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Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
Mega cities: on-the-ground intelligence from four global locations
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Mega cities: on-the-ground intelligence from four global locations

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By 2025, experts predict that nearly half the world’s population will reside in megacities. This new trend will bring both benefits and challenges as megacities expand to meet the needs the residents. …

By 2025, experts predict that nearly half the world’s population will reside in megacities. This new trend will bring both benefits and challenges as megacities expand to meet the needs the residents. Countries such as Indonesia, China, India and Brazil are incorporating conveniences that will enhance the lives of their residents. Each city has incorporated technology to increase social interactions and productivity within it.

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  • 1. Mega-citiesOn-the-ground intelligence from four global locations
  • 2. This white paper is a bit different.For a start you might be shocked to read in a business the IMF money and is investing in infrastructure – airportspublication that the world out there isn’t perfect. and roads – to be ready for the 2014 World Cup and 2016 Olympics.But these are challenging economic times and we thinkthat, in times like these, you need a little plain speaking. Our China report is about Guangzhou, a growth story of epic proportions. This city of more than 12 million people,And while a lot of businesses are looking to the world’s the capital of the southern Guangdong province, was thehigh growth markets and their booming megacities, we first part of China to open to foreign trade and to get rich.know that it’s not always straightforward to enter these Today the city boasts high-speed 3G connectivity even inmarkets. its subway system, and it is a test bed for the new fourth- generation connection which would double downloadSo this is a challenging white paper. There are bits that are speeds.uncomfortable reading for any business looking to set upin our featured cities. Next stop Jakarta, and welcome to the Facebook capital of the world. Did you know that Indonesia has theBut our message for you is that we’ve been there. We second largest Facebook user base in the world (moreknow the issues and our Global Services teams are there than 40 million, second only to the US)? And Indonesiannow, ready to navigate the megacities with you. ‘Facebookers’ have a high number of friends online – averaging nearly 200 each.So in this white paper we’ve set out to get a bold, realisticsnapshot of digital life in four of these global megacities. “Indonesians love to hang out in whatever form,” financialWe’ve gone beyond the boundaries of the business advisor Ligwina Hananto told the writer Jeremy Wagstaff,world and commissioned experienced journalists, with and as a business you would be wise to either work withbackgrounds reporting for the Wall Street Journal, Time, this fundamentally sociable nature, or lose out, in this highthe BBC and the China Economic Review amongst others, growth market.to give us on-the-ground reports of life in their patch. Lastly, we go to India. If São Paulo shows the economicThey take us to the streets of São Paulo, Guangzhou, shift, then Mumbai shows the social shift brought byJakarta and Mumbai, to hear real stories of innovators the digital revolution. In recent years India’s commercialand entrepreneurs. And they take an honest look at the capital has been rocked by a series of terror attacks. Yetchallenges and advantages for businesses operating there. with every attack people became more creative in usingThese megacities are centres of growth, opportunity and social networks to provide information about what wasinnovation. They are harnessing the digital revolution happening, and to coordinate relief and volunteers.to get ahead. But they are places where you need someknowledge to get around. We took these journalists’ reports back to our BT country managers and they enjoyed the insights and the chanceOur writer Andrew Downie in Brazil quotes the advice of for a bit of plain talking. You can see their responses on theCaio Bonilha, the president of Brazil’s state-controlled following pages too.telecommunications company Telebras, when he says:“Get to know the rules, get to know the market.” And What we all agree on is that these high growth cities areDownie shares with us the story of a start-up business run going to play a major part in the future of our world. Theby three Frenchmen who had to work hard to get set up. research company Frost & Sullivan predicts that by 2025 half the world’s population will live in megacities in theBut now their business is underway and they are part of high growth markets. This will bring great challenges butthe São Paulo success story. Dubbed “the city that cannot also great opportunities.stop” back in the 1950s, today São Paulo illustrates howBrazil made the economic shift to become the seventh So megacities – bigger, better, and with BT, easier –biggest economy in the world. It can now afford to lend welcome to the future.Megacities • A BT white paper 2
  • 3. How we chose our megacitiesThe word megacity applies to any city with a populationof more than ten million people. There are currently 21 ofthese and at least half of them are in high growth markets.Sources disagree about which are the largest cities in theworld. One reason for this is that some countries count thenumber of people living within a defined city area, andothers extend their counting to the surrounding urban andsuburban areas.The United Nations has identified the cities it believesto be the largest. Top is Tokyo with an astonishing 36.6million people. Next come Delhi, Mumbai, São Pauloand Mexico City, although they are well behind Tokyo ataround the 20 million mark.For this white paper, we chose two of the United Nations’top five cities in Mumbai and São Paulo. Then we pickedJakarta, which is on the brink of achieving megacity status:its daytime population, with additional people travellinginto the city for work, certainly makes it qualify.And we chose Guangzhou, which, in contrast to theUN figures, has declared its population to be over 10million people. It is also part of the new phenomenonof megaregions. In 2010, UN-HABITAT, the agency forhuman settlements, described how megacities werespreading and merging with other cities to form what itcalled megaregions. These “endless cities” can extend forhundreds of kilometres and be home to huge populations.The largest is the Hong Kong-Shenzhen-Guangzhoumegaregion where 120 million people live.Megacities • A BT white paper 3
  • 4. It’s boomtown-stylebusiness in BrazilBy Andrew DownieSão Paulo, BrazilAndrew Downie has been based in Brazil since1999 and has written about the country forpublications including Time magazine, the NewYork Times and the Christian Science Monitor.He’s also worked as a consultant for the WorldEconomic Forum and business organisations.Megacities • A BT white paper 4
  • 5. It’s boomtown-stylebusiness in BrazilThe founders of zarpo.com, a start-up in Brazil that offerscut price hotel rooms to travellers, got a surprise one daywhen they couldn’t get a mobile phone signal in theirdowntown São Paulo office.The three French entrepreneurs, along with the five othersin their small staff, had mobiles from a Brazilian firm. Thenall of a sudden they stopped working. Out in the corridor,their phones worked. Outside on the street, their phonesworked. But no matter where they went inside their five-room office, they couldn’t get a signal.“Our office was like a black hole,” says Numa Sales dePaiva, one of the company’s three managing partners. “Itwas as if someone had suddenly moved the aerial.”They spent hours on the phone to the mobile operatortrying to work out what happened and find a solutionthat would make their phones usable again. Like millionsof people who’ve contacted Brazil’s mobile phonecompanies, they discovered it was a time-consuming,frustrating and ultimately useless exercise. After daysof fruitless negotiating they ditched their company and decades the joke was that Brazil was the country of themoved to a rival firm. future – and always would be. But Brazilians are now the ones laughing. Brazil is a hot destination The seventh biggest economy in the world, its currency is right now not just for at its strongest level against the dollar since 1999, foreign reserves are at an all-time high, and the country that just start-ups, but for just nine years ago went cap in hand to the IMF is rich enough to be loaning the troubled institution money. about every forward Its abundant commodities are fuel for Asia – it was one looking company, big of the only western nations not laid low by the economic crisis, and it has just started developing some of the and small. biggest oil finds in years. To cap it all, the country will celebrate its coming out on the international stage byThat all-too-common story is indicative of how even the hosting the 2014 World Cup and 2016 Olympics.most basic things can hamstring a business in Brazil. Thisis a nation where a whole culture has developed to avoid Entrepreneur Leo Kuba, the owner of a B2B start-upbureaucracy and where consumers pay the highest taxes called Inkuba, is riding the wave. “The path to growth isin the developing world. It is also a place where a simple much broader because of the World Cup and the Olympics.task like getting an established mobile phone company Budgets are greater. Global and local brands have moreto comply with that most basic part of the contract – to money to spend because of these events.”provide a working service – can make your life miserable. The almost palpable sense that Brazil is on the up was“Doing business in Brazil is war,” says Alexis Manach, one crucial to zarpo’s decision to go live with their site in May.of the two other French natives who conceived of and runs Some 48.7 million Brazilians have jumped into the middlezarpo. “Everything takes ten times longer than it should. and upper classes since 2003, according to governmentEverything is a mess.” estimates, and with credit more readily available than ever before they have money to spend. Zarpo aims to sell themIn spite of that damning verdict, Brazil is a hot destination reduced rate hotel rooms at exclusive places not just inright now not just for start-ups like zarpo – who took Brazil but in Europe, North America and even as far awaythe plunge on the advice of Sales de Paiva, then working as French Polynesia.for the Boston Consulting Group – but for just aboutevery other forward-looking company, big and small. For “When you look at Europe, the growth curve is flat, butMegacities • A BT white paper 5
