In our most recent demand-side ICT study, Teleuse@BOP3, we asked bottom of the pyramid (BOP) phone owners if and how often they used their phone (mobile or fixed) for business purposes or any other financial or work-related purposes. The responses we got were quite encouraging:

Teleuse@BOP4 is almost underway. This time, we have decided to seek out the wisdom of the crowds in designing and fine-tuning some of the questions that we ask in Teleuse@BOP4.

Responses to the question of business use of phones are important in this research cycle, where we are trying to understand , inter alia, what services (including telecom) would better equip SMEs (many of which are owned by or employ people at the BOP) to participate in the knowledge based economy.

Similarly as important are the reasons that prevent greater use of phones for these purposes (trust, alternatives, cost, culture, etc). Here is a draft question to seek out this information; we invite comments, suggestions and feedback on how this question can be improved.

“Q: What prevents you from using the phone for these purposes (business, financial or work related) at all/more than you do currently?

a. It is more convenient communicating on these issues face-to-face than over the phone

b. I am not sure if I can trust the other party when talking about these things over the phone

c. Other people prefer to talk face-to-face

d. I don’t engage in such  activities

e. other”

Many studies conclude that a significant gender divide in access to the telephone exists, particularly in developing countries. Furthermore, women are also said to use telephones in a different manner from men — making and receiving more calls, spending more time on calls and using telephones primarily for ‘relationship maintenance’ purposes. Much of this research is based on small-sample studies in affluent developed countries. This article shows that a significant gender divide in access to telephones exists in Pakistan and India, to a lesser extent in Sri Lanka, but is absent in the Philippines and Thailand. It also challenges the findings which claim that women’s and men’s use is fundamentally different, at least at the ‘bottom of the pyramid’ in developing countries.

Key Words: Asia • bottom of the pyramid • digital divide • gender divide • internet • mobile phones • Pakistan • telecommunication • women
New Media & Society, Vol. 12, No. 4, 549-566 (2010)
DOI: 10.1177/1461444809346721

The article can be accessed here; a pre-publication version of the article can be downloaded here.

On the one hand, this interview with the head of financial services for Grameenphone on the experience with BillPay, a utility payment service offered by Grameenphone, as well as LIRNEasia‘s Teleuse@BOP findings from the Philippines seem to suggest that even once the system is in place, there is still a lot of work to be done in earning people’s trust to use the service and change their behavior. Through BillPay has been around since 2006, it has only pushed the over-the-counter service, rather than the e-wallet version of the service (currently used by a small number), due to this very issue. Once the service reaches a critical mass of users, they plan to push out the e-wallet service more aggressively.

On the other hand, could already-popular services like CellBazaar (used by 3.5+ million GP subscribers) help drive up volumes for electronic/mobile payments and help them to reach critical mass?

See full interview here.

Download LIRNEasia study on expansion of CellBazaar to include payments and delivery  here.

Download LIRNEasia Teleuse@BOP findings from the Philippines here.

In his presentation, Dr Samarajiva described the new “Budget Telecom Network Model” developed in South Asia that is enabling mobile operators to serve low-income customers who yield very low ARPUs [Average Revenues per User] and discuss its extension to enable broadband use.  Bangladesh, India, Pakistan and Sri Lanka have offered the lowest total costs of mobile ownership since 2005-06 while still yielding adequate, though somewhat volatile, returns to ensure continued investment in network extension and new services.  LIRNEasia research shows that this has been made possible by business process innovations to reduce operating expenses, and the minimizing of transaction costs made possible by widespread prepaid use.  The analysis extensively draws from LIRNEasia’s six-country, 10,000 sample Teleuse @ BOP3 survey which shows how poor people are actually using information and communication technologies in emerging Asia.

The presentation slides can be downloaded here, and the full paper can be downloaded here.

The invitation signifies recognition of the high profile LIRNEasia has achieved as a thought leader on innovations in telecom policy and regulation that benefit those at the Bottom of the Pyramid in emerging Asian economies. Other speakers include Professor Richard Heeks of the University of Manchester and representatives of NokiaSiemens Networks and Vodafone.  The workshop is being held on 10-11 September 2009 at the Paris Headquarters of the OECD.

