While conducting an interview in India recently, a Vital Wave Consulting researcher noticed a teenage boy standing on a fence outside the house. The interviewee explained that the boy was splicing the wires so he could tap into his neighbor’s cable connection to watch an upcoming cricket match. Meanwhile, across the sea, the Arab Advisors Group released a study claiming that, in Egypt, the average ADSL Internet connection is shared by three households. The group estimates the number of connected Egyptian households at around one million, effectively tripling the official residential ADSL access figure.
Belief in a one-to-one ownership and usage model is an assumption that mature-market business managers frequently (and erroneously) apply to the emerging-market context. In fact, sharing cable television signals, Internet connections, even electricity, is very common in many emerging markets. As with buying bootleg software and pirated videos, stealing signals is not perceived as a punishable offense, so much as a pragmatic way of living on a limited budget.
Though the Egyptian estimates need validation, the prospect of a user base that is three times larger than official figures is notable. The pervasiveness of shared services in India, Egypt and many other emerging markets suggests a substantial, over-looked market for online retailers, auction sites, advertisers and hardware companies. Hardware vendors have begun to capitalize on shared-usage models by designing products with features for multiple users (e.g., Nokia’s multiple phone books in one mobile phone). To accurately determine the size of these market opportunities, companies need a clear understanding of unconventional usage patterns and reliable methods for finding and validating market size data and assumptions.
Also in the news: