Are Mobile Solutions Overhyped?

  • and Kentaro Toyama, University of California, Berkeley; Maura O’Neill, USAID; and Katrin Verclas, MobileActive
February 7, 2012 |
...the ubiquity of the mobile phone - and its application to a diverse and growing set of development goals - doesn’t guarantee economic or social progress.
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Editor’s Note: Contributors to this post will be part of a panel on the topic taking place on Thursday, February 9th in Washington, D.C. Sign up for the event here. This post is part of the Global Innovation Showcase created by the New America Foundation and the Global Public Square.

There are now over 5 billion mobile phone subscriptions worldwide, according to the International Telecommunications Union, with global mobile penetration at 87 percent. In the developing world, where landlines are especially scarce in rural areas, mobiles have been used for governance, banking, agriculture, education, health, commerce, reporting news, political participation, and reducing corruption.

But the ubiquity of the mobile phone - and its application to a diverse and growing set of development goals - doesn’t guarantee economic or social progress.

Are mobiles just another high-tech solution to what are essentially systemic and deeply rooted problems? Are mobile solutions for combating global poverty overhyped?

Kentaro Toyama, (@Kentarotoyama), Researcher at the School of Information at the University of California, Berkeley

Yes, mobile solutions are overhyped. At the moment, there is tremendous excitement around using mobile phones to address illness, ignorance, oppression, and other socio-economic challenges of the developing world. Within a decade, though, I expect that we’ll look back and see mobile development just as we view 1960s attempts to tackle the same problems with television – the technology has great potential, but overall it’s just an unproductive diversion.

Cheerleaders for mobile development point out that there are nearly six billion active mobile accounts in the world, and that mobile phones are increasingly used by the remotest rural villagers. It’s hard, indeed, to overhype the business success or the consumer appeal of mobile phones.

Market penetration, however, is not the same as meaningful impact.

Technology amplifies human intent and capacity, but technology by itself doesn’t fix challenges of intent or capacity. What’s overhyped is a belief that mobile-centric programs are a cost-effective means to combat disease, improve education, or alleviate poverty, as if mobile or not were the essential question. What’s overhyped is technological innovation as a primary solution to complex social problems, at the expense of tested-and-true interventions that nurture people and institutions.

Here’s an analogy: Imagine that you were chair of the board of a failing organization. Which of the following actions would most help turn it around?

1. Replace the chief executive with someone smarter and wiser.

2. Consult with clients, and address organizational blind spots.

3. Provide relevant, high-quality training for the employees.

4. Buy every employee a fancy smartphone with specially designed productivity software.

I’ve asked this question of many audiences, and everyone always laughs at (d). Yet, (d) in one form or another is the rationale behind most mobile development.

The real question is one of priority: Why allocate resources for technology-centric projects, when they could be better spent on people-centric ones? To paraphrase an old adage (with a deep apology to poets), “If you give a person a turbo-charged, heat-seeking, robotic fishing pole, they might eat until the technology becomes obsolete, which in our age is a couple of years at best; if, however, you teach them how to fish, they’ll eat for a lifetime.”

Maura O’Neill, (@MauraAtUSAID), Chief Innovation Officer at USAID

It depends. If you are looking for instant improvements in health, education or income shortly after a mom in a remote village or a young person in an urban slum purchases a cell phone then you will be shaking your head. Five billion cell phones in and of themselves are not going to produce development.  On the other hand if you look at what occurred in Internet retail or music downloads you might predict we are within spitting distance of that development inflection curve.

After Amazon went public, raised an additional billion dollars in debt and was still mounting losses, many people were dismissing it - pointing to its single digit share of the book market.  It will never be more than a bit player, many thought.  Not sustainable. No scale.

A market rarely looks robust from the outset.  Until, of course, it does and it is too late for competitors.

However, one company usually doesn’t get it right at first. It is an iterative process. There was Napster, then Kaaza and then Apple launched a business model that finally was a hit for the industry and consumers. Legitimate downloads skyrocketed. There was Friendster and MySpace, both market leaders, before Facebook built a new mousetrap.

We are in that experimentation phase just before the inflection point in the field of mobiles for development. Thousands of apps, few with massive scale.  Lots of people are chasing that dream. Many will end up failing while the Amazons and the Facebooks of development will emerge faster than people think.

The first signs that mobiles will be a game changer in development are appearing. 15 million Kenyans or 70% of the country’s adult population now have mobile money wallets nestled in their back pockets – a phenomenon that occurred in just the last four years. It is already driving development outcome improvements in savings and internal remittances.

