Mobile innovation in an unlikely place

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When one thinks of third world countries, one pictures starving children, civil wars or dire economic conditions just to name a few. Interestingly, a different image sprung in my mind with the news a week or so ago about certain Google (third party contractors) poaching business from a Kenyan startup Mocality. I instead recalled a post I had read sometime back in regards to the rapid growth of mobile device usage in that country. From the article, Africa Might Just Skip the Entire PC Revolution

Earlier this year, the Chinese firm Huawei unveiled IDEOS through Kenya’s telecom titan, Safaricom. So far, this $80 smartphone has found its way into the hands of 350,000+ Kenyans, an impressive sales number in a country where 40% of the population lives on less than two dollars a day.

The country has an approximate population of 41 million with an outstanding 26.5 million mobile phone users in contrast to mere 355,493 fixed line customers!

With consumers here in the US bombarded with ads touting 4G LTE as the panacea for all our data hungry app cravings, nobody here in their right might would think that the good old SMS technology could be used for more than text messaging.

As the saying goes, necessity is the mother of invention, facing the prospects of serving a large subscriber base living on a limited disposable income, the country’s largest carriers have come up with solutions that give their customers the best value for their money.

The First is what I would describe as SMS on steroids. This entails being able to chat and post updates on Facebook, send and receive email from yahoo, Hotmail, Gmail e.t.c and also chat with their respective clients all via SMS. All this without the need of an additional data package. As far as I know, Facebook for feature phones here in the US requires a Java enabled phone and user will still have to pay for some form of data or “web access” fee. These Kenyan carriers use software from ForgetMeNotAfrica whose eTXT technology

runs on the Message Optimiser platform allowing telecommunication companies, enterprises and social networks to offer their users two way interaction on social media sites, as well as by email, instant messaging (IM) via SMS from and to any mobile phone regardless of its make or model.

Secondly, mobile payments. While here in the US and the rest of the developed world are still quibbling how facilitate financial transactions via NFC, Kenya, with the leading carrier Safaricom M-Pesa product, reportedly shifted 11% of the country’s GDP via the service and expected the number to jump to 20% of the GDP in 2010! You can read here and here on how this service has created waves in that country. That in itself is quite a feat!

When it comes to data bundles, carriers like AT&T consistently screw their customers with the new data rates of 300MB for $20 , 3GB for $30 and 5GB for $50. In contrast, Safaricom rates start from

 

Data bundle Price($) approx. 1 USD=86KSH
50 MB 1.16
200 MB 2.91
500 MB 5.80
1.5 GB 11.62
3 GB 23.24
4 GB 29.06
8 GB 46.5

The first four rates are very consumer friendly and would satisfy the needs for most consumers.

Additionally, subscribers enjoy the freedom of selecting any carrier with no long term contracts by being able to purchase any compatible phone outright and then purchasing a SIM card from a vendor of their own choosing. Talk about ultimate freedom! There are long term contract options but they are not the norm.

I have had fun doing research for this post and I think the growth of mobile usage in countries like Kenya and other developing countries provide great opportunities for the major mobile players chiefly Apple, Google and Microsoft with corresponding implications depending on how they play their cards. Google already has a presence with the $100 smartphones. Microsoft, well, they have the Tango update to go with new low priced phones scheduled to arrive in Q2. As for Apple, I think they will be content with selling low volumes at a high profit margins so I don’t foresee them fighting in this market.

Not matter what happens, I believe this is a market worth paying attention to.

Image credit Yu mobile


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Rush24 loves everything Microsoft and is fascinated by the influence of technology in everyday life.

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