  • 6. It’s boomtown-stylebusiness in Brazilhere it is growing fast,” says Manach. “This is one of the “There’s been a serious delay in the expansion of networksplaces to be.” over the last few years,” Moura said. “People want broadband. They are buying smartphones. But althoughThey are adding clients at a rapid rate but they also face demand is big investment has been small.”a host of problems, some of which are particularly acutefor outsiders. Not only is it much easier to get things done As if that were not enough, the quality of the lines thatwith personal contacts, which is tough if you don’t know do exist is poor and the cost is high. Zarpo has a line runanyone, there are also obstacles so notorious they are by Spanish firm Telefónica – which has a monopoly in theknown as the Brazil cost. centre of São Paulo – but it opted to base its servers in the US because it was easier than dealing with the Brazilian“The big three liabilities in Brazil are that it is very bureaucracy.bureaucratic, the tax burden is excessive and legislationhampers entrepreneurs,” says Leo Kuba. “Brazil is on the Entrepreneur Leo Kuba knows the problems only too well.cover of Time and the cover of The Economist but the gap “The speed with which infrastructure is being added isbetween starting a business here and starting in the US is not as fast as the speed at which the market is growing,”enormous.” he said. “The problem is the cost, the performance and mostly, the reliability.”Perhaps the most pressing challenge for Brazil is buildingthe infrastructure to cope with the rapid rise in livingstandards, as well as events like the World Cup and the Not only is it much easierOlympics. The money is there but planning is atrociousand construction is slow. Corruption is a constant drain on to get things done withfinances and morale. personal contacts, there areThe prestigious opening match of the World Cup, also obstacles so notoriousfor example, was originally planned for the city’s80,000-capacity Morumbi stadium. The Morumbi, they are known as thehowever, was ruled out because of petty personalityclashes and organisers now expect to take place at the Brazil cost.ground of São Paulo’s biggest football club, Corinthians. And while the government has promised to improveThe problem is, Corinthians don’t have a stadium. The broadband, many Brazilians might take such promisesclub designed one last year after the Morumbi debacle with a pinch of salt. The government promised a bulletand building started in May 2011. It is so late that it train between São Paulo and Rio in time for the World Cupwon’t be ready for the warm-up tournament, the 2013 and it is still to get off the drawing board. Infraero, theConfederations Cup, and so small that extra temporary government corporation that manages Brazil’s airports,seating will have to be installed to meet demand. promised free wi-fi at the country’s main airports, only to change their minds and leave passengers unconnected.The lack of planning is also evident when it comes Most glaringly of all, the city of Rio won the right to hostto airports, hotels, public transport and, of course, the 2007 Pan American Games by promising a ring roadtelecommunications. According to the Brazilian system, a new state highway and 54km of new metro line,Association of Infrastructure and Basic Industry, Brazil none of which was ever built.invested $76.7 billion in telecoms infrastructure between2003 and 2010 and must invest a further $55.9 billion by The men behind zarpo are well aware of those limitations.2015. This year, companies are expected to pump $11.3 But they are even more aware that Brazil in 2011 feelsbillion into their broadband networks, the biggest annual very much like being in the right place at the right time.investment since 2001. They are content right now to keep fighting those daily battles in the hope of seeing off their rivals.But that is still less than is needed to meet the growingdemand, according to João Moura, the executivepresident of Telcomp, the Brazilian association of telecomscompanies. European and US companies customarilyinvest around 15 per cent of revenue on updating andadding to networks, Moura said. In Brazil, the figure is justten per cent.Megacities • A BT white paper 6
  • 7. One Country, many facets How do you connect It is a similar story with mobile phones, with a few companies controlling the market and offering 190 million people? substandard services at offensive prices. Even the moderate use of mobiles costs as much as eight A large number of Brazilians only have access to times what it does in neighbouring countries, and broadband at their work or at LAN houses, primitive three times the OECD average, according to a 2009 cybercafés with high speed access that are important study by the Diálogo Regional sobre la Sociedad social hubs in poorer parts of the country. Recent de la Información. The cost of roaming is, in the figures from the Centre for Digital Inclusion show that words of Communications Minister Paulo Bernardes, 45 per cent of all internet access comes through LAN “ridiculously high.” houses, a number that rises to more than 75 per cent among the less well off. For that reason, many poorer Brazilians buy cheap phones (or chips) from each different provider and The government has a plan to provide broadband use them to call others on the same network. That access to 72 per cent of Brazilian communities by explains why there are more than 220 million mobile 2014. But those numbers are ambitious and even phone lines operational in a nation with 192 million the government’s own think tank recognised the inhabitants. current service on offer is poor, especially outside the big cities. So far, only 23 million of them are 3G, but that number is expected to rise exponentially in the coming years. “The discussions prior to the launch of the National Telefónica, Brazil’s biggest mobile phone operator Broadband Program (PNBL) in Brazil revealed a (through Vivo), says it expects broadband to account scenario in which broadband appears lacking not for 25 per cent of its revenues in 2013, up from just 15 only in relation to the more advanced economies, but per cent last year. also in relation to its Latin American neighbours,” declares a report by Ipea, the Institute for Applied The government recently promised a 4G tender for Economic Research. “The diagnosis showed that access April 2012 and says the technology, which offers to broadband internet in Brazil was expensive, that mobile internet connections up to 180 times faster speeds were well below those of developed countries than the present 3G system, will be operational at least and that the concentration of services on offer in a year before the World Cup. It also promised to invest major urban centres replicated the country’s unequal $113.3 million to guarantee the 12 host cities will distribution of wealth and infrastructure.” have internet connections of up to 100Mbps.One country, I can recognise some of my country in Andrew Downie’s report, but that’s not the whole story. First and foremost Brazil is a land of contrasts and heterogeneity.many facets Diversity everywhere São Paulo is our largest city. It is also the centre of ourBy Sergio Paulo Gallindo largest metropolitan area combining 39 cities which areCountry Manager, BT Brazil home to around 20 million Brazilians. Like our other big city, Rio de Janeiro, it has wealthy neighbourhoods, and very poor ones called favelas, or slums, where people live in poverty. We all share the same urban infrastructure.I would like to tell you how we are making a difference in Cultural life is vibrant and some services are really good,Brazil. How we are using cloud computing to overcome but public transportation, for instance, is deficient relativeinfrastructure challenges affecting Brazil’s biggest to the demand.companies. How satellites and fibre networks are helpingBrazil’s post office give services to some of the poorest of Diversity applies to some areas of the economy too.our people. But first, let me put the work in context. For large businesses like those in the finance sector, weMegacities • A BT white paper 7
