Meeting the Challenges of the Bottom of the Pyramid
Planting Seeds...
Intel Applications Research and Strategy Lab16 May, 2002
Colin M. MaclayCenter for International Development
Harvard University
Agenda
The State of the World TodayWhy We Care and the Role of ICTsChallenges We Face – Context MattersIdeas on Overcoming Them
State of the World TodayGrowing economic disparities4b people off the network and out of the loopMassive service deficits (education, health, finance)Political and economic instability (ineffective gov’t)Broad security concernsICT products reaching stasis?Many groups trying to address “digital divide” – some
as a problem, others as part of solution
Why We Care and the Role of ICTs
Moral/Social reasonsOrganizational interests
Business (integrating markets, growth, innovation)Government (tranparency, efficiency, policy reform)Academia and NGOs (social compact, increase reach)
ICTs as a common platform – and source of economic competitiveness
“The Digital Provide”
Information for Economic Decisions
Information Technology
Effective Markets
Income Gains
Economic Growth
Eggleston, Jensen, Zeckhauser (2002)
Market Opportunities
Small returns but large volumeFirst mover leadership, new consumers, sustained growthInnovation in products and modelsInternal benefits – employee satisfaction
Challenges We Face – Context Matters
Access – information infrastructure and hardware, software and support
Society – learning, job opportunities, social capital Economy – e-commerce, e-government, infrastructurePolicy – ICT policy environment, business and
economic environment
Not just technology, but people and institutions
Networked Readiness IndexGlobal Information Technology Report
2
3
4
5
6
7
Uni
ted
Sta
tes
Sin
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and
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gari
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a
Indo
nesi
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Rus
sian
Fede
rati
on
Chi
na
1 8 19 20 22 28 36 38 40 43 53 54 59 61 64Ranking (1 to 75)
Sco
re (
1 to
7)
Information InfrastructureGlobal Information Technology Report
23
45
67
Fin
land
Uni
ted
Sta
tes
Uni
ted
Kin
gdom
Sin
gapo
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n
Ban
glad
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1 4 10 15 18 20 26 27 35 42 44 55 65 66 72
Ranking (1 to 75)
Sco
re (1
to 7
)
Est
imate
d Inte
rnet use
rs p
er
100 in
habita
nts
Annual ISP cost for 20 hours of monthly use as % of GDP per capita.1 .5 1 5 10 50 100
.05
.1
.5
1
5
10
60
NGA
BGD
VNM
IND
BOL
HND
ZWE
IDN
ECU
LKAEGY
JAM
UKR
GTM
CHN
PHLJOR
PRY
SLV
BGRVEN
COL
DOM
PAN
ROM
THA
LVA
TUR
BRA
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MEX
MYS
POL
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CHL
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SVK
ARG HUNCZEGRC
PRT
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TWNKOR
ESPISR
NZLSGP
GBRITA
SWE
FRA
HKGFINDEU
NLD AUS
JPNAUTBEL
DNKCAN
CHEIRL
ISLNOR
USA
The Affordability Problem
Hardware, Software and SupportGlobal Information Technology Report
2
3
4
5
6
7
Uni
ted
Stat
es U
nite
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om
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ong
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Tur
key
Rus
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Fede
ratio
n
Chi
na
1 4 13 15 16 22 25 28 33 34 35 36 46 49 57 62 71
Ranking (1 to 75)
Scor
e (1
to 7
)
Social CapitalGlobal Information Technology Report
2
3
4
5
6
7
Fin
land
Slo
vak
Rep
ublic
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epub
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elan
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n T
haila
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outh
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ca T
urke
y
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na
Nic
arag
ua
Indi
a
Nig
eria
1 4 16 17 20 25 28 37 38 46 50 62 68 70 71 72Ranking (1 to 75)
Scor
e (1
to 7
)
Quality of IT Training and EducactionGlobal Information Technology Report
2
3
4
5
6
7
Fin
land
Uni
ted
Stat
es
Sin
gapo
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ada
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outh
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ratio
n
Ban
glad
esh
1 3 5 6 8 9 9 11 18 28 37 43 63 66 73Ranking (1 to 75)
Aver
age
Scor
e (1
to 7
)
Your country's training and educational programs for IT (1= lag far behind most other countries, 7=are among the best in the world)
Ideas on Overcoming Them
Organizations need to adjust their mindsetCollaboration across sectors is importantNot clear exactly how to do it – mixture of leadership
and consensusDialogue, incentives, experimentation and analysis are
essential
Factors for SustainabilitySome Goals for Collaboration
Improving access for everyone
Creating a supportive policy environment
Building human capital and institutions
Integrating ICT into the economy
Selected Learning Opportunities from the Developing World
ICTMobileSMSPre-paid (fixed and mobile)CableSTD-PCO
Other IndustriesHLL, Nirma,Amul Pizza
Priorities for FutureGrowth and Development with ICTs
Enhance communication and coordination
Leverage the Network Effect: 1 telephone is useless
Research!
