguably, mid-range phones are currently the devices of choice for end-users in the implementation of mid-complexity systems and customised solutions. Yet again, arguably, they have the potential of being the devices of choice for the implementation of simple, low cost systems in the future.

Another advantage of mid-range phones is that through the data channel they allow information to be exchanged way more cheaply than SMS. Steve Song оf manypossibilities.net has posted much on the lack of fairness in the pricing of mobile communication and recently started the initiative Fair Mobile).  Mid-range phones allow a cheaper alternative because in terms of the price of data transfer per character, data services based on GPRS are up to 1000 times cheaper. This argument was put forward as part of the presentation of Stephane Boyera from the W3C at CTA’s ICT Observatory. Moreover, the feasibility of extending the use of devices with mid-range functionality in the provision of mobile services is supported by the increased market availability of such devices at prices near the $50 mark.

In a recent analysis of the potential of hybrid devices, Simon Kearney notes that “while smartphones may dominate the mobile growth story in many developed markets, the picture is very different in the much larger developing and emerging world markets.”  In these markets products and services such as Nokia’s Life Tools are, in many ways, exploring leapfrogging possibilities by allowing mobile access to the Internet.

The Nokia Life Tools services, deployed in India and Indonesia are examples of mobile services which can be deployed through mid-range phones. These services are targeted at very low earners in developing countries. They allow users access to weather and agricultural market information. A series of phones designed as end-user devices for Nokia Life Tools, and retailing at prices between 20 and 54 Euros – before taxes and subsidies – are shortly due to begin shipping.

Mobile Information Services for agriculture and rural development: The Esoko Initiative

Wageningen, 2 November 2009. During the CTA ICT Observatory 2009 we interviewed Mike Davies from Esoko, in Ghana. Esoko is a software platform licensed to facilitate the flow of market information between farmers, governments, researchers and other stakeholders involved in agriculture and rural development. It is used to share information on prices, offers, price of fertilizers etc. It is managed by the web, but delivered via mobile phones. Mark underlines the potential positive effects that Market Information Services such as Esoko can bring about, both in agriculture as well as in for other sectors. He then concludes talking about the difficulties he has encountered in this initiative, such as the lack of content available and the lack of right capacities to build and develop such software.

See more at observatory2009.cta.int/

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The Bottom Line Episode 2: Growth vs Mature Markets for ICT

TelecomTV and IBM present an informative overview of the current divide in the mobile market between mature and growing markets.The commentators emphasise two significant trends encountered in the mobile markets of developing countries. Firstly, there is a trend of emergence of innovative home-grown operators in developing countries and emergence of home-grown business models, better suited to the needs of low ARPU customers. Secondly, there is a trend in developing markets for the establishment of mobile (as opposed to Internet) data services for banking, commerce, healthcare and education.The particpants in the video include:- John Chambers, Chairman & CEO, Cisco- Prof. John Nkoma, Director General, Tanzania Communications Regulatory Authority- Kent Lupberger, Snr Mgr Portfolio & Technology Global ICT, World Bank- Dr. Tim Kelly, Lead ICT Policy Specialist, Infodev- Prof. Dora Nkem Akunyili, Minister Of ICT, Federal Republic Of Nigeria- Adrian Baschnonga, Senior Analyst, Global Telecoms, Ernst & Young- Mike Hill, VP Enterprise Initiative, IBM

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The Economist: Mobile marvels

Sep 24th 2009

From The Economist print edition

BOUNCING a great-grandchild on her knee in her house in Bukaweka, a village in eastern Uganda, Mary Wokhwale gestures at her surroundings. “My mobile phone has been my livelihood,” she says. In 2003 Ms Wokhwale was one of the first 15 women in Uganda to become “village phone” operators. Thanks to a microfinance loan, she was able to buy a basic handset and a roof-mounted antenna to ensure a reliable signal. She went into business selling phone calls to other villagers, making a small profit on each call. This enabled her to pay back her loan and buy a second phone. The income from selling phone calls subsequently enabled her to set up a business selling beer, open a music and video shop and help members of her family pay their children’s school fees. Business has dropped off somewhat in the past couple of years as mobile phones have fallen in price and many people in her village can afford their own. But Ms Wokhwale’s life has been transformed.

