STORMING THE DIGITAL DIVIDE
Information and communication technology companies were born with a sustainable spoon in their mouths. Now it's time to put something back in.
Information and communication technology (ICT) companies are relatively blessed, sustainably-speaking. They are New Economy companies par excellence, in the business of creating value-lots of it-for relatively little stuff. Sure, dot.coms are not particularly renowned for progressive sustainability policies and cell phones, computers and the like do end up in dumps, but the New Economy is all about shifting the resource center of gravity from physical matter to bits and bytes. Another word for that is dematerialisation and it's one of the driving principles behind corporate sustainability.
What's more, ICT companies can make a plausible case that wiring the world is the best, if not the only, way out of our current environmental and social predicament. The argument isn't ironclad: opponents of globalisation argue that the Internet is merely a vehicle for consumerism. But it can also bring good and, in a world where the gap between haves and have-nots is widening steadily, the idea of using the Internet as a bridge to social and economic equality has intrinsic appeal.
Small wonder that ICT and other New Economy companies are starting to sit up and pay attention. In October 2000, the US-based World Resources Institute sponsored a conference in Seattle called 'The Digital Dividend,' the notion behind the clever title being that if the challenge is conquering the 'digital divide,' its solution lies in the 'dividend'-making money off tackling the problem. The concept clearly struck a chord: Among the sponsors were big-name ICT players like 3com, Compaq, Ericsson, Hewlett-Packard, Intel, Lucent, Microsoft, Motorola, Nokia and WorldCom. Speakers included Hewlett-Packard president and CEO Carly Fiorina, Amazon.com CEO Jeff Bezos and some guy called Bill Gates. Plainly the digital dividend concept has got ICT executives intrigued.
Hewlett-Packard (HP) was the first to take the plunge. At the conference, it announced the launch of World e-Inclusion Services, an ambitious multi-pronged venture targeting the world's poor and five specific types of need-health and telemedicine, education, broadening access to markets, boosting employment and expanding access to credit. HP's early strategies for addressing these needs include: (1) setting up solar-powered telecenters in remote villages so residents can gain access to medical, educational and other essential information; (2) supporting an online Development MarketSpace that brings together individuals and groups in developing countries with investors and technical professionals; (3) expanding research operations in India and China with a mandate to generate innovations targeted at developing countries; and (4) maintaining a World e-Inclusion website (www.hp.com/go/we) that lets people 'visit' a village, volunteer to help, or sponsor programs to benefit the poor.
This is a major undertaking, as evidenced by the scope of HP's first-year commitments. According to a press release, the company will:
- "Target $1bn of HP and partner products and services to be sold, leased or donated through World e-Inclusion programs, including a special HP Garage venture fund, special sales and solution bundles that apply more broadly to HP's customers in the developing world and discounts or donations to qualified organisations.
- "Enlist 1m partners by establishing several major alliances with global partners, regional and function-specific organisations, local project and service-delivery teams and individuals through the Web who are actively involved in e-inclusion programs; and
- "Touch 1000 villages through 'on-the-ground' initiatives that provide measurable social and economic benefits to people around the world, representing at least 1000 rural communities."
That's no small undertaking, but HP CEO Carly Fiorina appears committed to creating a positive future: "The Internet and related information technologies hold the promise of rapid, sustainable economic growth that directly benefits everyone on the planet," he commented during the launch. "However, the same forces could also exacerbate social and economic disparities. How much of each the world will see depends to some degree on how companies like HP approach sustainability and the deployment of technology across markets, cultures and continents." HP is making all the right noises. Press materials use the term 'people-centered' and partnership is strongly emphasised. "What differentiates HP's approach to bridging the digital divide is that we're focused on people, not technology. We're working with a broad range of local and global partners who share our vision and values," stresses Debra Dunn, vice president for HP strategy and corporate operations.
Moreover, according to Lyle Hurst, director of World e-Inclusion services, HP is tackling the needs of the have-nots head on. "Unlike other technology companies, which tend to focus on extending access to the next one billion people without access to technology, World e-inclusion focuses on the bottom of the economic pyramid-namely the four billion poorest people living on less than $1500 a year-with an emphasis on the rural poor."
Illiteracy, lack of infrastructure such as power and phone lines, poverty, language, government regulations and preserving local cultures and the environment, Hurst continues, are among the challenges to world e-inclusion. "HP is inventing or, through partnership, integrating truly disruptive technology that addresses these challenges." This is disruption with a difference-to do good.
Also pursuing the 'disruptive technology' approach is a new breed of players consisting of for-profit enterprises that were conceived for socially responsible reasons. One such company is GrameenPhone (www.grameenphone.com) which, since 1997, has been providing high quality cellular connections to people in Bangladesh. The company's goals are ambitious-nothing less than the provision of cellular service to 100m rural inhabitants in 68,000 Bangladesh villages.
To reach that target, the company is pursuing an innovative-some might say revolutionary-business model. Its partner is Grameen Bank, which is celebrated for having pioneered the idea of microcredit; uncollateralised loans as low as $25 to help poor people launch a business. GrameenPhone takes this model to the next logical level. Under its Village Pay Phone initiative, Grameen Bank borrowers-usually women-are supplied with mobile phones, which they purchase using microloans. These rural entrepreneurs make the phones available to other villagers, for a fee. Eventually fax, e-mail and other value-added services will be introduced.
