Wednesday, April 18, 2007

MIT Club event on Communications in Emerging Markets

The MIT Club Semiconductor Entrepreneurship Series hosted a panel on the Future of Portable Communication in Emerging Markets on Thursday, April 12th. This is the second in a four part series on the Future of Portable Communication. As with the other events in this series it was hosted at the offices of Cooley Godward Kronish LLP . This, of course, means the food and drinks are pretty good ;-) In the interest of full disclosure, I helped with the planning of this panel.

The panel consisted of John Gardner from Nokia Growth Partners, John Sherry, Director of Social Science Research at Intel's Digital Health Group, Kristin Peterson, Co-founder and Chief Development Officer for Inveneo and Michael Kanellos, Senior Editor at CNET The panel was moderated by Julie Ask, Senior Research Director at Jupiter Kagan. The diverse panel had some surprising agreement on many things. All of them agreed that cell phones beat PCs as communication devices in emerging markets by a large margin. They mostly agreed that this was due to cost rather than ease of use. John Sherry talked about Intel initiatives targeted at emerging market applications for PCs such as ruggedizing, dust proofing, using alternate power sources etc. However, sometimes these led to increased cost which made the devices less attractive in these markets. Also, it was incorrect to assume that all customers in emerging markets wanted the lowest cost devices. There was significant demand for higher end capabilities.

Mike Kanellos described the range of uses these devices can be put to in emerging markets. In countries in the Middle East with large immigrant populations from India and Phillipines, PCs with video conferencing capabilities in Internet cafes are used to visually communicate with families back home. Cell phone services are used to transfer money home at much cheaper rates than possible with banks or financial service brokers. Overall PC penetration in the Middle East is very low, less than 20%.

Inveneo's Kristin Peterson described their observations from their efforts in Africa. Inveneo is an unusual startup - a nonprofit social enterprise aimed at connecting villages around the world. In many of these countries, communication can make dramatic differences in the lives of people in villages. However, most of them cannot afford expensive solutions. So, state of the art technology is mostly available as a shared resource. Even what we take for granted and available cheaply at Fry's in Silicon Valley may cost several times more by the time it makes it to a remote part of Africa. However, the effect of small things such as being able to communicate with a market in a neighboring village to find out that the price of crop is higher there may make a considerable difference to a poor farmer trying to sell his produce. He may be willing to travel the extra miles necessary to get the price differential.

While at the event, I met Hans Robertson of Meraki, a startup with the lofty goal of bringing Internet access to the next billion people. Their idea is to have small low cost wireless devices which can be added incrementally to form a mesh network. While the idea of mesh networks itself is not new, their take is on the ease of use and low cost of deployment. So, someone with access to the Internet could quickly deploy a wireless network and provide access to those who don't. Though, I am sure the service providers would want a cut of it, there is still room for enterprising entrepreneurs in developing markets to create small businesses and be the local ISP ;-)

While we in the Valley are in a race to provide the latest in technology, the rest of the world, especially the villages, are struggling to improve their lives with what technology they can lay their hands on. To them technology is not an end in itself, but a crucial means for improving their lives. Clearly the rate of adoption of technology is much slower at the fringes than at the center of the vortex of technology. :-)


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