Monday, May 31, 2010

The world loses C.K. Prahalad, but his strategies for the BoP live on

Both the business and development communities are mourning the recent death of Professor C.K. Prahalad, the man who redefined the term "Bottom of the Pyramid" (BoP) in the context of the four billijavascript:void(0)on poor people across the developing world. Dr. Prahalad, a professor at the University of Michigan, passed away suddenly on April 16, 2010, at the age of 68. His best known book, The Fortune at the Bottom of the Pyramid: Eradicating Poverty through Profits, introduced some of the largest corporations in the world to the concept that there is money to be made in the poorest areas of the world. More recently, Professor Prahalad's work was integrating the concepts of corporate sustainability into business at the BoP. 

In the past year, many multinational organizations have adjusted their focus within developing-country markets to capture the higher-income "Middle of the Pyramid" (MoP), or the emerging middle class in these countries. The shift away from BoP strategies is largely borne of these companies' limited success in realizing the significant growth in the BoP needed to offset razor-thin profit margins. Indeed, other leaders of the BoP movement, including Al Hammond of Ashoka and Stuart Hart of Cornell University, are focusing their efforts on social entrepreneurship and sustainability as a primary mechanism for reaching the BoP.

However, this does not imply that multinational corporations (MNCs) should stop addressing the BoP. Companies such as Nokia with significant economies of scale have succeeded in penetrating this market with a combination of low-priced offerings and innovative solutions such as product financing. Furthermore, many firms are beginning to realize that the end users of their products are not always the buyers. Governments and development organizations are important purchasers of products and services on behalf of those in the base of the pyramid. By separating the concept of end user and "economic buyer", MNCs can realize near-term BoP business expansion by tapping into budgets that allow for profitable revenue growth. The key to this strategy is tracking the money flows and expenditures in public budgets and development organizations. Doing so can allow firms to not only provide appropriate offerings, but to develop the necessary relationships for successful sales.

Friday, May 28, 2010

Prediction that all you can eat data is going away is confirmed

by Karen Coppock

As I predicted last February after the Mobile World Congress in Barcelona ("All you can eat data" going on a diet) carriers are beginning to launch tiered-pricing plans.Verizon's tiered-pricing plan will not begin until it launches its LTE service near the end of this year and AT&T has not officially launched a tiered-pricing plan, but its executives have spoken of its inevitability since late last year.

Although consumers may not be happy about these changes, they were really inevitable. To minimize backlash and negative PR, operators should structure plans to be the easiest-to-understand and least technology-centric.

Thursday, May 27, 2010

Augmented Reality and Health...Institute for the Future workshop

by Karen Coppock

The Institute for the Future was generous enough to invite the Mobile Health 2010 participants to a half-day session on augmented reality (AR) and mobile health yesterday. Popular topics were using AR for preventative health, user interfaces, sensors and chronic care management. A few themes cut-across several of the topics and echoed some of the key take-aways from the Mobile Health 2010 event the day before, including:

Less is more
  • Actionable information and knowledge is better than raw data and dense charts and graphs
  • Simple and very easy-to-use user interfaces are essential - especially when dealing with elderly populations, which tend to have the highest incident of chronic health conditions
  • Images can be extremely powerful and persuasive
Personalization may go hand-in-hand with AR
  • Individuals may be more likely to be motivated to respond to AR when it is personalized. Motivational messages from grand-kids to give cancer survivors the strength to continue treatment, reminders from a recording you made yourself about how crummy junk food makes you feel may help you walk past - and not into - a McDonalds, the ability to block out food choices in a grocery store that are not aligned with your particular diet plan will help keep you on plan and images of yourself 10 pounds lighter may motivate you to continue on with your workout plan
AR applications for mobile phones will take a while to mature and start to be used in health and well-being initiatives in the developed world. It will take them even longer to reach the developing world given the levels of sophistication required from mobile device and networks. And just as with basic mHealth applications, the effectiveness of AR with regards to improving health and well-being outcomes will need to be proven and new business models created.