  • 8. One Country, many facets that are not connected to any type of network. An explosion in construction means telecom services to corporate clients can easily be disrupted if road builders or trucks hit cables. Last year we won a contract with one of Brazil’s state-owned banks, and we’re helping them roll out banking services to poor neighbourhoods in 5,600 locations via our satellite networks.operate levelled with best in class. For small and mediumbusinesses, it is more challenging. Harnessing complexityFor instance, the banking system in Brazil is very This heterogeneity is part and parcel of doing businessadvanced, on a par with First World countries. The majority in Brazil. It’s in harnessing it that we can add value forof the transactions are done electronically. Regulation companies coming here.is very welcome. Brazil’s largest institutions were not asbadly affected by the 2008 crisis and the sector maintains Back in 2001, one of the first things we did when wea high level of solvency. started serving our international customers was to act as a manager of carriers. Since Brazil’s state-owned telecomOn the other hand, for small and medium businesses, monopoly was broken and privatised in the early 1990s,bureaucracy and taxation are issues. Setting up a business many telecoms companies have provided varying levelsin most countries means a week to go through all the of service. Thanks to the open and competitive regulatorypaperwork and requirements. In Brazil it can take two framework, our customers were able to delegate themonths. Recent federal initiatives have reduced certain job of managing them to us to yield the high level ofburdens but there is room for improvement. performance they needed.One country, different infrastructures Now, ten years on, we have grown to provide services like MPLS and public internet on our own infrastructure. WeThis heterogeneity goes for our infrastructure as well. designed and delivered unified communication solutions for our global customers. Today there are 15,000 IPTThe bulk of the population lives in the south east, which extensions, provided as managed services. Two years ago,has the best roads. In the north, in the Amazon, people we launched a fixed line telephony service. We also have aonly live along the rivers, not in the countryside, where data centre service. And we have one of BT’s three globalthere is rainforest. So the roads there are much worse service centres here in Brazil with ISO 9000, to delivermaking it more difficult and costly for trucks carrying managed services to multinational accounts. Our peoplecargo. Some communities have access to banking services working on the centre are highly qualified in ITIL and theon a boat just once every 21 days. state of the art technologies of our main suppliers. The centre is ISO 9001 and 27001 certified.The situation is similar for telecoms. If a company needsa broadband service in São Paulo, we can provide a Taking the strain100Mbps internet connection on a fibre network. But inthe countryside this is simply not viable, either on fibre or Now we can host customers’ entire IT infrastructure andcable. Even in the state of São Paulo, our richest state with last year we set up a cloud computing offering. One of our33% of the country’s GDP, there are about 200 schools cloud pioneers is a major Brazilian business conglomerate,Megacities • A BT white paper 8
  • 9. One Country, many facetswhich started in logistics and has moved into petrolstations, restaurants and construction. Its CIO has talkedabout the savings he got from transferring systems fromhis data centre to our cloud-based service.It’s flexible – customers can have as much or as littlecomputing power as they need. For example, instead ofbuying more computers, they can buy more trucks. Andour data centre is resilient enough to keep service levelshigh – we have power generators, 24-hour managementand other back-up. Also, our network is global so we canreach out to some 150 countries.We’re also proud of our domestic business. Last year wewon a contract with one of Brazil’s state-owned banks,and we’re helping them roll out banking services topoor neighbourhoods in 5,600 locations via our satellitenetworks. We supply the IT network for Brazil’s lotteryhouses connecting 11,000 sites, combining fixed line,3G and satellite access technologies integrated intoa seamless MPLS network. And this year we signed acontract with the Brazilian post office, which will supplyservices to another 7,200 sites across the country.For me, all this is yet another example of heterogeneity,Brazil-style, with multinational companies and domesticbusiness, side by side. Our role at BT in Brazil is to provideuniform and effective service to corporations, alignedwith BT’s global vision and capabilities, backed up bythe quality and expertise of our people in an easy-to-dobusiness manner.Megacities • A BT white paper 9
  • 10. The quiet charms ofChina’s shopping paradiseBy Pete SweeneyGuangzhou, ChinaPete Sweeney is the editor of the ChinaEconomic Review, covering Chinese businessnews and analysis. He’s written abouttechnology, media and telecoms in China andwas a Fulbright Scholar researching businesspolicy in China. He is based in Shanghaiand took a 750-mile trip to Guangzhou toreport this piece.Megacities • A BT white paper 10
  • 11. The quiet charms of China’sshopping paradiseGuangzhou on a Friday night in August was hot, steamy you’ve got all this new storefront in the New Pearl Cityand… quiet. Riding in from the airport, a cabbie pointed area, all this nice new retail. The prices for real estateout various buildings and quoted stratospheric prices per are crazy but people are still coming in.” He noted thatmetre from time to time: this one, $3,100 per square because Guangdong province was one of the first to openmetre, that one $3,900. “Downtown, it’s worse,” he said. to foreign trade – namely through the Shenzhen Special“You can save your whole life and never afford a house.” Economic Zone that abuts the border with Hong Kong – the province was one of the first to get used to gettingTo a visitor from Shanghai or Beijing, of course, this is not rich, and by extension, to spending its money.news. What is different, very different, is the silence. Acity of over 12 million people; the capital of Guangdong However quiet the bars are at night, during the dayprovince in southern China; administrative hub of the shopping centres like the Tianhe mega-mall hum withprovince and de facto traffic control terminal for the custom, and old leafy historical neighbourhoods like thecountry’s massive export hub, Pearl River Delta (known Liuyun Erjie have seen their ground floor apartmentsas the ‘PRD’ to expatriates); favoured target of nearly taken over by small businesses: DVD stores, funkya quarter of the foreign direct investment into China in imported t-shirt shops and restaurants. As in some other2010… when one dismounts from a cab, one strains in Chinese cities, retail explosion has tunnelled downwardvain to here a car honk. Plenty of traffic, plenty of people, into erstwhile bomb shelters and subway lines; 7-Elevensbut they manage to get around without causing too much and lingerie shops are within steps of the turnstiles.fuss. Guangzhou has a reputation for being a dangeroushive of motorcycle purse-snatchers, for having excellent Much of the shopping is low-end, no-name brands –dim sum and marriageable wives. But it is not loud, it is the luxury brands are glanced at in windows, but rarelynot flashy – or at least, it wasn’t. purchased. This is not because people can’t afford to buy Prada, it’s because of the proximity of Hong Kong, which distorts Guangzhou’s top-end retail data downward. The province was one Hong Kong is only two hours away by train, and many of of the first to get used Guangzhou’s rich head there to buy luxury goods to evade stratospheric mainland taxes. Once the high-speed train is to getting rich, and by ready, the commute will diminish to around half an hour, and it will become feasible to commute to Hong Kong to extension, to spending work, even. But even so, the Guangdong government reported that retail sales of consumer goods in the its money. province rose 17 per cent in 2010. In June of 2011, retail sales in Guangzhou hit $37 billion, up 16 per cent year onStepping into Hooley’s, an expat hive that hosts a sliver year, but far below the record $70.1 billion that moved inof Guangzhou’s nascent nightlife scene, the energy level December of 2010 (sales are highly seasonal here).increased. A band made up of expats and locals wasplaying the blues, loud. The crowd was diverse in twoways: a mixture of foreigners and Chinese people, and amixture of Chinese people from different regions. At onetable a young couple leaned into the music, smiling andquaffing beers. The man was from Hunan, the womanfrom Henan; they had met in Guangzhou and fallen inlove. “I do like it here,” the woman told me just as thelead singer started on a Cantonese ballad. The locals sangalong, but the rest of the Chinese – most of whom do notspeak Cantonese – turned back to their beersRetail capitalWhether Guangzhou is socially slow or not, it has retailershot under the collar. Anthony Tartaglia, founder of a digitalmedia marketing company in Shanghai who moved downto Guangzhou to work on the Proctor & Gamble accountfor UT Starcom, ran down the advantages: “They investeda lot of money into cleaning up different areas of thecity leading up to the Asia Games. With that investmentMegacities • A BT white paper 11
