EECS 294-12 An Information and Communications Technology (ICT) Framework for Developing Regions Berkeley: Professor Eric Brewer, EECS Tom Kalil, Special

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<ul><li> Slide 1 </li> <li> EECS 294-12 An Information and Communications Technology (ICT) Framework for Developing Regions Berkeley: Professor Eric Brewer, EECS Tom Kalil, Special Assistant to the Chancellor Professor Richard Newton, Dean of the College of Engineering CMU: Rahul Tongia, Institute For Software Research International M. Bernardine Dias, Robotics Institute Prof. Raj Reddy, Robotics Institute/Computer Science </li> <li> Slide 2 </li> <li> Logistics and Other Practical Stuff EECS 294-12 (will be cross-listed at Haas for business students), 3 units Project, 60%; Homework 20%; Class participation 20% of final grade Written project with oral project review in last two weeks of semester Typical class format: 1 hr of lecture, 1 hr of discussion (3 rd hr reserved for use when needed) All other details on the web site at: http://courseweb.berkeley.edu/courseweb/pub/courses/2003/FL/COMPSCI/294/012 We will be using the Blackboard system at CMU for additional communications, etc.: www.cmu.edu/blackboard </li> <li> Slide 3 </li> <li> Value Creation in Product Development MarketsTechnologies ProductDefinitionFundamentalTechnologies ProductImplementation... The Way It Used to Be e.g. IBM, Hitachi, Digital, Siemens, Fujitsu $ ROI Source: Stan Shih, Acer, 1992 </li> <li> Slide 4 </li> <li> 15nm Value Creation in Product Development Product Definition Fundamental Technologies Product Implementation MarketsTechnologies... The Way It Is Today e.g. Microsoft, Sony, Acer, Cisco, Dell e.g. Xilinks, Intel, 3M Intel, 3M Disruptive Technology $ ROI Disruptive Business Model Source: Stan Shih, Acer, 1992 </li> <li> Slide 5 </li> <li> 4 Billion People Earning less than $2,000/year &lt; $2,0004,000 The Bottom of the Pyramid Middle Class in developing countries $2,000$20,000 2,000 Wealthy Nations Annual Purchasing Power Parity (PPP) in $US &gt; $20,000 Population In Millions 100 Source: Prahalad &amp; Hammond, Harvard Business Review, Vol. 80, Issue 9 (Sep. 2002), pp48-58 emerging mass markets adjacent markets We Can Build Large and Sustainable Businesses Based on These Markets </li> <li> Slide 6 </li> <li> The Bottom: A Brief Description 3-4 billion people with per-capita equivalent purchasing power (PPP) less that US$2,000 per year Could swell to 6-8 billion over the next 25 years Most live in rural villages or urban slums and shanty townsmovement towards urbanization Education levels are low or no-existent (especially for women) Markets are hard to reach, disorganized, and very local in nature http://www.wri.org/meb/wrisummit/pdfs/hart.pdf </li> <li> Slide 7 </li> <li> Growth in MegacitiesAn Urban Future Concentrated Population can be Addressed More Efficiently </li> <li> Slide 8 </li> <li> Example: An Emerging MarketIndia http://www.wri.org/meb/wrisummit/pdfs/hart.pdf Traditional MNC Business Model Some MNCs? Local Firms Future Opportunity? </li> <li> Slide 9 </li> <li> The Bottom: Not the Same Everywhere http://www.wri.org/meb/wrisummit/pdfs/hart.pdf </li> <li> Slide 10 </li> <li> Extent of benefit desired DESTITUTE CONSUMING CLASS CONSUMING CLASS RICH CARS WASHERS REFRIGERATOR BICYCLES ASPIRANTS CLIMBER COLOR TV B&amp;W TV MIXERS AUDIO Price able to pay Example: IndiaMany Price Points Source: NCAER, Millions of Households in 1999, and Rama Bijapurkar Source: NCAER, Millions of Households in 1999, and Rama Bijapurkar </li> <li> Slide 11 </li> <li> Example: IndiaDigital Photography Pyramid Phogenix DFX complete system for $39,900 Enterprise Village Photographer Target $400 -&gt; $200 Entrepreneurs 100,000s Photo shop for $3,000 Cheap Photo shop $1,000 SME (1000)s Source: Dr. Per-Kristian Halvorsen, HP Labs </li> <li> Slide 12 </li> <li> Telugu and Hindi voice-enabled news retrieval system Hand-writtten Email sent as bitmap Speculative Technologies Source: Dr. Per-Kristian Halvorsen, HP Labs </li> <li> Slide 13 </li> <li> ICT4BHypothesis 1: Current ICT projects for the Developing World are just trickle down first-world technology: Too expensive Assumes reliable infrastructure, power Assumes IT knowledge and significant support Assumes literacy We can directly attack these issues </li> <li> Slide 14 </li> <li> ICT4BHypothesis 2: Thousands of ICT projects, but: Almost all focus on devices not infrastructure No single project can afford to build infrastructure, but all of them would benefit. Existing elements of infrastructure not leveraged enough! Key Idea: We can enable low-cost infrastructure Enhance all of the existing projects Enable new projects that were previously intractable </li> <li> Slide 15 </li> <li> ICT4BThe Big Picture Enhance and enable ICT projects: Novel technology (direct attack) Novel deployment/support Support for semi- and illiterate users Two real-world deployments (validate) Question: Is this really true? Can new technologies really make a big