November 23, 2005

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Peter Gordon in The Standard lauds the new US$100 laptop as the latest tool to close the "digital divide". It is an interesting development, especially if it ends up doing most of what a US$1000 laptop can do. But they will do more good on the shelves of Wal Mart than in poor villages.

There are few phrases more meaningless than "digital divide". It is meant to represent the gap between the technological haves and have-nots, under the theory that those with the technology will get richer while those without will be left behind and get poorer. It has been deemed vital, by the patronising elites that be, to close that gap to help the poor help themselves.

Let's start with an experiment. You are going to be sent to run an isolated farm for 6 months, on your own, and you can take one piece of technology with you. What would you choose? You might well say a piece of farming equipment (if you could carry it). You more likely would say I can't live without my iPod. Most likely you would say I need my mobile phone to keep in touch with the outside world. More importantly, if you ask a poor farmer which they prefer, my money's on the mobile phone.

Mobile phones are immensely useful technological tools, and especially for the poor. Typically poor countries have limited infrastructure and communications networks. Roads don't work. Fixed phone connections can take months, cost a fortune and still not work. The post can take ages and still not get through. Mobile phones circumvent all of these problems. Farmers can check on weather forecasts, demand for their crops and market prices. Often villages share mobiles, with airtime being rented out, making useage even cheaper. Pre-paid phone plans eliminate the need for credit checks or bank accounts to get set up. And it is user-friendly technology. A study found a rise of 10 mobiles per 100 people boosts a developing country's GDP by 0.6% (via The Economist (sub req'd)).

Mr Gordon writes:

The US$100 laptop might be just as disruptive to the status quo in the technology world as it promises to be in poor and illiberal societies and for much the same reason: it will challenge accepted truths.
Replace US$100 laptop with US$30 mobile phone, and he's got it right. And such phones are on the way. The Economist article linked above notes Motorola has been contracted to supply 6 million handsets at less than US$40 each, and there are a new set of chips that could allow sub US$20 phones.

Ironically only a few pages away in The Standard is an article by Johan Norberg on globalisation which uses mobile phones as an example of its massive benefits.

In countries where people are surviving, barely, on a dollar a day, it is a complete no-brainer that mobile phones are the way to go. A third of the cost of the cheapest laptop, they are more immediately beneficial to users. A laptop might help school kids learn better, but they will probably do even better again if their parents are doing well enough they can send the kids to school, the teachers are well fed and well paid, the school house has a roof and materials for teaching and so on. That US$100 could be far better spent than on a laptop.

But aren't cheap mobile phones also about closing the "digital divide"? Perhaps. We could also talk about the "nutrition divide", the "environmental divide", the "sport divide" and numerous other meaningless divides. Who cares? The reality of the world is there are haves and have-nots, rich and poor. If you want an example of a place largely without such divides, North Korea awaits. The common fallacy is to confuse absolute and relative wealth. Just because I'm not as rich as Bill Gates does not mean that I am not well off. If our general standard of living is rising, albeit unevenly spread across the population, that is a better outcome than worrying about relative standards of living across that population. I'm all for the rich getting richer if it means the poor get richer as well.

Cheap mobiles are dynamic tools that could rapidly advance the well being of many. There is a demand and so there will be a supply. Mobile phone makers are faced with saturated and mature developed markets. The emerging and developing world presents masses of potential, with smaller profit margins but far greater volume.

Mobiles have ancilliary benefits too - often poor countries are those that are mismanged and repressive. The communication networks that mobiles form also allow for the rapid flow of information. As even China is discovering, controlling the internet is possible but controlling far more numerous mobiles and text messages is a monumental challenge. Once people can talk and talk widely, controlling what they say becomes impossible.

Let's close the mobile/globalisation divide. We will all be better off.

posted by Simon on 11.23.05 at 09:18 AM in the World category.


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Thoughtful and interesting post, Simon. You might also mention that mobile phones are way easier for poor governments to put up. Much easier to put up a tower than it is to string thousands of miles of cables. In fact, private consortiums, much to the horror of the far left NGO's and anti-globalization forces, are doing just that.

posted by: RP on 11.24.05 at 05:15 AM [permalink]

Did anyone mention clean drinking water, vaccination against common diseases, food, shelter etc?

posted by: HKMacs on 11.24.05 at 10:52 AM [permalink]

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