Digital Media Buzz > Mobile Market Floods Africa

Mobile Market Floods Africa

By N. Clark Judd

Thanks to an emerging class of social applications, farmers in Uganda have something in common with Madison Avenue advertisers: They both use their mobile phones to do business.

Non-profits like the Grameen Foundation and Kiwanja.net are pumping grant money into projects to bring SMS applications to the developing world. But the ultimate goal, says the Grameen Foundation’s David Edelstein, is to prove that there’s a market for mobile services in places like Southeast Asia and rural Africa.

With the number of mobile phone subscribers expected to reach 4.5 billion globally by 2012, and roughly two-thirds of those in developing countries by Edelstein’s count, there’s no shortage of subscribers. The challenge is showing that there is a reliable market, even in poverty-stricken parts of the world.

To that end, the Washington, D.C.-based Grameen Foundation has already worked with Google to launch an SMS application in Uganda, for example, that makes a market for goods via text message — almost like Craigslist or even eBay, Edelstein explains. Farmers who would previously have to accept whatever prices they can get from whomever drove out to do business with them can now expand their markets — meaning they might be able to get a better price.

Eventually Grameen hopes the project will be self-sustaining thanks to revenues from subscribers — an example for businesses who are looking in international markets.

“Our role is to prove that they’re economically viable and the business models exist,” Edelstein says.

Kiwanja.net’s Mobility Project, meanwhile, is working to create a new class of mobile application developers in Africa, and a new set of development tools for them that would allow them to actually write their code on their mobile phones.

In places like rural Africa, where desktop computers might not be readily available, Kiwanja.net explains, there’s no reason why people should not be able to take advantage of their increasingly more powerful, and considerably cheaper, phones to accomplish many of the same things a desktop computer can.

And mobile service providers like South Africa’s MTN are already moving into this market. MTN offers services ranging from banking on your mobile phone to booking tickets to sporting events. There’s even a number users can send a text to if they’re lost on a dark back road and need an operator to call them and talk them back to a major thoroughfare.

This doesn’t mean there isn’t room for American countries to move into markets like Africa or Indonesia, where Grameen also does work. “For a certain group of companies, there’s a clear benefit,” Edelstein says. Working in the developing world can expand brand recognition and market reach. Edelstein readily admits there aren’t many companies in the United States who have moved into the developing world as a market. But that’s part of the allure.

The New York Times published a story in May explaining how traffic in Jakarta, for example, is so bad that drivers actually pay professional hitchhikers to ride with them so they can use recently opened carpool lanes. Complex problems create a need for complex solutions. “[Indonesia] is an enormous market where the needs are not really being met,” he says. “There’s a lot of potential in areas like education, like financial services, like jobs … like transportation coordination.”

And a solution on one phone can affect more than just one person. Another Grameen project aims to stir entrepreneurship by helping to set up communications businesses in remote areas: “Village Phone,” which allows a villager to sell use of his or her phone to others in a remote village where the nearest landline might be miles away. “The 4.5 billion,” Edelstein says, referring again to the estimated number of phones in a few years, “underestimates the reach of mobile devices.”