It hasn’t gone viral globally. At least not yet. But when VISA invests in companies like Fundamo, and is putting it global distribution assets behind game changing mobile applications, we know true development is not far behind.  Serious mobile money launches or re-launches based on the lessons learned are occurring in dozens of poor countries. Vodafone, Google and other players are offering digital wallets. Financial inclusion will soon be within reach of millions.

There will be development hurdles mobiles will struggle to solve. Twitter may have accelerated the Arab Spring but tackling development problems will remain complex.  The next decade will be transformational in development. Mobiles will be a big part of the story.

Katrin Verclas, @Katrinskaya, Co-Founder and Editor of MobileActive

Yes and no. There is no doubt that mobile technology has revolutionized communications worldwide, with over six billion active subscriptions, according to the GSMA, and with Africa and India experiencing growth in mobile accessibility and availability that is unprecedented.

Mobile phones have been instrumental in allowing people to strengthen their social networks and safety nets in case of financial or medical emergencies. Phones have ‘normalized’ information disparity in markets, allowing farmers, for instance, access to information about commodity prices to negotiate better prices for their products. Information available via mobiles can streamline supply chains for small shopkeepers.

Phones are increasingly used for delivery of basic health care services, such as more accurate and speedy transmittance of patient information, streamlining of drug supply chains, vaccination outreach, and sexual health information.

Mobile money has seen particularly striking success in reaching the unbanked. A recent study looked at 18 branchless banking providers and found that they’d brought on average 1.39 million people into the formal financial system for the first time.

Lastly, mobile phones have the potential to lessen income and power inequalities between men and women. One 2008 study in South Africa notes that mobile phones can have a distinctly positive economic effect on female users. When network coverage was extended to a new locality, employment increased by 15 percent, with “most of this effect…due to increased employment by women.”

Yet mobile technology is no silver bullet. As the Financial Times pointed out not too long ago, in many Africa countries there is “an acute shortage of resources and trained staff means that more than 50% of the region’s population is estimated to lack access to modern health care facilities."  Mobile technology may serve as an effective communications medium for local community health workers, but it will not replace the lack of investment, and the lack of resources and trained medical staff.

While mobiles are great for accessing information about commodity prices, similarly, they will not replace investments into roads and transportation infrastructure that would allow goods to actually get to market efficiently and speedily.

Lastly, while the data on mobiles and women is conflicting, there is with growing evidence of a bottom-of-the-pyramid mobile divide. In the poorest areas, cell phones are especially scarcer, and cost and literacy impose greater barriers to poorer women, who are more likely to be illiterate than men. It is often these poorest, most rural women who could most use information about market prices, personal safety, and female health care who are also least able to afford mobile phones and take advantage of its opportunities.

Eric Tyler (@Erict19), Program Associate at the New America Foundation

Yes, if you are predicting that mobile technology will mean the end of the digital divide and that a mobile phone in every hand will solve all problems. No, if you are saying that utilizing mobile phones already in the hands of nearly 6 billion people is profoundly better than dropping tablet computers out of helicopters.

Mobile phones are leading the developing world into the information economy and digital age. Already, we’ve seen the potential of the devices to transform an entire industry, as mobile money did in Kenya. And for a large portion of the developing world’s next generation, it will be through mobile phones that Internet connectivity is gained.

But let’s not get ahead of ourselves and throw mobile phones at every problem we see. The sustainability and effectiveness of mobile solutions will be closely tied to the human reality and context that surrounds these devices. And important questions still need to be asked around replicability and costs. For example, why has mobile money not yet taken hold outside of Kenya? And how can prices come down for those who cannot afford mobile phones?

A promising sign of mobiles phones’ potential are early randomized evaluations of projects showing a range of positive impacts. One such study of a mobile money transfer project in a drought prone village in Niger showed a huge reduction in distribution costs and greater diversity in crop allocation, purchasing decisions, and diet for mobile transfer beneficiaries.

“Mobile development” is still in its infancy. After all, the first call was made from a mobile less than forty years ago. The inventor Martin Cooper picked up the two and half pound handheld and dialed his rival company’s head researcher to gloat. Martin couldn’t have envisioned the implications of his breakthrough for helping the world’s poorest, and the picture is still coming into focus today. What is already clear is that this is just the beginning, and as mobile phones get smarter, cheaper, and more widespread, they will continue to play an integral role in adapting international development to the digital age.