  • 12. The quiet charms of China’sshopping paradiseYes, life for retailers in Guangzhou is pretty good, was in Italy, and on a trip to Lombardy she discoveredbut they are facing increasing challenges from online Italian wine. “It started as a hobby,” she says. “But thestorefronts through platforms like Taobao, the Alibaba Italians told me, we are buying so much from you, youGroup’s ubiquitous and market-dominating answer should buy something from us. Good for the trade deficit!”to eBay. E-commerce in Guangdong is booming,thanks in no small part to the city’s status as China’s Zhang Qingqing is not running a high-tech enterprise.cell phone capital. Tartaglia points out that thanks to Like most Chinese of a certain class, she has an iPhoneGuangdong Mobile’s aggressive investment in mobile and an iPad, and like most Chinese of that class, she usesinfrastructure, Guangzhou is famous for robust mobile them largely for gaming. Her shoe business was run byphone connectivity: “Guangdong Mobile’s networks have telephone calls and faxes to agents. E-commerce foralways been notoriously faster, more stable; the incidence exporters is still a niche product – although there areof mobile search is higher, the population that is using 9,987 Guangzhou suppliers listed on B2B export portalmobile phones is much more aggressive here. Guangdong Alibaba.com (correct October 2011), the platform ismobile has done a really good job of packaging their still technologically simple, more of an online telephoneservices, having good pricing … they’ve just done it book than an actual fulfilment system. RFID systemsright.” This includes high-speed 3G connectivity running are lightly deployed here, and the internal shippingthrough Guangzhou’s subway system – and the city is set system, the infamous kuaidi, is a fragmented mess thatto become one of the first test beds for China Mobile’s is still being consolidated by policy. Small hit-and-runnew fourth generation LTE protocol, which should double kuaidi operators are known for delivering late, deliveringdownload speeds: state media is leaking rumours that wrong, and delivering broken; recently, refrigeratedtrials will begin this year. trucking companies were discovered to be turning off the refrigeration once they left town to save on gasoline. Technology alone cannot overcome such structural Technology alone cannot issues, and it hampers the development of e-commerce: overcome structural an online retailer is only as trustworthy as her delivery company is. issues, and it hampers the So far it hasn’t hurt Chinese businesspeople too much. And development of e-commerce: when it comes to trade, not all products need high-tech solutions anyway. “I have no need for a website – you an online retailer is only as can’t taste wine online,” Zhang pointed out. And this is a particular challenge for those selling Italian wines, which trustworthy as her delivery are far less well-known here. In fact, Zhang has a sort of company is. negative marketing strategy. If she puts out too many ads, she gets a bunch of people who come in, try wine and walk out, leaving her with an open bottle of expensiveThe connection between e-commerce and mobile Italian wine going stale. Instead, it’s all word of mouth;telephones in China is intimate. In the West, e-commerce she’ll have friends of friends over for a tasting at one ofgoes through computers, as a rule, but in China, people her shop’s giant dining tables, and sell by the caseload ifgenerally prefer to conduct transactions and pay for things it’s successful. She also sells into government banquetson their mobile devices, especially given that the mobile from time to time.payment systems are more secure than bank cards in someways – users can’t have their entire bank account drained To some, her success is anomalous. Your stereotypicalthrough a pre-paid phone account. The density of Chinese Chinese wine drinker will pay $5,000 for somethingcharacters also helps makes data more easily legible on French, and then pour Coca-Cola into it. Zhang hasa small screen. The result is both an online and offline discovered a new demographic: Chinese people who areshopper’s paradise. so wealthy that they can afford to cultivate a taste in something for its own sake, not just status – and who areZhang Qingqing is, in some ways, a typical story of the willing to pay an absurd tax mark-up just to skip the trip toevolution of Guangzhou. First, she’s not from Guangzhou Hong Kong.at all, but hails from the frosty northeast – far from theonly internal immigrant who moved to Guangzhou to That’s shopping, Guangzhou-style, and fit for a city that’sget warm. Second, like so many others in Guangzhou, as hot as its money.Zhang got her start exporting OEM (original equipmentmanufacturer) shoes. The business did very well, and shehanded off operations to her brother. Their biggest marketMegacities • A BT white paper 12
  • 13. The quiet charms of China’sshopping paradise Is Guangzhou’s boom still compete on price, and price alone, and that’s economy coming to an end? the inverse of brand strength. So the bedrock of Guangzhou’s economy, the manufacturing sector, is set to take a hit. “For companies that use less Guangzhou has so far benefited from being the sophisticated supply chains – apparel for example, administrative centre of the Pearl River Delta, but its companies like Adidas, Puma – they’re all looking at export role is limited. “Guangzhou is an automotive other options to sourcing beyond China,” said Mooney. centre, and in supply chain terms it’s important as an “China is still by a long way the biggest sourcing automotive hub. But in terms of exports, Shenzhen destination for these companies, but Vietnam, and Hong Kong are still the dominant export hubs in Bangladesh, Cambodia even, are becoming more cost the south, and will continue to be for the foreseeable effective for them.” He mentioned that the recent free future,” says Turloch Mooney, logistics consultant trade agreement between China and ASEAN and managing director of Supply Chain Asia. But has made it even easier for factories to relocate to Guangzhou is nevertheless a critical component in cheaper locations. serving the internal market, he said. Guangzhou’s port, while small, is serviceable enough, and it also The necessary economic shift, therefore, is pushing runs an important air hub. But its primary role these domestic consumption, as opposed to investment- days is serving as a distribution centre for internal led growth, ie dabbling in real estate; this also means demand; not a bad place to be, given the new policy moving away from manufacturing and into services. emphasis on stimulating domestic consumption and None of this plays to the interests of the PRD’s the relentless pace of China’s urbanisation – the largest current model. organised movement of humans from country to city in human history. The answer, of course, is that there is no crisis just yet. China sits on $3.2 trillion in foreign reserves, and But there may be an adjustment period ahead for the companies and consumers in Guangdong are still Guangzhou, and it will not be painless. The PRD is for the most part flush with cash. High savings rates under pressure on multiple fronts. For one, China’s can only facilitate the transition, and the shopping ‘demographic dividend’ – namely a surplus of poor paradise of the delta will continue its relaxed amble to workers willing to assemble goods for export for dirt the mall. cheap wages – has expired. The population of 15- 19 year-olds who make up the bulk of the low-end labour force peaked in 2005. Add to that inflation and policy, and you have Chinese wages shooting skywards (projected to rise 20 to 30 per cent for the next two years) even while workers become harder to find. These costs are punishing the small and medium-sized factories that comprise the bulk of the PRD’s export industry, and by extension much of its economy. The second front is external: given its dependence on exports, the continuing weakness in western economies hits Guangdong and Guangzhou particularly hard. But even as export growth softens, Beijing has cracked down on bank lending to vent asset price bubbles and consumer inflation that has been clocking in above 5 per cent per month – making it harder for the factories to obtain the credit they need to survive a potential double-dip in exports. Finally, these companies have not, for the most part, managed to build successful brands that can compete domestically or overseas. Chinese companiesMegacities • A BT white paper 13
  • 14. Staying ahead of changeStaying ahead Rapid change, rapid response These quick, responsive approaches appeal to theof change two kinds of customer we have in China. One group is large Chinese companies who have their sights set on business overseas. Like one of China’s largest white goods manufacturers, Haier, or one of its largest oil and gas companies. As a global brand, we can share ourBy Sun Jun experience of operating in different countries on issuesHead of Deal Structuring, BT China such as policies, regulations and infrastructure. We help them build a global presence with network, voice, unified collaboration, contact centres and data centres.About 20 years ago, Guangzhou was the first Chinese We also support a lot of manufacturers in Guangzhou,city to open its market to the world. Back then it was a because traditionally this area is a big base for makingcollection of 21 towns with a population of around four goods for export. So when a company sets up a new plantmillion. With its proximity to Hong Kong and its command we help them with their infrastructure, including LAN,of the Pearl River, development took off. Today it’s China’s WAN and all the other parts of the portfolio.third largest city, behind Beijing and Shanghai, and it hasmore than 12 million people. Our other main group of customers is foreign companies who want to grow in China. It might be new shops forSimplifying complexity luxury fashion brands, or new restaurants for food companies. When they open a new outlet they need theSo, as Pete Sweeney shows in his report, a lot of things IT infrastructure ready so they can immediately connectare changing very quickly. And businesses here need to back to their HQ and their system and make the new storeadapt