Full participation in the global Internet Economy requires electronic connectivity of considerable complexity. Today, due to a worldwide wave of liberalization and technological and business innovations in the mobile space, much of the world is electronically connected, albeit not at the levels that would fully support participation in the global Internet Economy. Yet, many millions of poor people are engaging in tasks normally associated with the Internet such as information retrieval, payments and remote computing using relatively simple mobiles. Understanding the business model that enabled impressive gains in voice connectivity as well as the beginnings of more-than-voice applications over mobiles is important not only because widespread broadband access among the poor is likely to be achieved by extending this model but because it would be the basis of coherent and efficacious policy and regulatory responses…

This is an excerpt from a background report by Rohan Samarajiva, to be presented at “Policy coherence in the application of information and communication technologies for development,” a joint workshop organized by the Organisation for Economic Co-operation and Development (OECD) and the Information for Development Program (infoDev) / World Bank from 10-11 September 2009 in Paris. The report has been published in the OECD’s Development Dimension series:  “ICTs for Development: Improving policy coherence.”

The Bastiat Prize (for journalism) was first awarded in 2002 and judges have included Lady Thatcher and Nobel-Prize-winners James Buchanan and Milton Friedman. The prize was developed to encourage and reward writers whose published works promote the institutions of a free society: limited government, rule of law brokered by an independent judiciary, protection of private property, free markets, free speech, and sound science. This is the first time that a seperate category for online journalism is being awarded.

Other finalists for the 2009 Prize for Online Journalism are Shikha Dalmia (Forbes.com, Reason Foundation) and Daniel Hannan (Telegraph.co.uk blog).

Winners will be announced at the annual Bastiat Prize Dinner in New York City on 26 October, featuring journalist/author P.J. O’Rourke as the keynote speaker. “P.J. O’Rourke, one of Bastiat’s true spiritual successors, sets a high bar,” said IPN Executive Director, Julian Morris, “But the finalists all show a deep understanding of the institutions that underpin freedom and an acute ability to communicate their importance to a general audience. The final decision lies with our eminent judges –including former winners, Brian Carney and Amity Shlaes, and internet entrepreneurs Jimmy Wales, Esther Dyson and Scott Banister.”

The study of over 1,500 domestic and overseas migrant workers in six Asian countries (Bangladesh, India, Pakistan, the Philippines, Thailand and Sri Lanka) has yielded some interesting insights in Bangladesh, with important policy implications.

Demand for communication among Bangaldeshi migrants surveyed was particularly high compared to the other countries surveyed; a significant number of overseas migrants even used the Internet to call home. Bangladeshi migrants were sending home around half of their salaries on average, mostly through banks, and hand-carried in cash. Mobiles play a key role in coordinating remittances; a small number of overseas migrants were even sending money home through their mobiles.

These findings as well as the important policy implications (e.g. on IPLC policy, as well as mobile payments policy) were elaborated on by Dr. Rohan Samarajiva, LIRNEasia Chair and CEO at the event. The presentation sides can be downloaded here.

The migrant study is a part of a large multi-country survey of telecom use at the bottom of the pyramid, Teleuse@BOP3. Teleuse@BOP is conducted by LIRNEasia every two years. The study looks at how the lowest socioeconomic groups or the bottom of the pyramid (BOP) make use of telecom and other ICTs in their lives. Teleuse@BOP3, the third of these studies was conducted between October 2008 and March 2009 and included Bangladesh for the first time. Teleuse@BOP3 also included a survey of BOP overseas and domestic migrant workers from the same six countries (Bangladesh, India, Pakistan, the Philippines, Thailand and Sri Lanka). Over 1,500 migrant workers were surveyed in late 2008. In Bangladesh, 180 recently returned overseas migrants and 170 domestic migrants were surveyed. In-depth qualitative research with similar migrant workers as well as their families was conducted in the six countries in early 2009.

The Bangladeshi findings from the main Teleuse@BOP3 study can be downloaded here: Teleuse@BOP3 Bangladesh findings 26Jun09

The project is funded by the International Development Research Center (IDRC) of Canada; an inception meeting was recently held in Kampala, Uganda, which Harsha de Silva attended. The project will be conducted in six African countries: Kenya, Malawi, Uganda, Ghana, Benin, and Madagascar.

The  Scientific Advisory Committee constitutes:

• Prof. Chris Ackello-Ogutu, Department of Agricultural Economics, University of Nairobi, Kenya
• Prof. Julian May, School of Development Studies, Kwa Zulu Natal, South Africa
• Dr. Colin Poulton, School of Oriental and African Studies, University of London
• Dr. Adrian Mukhebi, CEO Kenya Agricultural Commodity Exchange and Market Economist, Nairobi
• Dr Harsha M. De Silva, Lead Economist, LIRNEasi

Harsha leads the agriculture-focused research at LIRNEasia, including a study on the impact of ICTs on transaction costs in agricultural markets in 2007.