Ms Wokhwale prospered because being able to make and receive phone calls is so important to people that even the very poor are prepared to pay for it. In places with bad roads, unreliable postal services, few trains and parlous landlines, mobile phones can substitute for travel, allow quicker and easier access to information on prices, enable traders to reach wider markets, boost entrepreneurship and generally make it easier to do business. A study by the World Resources Institute found that as developing-world incomes rise, household spending on mobile phones grows faster than spending on energy, water or indeed anything else.

The reason why mobile phones are so valuable to people in the poor world is that they are providing access to telecommunications for the very first time, rather than just being portable adjuncts to existing fixed-line phones, as in the rich world. “For you it was incremental—here it’s revolutionary,” says Isaac Nsereko of MTN, Africa’s biggest operator. According to a recent study, adding an extra ten mobile phones per 100 people in a typical developing country boosts growth in GDP per person by 0.8 percentage points.

In 2000 the developing countries accounted for around one-quarter of the world’s 700m or so mobile phones. By the beginning of 2009 their share had grown to three-quarters of a total which by then had risen to over 4 billion (see chart 1). That does not mean that 4 billion people now have mobile phones, because many in both rich and poor countries own several handsets or subscriber-identity module (SIM) cards, the tiny chips that identify a subscriber to a mobile network. Carl-Henric Svanberg, the chief executive of Ericsson, the world’s largest maker of telecoms-network gear, reckons that the actual number of people with mobile phones is closer to 3.6 billion.

But exact numbers are hard to come by, not least because of the continued rapid growth in the global number of subscribers. In the year to March 2009 an additional 128m signed up in India, 89m in China and 96m across Africa, according to TeleGeography, a telecoms consultancy. Numbers in Indonesia, Vietnam, Brazil and Russia also grew rapidly (see chart 2). China is the world’s largest market for mobile telephony, with over 700m subscribers. India is adding the biggest number each month: 15.6m in March alone. And Africa is the region with the fastest rate of subscriber growth. With developed markets now saturated, the developing world’s rural poor will account for most of the growth in the coming years. The total will reach 6 billion by 2013, according to the GSMA, an industry group, with half of these new users in China and India alone.

All this is transforming the telecoms industry. Within just a few years its centre of gravity has shifted from the developed to the developing countries. The biggest changes are taking place in the poorest parts of the world, such as rural Uganda.

Not the usual suspects

Three trends in particular are reshaping the telecoms landscape. First, the spread of mobile phones in developing countries has been accompanied by the rise of home-grown mobile operators in China, India, Africa and the Middle East that rival or exceed the industry’s Western incumbents in size. These operators have developed new business models and industry structures that enable them to make a profit serving low-spending customers that Western firms would not bother with. Indian operators have led the way, and some aspects of the “Indian model” are now being adopted by operators in other countries, both rich and poor. This model provides new opportunities, especially for Indian operators. The spread of the Indian model could help bring mobile phones within reach of an even larger number of the world’s poor.

The second trend is the emergence of China’s two leading telecoms-equipment-makers, Huawei and ZTE, which have entered the global stage in the past five years. Initially dismissed as low-cost, low-quality producers, they now have a growing reputation for quality and innovation, prompting a shake-out among the incumbent Western equipment-makers. The most recent victim was Nortel, once Canada’s most valuable company, which went bust in January. Having long concentrated on emerging markets, Huawei and ZTE are well placed to expand their market share as subscriber numbers continue to grow and networks are upgraded from second-generation (2G) to third-generation (3G) technology, notably in China and India.

The third trend is the development of new phone-based services, beyond voice calls and basic text messages, which are now becoming feasible because mobile phones are relatively widely available. In rich countries most such services have revolved around trivial things like music downloads and mobile gaming. In poor countries data services such as mobile-phone-based agricultural advice, health care and money transfer could provide enormous economic and developmental benefits. Beyond that, mobile networks and low-cost computing devices are poised to offer the benefits of full internet access to people in the developing world in the coming years.

This special report will examine each of these three trends in turn. Each one is significant in itself but also has consequences for rich as well as poor countries. Together they could start a second wave of mobile-led economic development as powerful as that prompted by the original launch of mobile phones. Their spread in poor countries is not just reshaping the industry—it is changing the world.

via A special report on telecoms in emerging markets: : Mobile marvels | The Economist.