to that and change fast. There’s no time for lengthy operate.processes and drawn-out decision making, so what we’redoing at BT is trying to make the complex simple. And we work as agents for our customers with the three state-owned telecoms providers: China Mobile, ChinaIn China, we’re an IT provider. If a customer opens a new UniCom and China Telecom. The telecoms market isn’tplant, for example, they need a lot of things, like a network open to foreign companies because the government treatswithin the plant, connections to other sites, a data centre it as an area of national security.and video conference facilities. If they combine all thesethings it becomes a big and complex project, and with the Keeping up with trendsmarket changing so fast, requirements can change. Sowe split these big complex processes into smaller projects So life in China for the past 20 years has been aboutwhich match our portfolio. managing change. And that doesn’t stop. Now the financial crisis is affecting what Chinese companies andLocal needs, local service multinationals do. Some foreign companies are moving their Asia Pacific headquarters to China. Meanwhile theIf we can’t do that, we try to supply a localised product. Chinese government has encouraged domestic companiesLike the one we call Retail in a Box. Sometimes a retailer to find business abroad. At BT we have the expertise andwill open a lot of stores in China. They’re small shops experience to keep up with both trends.that need a basic connection but from someone who canprovide managed services. In that situation we’d buy DSL As for Guangzhou, it’s seen it all before. It was anservices from local telcos and sell or lease equipment to important river and sea port back in 200 BC and it keptretailers. In BT it’s a complex process, but here we package prospering as traders came from India, the Middle Eastit as a local product so we can adapt to meet local needs, and, in the 16th and 17th centuries, Europe. Today’s worldwith one-stop shop management. We have a joint venture brings a different kind of business boom, but one thingwith a Chinese business that’s very good on systems Guangzhou’s people know is how to adapt.integration, which again lets us customise to meet localneeds, as does our service centre in north east China.Megacities • A BT white paper 14
  • 15. How working on the movehas got Indonesia goingBy Jeremy WagstaffJakarta, IndonesiaJeremy Wagstaff is a writer, commentator,broadcaster and consultant on media andtechnology issues. A former correspondentfor Reuters and the Wall Street Journal, he isbased in Singapore where he runs a technologyconsultancy called Loose Wire.Megacities • A BT white paper 15
  • 16. How working on the move hasgot Indonesia goingIn May 2011 the BBC released the results of a survey into Eugy Avriliawati has been selling stuff since junior highentrepreneurship. The poll asked people in 24 countries school, from self-decorated alphabets to toy lizards. Now,— among them China, the US, UK, Germany and Australia aged 40, she sells beautifully designed fashion clothing— whether their cultures valued individual enterprise for young girls, all with an Indonesian flourish. And it’sand whether people with good ideas could put them into technology that has helped make her business morepractice. The result: Indonesians believed their country efficient – appealing to both customer and entrepreneur –was the best place to start a business. and more profitable.No one seems to be more surprised than people who know The whole enterprise is run via BlackBerry and a SamsungIndonesia. Galaxy Tab. Her channels? Twitter, BBM, Yahoo Messenger and a Facebook page. Stuck in traffic, her business stillOr thought they knew it. runs. “I can do every aspect of my business using a BlackBerry,” she says. “From taking photos of the product,Indonesia, the conventional wisdom goes, is not a place uploading them to Facebook, taking orders, sending andto get things done. The country ranks 110th out of 178 receiving invoices, and so on. And most of my customerson the Transparency International Corruption Perception have mobile banking on their handphone, so they can doindex. The capital, Jakarta, ranked bottom of 23 cities for the payment using their mobile phone too.”commuters by Frost & Sullivan, and 125th out of 140 inthe Economist Intelligence Unit’s list for 2011 of Most It’s the advance of communications that has made all thisLiveable Cities. Despite more than a decade of democracy possible for Avriliawati. Indonesia fell badly behind in theand stability, it still suffers from a perception problem. 1990s when a lack of investment in landlines left manyIn March Gita Wirjawan, the chairman of Indonesia’s without a telephone connection. In 1991 it had roughlyInvestment Coordinating Board, warned it was in danger the same number of landlines per capita as China – sevenof being forgotten. “Not a whole lot of people,” he told for every 1,000 people. A decade on, and China had 140interviewer Charlie Rose, “know where it is.” lines for every 1,000 people; Indonesia had a quarter that. So when mobiles came along in the late 1990s, they tookAnd yet, according to other yardsticks, Indonesia is very off very quickly.visible indeed. It is home to the second largest Facebookuser base in the world (more than 40 million, second only When the short message – SMS, or text message – wasto the US). Jakarta is by far the biggest Facebook city in introduced in 2000, it caught on equally quickly, forthe world, with nearly double the number of users as the exactly the same reason: for many Indonesians, thenext largest, Istanbul, according to data from SocialBakers. mobile phone was the first communication device they’dcom. ComScore lists Indonesia as having the largest owned, and they wanted to get the most out of it. Indeed,number of Twitter users (the report lists countries in terms Indonesians were the second biggest sender of textof reach, but that equates to 52 million, some seven messages after the Philippines.million ahead of Brazil). And Indonesia is, according tounofficial figures, the largest BlackBerry market in Similarly, the Internet suffered from a lack of investment inthe world. cables – meaning it too only took off when mobile phones became smart and web ready. Until 2007 Indonesia lagged behind much smaller Malaysia and Thailand – wealthier, Jakarta is home to the but mired in regulatory issues which have hampered the second largest Facebook rollout of 3G services – in internet users. In that year mobile internet started to kick in, and Indonesia embraced user base in the world. it wholeheartedly. Within a couple of years internet usage overtook its two Southeast Asian neighbours – even as More than 40 million, fixed broadband subscribers remain negligible (less than one per 100 people in 2008, compared with five per 100 second only to the US in Malaysia). Almost half of all Indonesian internet users, according to data from internet consultancy Nielsen,Reconciling these perspectives – hotbed of access the internet from their mobile phones, compared toentrepreneurialism, quagmire of corruption and traffic, 35 per cent in Singapore and 21 per cent in Malaysia. Thissocial media paradise – requires a visit to Jakarta. There is partly driven by price: Indonesian mobile entrepreneuryou’ll get a glimpse at how Indonesians, long used to Andy Zain says that Indonesia has one of the lowest – ifovercoming the limitations of government, geography and not the lowest – cost of mobile data.circumstance, adopt and adapt technology.Megacities • A BT white paper 16
  • 17. How working on the move hasgot Indonesia going Almost half of all 2011 to build the city’s first monorail project. Pillars and foundations have been left unfinished since 2007. Indonesian internet users Jakarta says it will pursue alternatives but even if work starts tomorrow, nothing will be ready before 2016. In access the internet from the meantime, some Jakartans are pioneering what they predict will be an increasingly mobile workforce. Take, their mobile phones for example, Budi Putra, a journalist and entrepreneur who only accepted a senior position in Yahoo!’s IndonesiaIndonesians have learned to work around the limitations of operations on the condition that he be allowed toinfrastructure and government policy, and have turned to work from anywhere. “A lot of people are becomingtechnology when it’s available – and when they can afford freelancers,” he says. “If employers don’t let them workit. They may not have a computer at home, they may not remotely, they set up on their own.”have a broadband internet connection. They may nothave the fanciest phone: entrepreneur Zain reckons thatup to 80 per cent of phones sold cost less than $120. ButIndonesians are used to squeezing the best out of whatthey have.The mobile phone, in short, is opening things up forIndonesians. Small, portable, reliable, and alwaysconnected. And the critical mass has fostered anecosystem of other services: online banking has seen asurge in growth in the past year, according to comScore:Between January 2010 and January 2011 the number ofvisitors to online banking websites in Indonesia grew by 72per cent, by far the biggest jump in Southeast Asia.Business blogger Rama Mamuaya estimates that start-upsnow number more than 700, and the most noteworthyones are those which build on the particular challenges ofa city teetering on gridlock.Jakarta has many more people than its planners hoped for,and not enough thoroughfares to accommodate them.Its daytime population is more than 12 million, and even Mee Kim, a Korean who runs a regional networkat night, when commuters have left, it’s still home to of temporary offices and meeting