How rural users gain from connectivity in emerging markets

The theme to which I have really warmed in the last few days is that of how telecoms and Internet services are improving the lives of poor people in developing countries, especially those who live away from major towns and cities. I have tried to examine how this kind of humanitarian objective can be reconciled with for-profit telecoms sector businesses seeing a solid return on their investments and thereby building shareholder value.

My most recent post, for example, mentioned Village Phone projects in Bangladesh, Indonesia and those involving subsidiaries of MTN in Uganda and Rwanda. This did include a video clip about the Village Phone initiative in Uganda, but I am conscious that I have otherwise been a bit vague about precisely how access to services makes a positive impact on the economies and social conditions of rural communities in emerging markets. In the following clip, which relates to the Rwanda project, we see how a small business works more efficiently by gaining the facility to order materials online rather than having someone travel to make a purchase. The same business has also gained from being able to access international markets for its products.


As well as showing us the benefits for users of services, we also hear echoes of a point discussed here. In the clip, MTN Rwanda CEO Themba Khumalo says: "we are creating a base of potential customers into the future. Not the very far future. The near future." This chimes neatly with the 2005 quote from Neil Gough of Vodafone which I dug up for Saturday's entry: "all of these results were achieved through enterprise rather than aid. A clear success story in commercial terms but one that also had a profound impact on the development of the economy and society."

This is taken from the Autumn 2008 edition of Ericsson 's online magazine 'Telecom Report' and is part of a longer video article on Corporate Social Responsibility. In my last post, I looked at the enthusiasm of Ericsson's rival Nokia Siemens Siemens Networks for work of this kind, quoting the company's Head of New Growth Markets, Rauno Granath who is adamant that "there is still a lot of pure business sense for operators to reach the rural areas." With that in mind, I do wonder why the presenter of Ericsson's video magazine saw the need to round up the item by asking whether the case of the basket weavers of Rwanda is "a marketing ploy or sincere commitment", particularly because it's not immediately clear whose possible 'marketing ploy' he is referring to. Does he mean a marketing ploy on the part of MTN? It is hard to tell, not least because I am not sure who commissioned and produced the film from Rwanda. MTN? Ericsson? Some third party? Whatever the story, I feel sure that Ericsson would not want the remark to suggest any cynicism on their company's part regarding the idea of bringing communications services to poor people in rural areas in the developing world - not least because in late 2007, the Swedish vendor announced its own partnership with the United Nations and The Earth Institute to provide connectivity to African villages through the same Millennium Villages project mentioned in the Rwanda clip.

In the clip, and via Ericsson's November 2007 announcement, we can see that as well as improving the efficiency of the villages' nascent entrepreneurs, access to the Internet is being used to benefit the education of children. Ericsson's Millennium Villages announcement also emphasised the health benefits, quoting Jeffrey Sachs, special advisor to the United Nations Secretary-General and head of the Earth Institute at Columbia University, a key partner in the Millennium Villages project: "A mobile phone is one core breakthrough technology; it won’t end malaria by itself, but it can make it possible for a mother whose child is dying of malaria to access a community health worker to ensure that her child gets the emergency treatment they need to stay alive."

I only wish these points were always so clearly articulated in the general news media. The UK's Guardian newspaper supports development work carried out by the African Medical and Research Foundation (Amref) and Farm-Africa in Katine, a rural sub-county of north-east Uganda. The project was launched by Guardian editor Alan Rusbridger and is being funded by donations from Guardian and Observer (the paper's Sunday edition) readers and Barclays Bank, which initially gave £500,000 to the project and will match fund donations over the course of the project up to £1m.

The Katine project is more than just a fundraising push. Via the Guardian's dedicated Katine website readers can follow how the money is spent, how development works (the successes and the failures) and how the lives of the sub-county's 25,000 inhabitants are changing.

While this all sounds very good, something I did find rather frustrating was an article earlier this month, which I felt made a fairly weak case for spending donors' money on providing Katine resident with Internet access. I felt the flippant title ('Learning to surf') and the fact that the piece does not really go into how Internet access will benefit the villagers makes it an unhelpful contribution to the debate around this.

Last month, however, there was a better Katine article covering mobile phone use and how "the latest technology is enabling villagers to bypass middlemen and find out the prices their crops will command." I also noticed that Ken Banks of Kiwanja.net fame responded to the article's point about how mobile users in Katine charge their phones. There is more about this issue from Ken on one of his 2008 blog posts.

That's all for now. In the next hour I have to head for the airport to take the last family vacation before starting my challenging, exciting new assignment. I daresay that by the next time I am on online there will be plenty of news emanating from Barcelona worthy of comment here.

How rural users gain from connectivity in emerging markets