Mobile Kills the Telecenter Star?

Client Logo Colloquium – based on LIRNEasia research Mobile Kills the Telecenter Star? * Reaching the Bottom of the Pyramid in developing Asia USC, Annenberg School 30 th Sep 2007 * With apologies to Trevor Horn, Courtney Courson, Geoffrey Downs, Bruce Woolley of the Buggles

Table Of Contents
Taking ICTs to the Bottom of the Pyramid (BOP) through telecenters
What the BOP uses – phones
What do phones do to the telecenters narrative
What do we do, if the phone is the only device for the BOP
Re-thinking e-Gov in this light

ICTs: the hype and hope
“ICT, with the ability to use and adapt it, is the critical factor in generating and accessing wealth, power and knowledge in our time” (Manuel Castells)
In the west, improvement in productivity and related growth due to ICT
Happening in Asia
e.g. ICT-enabled outsourcing book contributing to growth in India
For developing countries, special significance
A chance to catch up (leapfrog)
A chance to take government services to citizens more equitably, reduce corruption

The model in the west: fat pipe to the home
Fiber/Cable/ADSL or other high bandwidth alternatives
Multiple devices connected to this pipe
TV
Computer
Mobile/Fixed phones
Delivering
Video
Voice (mobile, fixed)
Data (internet)
Quadruple/Multiple Pay play is what it is about

The equivalent in developing Asia: the telecenters
Across the world, despite significant gains, ICT networks are not reaching the poor (ITU 2006)
In developing Asia, under-developed network infrastructure
If at all, broadband rolled out in urban areas (even with the hype of WiFi)
Connectivity priced for businesses and households with higher income
Unavailable and unaffordable to the poor and the rural
High cost of PC’s relative to income
Community Access Model promoted in an attempt to bridge the gap in income and geography
Telecenters targeting the lower income/bottom of the pyramid or BOP
Rationale Response

Telecenters come in various forms, and provide a range of services: some “tele” services, other are not
Some services dependent on having some telecommunication facilities
Telecommunication services (voice, fax, internet)
Information (e.g. agricultural information for farmers) obtained via the internet to telephone, disseminated locally
Some services that benefit from connectivity but not dependent on it
Capacity building for rural communities
E.g. language training, training trade skills for farmers
(often via CD’s that are available or through instructors who physically visit the center).
Often a host of services NOT dependent on telecommunications
Telecenter operator collect bills from villagers, travels to town and pays them. Charges INR5 per bill
“Telecenter” as village meeting house (simply providing a common facility/space).

Many services provided for free. Voice, fax among the few services routinely “sold” to use
Many services provided for free
Voice/fax are the only services routinely sold
Citizens expect to pay for phone calls made at telecenters
Willingness to pay for Internet untested
Lack of content?
But all of this s seen as “OK”
Most telecenters are donor funded and services nearly fully subsidized
Many are implemented as pilots, without concrete scale-up plans
Seen to provide other larger social objectives
Non-sustainability seen is “OK”?
“ Telecenters are a highly visible, powerful and inexpensive political tool. They generate much fanfare during early planning and inauguration stages of the programs, but interest in their programs wane shortly afterwards” (Proenza, 2003)

Most telecenters are already not sustainable; those that are depend on voice (phone calls) for large portion of revenue
Systematic studies on telecenter sustainability not available
South Africa exception (Peter Benjamin PhD thesis and ITU Africa,2001)
DO know that a telecenter needs to be run “like a business” to ensure financial sustainability
Amin, 2003
Peter Benjamin’s 4 year evaluation of South African telecenters
Voice is the only service that is providing steady stream of revenue (not internet)
E.g. e-Sri Lanka’s (planned) 1000 telecenters depend on voice calls to make up 60% of the revenues (World Bank,2003)
Many get 100% of revenues from voice

Telecenters are popular and growing in numbers in PK, IN, LK 500 189 1,000 USAID Sarvodaya E-Sri Lanka/ICTA Sri Lanka 95 20,000 1,020 196 21 30 200 MS Swaminathan Research Foundation ITC (E-Choupal) Drishtee Tarahaat Gyandoot N-Logue Gramdoot India 3,500 400 12,000 200 100 2,000 200 Several 100 Pakistan State Oil Pakistan Telecom Authority Post Office Telecenters Agha Khan Rural Support Program Karakoram Development Authority Allama Iqbal Open University Telecard, Mobilink,Telenor Entrepreneurs Pakistan Number of telecenters to be deployed in the next decade Organization Country

What have telecenters delivered? Not much: urban/rural divide very much alive, specially at the BOP

Most people at the BOP have not heard of the internet….

…. let alone have access to it *excluding FANA/FATA – Tribal Areas; **excluding N&E Provinces 10.40% 8.80% 1.50% 0.30% 1.90% % at BOP who have accessed the internet 23.44% 46.07% 20.00% 23.74% 46.67% BOP population as % of total population 15 41 4** 260 77* Target BOP population of study in millions Thailand Philippines Sri Lanka India Pakistan

Table Of Contents
What the BOP does use – phones

Majority of the BOP have access to and use phones *excluding FANA/FATA – Tribal Areas; **excluding N&E Provinces 23.44% 46.07% 20.00% 23.74% 46.67% BOP population as % of total population 15 41 4** 260 77* Target BOP population of study in millions 95% 93% 92% 94% 98% % of those approached who have used a phone in the preceding 3 months Thailand Philippines Sri Lanka India Pakistan

The BOP use public phones when a (fixed or mobile) phone is not owned

Even for those who do no own a phone, one is accessible quickly Time taken to access a phone

Phones are accessible, even in rural areas Time taken to access a phone, urban vs. rural Rural Rural Rural Rural Rural