Wednesday, May 26, 2010

Mobile Health 2010 - Day 2

by Karen Coppock

Day two of the Mobile Health 2010 conference was even more action packed than day one...from discussing FrontlineSMS Medic's use of mobile phones to find survivors (and then rebuild the country) after the earthquake in Haiti to the low-hanging fruit application area (drug compliance).

Some cold water was poured over the idea of mHealth by a few industry players and VCs who said things such as "this isn't a business" and "we are a $20+ billion dollar business, will your mHealth innovation make a difference in my revenues - unlikely." Yet some organizations, BabyCenter being an excellent example, are reaching scale and likely profitability. BabyCenter is used by nearly half of all pregnant women in the US and has expanded to serve pregnant women and young mothers in 22 countries. BabyCenter's business model is threefold: advertising revenue, premium paid services and patient reimbursement. In countries such as India, BabyCenter content is often delivered via mobile phones as the percent of the population that owns a PC is very small. BabyCenter's VP of International astutely noted that advertising is still a viable model in India as a mobile phone purchase is the first step into the middle class and hence mobile-phone owners are a compelling market for advertisers.

In the final panel, Dave Marvit of Fujitsu Labs of America nicely summarized three parting thoughts:
  1. Don't forget sensors when thinking about mHealth 
  2. It's not about the data, it's about knowledge or actionable information
  3. Focus more on health and less on technology
Thank you BJ Fogg and all of the conference speakers/participants - was an excellent two days.....however, there is still a lot more work to do to transform interesting mHealth pilots into viable businesses with proven health outcomes.

Tuesday, May 25, 2010

M-PESA mMoney service - impact and usage in Kenya

by Karen Coppock

CGAP recently published an interesting brief, Poor People Using Mobile Financial Services: Observations on Customer Usage and Impact from M-PESA - about M-PESA in Kenya.

Some interesting tidbits from the brief:
  • Money is usually sent from urban to rural areas: as to be expected, most funds are transferred from urban to rural areas with urban residents (generally men) adopting the service and then encouraging their relatives in rural areas (generally women) to use it.
  • There are some wrinkles in the service: not all text messages (money transfers) go through and not all rural agents have cash on hand...both of which cause frustration with the service
  • Outcomes are mixed:
    • positive - increased income levels among rural users, more frequent and smaller transfers, women's empowerment due to ease of requesting and receiving funds and M-PESA acts as a savings account or feeds into a savings account to increase savings and financial security
    • negative - men tend to travel home to rural areas less often to deliver funds as they can now do it via their mobile...women back home fear that their husbands will take up "city wives" and stop sending them money or that they will have to share limited funds with these new spouses.
The unexpected result of the technology potentially decreasing rather than increasing existing relationships is an unfortunate finding.  Regardless of the final verdict on this issue, it is important to have a reference point on mMoney usage and impact as mMoney solutions are rapidly spreading across Africa and other developing nations.

Monday, May 24, 2010

Mobile Health 2010 - day 1

by Karen Coppock

Mobile Health 2010 started off with a bang today with more than two dozen speakers ranging from academics to medical professionals to NGOs and technologists....long breaks were scheduled throughout the day to encourage interaction and networking and the participants were just as interesting as the panelists.

The day started with discussions about behavioral science (e.g., BJ Fogg presented his behavior grid) moved into text messaging for health - I learned that more than 1.5 TRILLION text messages - or approximately 220 per person on earth - were sent in 2009 alone. This was an approximate 50% increase in the number of text messages sent in 2008. SMS is a very compelling platform to use for health education, monitoring and drug compliance.  Unfortunately, Frank Bailey from AARP noted that as folks age and their health worsens, they are less likely to use text messaging (only 23% of adults over 60 years old with two or more chronic medical conditions used text messaging technology.)

Later in the day, the urgency behind mHealth was discussed. Richard Adler of the IFTF cited a depressing CBO statistic that if cost increases remain constant, health care expenditures will equal 99% of GDP in 2082. A less dismal scenario was that health care expenditures would only equal 50% of GDP in 2082. Either way, it is clear that innovation and alternative business models will be required moving forward and there is a great deal of hope for mHealth.

