At LIRNEasia, we all do our own CSR. Rohan and Harsha are perhaps among the most invited speakers to business conferences. Helani taught Information Systems to Masters students. Call this mine. I do not blog.
Little ones with Anthuriums in their hands greet us. Mederigama near Mawanella (about 1-2 km off Kandy road) is a tiny hamlet where LIRNEasia’s International Advisory Board members would directly interact with the Sri Lankan rural life. Sarvodaya has been present in this village for so long that nobody is sure when things started. We learn about multiple programs which had their own beginnings. Right now the core is a ‘bank’ that provides micro finance services, a pre-school and a small library.
Multiple submarine cables with multiple landing stations, owned by different entities, don’t offer competitive wholesale international bandwidth in India. Today a chunk of 10-gigabytes bandwidth varies between $5 million and $9 million in India while it’s being sold from $1.5 million to $1.7 million in other Asian markets. It’s a huge challenge for the world’s fastest growing telecoms market where broadband penetration remains a national embarrassment.
Mobile phone message services like one deployed by the financial news agency Reuters to over a million farmers in India, could help Sri Lankan farmers earn more for their produce, experts said. Ranjit Pawar of Reuters Market Light, India said their SMS (short message service) in India provide farmers timely information and helps eliminate middlemen. “A farmer told me, ‘If I had timely information I could have made 40 percent more money,’ when we launched the short message service in India,” Pawar told a seminar on knowledge based economies. It was organized by LIRNEasia, a regional think tank based in Colombo, Sri Lanka. Full story.
Competition in the handset market cannot but accelerate the process of mobiles becoming the primary interfaces to the Internet. Google plans to begin selling its own smartphone early next year, company employees say, a move that could challenge Apple’s leadership in one of the fastest-growing and most important technologies in decades. Google’s new touch-screen Android phone, which it began giving to many employees to test last week, could also shake up the fundamentals of the cellphone market in the United States, where most phones work only on the networks of the wireless carriers that sold them. Full story
We didn’t quite think we’d be generating news at the conference, but apparently some of what was said was truly newsworthy. Capital investment in Sri Lanka’s telecom infrastructure has plummeted amid a price war and high taxation which will crimp expansion in the future and broadband roll out in the island, top telecom operators said. “Before the price war each operator was spending about 150 to 200 million (US dollars) a year in capital expenditure,” Dumindra Ratnayake, head of Tigo Sri Lanka said at a forum organized in Colombo by LirneAsia, a regional policy research body. “This year all operators put together may have invested about 150 million.”
Long gone are the days of waiting for dial-tone. We have now taken the ubiquity of connectivity as natural as oxygen in the air. But its quality often gets “polluted” like the air we breathe. The list of “pollutants” is endless in the wireless world: bad coverage, bad handset, bad battery, bad antenna, bad OS – you name it. The mobile phone users are upset.
Dumindra (Tigo): Today my spectrum fee is 10% of my revenue. I still manage a 30% EBITA, but that’s not enough to make ends meet with equipment. In this business you need 60% EBITA. If you look at Sri Lanka the only that has been going south is telecom prices, everything is going up. Not long ago my friend was asking me about call center agents.
There is one player here in the big game that hasn’t contributed that much, and that’s government. The obvious things like taxation, duties have been mentioned many times. This isn’t a lot of researching, it’s more implementing on the government side. What does access to spectrum mean? It means a great deal.
-Hans Wijeyasuriya and Dumindra Ratnayake on the Asian market and the bottom of the pyramid Its not the financial crisis that has reduced profits in South Asia. Sri Lanka is a very good case study. This happened because policy makers did not understand the market. We have one too many operators. Our base stations have too long payback times.
Divakara Goswami (Chair): I’m at Deloitte and we try to find the ROI on our research. One thing we’ve found that works is doing a survey on our research. The question that I have for you is, what is the research LIRNEasia has done that can be useful to you? I’m Sanna Eskelinen from Nokia, Emerging Markets. I think it is easy for me because Rohan thinks about making himself redundant.
Harsha de Silva: Kentaro, you talked about the expenditure and ringtones, but this whole group answered vacation or new car (also new car). That doesn’t seem to be a BOP thing. Helani, you talked about prepaid, but that’s 95%, so not necessarily BOP. So is there anything that’s BOP specific? Sultanur Reza: CSR, people have different expectations.
What we know The BOP is a large group of people, we know they have low income. They can only spend a limited amount on communication. Their income is also irregular. So they can’t spend at a constant rate. We know they have phones.
I am currently based in Bangalore India, but as you can tell I’m not Indian. There’s some things which I don’t understand emotionally, though I do understand intellectually. For example, singing in the rain is an exception in Hollywood, but it’s the norm in Bollywood. I can’t muster the same joy at the rains, but the entire country gets a bonus when it rains on time. There’s a huge difference, based on a similarity.
– Sulatnur Reza, GrameenPhone, Bangladesh The BOP are the people that make up the base of the pyramid. Therefore i like to refer to them as the base of the pyramid and not the bottom. At 5.3. bn people, its a huge potential market.
I want to talk about not the demand side so much as the supply side. How we’re going to reach BOP users, and how much it will cost, and whether private sector can do this. If you look at the side, you can see that more than 3/4 of mobile users are from developing countries. Some developing countries are beginning to leapfrog OECD counterparts. The level of economic development is not necessarily a good predictor of how a country will do.