difference here? Or is this market better served by a trickle down of existing technology and the real challenge is simply the business model aspect? </li> <li> Slide 16 </li> <li> ICT4BHypothesis 3: There are many applications that can benefit the developing world built upon an affordable, reliable and ubiquitous ICT infrastructure. There are sufficient productivity gains, opportunities to increase government efficiency, and health and well- being benefits to build sustainable businesses at all levels By providing these opportunities in the developing world, we will also provide a mechanism to address such critical long-term issues as population growth, human rights, and a sustainable environment </li> <li> Slide 17 </li> <li> Information and Communication Technology The Digital Provide (http://www.weforum.org) The Digital Provide Global Information Technology Report 2001-2002: Readiness for the Networked World (http://www.weforum.org) Information for Economic Decisions Effective Markets Income Gains EconomicGrowth CapitalInvestment EconomicROI </li> <li> Slide 18 </li> <li> Tangible Economic Benefits of ICT4B Productivity Drives long-term standard of living Large part of U.S. resurgence of productivity growth in 1996-2002 How widespread would it need to be in LDCs to yield significant productivity increases? Income generation ICT equivalent of Super Money Maker irrigation pump6-9 month payback GrameenPhone$170/month vs. $368 GDP/capita in Bangladesh Outsourcing Virtual security guards from Cape Verde Business process outsourcing in India But if 5 percent of developed country service jobs are contestableonly 0.24% of developing country population Digital diaspora as development resource (brain drain to brain trust) </li> <li> Slide 19 </li> <li> Economic Benefits and Applications Price discoveryrural farmers able to double incomes by discovering price of their crops in the capital city Improved exports to developed country markets Transfer of dollars from diasporanetworked diaspora as a development resource Coordination of transportation and distribution (e.g. crops to markets) Natural disaster mitigationearly warning of floods, monsoons, etc. </li> <li> Slide 20 </li> <li> Example: ICT for Improving Market Efficiencies Price dispersion is a manifestationand, indeed, it is the measureof ignorance in the market (Stigler, 1961) Source: China Health and Nutrition Survey, 1991 Badiane and Shively (1998) studied monthly maize prices in Ghana from 1980 to 1993: the estimated time to fully transmit a price shock to each of two outlying markets is about four months. </li> <li> Slide 21 </li> <li> Economic Benefits and Applications Price discoveryrural farmers able to double incomes by discovering price of their crops in the capital city Job creation (jobs like data entry that can be shifted to developing countriesinexpensive IT workforce) Improved exports to developed country markets Transfer of dollars from diasporanetworked diaspora as a development resource Coordination of transportation and distribution (e.g. crops to markets) Natural disaster mitigationearly warning of floods, monsoons, etc. </li> <li> Slide 22 </li> <li> ICT Empowers Women We get our freedom from the Internet, since in our society girls are not allowed to go wherever we wantthe Internet takes us out to other people, places and realitiesit is our way of escaping from our closed society. It is vital to us, it gives us liberty. A young Muslim girl from Mauritania, Global Information Technology Report 2001-2002: Readiness for the Networked World </li> <li> Slide 23 </li> <li> SocietalROI Information and Communication Technology The Digital Provide Information for Economic Decisions Effective Markets Income Gains EconomicGrowth Smaller Families Healthier Families Better Education Capitalism Thrives </li> <li> Slide 24 </li> <li> Social Benefits and Applications A Platform for Education, Training and Consultation Educated women have fewer children and they are healthier Transparency: Cost of obtaining a land title in Madhya Pradesh drops from $100 to 10 cents (reduced corruption) GIS for location of roads, schools, power plants to reduce politicization (Bangladesh) Internet-based disclosure Increased pressure for compliance with environmental regulations </li> <li> Slide 25 </li> <li> Social Benefits and Applications More voices (ease of publishing, many to many communication) Hondurasall media owned by one of 10 wealthiest families Revistazo.com provides outlet for investigative journalism Entertainment Developing country communities of practice Preservation and global sharing of local culture </li> <li> Slide 26 </li> <li> Health Benefits and Applications E-health (Health information, remote consultation using digital cameras, public health networks) SMS text messages used to increase compliance for TB treatment in S. Africa: 4 tablets 5 times/week for 6 months Non-compliance increases drug resistance Only 1 treatment failure in pilot of 138 patients Very significant life and cost savings possible </li> <li> Slide 27 </li> <li> Example: Health benefits of ICTRiver Blindness IT used to help eradicate black fly that carries river blindness in West Africa Network of real-time hydrological sensors, satellites, and forecasting software determined best time to spray larvicide Protects 30 million people from infection Freed up 100,000 square miles of land capable of feeding 17 million people </li> <li> Slide 28 </li> <li> But ICT not just VOIP, Computers and Internet MEMS for low-cost lab on a chip and drug delivery Sensors for environmental or food quality Remote sensing for predicting crop yields and enhancing regional security Leveraging cyber-infrastructure for science aimed at developing country problems </li> <li> Slide 29 </li> <li> ICT4BWe are Studying Five Main Application Areas Commerce Health Education Government Location-based services Team includes social scientists: Professors Stephen Weber, Isha Ray, at Berkeley </li> <li> Slide 30 </li> <li> ICT4BHypothesis 4: It will take new and very innovative approaches in business models to make this workthis is not just about technology! Financing deployment: Grameen Bank, Grameen Phone, Yahoo BB and DSL Distribution channels: Intel White-Box experience? Working with (or around) local and national governments and regulations User and technical support models Deployment of services, enabling and encouraging the development of applications built upon them </li> <li> Slide 31 </li> <li> 15nm Disruptive Business Models &amp; Implementation Product Definition Fundamental Technologies Product Implementation MarketsTechnologies... A Major Societal Opportunity e.g. Microsoft, Sony, Acer, Cisco, Dell e.g. Xilinks, Intel, 3M Intel, 3M $ ROI Source: Stan Shih, Acer, 1992 </li> <li> Slide 32 </li> <li> Example: Grameen BankBangladesh Owned entirely by the poor Began in one village in 1976 97% of equity owned by the (women) borrowers, remainder by the government 2.6 million borrowers (95% women), over 1,000 branches in over 42,000 villages. 12,000 staff. Has loaned more than US$3.9B since inception Over US$3.5B repaid with interest (98.75% recovery rate); $290M loaned in the last 12 months. Has never accepted any charityhas always been run as a profitable social enterprise 46.5% of Grameen borrowers have crossed the poverty line </li> <li> Slide 33 </li> <li> Grameen Telecom A Disruptive Societal-Scale Business Model Village Phone is a unique idea that provides modern telecommunication services to the poor people of Bangladesh. So far over 26,000 loans of average US$200 have been given to buy mobile phones. Average Phone Lady income goes up by 3- 10x! The goal is to provide telecommunication services to the 100 million rural inhabitants in the 68,000 villages in Bangladeshthe largest wireless pay phone project in the World. </li> <li> Slide 34 </li> <li> e.g. Cellular &amp; Wireless Systems e.g. Grameen Phone Disruptive Business Models &amp; Implementation Product Definition Fundamental Technologies Product Implementation MarketsTechnologies... A Major Societal OpportunitySocietal ROI ROI Grameen Grameen Bank Source: Stan Shih, Acer, 1992 Key Idea: Can such a model be used to successfully develop and distribute other technologies and services? </li> <li> Slide 35 </li> <li> Source: John Gage, Sun Microsystems and K. C. Claffy, CAIDA, UCSD So Why Now? Rapidly Expanding Access to Communication Networks (especially wireless) Low-Cost Electronics and Devices Intuitive and User/Task-Oriented Interfaces Peer-to-Peer (and Device-to-Device) System Architectures Precise Spatial Location (via GPS) Embedded into Every Device Sensor fusion Unique Identity Systems </li> <li> Slide 36 </li> <li> ICT4BHypothesis 5: Key Idea: By developing technologies and services specifically for this market, rather than simply retargeting existing technologies, there is a disruptive opportunity Fully-integrated, single-chip handset Chips optimized for server farm managementintrospection, power management, test, diagnosis and self-repair Hardware and software interaction in new and unique ways (e.g. to support privacy, security, reliability, reprovisioning and repair) Key Idea: By co-developing devices and infrastructure, significant efficiencies can be obtained, and such development is possible in these relatively green field markets New and very powerful architectural control points can and will be established by the early-movers in these markets Given the significant pent up entrepreneurial desire in these markets, the right technologies and services are likely to move and grow relatively quickly. </li> <li> Slide 37 </li> <li> Novel Technology Device cost: 10-100 times reduction Infrastructure cost: 10-100 times reduction Device power: 10-100 times lower Speech recognition for obscure languages and dialects </li> <li> Slide 38 </li> <li> Whats the Right Physical Network Architecture? I took a map of India and said what if we drew 5000 circles, 40 km in radius. Each circle covers a 100 villages, about 5000 sq kms each, on avera...</li></ul>