The main question remains - does it work? Will it "bend" the cost curve while also dramatically improving health outcomes. Much more work needs to be done to answer this question and there is a great deal of optimism that the answer will indeed be yes...

Friday, May 14, 2010

mPayments not just for friends and family anymore...

by Karen Coppock

mPayments are not just for money transfers between friends and family anymore - they are increasingly being adopted by mainstream firms in Africa. The mainstream firms in Africa. The Balancing Act newsletter notes that Stanbic Uganda will pay its shareholder dividends through mPayments. The change was due to the fact that it was neither cost effective for the bank to send checks nor convenient for shareholders to receive and process such low value checks. mPayments overcame both of these issues and should result in cost savings as well as increased shareholder satisfaction.

Roshan, a mobile operator in Afghanistan, pays 100% of its employees (from its janitors to senior executives) via its mPaisa money transfer service. Not only is it creating a culture of mPayments, but it is decreasing its costs and increasing the security of its employees. mPayments are a much safer payment method in unstable economies where it can be dangerous to carry large sums of cash.

mPayments may not catch on to the extent that they are in Africa in the developed world given the sophistication of alternative payment systems (e.g., credit and debit cards), but they are definitely a viable model in developing economies.

Thursday, May 13, 2010

mHealth for the masses...

by Karen Coppock

MIT's Technology Review highlighted an ultra inexpensive microscope - just $3 - that can be attached to a mobile phone to conduct basic medical diagnostics such as generating blood counts and identifying disease cells and bacteria.

The key to its low price is the use of software, rather than an expensive lens for the medical diagnostics. Aydogan Ozcan, an academic and entrepreneur at UCLA, is the brain behind this solution and he is forming a venture, Holoscope, to continue to refine and then commercialize this solution.

I was very pleased to see that one target market for this low-cost microscope is educational institutions. While in Uganda a few months ago, the research organization where I was doing some volunteer work (Conservation Through Public Health) lent its microscope to the local hospital and schools as neither had access to a microscope (not even the hospital!). Even the most resource-constrained schools may be able to find a way to come up with $3 and most teachers that we met - even in very rural areas - owned mobile phones.

One critique of the $3 microscope was that the images were not clear enough and that doctors would be hesitant to use them. Many public high schools in remote areas in Africa (and likely Latin America and Asia) have no microscopes, so I imagine that low-quality images are a tad better than no images. Regardless as to if this particular solution succeeds or not, the most important take-away is that engineers are beginning to design very low-end, low-cost solutions so that the masses in emerging markets (and low-income segments in developed countries) will be able to benefit from the power of mHealth applications.

Sunday, May 9, 2010

Is China Changing its Tune on Foreign Technology Companies?

China's very public spat with Google on Internet censorship has been making the news for months, but recently there have been a few developments which indicate that China is slowly becoming a friendlier environment for foreign technology firms. Microsoft, which like other companies has struggled to operate in a market where software piracy is rampant, won a major victory in a Shanghai district court against a Chinese insurance company found to be using illegal copies of its software. The court ordered the company to pay Microsoft over $300,000 in damages. The judgment comes on the heels of the Chinese government's decision to relax procurement rules that forced the government to choose Chinese technology for public tenders, a rule China's trading partners charged was a protectionist measure.

These developments are critical for several reasons. The Business Software Alliance says that piracy in China cost its members $6.7 billion in lost revenue in 2008, so firms have a strong financial interest in seeing China strengthen its enforcement of intellectual property (IP) protection. But there are other reasons why these stories matter to foreign technology firms. In the wake of China's unwillingness to back down in its confrontation with Google, many firms may have feared that they have little leverage in disputes that directly affect their ability to profitably operate in China. The sheer size and growth rate of the Chinese market means that companies wanting to do business there would have to bend to the Chinese government's decisions, for fear of being locked out. These latest developments provide hope that the Chinese government has a stake in enforcing IP laws and opening procurement rules, perhaps because Chinese firms are moving up the value chain and want reciprocal access to foreign markets.

