July 10, 2008

Technology business rules in the developing countries

Katy Bacon at the official Google.org blog writes about the mobile phone revolution in Africa:
It is the story of Safaricom, the most successful telecom company on the continent. Safaricom started trading publicly on the Nairobi stock exchange in June and catalyzed the largest IPO on the continent ever. More than $800 million was raised from Kenyans from all walks of life, resulting in an over-subscription of stock of more than 400%. Mobile is growing faster in Africa than in any other part of the world. While levels of internet penetration are well below 5% for the continent, nearly 40% have access to mobile phones and Nairobi sends more text messages in a single day than New York (a statistic frequently quoted in the region).

Ten years ago people were talking about land lines and how they would ever penetrate rural Africa. Infrastructure has long been a constraint on economic development and growth in Africa but nobody imagined that a new technology would completely leap-frog the traditional phone and fundamentally disrupt telephony in Africa. I can't help but think about rural energy in the same light. Today, countries like Uganda are still 90% unserved by electricity. Can you imagine not having power in 90% of any country and still trying to grow the economy? Do we expect Africans to wait for grid electricity to incrementally reach people or are there disruptive innovations that can provide off-grid renewable energy to rural Africans in scaleable ways?
We may see similar response when Bangladesh's largest mobile phone provider Grameen Phone launches its IPO. And Grameen Phone's contribution to Bangladesh's rural economy should not be neglected.


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