The latest Economist covers the powers and wonders of mBanking-- it's good to see the subject getting attention from the foremost weekly newspaper of the former British Empire. M-PESA, the success story from Kenyan mobile operator Safaricom, gets some attention in the article, which then extrapolates outward:
Extending mobile money to other poor countries, particularly in Africa and Asia, would have a huge impact. It is a faster, cheaper and safer way to transfer money than the alternatives, such as slow, costly transfers via banks and post offices, or handing an envelope of cash to a bus driver. Rather than spend a day travelling by bus to the nearest bank, recipients in rural areas can spend their time doing more productive things. The incomes of Kenyan households using M-PESA have increased by 5-30% since they started mobile banking, according to a recent study.
Why haven't we seen more of this? Well, it's a combination of banks nervous about losing market share, government regulators nervous about fraud, and existing laws that prevent corner-shop retailers from behaving like banks. But there are ways around (or through) these obstacles, says the Economist's usual omniscient-sounding editorial voice:
Instead of lobbying against mobile money, banks should see it as an exciting chance to exploit telecoms firms’ vast retail networks and powerful brands to reach new customers. Tie-ups between banks and operators will help reassure regulators. But they, too, need to be prepared to be more flexible. People who want to sign up for mobile-money services should not, for example, have to jump through all the hoops required to open a bank account. Concerns about money-laundering can be dealt with by imposing limits (typically $100) on the size of mobile-money transactions, and on the maximum balance. And inflexible rules governing the types of establishments where cash can be paid in and taken out ought to be relaxed.
Mobile money presents a shining opportunity to start a second wave of mobile-led development across the poor world. Operators, banks and regulators should seize it.
UPDATE: Silly me for missing this-- the above article actually comes out of a whole special report in this week's Economist devoted to telecom in the developing world. Six more articles for your consumption!:
Mobile marvels Poor countries have already benefited hugely from mobile phones. Now get ready for a second round, says Tom Standage
- ZMQ Software systems in India is running a program that helps women access pre-natal care via mobile, by sending them reminders and advice via SMS every few days. The program, still in early stages, is designed to both raise the number of women seeking and receiving pre-natal care, while also empowering women with access to mobile phones in a country where phones tend to be the domain of the men in the family. This is similar to MoTEcH, a program run by the Grameen Foundation in Ghana. (via MobileActive)
- The Ethiopian government text messaged its entire mobile-using population to offer them free HIV/AIDS tests as part of a campaign to leading up to the new years festival earlier this month. I haven't seen anything about the success of the campaign, but the government was able to reach 2.5 million mobile users.
- Juniper Research came out with a report forecasting a hurdle to the spread of mobile networks in the developing world: rising power costs for mobile base stations. Not much has been made of this that I've heard, but as energy costs inevitably rise, network providers will have to put more emphasis on efficiency and renewables. Nokia could leverage their recent crown as the world's most sustainable tech company to become an early leader here.
- The BBC's Connected Africa has a great audio slideshow of how Rwanda is working hard to bring ICT to rural parts of the country. (On a bus!)
FCC Chair Julius Genachowski gave a pretty big speech (pdf) at Brookings yesterday, laying out two new principles to protect the openness of the internet, and throwing his weight behind net neutrality. There's all kinds of debate flying through the tubes right now-- on both sides of Genachowski-- but I'm going to stay out of all that, and instead share a few thoughts on how these principles might apply (or not) outside the U.S.
Granted, in most of the developing world, preserving the openness of the internet will take a backseat to broadening access for some time. Unfettered access to BitTorrent isn't worth much if you're confined to a feeble mobile connection and the nearest broadband access is a day away. But as high speed networks arrive in places like Ghana, Nigeria and Kenya, these countries will face the same quandaries we're confronting in Washington.
If anything, protecting open access to the web will be more important throughout Africa, Asia, and Latin America. In most countries, the population is much more rural, and anti-trust laws are much weaker-- two factors that would contribute to less competition and a surfeit of power for a very few ISPs. Already, VOIP applications like Skype, which are widely used around the world, have been targeted for throttling due to their high bandwidth requirements. For the sake of the innovation and entrepreneurship these applications enable, it would seem important to keep them open and available.
Questions of enforcement are more difficult. For a government to effectively monitor an ISP to ensure openness would require a very tech-savvy team, something many resource-poor governments would struggle to maintain. Perhaps there will be space for an international body-- an NGO, or perhaps even a for-profit company-- to protect web openness on a contract basis on behalf of governments incapable of doing so themselves.
Countries like Iran and China are, of course, a separate challenge. I'm not one to meddle in another state's sovereign affairs, but as someone with a history of being censored in China, I tend to see denial of access on par with any other violation of the freedom of the media.
Just a few opening thoughts in the hopes of provoking a conversation or a bit of disagreement.