rooms from her9.6 million, making it the world’s tenth largest city and headquarters in Jakarta, says companies in Jakarta aresurpassing the city’s projection for another 14 years hence. slow in allowing employees to work flexible hours orInclude its suburbs and sprawl and you’re talking nearly 28 remotely. But she says she is seeing a growing demandmillion people. for her virtual office services supporting one-person businesses – an address for mail, a secretary to handleJakarta’s biggest headache has always been its roads, or voice calls, for example. “Office rents and wages are onelack of them. According to the Jakarta Globe, they account of the biggest business operating cost. Smartphones andfor only 6.2 per cent of the city’s area, against 15 to 20 the internet are the most powerful and effective tools for aper cent in cities like New York, Tokyo or Singapore. And one man operation.”it’s only getting worse: according to official figures roadlength – the amount of thoroughfare available to traffic In the meantime, however, gridlock is creating its own– will have increased between 1994 and 2014 by only a commercial opportunities: drivers skirt the three-in-quarter, while the number of vehicles will have more than one rule (in which a passenger must carry at least threedoubled. The result is gridlock: in 2000, it took 60 per cent passengers when passing through restricted zones) bylonger to get around the central business district than it picking up ‘jockeys’ – kids, teenagers, mothers, who standdid 15 years earlier. by the side of the road offering to make up the numbers for a fee. Motorcyclists offer to ferry commuters fromAnd it’s not going to get any better. After seven years and bus-stop to office or home. Vendors ply the streets sellingbillions of rupiah in public money, the Jakarta government anything from bottled water and cigarettes to inflatableabandoned a long-stalled project in late September hammers to bored drivers stuck in endless jams.Megacities • A BT white paper 17
  • 18. How working on the move hasgot Indonesia goingThere are now several Twitter services for crowd-sourcing parcels and other services. While traditional ojek driversthe location of the worst jams. Koprol has been so look somewhat scruffy, crouching beneath a home-madesuccessful in connecting users to others around them – in sign that doesn’t inspire confidence, GO-JEK drivers havethe same mall, or neighbourhood – that it was bought by a logo-ed jacket and helmet and a fixed price. TheYahoo! in 2010. Mobile app developer SeaTech Mobile surprise? Instead of ferrying the ojek’s traditional clients –recently released an app for Jakarta’s biggest and most commuters from their bus stops to homes or work placesreputable taxi company BlueBird, which not only allowed – GO-JEK has found most of their clients are corporate. It’scustomers to order a cab but, crucially, used the taxi’s GPS a reflection of how the small-scale entrepreneurism bornunit to track its whereabouts. out of necessity has moved into the digital age and the mainstream.Another traffic-related service: GO-JEK, which partnerswith 200 motorcycle taxi drivers (called ojek) to handle “My business,” co-founder Nadiem Makarim told the newsphone or text bookings for moving passengers, delivering agency AFP, “exists because of a lack of infrastructure.” Indonesians: sociable by nature cope with the unpredictability and frustration of living and working in the city, but also, for many of them, and by media a chance to supplement the relatively low salaries most office workers and bureaucrats draw. BlackBerry There’s no doubt that Indonesia has a highly sociable Messaging (BBM) groups are closed networks through culture. So when social media came along, out which friends from school, or office colleagues, stay in went texting and email and in came the new, more touch. But they’re also networks for selling. communal ways of being in touch. Astrid Anastasia, for example, works for Nokia in Dev Yusmananda, who works as a telecommunications Jakarta and lives in Bogor, a town about 40km south of and technology transformation consultant in Jakarta, Jakarta. During her commutes and spare time she turns puts it this way: “People in Indonesia don’t start their to her BlackBerry and netbook computer to run a small communication from a two-way perspective anymore, online air ticketing service. She monitors special flight but from a public broadcast medium and, when deals via airline apps on her BlackBerry and broadcasts needed, they will go into private mode. This function offers to friends and clients via her BBM groups. was not a standard feature for email and SMS.” Colleagues in her office are all doing something similar, she says, acting as resellers for products such Indonesians not only make up the second largest as handbags, clothes, shoes and baby needs, which Facebook population in the world, they are also they will promote, along with photos of the products, some of the most sociable people in the world. On through BBM or Facebook. “They will progressively average Indonesian Facebook users have 199 friends, invite members of BBM groups and broadcast the most according to a report by TNS. And much of this is updated information on latest products and always get mobile: the Jakarta-based internet research firm Saling customers,” she says. Silang found that 43 per cent of Indonesian tweets are from UberTwitter, an app particularly popular among For some it’s become more than a sideline. Ivan BlackBerry users. Chandra is a corporate attorney and a drummer in the three-man soul band Urban Vibe, but most of his This has made social networks and the mobile phones income comes from selling the cajón, a box-shaped that drive them compulsory accessories for any self- percussion instrument, which he makes in a workshop respecting Jakartan. Says Maryam Jamiella, a 25-year in Bogor. He handles all orders via a combination of old civil servant: “You have to have a BlackBerry, BlackBerry and iPhone. “I can get almost everything because everyone has one, and that’s how they keep in from my mobile phone: checking emails, telephone, touch. If you don’t have one, you’ll be socially isolated, updating the website, searching information that you’ll be like an outcast. The first question people will relates to my business such as pricing comparisons, ask is ‘what’s your BB pin number?’” displaying the products, and shipping costs if I need to send the product overseas. I can follow up orders, It’s these networks that not only enable Jakartans to wherever I am, through these two gadgets.” HisMegacities • A BT white paper 18
  • 19. Passionate about business girlfriend runs a business on the side too, selling flew off the shelves and has been reprinted four clothing through BBM groups. times. She credits early adopters like her husband, the infrastructural failures that force Indonesians to Some of these sidelines grow into major businesses: adapt – and the culture: “Indonesians love to hang out Ligwina Hananto, a jilbab-clad graduate of Australia’s in whatever form,” she says. “It used to be in coffee Curtin University of Technology, uses Twitter to shops, radio chat, then the years of IRC (Internet Relay promote her financial consulting business. Her Chat, an early kind of online chatting). Then Facebook. seminars sell out just by spreading the word on Twitter. Now Twitter. That’s why local social networks grow so When she decided to write a book she tweeted about quickly.” the process to her 40,000-odd followers. The bookPassionate heart and passion, we work as a team to understand the customer and see the situation from their point of view. Number three is inspiration so that we can meet our goals. And number four is being straightforward: I think BT isabout business very open and easy to work with. Our future potential is already being realisedBy Wibisono Gumulya In Indonesia there is a lot of potential to develop BT’sCountry Manager, BT Indonesia business but also to bring its global expertise to help develop this country and develop the people. Other countries may be more sophisticated in their technology use, but we have potential as the technology is new hereThis is an exciting time for Indonesia and an exciting time and people are excited about it.for BT. As an Indonesian, I really think the two can benefiteach other. And I would like to tell you how. In schools, for example, we have very few computers, students don’t have great access to technology. ButIT capability here is still quite low. Even today only a now we are seeing graduates returning to the country,few companies have really grasped that IT should be they have studied at schools in America and Europe, andat the heart of their business. And I think that provides they want to set up their own websites and blogs andopportunities for BT and for the country. businesses.I joined BT in April to help them start offering IT services, Indonesians have taken up social media – as Jeremyand big customers are already listening. For example, we Wagstaff writes in his article, the country is numberare working for the third largest telecoms company and we two for the most Facebook users. And it’s true that ahave designed a ‘green’ data centre for one of the region’s lot of my family and friends are using Facebook.biggest banks. Indonesians are very sociable people and they like to have a network. So the culture is there and people areMaking your business work using technology.We know our customers will be the companies that In Indonesia right now there are still some negativerealise their IT network is key to their business, these feelings about the government and corruption, but if weare professional, well-led companies that want to get look at the global economy we are very solid. There is a lotahead. We can pinpoint what would help them in their of potential in the domestic market, we have exports tobusiness – such as data security and storage – and give Japan and China, and the crisis in the US and Europe hasthem a detailed proposal of how we can help not just with not had too much impact on us. The central bank has cashhardware but with IT services too. reserves, the financial system is strong and for the next three to five years I see good growth ahead.I want us to represent all the BT values to win trust andhelp us grow. BT’s number one value I think is to be I joined BT to work with good people with good values andtrustworthy; we deliver what we say we will. Second is to grow. And I hope you will join us.Megacities • A BT white paper 19
