There was a time when regulation had three priorities: interconnection, interconnection and interconnection. Was it Maeve Sullivan who came up with that line? Anyway, we fought those battles, and then we got beyond that. So anyway, looks like it’s coming back in the form of interconnection of mobile financial services. Mr Collymore agreed that the industry needs greater cross-platform interoperability even as he argued that the process should be driven by market forces rather than regulatory intervention.
In the early years of TRAI, the Authority had to defend itself against strictures from India’s Comptroller and Auditor General that it was not maximizing revenues to the government, connectivity be damned (relevant to present day debates on spectrum prices). I had to convince Sri Lanka’s Auditor General that we should pay replacement costs to those who vacated frequencies, not depreciated costs. They perform a valuable function, but they do not always inhabit the same universe as the reformer. This is additionally supported by the Kenyan AG wanting a nationwide fiber network to start covering operational costs in its first years. I do not know the details, but not it would be good if the Kenyan AG engages in conversation with infrastructure experts to see what a reasonable time frame would be.
Dr Bitange Ndomo is perhaps one of the most prominent voices on African ICT policy. Suffice to say he has 102,000 Twitter followers. In his latest column, read by many more than who get the hardcopy version in Nairobi, he says thus: For example, a systematic review conducted by Rohan Samarajiva, Christoph Stork, and Nilusha Kapugama in Asia sought to isolate the economic impact of mobile phones in rural areas by looking at the most robust quantitative studies available. The systematic review assessed the impacts of the following: increased coverage or availability of mobile signals, use of mobile phones or Subscriber Interface Modules (SIMs), and use of mobile-based services and/or applications. PULL OVER PUSH From the study, they came up with three key findings including: 1.
The story of M Pesa in the form of a book. Launched as a simple money transfer service, M-PESA has evolved to a full payment service which now includes payment services and the Lipa na M-PESA service which is targeted at SMEs. Since launch last year, Lipa na M-PESA has so far recruited 36, 749 merchants. “M-PESA has put Kenya and Africa at the forefront of ICT innovation and is a reference for many other countries that plan to implement a mobile money payment platform.M-PESA is indeed one of the ways that we have been able to fulfil our aspiration to Transform Lives,” said Safaricom’s GM of Financial Services, Betty Mwangi-Thuo.
I know. Kenya is not in Asia. And M Pesa is in Kenya. But I read this nice blog post and figured that readers of LIRNEasia might appreciate learning a bit more about M Pesa. Few initiatives in microfinance, or for that matter in development, have been as successful as M-PESA: 3 and a half years after launch, over 70% of households in Kenya and more importantly over 50% of the poor, unbanked and rural populations use the service.
I saw this lament and my first thought was, she does not live in Kenya, but in backward New York. A truly mobile wallet — one that would let you easily pay for restaurant meals, subway rides or beers at a bar with a quick wave of your cellphone — has long been described as imminent. But it remains elusive. Some innovations have begun to bridge the gap, but most have been a disappointment or have not yet worked well enough for mainstream adoption. In 2012, Square, which makes a credit card reader that can be plugged into an iPhone or iPad, worked on a credit-cardless system that let people pay for goods without ever pulling out their wallets or phones.
Earlier we highlighted how India is learning mobile banking from Kenya. Recently the Economist said, “Paying for a taxi ride using your mobile phone is easier in Nairobi than it is in New York, thanks to Kenya’s world-leading mobile-money system, M-PESA.” This world-leading mobile-money system of Kenya is a great example of unintended consequence. It had several factors in its favour, including the exceptionally high cost of sending money by other methods; the dominant market position of Safaricom; the regulator’s initial decision to allow the scheme to proceed on an experimental basis, without formal approval; a clear and effective marketing campaign (“Send money home”); an efficient system to move cash around behind the scenes; and, most intriguingly, the post-election violence in the country in early 2008. M-PESA was used to transfer money to people trapped in Nairobi’s slums at the time, and some Kenyans regarded M-PESA as a safer place to store their money than the banks, which were entangled in ethnic disputes.