The award honors one person each year whose work has had a demonstrable impact on practice outside the academy, with clear benefits to the community.

The award was presented to him by Patrice M. Buzzanell, President of the International Communication Association.

At the ceremony a brief statement about his accomplishments and the ways his work has had sustainable social benefits was presented by the ICA:

“Dr. Rohan Samarajiva has co-edited a volume, ICT Infrastructure in Emerging Asia: Policy and Regulatory Roadblocks, that exemplifies the intention of this award, i.e., to show ways in which a significant engagement with research can influence communication change. This work highlights a very important but often under-researched region focusing on five Aisan countries: Bangladesh, India, Indonesia, Nepal and Sri Lanka… A central thread underpinning all the viewpoints provided in the book is that technology itself cannot improve access to ICTs; policy and regulatory reform is critical. In providing data that challenges the vested and frequently dysfunctional interests which have underpinned past and present governance structures, this important research becomes in itself a significant marker of ways to work towards policy and regulatory reform.”

The 2009 conference of the ICA, themed “Keywords in Communication” took place from 21-25 May 2009 in Chicago, USA. The ICA is an academic association for scholars interested in the study, teaching, and application of all aspects of human and mediated communication. The ICA is over 50 years old, beginning as a small association of U.S. researchers and is now an international association with more than 4,300 members in 70 countries. The ICA includes 24 divisions and interest groups, each representing a special subfield of communication processes and phenomena

The current issue of Nokia’s Expanding Horizons quarterly magazine highlights LIRNEasia’s Teleuse@BOP3 study findings from India, illustrating this point.

Mobiles are now the most common form of communication, pushing public phones into second place… The rapid evolution of the mobile into a multi-purpose communications and knowledge tool combined with its fast adoption by the BOP, means they and the majority of people in the developing world are likely to have their first Internet experience via a mobile.

Although use of “Mobile 2.0” services such as payments and  e-government services is low, these are the ‘doors’ through which people are likely to enter these services. Governments and industry in South Asia need to understand potential barriers to usage and to identify what will motivate use of ‘non-voice’ applications among the BOP.

Key results can be previewed here. The full article can be viewed here.

Does research influence public policy and decision-making and, if so, how? This book seeks to address this question by investigating the effects of research in the field of international development. It facilitates a sophisticated understanding of how research influences public policy and decision-making. It shows how research can contribute to better governance in at least three ways: by encouraging open inquiry and debate; by empowering people with the knowledge to hold governments accountable; and by enlarging the array of policy options and solutions available to the policy process.

The launch is open to the media.  Journalists are encouraged to register by calling Mr J Samaranayake, SLEvA Council Member at: 94 11 236 5521 and Mobile # 0777365533.

About IDRC
Canada’s International Development Research Centre (IDRC) is one of the world’s leading institutions in the generation and application of new knowledge to meet the challenges of international development. For nearly 40 years, IDRC has worked in close collaboration with researchers from the developing world to build healthier, more equitable, and more prosperous societies.

IDRC’s Regional Office for South Asia and China is located in New Delhi. Dr Stephen J McGurk is the Regional Director. The office was established in 1983, following a formal agreement between the Government of India and IDRC. It is mainly responsible for delivering IDRC’s program of research support to development activities in Afghanistan, Bangladesh, Bhutan, China, India, the Maldives, Nepal, Pakistan, and Sri Lanka.

For more information:

Prabha Sethuraman
Executive Assistant/Communications Officer
IDRC-South Asia and China
208 Jor Bagh, New Delhi 110 003
Phone: 91-11-2461 9411 ext. 7412
Fax: 91-11-2462 2707
Email: psethuraman[at]idrc[dot]org[dot]in

But now, the picture is different.  Last October, Minister A. Raja stated that there were 11 access paths per 100 rural inhabitants, compared to 30 for urbanites.   Massive progress has been achieved, but is it making an impact at the bottom of the pyramid (BOP)?

LIRNEasia’s Teleuse@BOP3 study has yielded some intriguing answers.

Forty five percent of Indian BOP teleuser households had a phone in late 2008.  Thirty seven percent had a mobile only; five percent had a fixed phone only; three percent had both.  This is massive progress from the 19 percent of BOP homes with a phone just two years ago.

In 2006, public phones of various kinds were the most frequently used; of the BOP teleusers, 71 percent relied on them.  By 2008, 36 percent said “my own mobile” was the most frequently used mode, over the 33 percent using public phones.

