NextBillion.net - Development Through Enterprise - Can the Cellphone Help End Global Poverty? Al Hammond Comments - Comments

Steve - fascinating

Rob Katz — Wed, 16 Apr 2008 09:57:36 -0500

Steve - your experience sounds fascinating. Please let us know when your writing on this experience is ready, I am very interested in see what your meta-level thoughts are. Thanks for commenting. Rob

Yes, I have lived without

Steve Cisler — Wed, 16 Apr 2008 05:57:59 -0500

Yes, I have lived without connectivity. In 2004 I went offline totally and began traveling around the U.S. talking to people not using the Internet. Seeing how they coped, what they might be missing. Then I went into Mexico and rode buses around the country, talking to people (the majority of course) not online. It was an eye-opening experience to see how many did not need or want access and had other ways of staying informed and connected. For myself who had been on the Net since the mid-80's it was very hard to stay off for 8 months. People thought I was dead. "You've committed virtual suicide said one." I am writing more exensively about this now.

Have you ever lived with no connectivity?

Al Hammond — Tue, 15 Apr 2008 15:24:20 -0500

I find all these comments fascinating. Personally, I think its no longer debatable that connectivity is a very powerful tool to empower people in ways that can help them climb out of poverty. Can you imagine what it would be like not to be able to make a phone call or send an email--instead, have to go physically to talk to everyone with whom you need to interact? That, unfortunately, is still the case for about half the world's people, either for reasons of access or cost. We are now piloting a model in rural Vietnam that could dramatically lower the costs of phone and internet service, both for users and for telecommunications. In fact, this model can make local calls entirely free for users, and lower capex by a factor of 5 and operational costs by half, compared to a typical mobile network. Because both customers and telcos win under this model, we think it has a chance of being adopted and used to build out in rural areas. And then the incredible entrepreneurial innovation that low-income phone users display in finding new ways to use this tool--as illustrated in the NYT article--can be unleashed.

Global Poverty and telecommunications

Paul Rigterink — Tue, 15 Apr 2008 13:10:55 -0500

I will give an example of how poor people will use telecommunications to increase their standard of living based on my understanding of poverty problems in a Central American country. A campesino in a rural area has been offered 1000 pesos for 10 bushels of corn by a middleman who declares his corn to be of "low quality". He calls his friend in the capital and learns chicken farmers in the area are paying 5000 pesos for 10 bushels of corn of "commercial quality". After calling his friend and the chicken farmer he decides to ship the corn to the capital and is able to sell it for 3500 pesos. He also talks with other friends and learns how to improve the quality of his corn, learns where to buy small grain storage systems so he can sell his corn when the price is higher, and learns that he can make even more money by raising chickens with his corn (1 lb of chicken takes 2 lbs of corn and sells for the price of 4 lbs of corn.) The use of telecommunications has helped the campesino increase his income by a factor of four.

Yes, they MAY

Beth Nderitu — Tue, 15 Apr 2008 10:31:27 -0500

I was born and raised in Kenya at a time when land-line phones were the preserve of the rich, corporations, and other institutions. Currently, almost all the families I know (here family means extended family) have at least one cellphone. So yes, poor people can afford cellphones. What is now needed are better ways to make them productive. Most of the people I know use them for social purposes, but some business people use them to order supplies, inquire about prices, and even get market prices sent to their phnes by text. This cuts down on time to travel to market and inquire price, and also give new leads on the best market to sell produce. New innovations are making them useful for other reasons as well. Case in point: M-Pesa, a money transfer service using cell phones. Of course cell phones can't end poverty by themselves. But they may be key.

No, the Cell phone can NOT Help End Global Poverty.

Henry Lahore — Mon, 14 Apr 2008 22:06:38 -0500

The poor cannot afford cell phone service. Even if new handsets were free most of the poor could not afford cell phone service. A major change is needed to drastically reduce the cost of wireless phone service. I have designed a ‘message phone’ system which needs 10,000 fewer phone towers to provide service to a region. Only three message phone towers would be needed to cover all of India. I designed a ‘message phone’ to provide service at less than a fraction of a cent per minute, and thus be affordable by 2 billion people. I have applied for a patent and wish to donate the design to a company which can use it to help end poverty by providing communications for less than 1 cent per minute. The message phone is also extremely rugged, will last for at least 10 years, can be used by people who are illiterate or blind or who speak any of thousands of languages, can be shared by many people, and will be able to download and play 100+ hours of podcasts from the internet. Henry Lahore