The program has expanded rapidly. In early 2000, subscriber levels passed the 100,000 mark. So great is the pent-up demand for services that the loan is usually repaid within a few months. GrameenPhone is now the largest mobile operator in the country, with a more than 50 percent market share.
The concept is catching on. Vodacom, a venture joining Telkom SA and the UK-based Vodafone Airtouch, the world's largest mobile telecom company, has launched a similar program in South Africa, which has been successful enough to stimulate a similar initiative in nearby Uganda. In India, Ushafone is pursuing the same model.
More can be expected-and its pure enlightened self-interest. Over 75 percent of the world's population lives in rural villages and most have never made a phone call. This adds up to a very big business opportunity.
Another enterprise with big plans for the South's e-literate is educ.ar, the private half of a public-private partnership with Argentina's Ministry of Education. It's the brainchild of Martin Varsavsky, a native Argentinian who made a fortune in telecommunications and the Internet in Europe. Varsavsky's catalyst was this: Of the roughly 10m students in Argentina, only about 200,000, or two percent, have access to the Internet. This severely limits their access to the millions of jobs that the New Economy will be generating. Varksavsky's response was to fund, to the tune of $10m, a national student portal, www.educ.ar. Under the plan, every student in Argentina will receive an email address and server space to create his or her own website, using teacher-supervised hardware. The editorial content of the website-consisting of items such as class listings, online registration, homework assignments and course materials-will be controlled by the Ministry of Education. The private company, educ.ar, will manage operations and have exclusive rights to advertising and e-commerce revenue. The initiative will usher a new generation of students into the digital age, creating overnight a pool of 10m potential users-close to half the size of America Online. That's a whole lot of 'eyeballs' and it comes guaranteed.
Varsavsky's approach has got e-entrepreneurs hooked. There's already talk of similar initiatives in India, Israel and Colombia. The model does have one shortcoming, however. "The program doesn't reach the poorest of the poor," acknowledges Alan Hammond, chief information officer and senior scientist for WRI and the architect of the recent Digital Dividend conference. That doesn't dampen his enthusiasm for it, though. "This program could be cloned in a lot of mid-level countries," he says. "It will create an Internet-literate generation of kids."
Meanwhile other ICT players are queuing up to stop the gap. San Jose, CA-based Cisco Systems, which supplies the networking software that powers much of the Internet, is targeting precisely the group that the educ.ar model misses through Netaid.org, a non-profit that is leveraging the Internet to address the challenge of what its website calls 'extreme poverty.' "An astounding 1.2bn of us make less than $1 a day, nearly 1.24bn people in developing countries cannot read and write and 56 percent lack access to sanitation. This contrasting situation makes action on extreme poverty a moral imperative," its website declares.
Netaid, developed in partnership between Cisco (which is contributing about $10m per year in funding) and the United Nations, proposes to do this through a dynamic Internet platform that supports what it calls 'eAction'. Its website offers a variety of ways for people to help address the problem, ranging from volunteering time, to cash donations, to facilitating access to fair-traded arts, crafts and foods-not dissimilar to the website HP is setting up as part of its World e-Inclusion Services.
Netaid was launched in grand style in October 1999 with three simultaneous concerts in Geneva, London and New York, boasting Bono, Sting and Annie Lennox among the featured performers. Following in the steps of its predecessor, BandAid, 100,000 people attended the concerts. But-thanks to the Internet-another 2.4m logged onto a live webcast, while millions more around the world tuned in via radio and television. Over the next months the Netaid.org website received over 40m hits from 160 countries: A new model for social engagement had been born.
According to David Morrison, president of the Netaid.org Foundation, the project is about "30 percent of the way toward where we want it to be by next summer." It is expanding its e-contribution and online volunteering programs and is also developing a program focusing on children.
In actively linking the problems of poverty, the digital divide and access to markets, Cisco, HP and others are doing something of absolutely fundamental importance. They are trying to create what futurist and visionary Buckminster Fuller some years ago called "a world that works." Once upon a time, that may have been the stuff of utopian fantasy. Today, in the wired world, nothing less will do.
RINGING IN THE CHANGES
The digital divide isn't the only social issue ICT and other New Economy companies are addressing. In 1999, a group of telecom CEOs from major players such as Alcatel, Ericsson, Nokia and Nortel, announced their agreement to promote the 'Three Es'-Education, Environment and E-business-as part of a broad commitment to support the environment and sustainable development. Convened at the suggestion of Sir Peter Bonfield, CEO of British Telecommunications, the initiative, called the Chief Executive Forum, is an ongoing conversation about how to help the telecommunications sector become a more deliberate source for social good.
This is not the only venue where telecom companies are teaming up. The fledgling UNEP-facilitated Global Telecom Initiative (GTI) grew out of the separate North American and European Telecom Charters signed by major companies over the last few years. These Charters commit signatories to developing tough environmental and social standards for the industry, thereby forging cooperation among competitors and discouraging the infamous 'race to the bottom.' The GTI takes those efforts further by making them more global and by making issues such as the impact of e-commerce more central to the industry's agenda. Brad Allenby, vice president for environment, health and safety at AT&T, believes the GTI could pave the way for a new kind of governance structure in which transnational corporations, NGOs and governments collectively set standards and even policy. Whether good intentions will be enough to bridge the digital divide remains to be seen-but the industry's made a start and that can't be bad.
By contributing editor Carl Frankel
Republished with kind permission from
Tomorrow Magazine. Originally published January-February 2001.