Liberalisation and User Driven Innovation in Liberalisation helped create an enabling environment...

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  • Liberalisation and User Driven  Innovation in AfricaInnovation in Africa

    Sam Paltridge, OECDSam Paltridge, OECD

  • Liberalisation enabled access growthLiberalisation enabled access growth

    30 Fixed and Mobile Subscriptions per 100 inhabitants in Low income countries 

    25

    30

    Global telephone subs (fixed + mobile) 1st Billion (1997) = 120 years.  

    20

    ( ) y 2nd Billion = 4 years 3rd Billion = 3 years

    15

    y 4th Billion = 2 years

    5

    10

    0

    Source: OECD based on ITU

  • Net subscriber additions in 2007 Internet (Top 20) Mobile (Top 20)

    1 Chi 11 M i1. China

    2. USA

    1. China

    2. India

    11. Mexico

    12. Thailand  11. Vietnam 

    12.  Canada

    3. Brazil

    4. Pakistan

    3. Pakistan 

    4. Brazil 

    13. Turkey

    14. Argentina 13.  Egypt

    14. Indonesia

    5. Columbia

    6. India

    5. Russia

    6. Indonesia 

    15. Saudi Arabia

    16. Vietnam 15. UK

    16. Mexico

    7. Iran

    8. Russia

    7. United States

    8. Iran

    17. Nigeria

    18. Philippines  17. Thailand

    18. Nigeria

    9. Germany

    10. France

    9. Egypt 

    10. Germany

    19. Peru 

    20. Algeria 19. Poland

    20. Venezuela

    = 7 out of 20 = 4 out of 20

  • Liberalisation helped create an enabling environment

    • “You don't look at GDP.  You ignore that.” – Dennis O'Brien, CEO Digicel  (quoted in The Economist  S t b 2007)en

    si ty

    September 2007)

    Te le

    -d e

    T

    WealthWealth Jipp, A. (1963). “ Wealth of Nations and Telephone Density.”

  • Creating innovation aimed at local requirements

    Safari Bima is a Personal Accident coverSafari Bima is a Personal Accident cover, providing a benefit of US$ 1300 in the event of DEATH or Permanent Total Disability resulting from an accident. 24 hour coverageresulting from an accident. 24 hour coverage can be activated by SMS at a premium of US$ 0.39 deducted from a customer’s mobile phone credit.

    Mobile phone SIM card collar, virtual "geofence" using gps, when elephant approaches the virtual fence collar texts

    p www.korient.co.ke

    approaches the virtual fence collar texts rangers. www.savetheelephants.org

  • J

    B A

    C

    I

    Creating innovation aimed at  overcoming local barriersD

    E

    F HG

  • Location of innovation and take‐up rate no longer predictable

    Acceleration/deceleration measures the rate at which technology adoption exceeds (or falls below) expectations for the country’s level of GDP. Rates have been

    Source: Intel Technology Metabolism Index averaged across three technologies: mobile phones, PC’s, and internet users.

  • Time to change perceptions of what is possible Af iOECD

    • North America

    Africa

    • Gabon  f b h– Mobile penetration 

    mid‐2008: United 

    – 1st African sub‐Saharan  with 100%+ mobile  penetration?States 84%, Canada 

    62%, Mexico 68%

    E

    penetration?

    • sub‐Saharan Africa Borderless roaming for• Europe

    – High roaming charges K

    – Borderless roaming for  post‐paid and prepaid  users across Africa for on‐

    • Korea  • 15.4% of mobile users 

    use mobiles for

    net calls (and Middle East)

    • Kenya  use mobiles for  payments of products  and services (Dec 2007)

    – 30% of Kenya’s 12 million  mobile users were and services (Dec 2007) registered for M‐Pesa by  mid 2008

  • Some emerging market segment rankings Opera Mini Browser 

    (Top 10) Sept 2008

    AdMob Mobile Advertising 

    (Top 20) Sept 2008

    1. Russia

    2. Indonesia 1. United States

    2. Indonesia 

    11. Brunei

    12. Saudi Arabia  3. India

    4. Ukraine 3. India 

    4. United Kingdom

    13. Israel 

    14. Australia 5. China

    6. South Africa

    4. United Kingdom 

    5. Philippines 

    6. South Africa

    14. Australia 

    15. Canada 

    16. Kenya 7. United States

    8. United Kingdom

    6. South Africa 

    7. Nigeria 

    8 Romania

    16. Kenya 

    17. Italy 

    18 Pakistang

    9. Poland

    10. Egypt

    8. Romania

    9. China 

    10 Malaysia

    18. Pakistan 

    19. Bangladesh 

    20 Francegyp 10. Malaysia  20. France 

    = 3 out of 10 = 6 out of 20

  • Send in the ICT anthropologists!

    • ICT companies are  increasingly seeking  better ways to 

    Jan Chipchase Nokia

    understand emerging  markets

    Dawn Nafus, Intel

    Jan Chipchase, Nokia • For example  observations of sharedobservations of shared  use lead to design  innovation in areas such

    Younghee Jung, Nokia

    innovation in areas such  as multiple address  books and cost trackers

    Genevieve Bell, Intel Nokiabooks and cost trackers

  • How does this work in practicep User Innovation: Sente (Uganda) Market internalises financial 

    transfers • an informal way of sending 

    and receiving money, cheaper 

    transfers 

    • Operator sees value (an  externality) being captured by

    than other options

    • User buys prepaid airtime and  ll l l ki k i

    externality) being captured by  users and wants to internalise.

    • Internalises by creating calls local kiosk operator in  location of recipient

    • Negotiation on commission

    Internalises by creating  network of trusted agents  across a country, information 

    • Negotiation on commission • Kiosk operator tops up their 

    own phone with the credit

    goes direct to recipient,  transparent pricing,  promotion etcown phone with the credit, 

    and after taking commission,  pays cash to recipient

    promotion, etc

    • Provides banking and payment  services to the unbankedp y p services to the unbanked

  • From little things…g • Safaricom: 3.8 million customers in 18 months for M‐Pesa

    – Kenya’s banking industry took over 100 years to achieve this  benchmark

    • Competitive response in 2007 :  – Traditional banking sector tripled number of account holders 3.3  million to 10.1 million.

    – Branches expand from 575 to 740 and mobile banking services  launched

    • World Bank estimates remittance flows to developing  countries were $251 billion in 2007, up 11 percent on 2006 – regulatory barriers to low cost cross‐border remittance services  deserve examination.

    • Each mobile user becomes an ATM with potentially  profound development effects

  • For further informationFor further information • www.oecd.org/futureinternetg/

    • The Seoul Declaration for the Future of the  Internet Economyy

    • Shaping Policies for the Future of the Internet  EconomyEconomy

    • Global Opportunities for Internet Access  Developments