Telecommunications and global issues

Dr. Paul Rigterink — Mon, 14 Apr 2008 12:21:23 -0500

In the year 2000, I helped two major IT companies develop a multi-billion dollar business concept for improving global telecommunications throughout the world. We investegated how telecommunications could help solve “Global Issues” in 10 different countries. These "Global Issues were: Health, Food, Water, Energy, Education, Environment Protection, Security, Population Shift, Governance, Crime. We found that telecommunications was an excellent investment since it allowed people (including those at the "Bottom of the Pyramid") to order the supplies they needed to conduct a business, determine markets and prices for their products, report criminal activity, get help when they needed it, etc. The project had to be abandoned when one of the companies became worried about anti-trust considerations should they enter the telecommunications market. I have suggested to the leaders of Colombia SA that they improve their telecommunications in rural areas to help fight drug traffic and improve their economy. It would be very hard to conduct a drug operations if every Colombian citizen had a phone and could report illegal activity to responsible officials. In addition, each rural Colombian citizen would be able to order the supplies they needed to conduct a legitimate business. This is not possible now since it can take all day to go to a store with appropriate supplies if you live in a rural area.

Can the Cellphone Help End Global Poverty? Al Hammond Comments

Derek Newberry — Fri, 11 Apr 2008 15:55:31 -0500

April 11, 2008 - 15:00, New York Times

Can the Cellphone Help End Global Poverty?

Story Link: http://www.nytimes.com/2008/04/13/magazine/13anthropology-t.html?ex=1208577600&en=528280c6bccfef1b&ei=5040&partner=MOREOVERNEWS

Teaser:
Last year, the World Resources Institute, a Washington-based environmental research group, published a report with the International Finance Corporation entitled "The Next Four Billion," an economic study that looked at, among other things, how poor people living in developing countries spent their money. One of the most remarkable findings was that even very poor families invested a significant amount of money in the I.C.T. category - information-communication technology, which, according to Al Hammond, the study's principal author, can include money spent on computers or land-line phones, but in this segment of the population that's almost never the case. What they're buying, he says, are cellphones and airtime, usually in the form of prepaid cards. Even more telling is the finding that as a family's income grows - from $1 per day to $4, for example - their spending on I.C.T. increases faster than spending in any other category, including health, education and housing. "It's really quite striking," Hammond says. "What people are voting for with their pocketbooks, as soon as they have more money and even before their basic needs are met, is telecommunications."

Last year, the World Resources Institute, a Washington-based environmental research group, published a report with the International Finance Corporation entitled "The Next Four Billion," an economic study that looked at, among other things, how poor people living in developing countries spent their money. One of the most remarkable findings was that even very poor families invested a significant amount of money in the I.C.T. category - information-communication technology, which, according to Al Hammond, the study's principal author, can include money spent on computers or land-line phones, but in this segment of the population that's almost never the case. What they're buying, he says, are cellphones and airtime, usually in the form of prepaid cards. Even more telling is the finding that as a family's income grows - from $1 per day to $4, for example - their spending on I.C.T. increases faster than spending in any other category, including health, education and housing. "It's really quite striking," Hammond says. "What people are voting for with their pocketbooks, as soon as they have more money and even before their basic needs are met, is telecommunications."

There are clear reasons for this, but understanding them requires forgetting for a moment about your own love-hate relationship with your cellphone, or iPhone, or BlackBerry. Something that's mostly a convenience booster for those of us with a full complement of technology at our disposal - land-lines, Internet connections, TVs, cars - can be a life-saver to someone with fewer ways to access information. A "just in time" moment afforded by a cellphone looks a lot different to a mother in Uganda who needs to carry a child with malaria three hours to visit the nearest doctor but who would like to know first whether that doctor is even in town. It looks different, too, to the rural Ugandan doctor who, faced with an emergency, is able to request information via text message from a hospital in Kampala.

Jan Chipchase and his user-research colleagues at Nokia can rattle off example upon example of the cellphone's ability to increase people's productivity and well-being, mostly because of the simple fact that they can be reached. There's the live-in housekeeper in China who was more or less an indentured servant until she got a cellphone so that new customers could call and book her services. Or the porter who spent his days hanging around outside of department stores and construction sites hoping to be hired to carry other people's loads but now, with a cellphone, can go only where the jobs are. Having a call-back number, Chipchase likes to say, is having a fixed identity point, which, inside of populations that are constantly on the move - displaced by war, floods, drought or faltering economies - can be immensely valuable both as a means of keeping in touch with home communities and as a business tool. Over several years, his research team has spoken to rickshaw drivers, prostitutes, shopkeepers, day laborers and farmers, and all of them say more or less the same thing: their income gets a big boost when they have access to a cellphone.

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