Doing business in China still poses challenges for even large firms experienced in emerging markets, but these recent developments indicate new opportunity. For companies ready to seize it, a robust but respectful government relations effort can pay off in the long term, as Microsoft's high-level engagement with the Chinese leadership demonstrates. But persistence in lobbying home country governments to enforce trade rules and act as an advocate is also crucial, because it can magnify firms' influence and increase their leverage. Developing patient but proactive government engagement efforts on issues vital to a firm's success can yield positive results over the long term.

Thursday, May 6, 2010

Globalization of R&D - Emerging Market Business Speaker Series, 5/13 - 9am PDT

Vital Wave Consulting is hosting a webinar on the Globalization of R&D on Thursday, May 13, 2010, 9-10 AM PDT

Click here to reserve your Webinar seat now

Multinational firms based in the developed world have been shifting production to emerging markets for decades while performing most research and development (R&D) work in the US, Europe and Japan. Recently, however, more R&D is being performed in China, India, Brazil and other emerging markets as their economies boom, their consumer bases grow in importance and local talent becomes more sophisticated. Join us as we share the results of an original Vital Wave Consulting and Harvard University research report on the globalization of R&D and the factors behind this important shift. This presentation will review the data associated with this trend, key factors driving it and a case study that illustrates how MNCs are making it a reality.

After registering you will receive a confirmation email containing information about joining the Webinar. If you encounter any registration difficulties, email us at:

Men, women, mobile phones and reproductive health...

by Karen Coppock

Yesterday I moderated a fascinating live chat on Gender, Phones and Reproductive Health - transcripts for the session are now available under the Discussion Boards link in the Conference Hall on the eConference website. I encourage you to review the transcripts and continue the conversation on the Discussion Board.

More than three dozen participants - from across the world - contributed to a very lively and informative discussion on using mobile phones in reproductive health and differences in targeting men and women. Organizations are taking very different approaches to gender differences - participants in the chat noted the following examples:
  • "In a pilot family planning project called Saathiya, in India we established a helpline with two separate phone lines for men and women served by same-gender operators. This approach proved to be very effective for men to be very comfortable asking wide range of questions on sexual health and FP"
  • "the audience is not necessarily just the target women, but often many other influential people in the community...." This approach was taken in Rwanda - "an SMS in Kinyarwandan in 2006 [was sent] to all registered mobile phone users to announce the child health campaign with bed nets, immunization, and deworming. It went out 2-3 days before the campaign"
  • "In using mobile phones, what is the role of women versus the role of community health workers. In
    a rural Nigerian setting, we need CHW to be intermediaries...process and interprete into local language, do reports etc"...CHWs [community health workers] in Nigeria are often, in my experience, the entry point into the household, past husbands, and can reach the wives. I agree with Ego in the importance in that setting to look at the relationship between the two."
Many more topics and issues were raised in the chat, but one theme was consistent throughout the discussion....sustainability and scale has not yet been achieved, but "People are really thirsty for information!" so we need to figure out the most effective method of quenching this thirst and mobile phones could be a very viable solution.

Monday, May 3, 2010

eConference, May 5th, 11am session on Gender, Phones and Reproductive Health 2pm EST

Vital Wave Consulting will be moderating a live chat on Gender, Phones & Reproductive Health on Wednesday, May 5th, from 2-3pm US Eastern time - please join us!

The discussion is a part of the Using Mobile Technologies to Improve Family Planning, Maternal Health & Newborn Services in the Developing world and is sponsored by USAID, the mHealth Alliance and SHOP. The session will revolve around a recent Vital Wave Consulting report, Women & Mobiles: A Global Opportunity, and will cover how gender issues will impact mHealth design, use and outcomes.

To register for the free conference, please click here.

According to conference sponsors, the conference is "intended for health program implementers with little or no experience using mobile technologies such as cell phones and PDAs to achieve public health goals."

The Women & Mobiles report - as well as several other Vital Wave Consulting reports - can be downloaded from the Resource Center section of the eConference, as well as from Vital Wave Consulting's website.