  • 20. Mumbaikars usetechnology to cut throughthe blockagesBy Sidin VadukutMumbai, IndiaSidin Vadukut is a writer from India and iscurrently the managing editor of Livemint.com, a premium online business news servicelaunched in collaboration with the Wall StreetJournal. Born in a small village in Kerala, he haslived in Mumbai on and off for the past 11 years.He is also a columnist and blogger.Megacities • A BT white paper 20
  • 21. Mumbaikars use technology tocut through the blockagesFor 22-year-old political science student, Berges, texting around 35 million Facebook users, with some ten per centis slow. And email is positively Neanderthal. He is on an of them in Mumbai alone. Given that only two per cent ofInstant Messenger app all the time. the total national population lives in the city, this is a sign of its popularity. And sometimes these social networksThat means he is always connected, and always available: have been used for more than sharing photos or cheeky“Every time my phone vibrates I pick it up,” he says. status updates.Berges says this is true for the vast majority of his friends Over the past ten years Mumbai has been hit by a series ofand they all enjoy using IM, although it does have some bomb attacks and each time the city’s response has beendownsides: “I’m never having one conversation at a time,” markedly different thanks to the use of new technology.he says. “There is someone I’m talking to in real life, and The Mumbai terror attacks of November 2008, whichsomeone else on my phone. You can see this whenever I killed more than 160 people, were one of the firstmeet my friends, we are always reaching for our phones.” instances where real-time social networks helped report what was happening. Locals used Twitter and Flickr toEven his father has learned that IM is the way to stay in share information about the ten shooting and bombtouch with his son, ever since Berges convinced him to attacks across the city. Some of the first images to beuse Whatsapp on his Android handset (Whatsapp lets you broadcast of the aftermath of the attacks were those takensee mobile messages from people using different phone by resident Vinukumar Ranganathan and posted on Flickr.platforms). Indian bloggers offered live updates.Berges is a genuine Generation Y-er, he falls in the groupof 15-34 year olds who have grown up with digital The New York Times saidtechnology. By 2020, according to the global researchconsultancy Frost & Sullivan, this group will make up a The Mumbai terror attacks ofthird of the world’s population. And 37 per cent of thoseGeneration Y-ers will live in India and China. November 2008 ‘may be the most well-documented terrorThat their world will be different is certain, and it’s up toBerges and his friends to shape just how different. Already attack anywhere.’in his short life span Berges says that the emergence ofcheap data plans, reliable networks and good software has Referring to the huge electronic record of the attacks fromfundamentally changed his social life and the way he uses photos, video footage and phone recordings, the New Yorkhis phone. Times said it “may be the most well-documented terror attack anywhere”.Berges pauses to think back fondly to the old days – inparticular 2003, when he got his first laptop. Back then During the latest series of bomb attacks in Mumbai in July,he used Yahoo Messenger with only ten friends and spent citizens responded with even more sophistication. Besidesmost of his time talking to a cousin in the US. relaying news and quashing rumours, Mumbaikars also used networks to arrange transport for those stranded,Then he switched to Google Talk and in 2008 he got his volunteer help and coordinate relief. The #needhelp andfirst phone, a Nokia E Series device, with an unlimited #here2help hashtags were used to consolidate offers anddata plan. “That changed everything,” he says. “Instant requests.messaging went from being something I did once ina while with a small group of friends, to becoming What all this indicates is that the government should bemy primary means of communication. Rarely do I get looking at platforms like IM and mobile telephony to helpanywhere close to using my monthly texts and free calls inform, assist and aid citizens. But the indications so farallowances on the phone now; I send less than five text are not good.messages a day.” “Security is currently a huge priority for the nationalStarting from a meagre base just a decade or so ago, India government,” says Lloyd Mathias, President, Corporatehas seen an explosion in internet connections, internet and Monitoring at Tata Teleservices, one of the country’susers and social network usage. Much like Berges, young major telecom operators. “And they are constantly lookingpeople throughout Indian cities have adopted social at ways to use regulation to improve intelligence andnetworks vigorously. security.”One social media statistics service estimates that India has This has led to push back from privacy advocates andMegacities • A BT white paper 21
  • 22. Mumbaikars use technology tocut through the blockagesproblems for the telcos themselves. Lloyd explains: cheaply. In some cases agents had leaked the information“Unlike in the west where governments have the directly from telecom companies.equipment to trace and track calls, here the governmentwants the service providers to have this facility. This The government has responded with a raft of laws,requires investment.” including a National Do Not Call Registry – this is a database where you can add your phone number andThe IT (intermediary guidelines) Rules 2011, recently supposedly opt out of spam calls or texts. So far thesereleased by the Information Technology ministry, requires measures haven’t really worked.hosts, ISPs, social networks, search engines and otherintermediaries to not only process complaints, but also Tata Teleservice’s Lloyd Mathias says that there is more toproactively keep an eye out for objectionable content. this than just leaked information. “In some cases people leave business cards or contact details at restaurants orWhich, in times of emergencies, leaves the job of early shops,” he says. “These can then easily get accumulatedresponse, rumour management and coordination in the and sold to spurious marketers. When we sell databaseshands of enterprising civilians. ourselves we can regulate them. But when they are procured indirectly, it can be a problem. There are benefitsAnd things aren’t much better in the everyday world in leaving your details at shops. But consumers must beeither, says Anupam, a 29-year-old stockbroker from aware of the potential for misuse.”Mumbai: “Over the last four or five years the websites oflocal government bodies have improved tremendously. Frustrated by the problem of text spam, the TelecomBut the data still simply resides on their servers. There has Regulatory Authority of India (TRAI) has now said thatto be a way to push it out more dynamically.” from 27 September 2011 no user will be able to send more than 100 text messages a day. TRAI is hoping that this will curb spammers. (Though this then raises the issue: what if “Now when something your 101st message has to do with an emergency?) happens in the stock market But the aspect of his life Anupam would most like to the first thing I do is text my improve through modern technology is his commute. “There has to be a way to make the misery end, or at least colleagues. That is how bearable,” he says. I break the news.” With a population of over 12 million people and another ten million in the surrounding area depending on the cityAnupam loves the new ways of communicating and says for their livelihood, Mumbai’s public transportation systemhis mobile phone has changed his life. Each morning he is under huge pressure. Sure, the existing system doeswakes up and “sometimes even before I’ve gone to the its best – the city’s suburban train system is the stuff ofloo”, he switches on his phone and browses through legend. Regardless of natural calamity or terror attacks,emails, business news headlines and tweets. the train system is the last to shut down, and the first to get back to work.When he first started stock broking seven years ago, herecalls, email was the gold standard for communication. On 11 July 2006, for example, seven bombs ripped“Now when something happens in the stock market the through the network in 11 minutes killing 209 passengersfirst thing I do is text my colleagues. That is how I break and injuring 700. The last bomb exploded at 6:35pm. Thethe news. The analysis can come later via email,” he train system resumed service at 10:45pm.explains. “We have come a long, long way from using a faxmachine in the trading room.” When the trains stop, so does the city. So they never stop.But Anupam admits that he doesn’t use his mobile phone But the conditions on the trains are excruciating. Nine-carand mobile networks for much more than communicating. trains designed to carry 1,700, often carry up to 4,500,Partly, he says, this is because of privacy issues. “Service a situation referred to, technically, as Super Dense Crushproviders here are extremely lax about privacy and data Load. Passengers who hang from open doorways andprotection. You don’t want to leave your address and sit on the roof are particularly susceptible to accidents.phone numbers with shady companies,” he says. Unofficial figures estimate that an average ten people die every day on the network.Last year Mint, the business daily, published a story abouthow hundreds of thousands mobile numbers complete Political science student Berges thinks things can andwith personal details of the user were available for sale should be improved: “The railways keep harping on aboutMegacities • A BT white paper 22