We have consistently argued that human beings must be associated with, and be accountable for, SIMs. The imperatives of the Budget Telecom Network Model cause companies (or more, the thousands of resellers who actually interact with customers) to give away SIMs without too many controls. Therefore, one must be judicious in enforcing the rules. We have been pointing to Pakistan as a model. Kenya, it appears, is exemplary of what not to do.
It’s a rare government servant who does not believe that his prime directive is not that of giving all possible power to his government. Refreshing. But Dr Ndemo had indicated he would not support the inclusion of internet in the ITU regulations even before he left the country for the conference. “Why would we want to change anything? This period that ITU has not been regulating internet there have been tremendous innovations.
In the morning there was a report that the great Asian democracy, India, had not signed the ITRs. Now it looks like it did. Looks like poetic babus played a double game. Kenya’s brave lone stand is extraordinary and can be explained by what it has to lose if the Internet ceases to be seamless, as I explained in an oped in the Business Daily in October. But there are surprises: Qatar and Egypt?
The Economist carries a good piece on the innovation/entrepreneurial boom in Kenya centered around the mobile. There should be such a place in developing Asia. Where? In 2002 Kenya’s exports of technology-related services were a piffling $16m. By 2010 that had exploded to $360m.
Hard truth about why the successful mobile payments model pioneered in Kenya has failed to spread. However Kenya’s success has yet to be replicated much elsewhere. More than half of all the world’s mobile-money transactions are handled by Safaricom. Mobile money is popular in one or two chaotic countries, such as Sudan and Somalia, but barely used in most places where it could do immense good, including India and China. Not all countries need mobile money, of course.
Curious why they are not using simple m payments. Also curious why Africa? Standard Chartered Bank and MasterCard have developed a solution that will allow people in the East African nation to make online purchases with their cellphones, obviating the need for a credit or debit card. The service, called PayOnline, will soon be expanded to other African markets. It allows Airtel Money customers to make online purchases via a 16-digit code, much like using a credit card.
Usually politicians like low prices. But the Kenyan President dislikes them so much that he could not wait for the Task Force established by the Prime Minister to examine a decision by the “independent” regulator to lower mobile termination rates, an esoteric wholesale price determined by technical methods. I have not looked at the Kenyan legislation in detail, but I’d be surprised if the legislation permits review by a Prime Minister’s Task Force, let alone the President acting after a meeting with a few of the stakeholders behind closed doors. With its “independence” in tatters, the regulatory agency did the one thing it can do to recover: it ratified the President’s unlawful act. A mass resignation would have been the more appropriate response, methinks.
Writing a piece on the technological challenges that had to be overcome to increase connectivity in the 49 least developed countries (LDCs) recently, I was struck by how many words I devoted to electricity, both on the need for keeping down the costs of network equipment and for powering handsets. In the old days, we assumed that the footprint of the electricity network was larger than that of the telecom network; now it is the other way around. What is interesting is that the trigger for getting the USD 80 solar generator in the story below was the phone: For Sara Ruto, the desperate yearning for electricity began last year with the purchase of her first cellphone, a lifeline for receiving small money transfers, contacting relatives in the city or checking chicken prices at the nearest market. Charging the phone was no simple matter in this farming village far from Kenya’s electric grid. Every week, Ms.
Intriguing idea reported by the Economist about breaking down work into small chunks and getting people to send it back using their mobiles. The polling feature developed for LIRNEasia by Respere could fit into this easily, though Eagle may have done that in his application. Mr Eagle hopes txteagle will do its bit by mobile “crowdsourcing”—breaking down jobs into small tasks and sending them to lots of individuals. These jobs often involve local knowledge and range from things like checking what street signs say in rural Sudan for a satellite-navigation service to translating words into a Kenyan dialect for companies trying to spread their marketing. A woman living in rural Brazil or India may have limited access to work, adds Mr Eagle, “but she can still use her mobile phone to collect local price and product data or even complete market-research surveys.