One more thing-- Dr. Rob Shapiro, Chair of the Globalization Initiative here at NDN, just came out with an economic study (pdf) on "flexible broadband pricing"-- i.e., charging high-volume web users more for their access. I imagine the concept would offend some apostles of net neutrality, but the study makes a pretty compelling case that such progressive pricing would help close the digital divide here in the U.S. (and, surely, elsewhere).
- The BBC has a cool and (apparently) new feature-- "Connected Africa." The page is dedicated to broadband penetration in Africa and all related phenomena. Ken Banks of Kiwanja has a good op-ed-style piece up there now, about the innovation that has sprung up around mobile technology, and how it might be a preview for what the arrival of high-speed, fibre-optic broadband might look like. Also, a new broadband cable into East Africa is about to go live.
- One of the big themes from the World Bank sessions earlier this week was that little innovation is the technology is all in good shape, the real challenge is around developing the business models that will allow this technology to become available and effective in the developing world. M-PESA, Safaricom's mBanking wing, has been one of few-- perhaps the only-- really successful mVenture. An essay by Mark Pickens at CGAP looks at what has made it successful, and his conclusion is familiar-- it's all about scale.
- Wayan Vota of Inveneo responds to a question posed by Erik Hersman of White African-- whether non-profits and businesses should focus on SMS or IP capacity. Vota argues that high SMS costs, relative network openness and demand for video will push us all-- even those in the developing world-- toward high-bandwidth use. For now, it would be foolish to abandon SMS, as the majority of phones in use in the developing world are SMS-enabled but not web-enabled... but the future, to be sure, is in internet services.
- Tomorrow is Software Freedom Day, and Sugar Labs-- the developers of the free and transparent software run on most OLPC-XO machines (the current One Laptop Per Child computer)-- is having a party up in Boston. Check them out if you're in the neighborhood.
At the World Bank's panel on education yesterday, one of the more alarming revelations came from Leigh Jaschke of MobileActive. She devoted most of her brief talk to literacy in the developing world, and highlighted this alarming statistic: In West Africa, literacy rates are below 60%, and for women, they're below 50%.
If you exclude Nigeria-- the largest and best educated country in the region, the literacy rate drops to just 52%. In four of the 13 countries in the region, the female literacy rate is less than 20%. All this data is laid out in a recent report (pdf) from Oxfam and a group of other organizations.
Aside from being an abomination, these facts pose a challenge for mDevelopment in all its incarnations. As Brendan Smith of Vital Wave explained in his presentation on the mHealth panel yesterday, less than 10% of mHealth applications use voice technology, while more than a quarter are SMS-based.
Needless to say, if you can't read, texting doesn't do you much good. mLearning, despite being perhaps the newest and least developed of mobile applications, may need to take priority in places like West Africa, where illiteracy is a barrier to any successful program.
Kate Place gave her own presentation yesterday on Bridgeit, a program she works with in Tanzania. Basically, the program allows teachers to access a database of educational videos through their phone, which they can download and use as aids in the classroom. Mostly the program has focused on math and science education, rather than literacy, but they seem to have had some success. Her presentation (ppt), gives you more if you're curious.
UPDATE: I should have mentioned this earlier, but if you're interested in what went on at the WB yesterday, materials from all the sessions are available here, and Florian Sturm of ICT4D (who was watching a webcast of the sessions from an internet cafe in Accra) put together great summaries of all the sessions.
Yesterday I was at the IDB for "Reinventing the Classroom: Social and Educational Impact of ICTs in Education." I wrote yesterday about CEIBAL, Urugay's initiative to distribute laptops to every student and teacher in the public school system. Nicholas Negroponte, the founder of One Laptop Per Child, followed that with a firey talk in the afternoon.
The mission of education, Negroponte reminded his audience, isn't teaching, it's learning. What happens inside the classroom is only a part of the story, and hand-wringing over how to train the teachers to teach the students is silly and a waste of time. Often as not, the students learn to use the laptops themselves, and will teach their parents and each other. There is nobody at this table, he said, who wouldn't buy a laptop for our own child if we could afford it. To get hung up on assessing the impact of the program is just a waste of time.
Now, clearly, the reality of the world we live in requires impact assessments. And clearly, we can't just drop a stack of laptops on a school in some remote village without any kind of training or introduction. But Negroponte has some inspiring and compelling words nonetheless.
In the opening session, Brooke Partridge, CEO of Vital Wave consulting, had a pretty interesting presentation about the broad opportunity for mobile in the developing world. To really make sServices work to improve billions of lives in the develping world will require new innovation-- but the innovation that is required is not in IT, but in mastering the business models that can create successful projects and bring them to scale.
I've been over at the IDB all morning, for a series of seminars on the impact of ICTs in education. I'll report on this more in the coming days, but for now:
President Tabaré Vázquez of Uruguay gave the keynote this morning, talking about CEIBAL, the very successful national laptops-in-backpacks program he has overseen. He argued that the introduction of technology into education constitutes nothing less than a revolution-- "the most profound and beautiful of revolutions." It's a big word to use in Latin America, but seems appropriate.