  • 23. Mumbaikars use technology tocut through the blockages traffic. He uses a BlackBerry for mobile email and data, and uses a Macbook to constantly keep an eye on his 16 outlets: “The traffic in Andheri East is hellish. There is no physical way I can checkup on everything. So I use the Macbook to access realtime reports generated by my system.” Barman, who says he is connected every waking minute of the day, claims that his is the first restaurant chain in the world to take delivery orders via Twitter. “We were present on the social network already, and using it to interact with customers. So we thought why not use it to actually generate sales as well,” says Barman. Initially the company had an employee manually collating orders based on Twitter updates from customers. But later they hired a local software company to build an application. The process is simple. Users need to register on the Faasos website once with address details. Then all they need to do is tweet the Faasos handle withhow the trains have GPS modules. Why don’t they leave their order and add a keyword hashtag at the end:that data open like they do in places like the UK?” #faasosnow. The software picks up orders, processes it and then communicates it to the Faasos kitchen. “ItAnd Tata Service’s Mathias is equally keen for more will never become a huge part of our revenues,” saysinformation: “Why can’t I go to a bus stop, send a text Barman. “Twitter is still niche. But we are a brand thatmessage and know when the next bus will come? This can dislikes marketing ourselves too much. This is a good wayhelp reduce so much over-crowding and panic,” he says. to make new customers curious. When they see friends posting orders publicly, they will eventually want to try itFaced with such overwhelming systemic challenges, themselves.”people in Mumbai and elsewhere have learnt to workaround obstructions. That’s why, when mobile telephony Like all major cities, Mumbai’s fortunes are now tied upwas first launched in India, it was embraced so vigorously. with new technology. Whether it is ordering a chickenUntil that point, consumers were dependent on sluggish tikka roll from Faasos via Twitter, or organising emergencypublic sector companies to lay the copper wires and relief efforts via BBM, the city’s fortunes are being shapedhardware required to get phones into homes. Wait times by new ways of communicating.could often stretch into years.With wireless mobile phone connections, they wereliberated. The Indian mobile phone boom began in1994 when the government launched the NationalTelecommunications Policy, or NTP. In ten years, by late2004, the number of mobile phones in India overtook thenumber of landlines and reached a total of almost50 million.Today there are 851 million mobile connections in thecountry, and the state of Maharashtra, of which Mumbai isthe capital, has 899 phones for every 1,000 people.Businesses have been quick to latch on to this platform.And they’ve learnt to adapt to not just the platform itself,but to the services that thrive on it.Jaydeep Barman is a partner in restaurant chain Faasosthat has branches in Mumbai and Pune. As a food deliveryservice he somehow has to get food through Mumbai’sMegacities • A BT white paper 23
  • 24. Less rush, more timeLess rush, geographies so our services won’t be affected by emergencies. They’re based in different countries so even if the main platform is affected, the back-up is always available from another location.more time Less commuting, more conferencingBy Mridul Srivastava and On a personal level, we can recognise the problems of the stockbroker Anupam in the report, when heGirish Bhandarkar says the aspect of his life he’d most like to improveDirector of Marketing, BT India and through technology is his commute. Not only are there the physically unpleasant conditions of packed publicHead of Product, BT India transport, but there is also the work-life balance issue. People are getting up at 5am, spending one-and-a-half to two hours commuting, working late and getting homeTechnology has opened Mumbai up like never before. by 10pm.There are many examples like Berges, in Sidin Vadukut’sreport, who’s made a whole new group of friends via his I don’t think we can overcome the problems of movinginstant messaging. large numbers of people through cities, but we can offer new ways of working that get round this.But Mumbai knows better than most that security is ahuge concern. That’s both physical security, which has Take audio and web conferencing, which is only nowcome under threat in recent years from a series of terror picking up in India. There are Indian companies thatattacks, and information security. still don’t know about its benefits. They’re used to face- to-face meetings and travelling long distances for anBecause of concerns that technology helped co-ordinate appointment. They’re not aware of the service and whenthe attacks, the government is extremely stringent about they hear about it, they’re worried that it maycommunications services in India. At BT, as one of the be expensive.country’s leading networked IT services providers, we’vekept pace with new laws and requirements on lawful Piloting a new cultureinterception and monitoring of all our services andcommunications. So we’ve launched a pay-per-use service with no monthly charge, and with full visibility, security and control to thePicking the right technology user from either a mobile phone or a desktop. Still, we found that some people weren’t open to adopting this wayThe geo-political situation, regulatory issues and the of working. So we offered them a pilot with demo user IDslimitations of the infrastructure mean it can be a challenge and said ‘If you like it, use it’. And we found that once thedoing business in India. And I think that’s where BT really senior management started using it, it caught on.stands out as a neutral provider. We can stand abovedomestic problems and choose the best technology and Any initial concern that the conference call costs morethe best services for our customers. than a normal call disappears because people see how useful it is. How it cuts the cost of face-to-face meetings,We know the ground. We know how things work. For how it makes people more productive.example, if a multi-national company wants to set upshop in India, our team of experts can advise them on One world, one servicelocal regulations and compliances. Large companiesdon’t always know about network compliance issues. Around 70 per cent of our services are launchedWe help customers design their network in full compliance worldwide, although they’re offered using different localwith local regulations, help them prepare their business access providers in different countries. So when businessapplications and also help them get the approvals they people travel to the UK or the US they can use the sameneed to get started. technology and be able to do their normal day-to-day job without impacting their productivity. They’ll be familiarWe’re reliable too. For instance, we have multimedia with the product, irrespective of the local carrier … andhosted contact centres outside India, located in diverse from one megacity to another.Megacities • A BT white paper 24
  • 25. ConclusionSo a glimpse of digital life from four megacities – each ofthem thrilling, complex, and dynamic.They have things in common – millions of inhabitants,gleaming buildings and high-end culture alongsidecongestion, lack of infrastructure and poverty. But eachcity is also unique. Unique compared with megacitiesin different countries and unique even within their owncountry. So the feel of Guangzhou is not only different tothe feel of São Paulo, Jakarta and Mumbai, but also to thefeel of Beijing.And it is these local differences that we embrace. Weemploy people who come from these cities, who knowthese cities. And we are aware that these differencesmatter. They are the reason why your business in theseplaces will succeed or fail.But we also provide the security of being a globalcompany, providing technology that works around theworld, and having a huge level of expertise in delivering it.This is the reason our employees around the world want towork for us – because they know BT can make a difference.BT can make your company work. And we want to makeit work.Today we have a new uniting power – digital technologyhas brought the world together more than we everthought possible. We use the same applications –conference calls, IM, Facebook – everywhere. But in aworld of multinationals and globalised thinking, you canforget that things are not homogenous, that differencesare interesting, and that we can learn from each other.And it’s the mixture of the global and the local that is thefuture of our world.Megacities • A BT white paper 25

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