The most recent quantitative findings of the Teleuse@BOP3 study are now available. The findings were released at a presentation to the Cellular Operators Association of India in February 2009. The study looks at teleuse at the ‘bottom of the pyramid,’ or the lowest socio-economic classes across six Asian countries: Bangladesh, India, Pakistan, the Philippines, Sri Lanka, and Thailand. The quantitative component involved a detailed face-to-face survey of 9,750 sample representative of the BOP in the six countries.

Though across all six countries it appears that the access challenge has been met, there is still huge potential for more‐than voice services. Awareness levels are still low and usage even lower. Download findings to see more.

India’s “mobile revolution” is still mainly seen in the cities, but the real prize for phone companies is the vast rural market, where nearly 70 percent of the 1.1-billion-strong population live, analysts say.

By the end of January, 34.5 percent of the population owned a telephone, Telecom Regulatory Authority of India said.

But those figures distort the picture, with 66 percent of people in cities owning a phone compared to around nine percent in rural areas, says Frost & Sullivan.

“The next addition of subscribers will come from rural regions,” said consultant Trivedi. The government calls the rural market the “next accelerator” for mobile growth.

LIRNEasia’s findings from a recent 3,000 sample-strong demand side study of telecom show that in fact at the bottom of the pyramid (BOP) between September 2007 and 2008, India’s rural BOP actually did add more connections than their urban counterparts, with 27% of rural BOP mobile owners (or 11% of all rural BOP teleusers) getting connected versus 19% of urban BOP mobile owners (8% of all urban BOP teleusers) over the period. Adding in fixed phones will increase the numbers marginally.

An important issue in how “urban” versus “rural” connections are counted has become a topic of interest recently. A separate article also published today, in The Hindu (Chennai online edition) highlights an important fact in counting urban and rural connections:  supply-side numbers count phones at the point where they are purchased, not where they are actually used. So a mobile (which is exactly that) purchased in the city may very well be actually used in the surrounding rural areas.

Hence, the statement in the AFP article, that “66 percent of people in cities owning a phone compared to around nine percent in rural areas,” quoting Frost & Sullivan may be reflective of the supply-side situation, not reality. According to LIRNEasia’s demand-side calculations at the BOP (note, not at the overall population level), urban BOP phone penetration (mobile + fixed) was seen to be 47% while rural BOP phone penetration was at 44%. If one was to look at the overall population numbers also from the demand side, the urban-rural gap may be wider than at the BOP-only level, however, it may not be as high as most supply-side numbers present it to be.

The Department of Telecommunications (DoT) has signed a memorandum of understanding (MoU) with state-owned telecom operator Bharat Sanchar Nigam Ltd (BSNL) to provide wireless broadband in rural areas.

Under the MoU, BSNL will provide wireless broadband at 29,000 rural exchanges throughout the country. Each exchange will have 31 connections along with one kiosk for public use. A DoT official said, “Out of these 31 connections, 6 will be used by institutions like schools, while the rest will be for individual users.”

The implementation of the entire project is expected to be completed by 2011. Currently, there are over 5.45 million broadband subscribers in the country. This move comes as a catalyst in the government’s aim to reach 20 million broadband subscribers by 2010.

The DoT is planning to provide funds worth around Rs 1,800 crore to BSNL for its various activities. According to sources close to the development, approximately Rs 700 crore are being provided for upgrade of the 2,700 BSNL exchanges across the country for provisioning of wireline broadband, Rs 700 crore for kiosks and Rs 400 crore for computers.

However, private telecom operators have opposed the extra funds being allotted to BSNL from the Universal Service Obligation (USO) Fund. In a letter to the Union telecom secretary, the Cellular Operators’ Association of India (GSM operators’ lobby) and Association of Unified Telecom Service Providers of India (CDMA operators’ lobby) have alleged that there is huge corpus lying unutilised under the USO Fund (approximately Rs 15,000 crore).

The USO fund is created from a 5 per cent universal service obligation levy that the government charges all telecom operators in India. The fund is meant to support extension of connectivity to areas where private operators do not enter due to lack of adequate profitability.

Private operators have asked the DoT to disburse the USO funds to all operators rather than restricting it to state-owned operators.

The letter stated: “BSNL is as much a commercial operator like any other private operator …In fact, they are making all out efforts to aggressively roll out their networks and services across the length and breadth of the country …any step at this stage that is aimed at advantaging only the public sector operator will be a huge blow to the principles of level playing field, natural justice and fair competition.”