Introducing laptops to every student and teacher in the country is not just a revolution of teaching and learning, he said, but a social revolution as well. Students now have access to networks that connect everyone-- from the wealthy kids in Montevideo to the 20% of children who live in poverty around the country. The laptops guarantee nothing, but they're a tool-- for learning, for communication, and for equality-- and they're helping create better educated citizens, who in turn make for a stronger, wealthier country.
Miguel Brechner, President of the Uruguay Technology Laboratory, has been the man in charge of CEIBAL during its three-year rollout. He followed Vázquez in a technical seminar with a review of the costs and impacts of the program. He echoed the point made by Marcelo Cabrol of the IDB that this technology is a fundamentally disruptive innovation, and one that requires vast reorganization of the educational system. Uruguay has met that challenged with a comprehensive rollout of the program over three years, introducing the machines gradually, and coupling them with teacher training and appropriate software.
Nonetheless, Brechner offered an accounting that calculated the cost of the program at about $276 per machine over four years. This includes the major costs of hardware and connectivity, and many minor costs including service, software, and content. While no broad academic studies on the impact of the program have yet been done, observational and anecdotal evidence suggests that the machines have been well incorporated by teachers into their lessons, and they have already pushed up attendance and academic achievement.
There's been a lot of negative chatter about OLPC lately, some of it well-grounded. The program has hit some hurdles, and failed to meet some optimistic projections. Still, the theory is sound: Understanding technology and having access to the worldwide network through devices like laptops and mobile phones will be an essential part of a child's success in the 21st century, and needs to be introduced to the classroom. Hats off to Uruguay for pulling it off-- swiftly, completely, affordably and, it seems, successfully.
- If you're like me, you missed the news that there were major riots in Kampala, Uganda late last week. The MSM didn't make much of the story, but if you had your eye on Twitter, you may have seen some good reporting by @mugumya, @solomonking, @appfrica and @UgandaTalks-- with everything gathered at #kampala. As happened in Iran earlier this year, local media was largely shut down during the riots, so Twitter was one of the only ways people in Uganda could communicate with each other and spread the word about what they were seeing. The Independent had a good explanation of why the riots happened.
- The Blackberry Curve is coming to South Africa-- big step for smart phones on the continent. Perhaps South Africans will use their new phones to call the new Presidential hotline (this was one of Jacob Zuma's big campaign promises); the government expects to recieve 1,500 calls a day in a variety of different languages.
- Safaricom, the Kenyan phone company that recently unveiled a solar phone, just announced that they'll be paying dividends to their investors via m-PESA, the popular phone-based money transfer system. Assuming investors sign up, the savings for Safaricom (and their shareholders) could be significant.
- Also, from last week-- a South African company did a test, and found it was faster to send digital data via carrier pigeon than by web. Ouch.
The Inter-American Development Bank (IDB, or IADB, or BID, depending on where you're from) is putting together a really interesting event for next Tuesday, to talk about technology in education. The slate of speakers includes President Tabaré Vázquez of Uruguay, Secretary of Education Arne Duncan, IDB President Luis Alberto Moreno, and Nicholas Negroponte, founder of the MIT Media Lab and the driving force behind the One Laptop Per Child initiative.
They'll be focusing particularly on OLPC-- Negroponte continues to pick up steam, and Uruguay has run a very successful spinoff program that has provided laptops to every student and teacher in the country's public education system.
You may know that we published a paper at NDN a couple years back calling for a similar program here in the US-- A Laptop in Every Backpack. Alec Ross, who co-authored the paper with Simon, is now a senior advisor on technology and innovation to Secretary Clinton.
Anyway, it's good to see this initiative gaining the support it has, and to see both the IDB and the Department of Education taking laptops seriously as a crucial part of educating our youth. It is pretty hard to imagine a child-- here in the US or anywhere else around the world-- succeeding in the 21st century without a very strong foundation in technology.
The Asia Times had an interesting article last week about Google's travails attempting to replicate the success they have had elsewhere in the world as the dominant search engine. A big part of their plan is to focus on mobile search, and the article has some interesting bits on the growth of mobile in China:
China didn't introduce 3G mobile-phone technology until the start of this year, and companies such as Baidu and US-based Google are looking to cash in as the world's biggest mobile phone market switches to the faster technology.
China had more than 695 million mobile users at the end of June, according to the Ministry of Industry and Information Technology.
"As 3G starts in China, mobile Internet will be an explosive opportunity," said Lee Kaifu, president of Google Greater China. That applies across the spectrum of those involved in the business - from phone makers to application developers, to service providers. "For example, Beijing is often choked with traffic. For people who are driving, a real-time traffic map of the city available on mobile phone will be very useful."
Lee envisions a day when more people will be using cellphones than computers to go online in China. At the end of June, about half of the 338 million Internet users in China, or 155 million, have been surfing the net with their phones, said researcher China Internet Network Information Center .
"Right now, the Internet traffic from mobile phones is about one-twentieth of that from computers in China. But mobile Internet traffic can catch up quickly once the infrastructure is ready," said Lee.