And ownership is likely to increase: 232 million at the BOP will own phones by mid 2008

…they will mostly purchase mobile phones or those with mobile-like capabilities (e.g. CDMA) Type of phone the BOP say they will purchase

And they are willing to pay up to USD 5 per month for the service Expected monthly spend on phone services

Table Of Contents

Voice is making telecenters sustainable. But that revenue stream is running out telecenters are already not sustainable; those that are depend on voice (phone calls) for large portion of revenue
The BOP is spending money at telecenters
But on voice
But soon this money is now going to be spent on a phone they (or their family members) own
Money going to telecom companies, not telecenters
Also resulting in less ‘traffic’ walking into telecenters
lowering even other revenue streams
Already public access phone model under threat
Bangladesh mobile phone ladies losing over 50% of their income (Shaffer, 2007)
Senegal's public call centers experiencing declining revenues (Le Soleil, 2007)

Table Of Contents

Develop Phone Centric Models that do not discriminate, and do not delay
Telecenters a long way from rolling out in mass numbers
wait for them to become sustainable? Or for them to roll out in sufficient numbers?
Phones here, now, and in use
Put the phone at the centers
Solutions may lack sophistication
But they will benefit the BOP NOW, not at some distant point in the future

Table Of Contents

e-Government: taking government to the BOP
G2G e-Government initiatives promise to increase
Transparency
Efficiency
Citizen centric service delivery
To act as a media to facilitate citizen consultation, policy discussion & increased democratic input into policy process
Dominant model to take e-Gov to citizens have 2 parallel strategies
@ the Back-end: the re-engineering and automating of government services so that they are accessible online, and
@ the Front-end: the installation of telecenters (community Internet access centers) for citizens to access reengineered government e-Gov services via the Internet

Government presence online evolves: inform  interact  transact INFORM INTERACT TRANSACT Level of Sophistication of e-Government Low High Information about government services made available via government websites 94% of UN member countries have some kind of online presence (UNPAN,2005) Full govt. transactions (including payment) completed online 24% of UN member countries offer online payment on certain govt. services Govt. presence online allows citizens to send/receive information (e.g. email govt. office, receive response) 88% of UN member countries offer interactive services for citizen (UNPAN,2005) TRANSFORM Govt. uses online presence to as a tool to improve governance 15% of UN member states encourage participatory deliberative decision-making & engage with citizens in open debate online

The dominant e-Gov requires re-engineering, requires the internet. But have disadvantages, specially in developing Asia
We’ve already seen that the internet reach @ the BOP is negligible
Transacting online requires credit cards. The BOP have none
E.g. Less than 4% of the TOTAL population of India and Sri Lanka + India have a credit cards
Re-Engineering is extremely difficult
Over 50% of e-Gov projects fail. Another 35% are partial failures (Heeks)
Key reason for failure: re-engineering government attempts to radically change the way the government (and its employees) work.
A large gap between existing (manual) system, and new (re-engineered and automated) system
Cost benefits analysis for government automation unproven in the developing world
It works for the west. Cost of investment in ICT more than off-set by savings in labor cost (Stanforth, 2006)
In the developing world, labor is ten times cheaper, and software+hardware much more expensive
But developing countries, specially developing Asia, have undertaken LARGE re-Gov initiatives along with telecenter programs
Sri Lanka, India

How can governments (and donors) do e-Gov with just a phone? Examples already exist
Inform
Government Information Center (Sri Lanka) enables dialing 1919 from any phone and finding out the procedure for obtaining government services
Highly used service; used by citizens where ever there are phones.
Interact
State of Gujarat passport example
Passport application has 7 stages. Citizens kept informed of progress (or lack of) at each stage via SMS
Reduced queues reduced from 900 (previously) to 350. Most came just to inquire about the state of their passport
Transact
SMS tax payment in Philippines via g-Cashs “payBIR” service
Taxes (income tax, fines, stamp duty) of up to P10,000 (USD 180) can be done via mobile phone
SMS receipt sent to citizen for records

Why is this helpful?
Avoids the pit-falls of large-eGov initiatives
Projects less likely to fail
Face less resistance from government employees
Employees likely to view further re-engineering more positively
Phones are here, now, and available to the BOP
Enables the BOP to benefit now, not at a distant time in the future
Don’t have to wait for tele-centers to roll-out
Unlikely to face sustainability issues in the end-delivery (people willing to pay for phone service. Not telecenters)
Enables a full range of e-Gov services including transactions
Not just information service provision, but full transaction (0% of BOP with credit cards, vs 124 million at the BOP who have transaction-capable mobile phones in Sri Lanka, India, Pakistan)
People ALREADY USED to transacting via the phone – just not with government (e.g. cash transfer via phone, paying for goods through phone minutes)

Does NOT mean internet (via telecenters) and re-engineering of Government services are not needed
Some services will always need high-bandwidth
Uploading a picture + filling out an online passport application, then submitting online
Many more services (and benefits) brought by broadband
Rural Business Process Outsourcing, creating of jobs
But these are for the future: at least 5 – 10 years to REALLY reach the BOP
Do we keep them on the other side of the digital divide till then?
Its time for governments, donors and civil society to re-think immediate ways to empower the BOP using mobile-centric models
Not just in e-Gov, but other initiatives (e.g. agriculture, fisheries)

Our mission
To improve the lives of the people of Asia Pacific by facilitating their use of information and communication technologies; by catalyzing the reform of the laws, policies and regulations to enable those uses; by building Asia Pacific based human capacity through research, training and advocacy
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Mobile Kills the Telecenter Star?

by ARNIC on Oct 27, 2007

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Mobile Kills the Telecenter Star? — Presentation Transcript

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