Educate policymakers, business leaders, civil society
Create incentives
Leadership -- look for opportunity/take risks
Priorities for FutureGrowth and Development with ICTs
Put your resources where your mouth (and the market) is
Include a social mission, but do business
Employ entrepreneurship and existing networks to meet market needs
Use local context – even though some may appear to be problems
Remember that the greatest challenges are political, institutional and cultural change
Thank You More Information
More on the Global Information Technology Report and ITG research at:
www.cid.harvard.edu/cr/gitrr_030202.html
Smith’s Cross Functionalism
Cisco Networking Academy
Government Relations
Marketing Research
Philanthropy
Human Resources
AOL Helping.org
Verizon Literacy
HP e-inclusion
IBM Reinventing Education
Bertlsmann Foundation
Grameen PhoneMicrosoftWorking Connections
Worldcom Marco Polo
AT&T Learning Network
Intel Teach to the Future
GITR More Information
Information Infrastructure micro-index = 5/9 Hard Data + 4/9 Survey Data
Hard Data
2.1 Teledensity, 2000
2.2 Years to first adopt cellular telephony
2.3 Waiting list for telephone lines
2.4 Telecommunication staff per 1,000 mainlines
2.5 Telephone faults per 100 mainlines
Survey Data
2.6 Availability of telephone lines for businesses
2.7 Perceptions of broadband Internet access
2.8 Price and quality of Internet connection
2.9 Availability and cost of mobile telephony
GITR More Information
Hardware, Software and Support micro-index = 2/5 Hard Data + 3/5 Survey Data
Hard Data
3.1 PCs per 100 Inhabitants
3.2 Software piracy
Survey Data
3.3 Availability of specialized IT services
3.4 Software products fitting local needs
3.5 Competition in the domestic software market
GITR More Information
Social Capital micro-index = 3/6 Hard Data + 3/6 Survey Data
Hard Data
8.1 No schooling in the total population
8.2 Average years of schooling in the total population
8.3 Illiteracy
Survey Data
8.4 Political Rights
8.5 Quality of public schools
8.6 Difference in quality of schooling for rich and poor children
Sustainable Access in Rural IndiaKey Innovations
• Network effect – not one or two, but one thousand
• Low cost – under Rs 50000 per kiosk – about Rs 115 daily income to break even
• Based on entrepreneurs (and leveraging SHGs)
• Multi-sectoral partnership (academia, private sector, NGO, help from gov’t)
• Wide range of appropriate applications and content(voice and video mail, local egov services)
• Ongoing qualitative and quantitative research and feedback
Sustainable Access in Rural IndiaEarly Insights
• Capturing imagination is key
• Education and training are early leaders
• Cost and pricing scheme are utterly important
• Operator must be the ICT ambassador and champion
• Business must be designed for local context
• Figuring out killer aps takes time and experimentation
• Identifying effective indicators (and tracking them) and developing frameworks for understanding impact is hard
