ICTworks by Inveneo

Bloomberg is breathlessly reporting iPhone 5 rumors that have all the mac fanboys foaming. But tucked into the talk about faster chips and better displays for Apples most successful product is this little aside that could get everyone in ICT4D foaming too:

Apple is also working to finish a cheaper version of the iPhone aimed at attracting customers in developing countries, the people said. This device would use chips and displays of similar quality to today’s iPhone 4, the people said. Apple’s work on a smaller, lower-priced version of the device was discussed by people familiar with the matter in February.

Now what might this low-end iPhone mean for Apple? Why does it even care about the developing world - its already so dominating the developed one its now second only to ExxonMobile in market cap. Let us hear what Fast Company says:

An iPhone Lite could translate into billions of new sales for Apple. From the sounds of it, the scaled-back iPhone uses much of the guts of the iPhone 4 in a cheaper shell, which could be the "radical" overhaul the market's been chattering about, including a super-slim teardrop-shaped design. Apple's possibly dropping expensive items like memory and the unique metal chassis and glass back to keep the price low--low enough to please buyers in developing nations. This also could mean consumers in China, and people with smaller budgets in the U.S. and Europe.

Before we all get too excited about rural African farmings checking crop prices on a mAg app or community health workers diagnosing patients on a mDoc app, note the markets that Apple would gain the most in - China, USA, and Europe.

The iPhone Lite is not going to be starting an iPhone4Dev revolution, not when $100 smartphones are already flooding Africa's markets, but only going to urban elites. the iPhone, no matter which model, will follow that same dissemination pattern - the haves will have it, the have nots will not.

That said, be prepared for an explosion of mApps for development activity as African coders start seeing the real wealth that targeted, well-designed consumer iPhone apps can create when they satisfy local needs.

Are smartphones to advanced for the rural poor? That's the idea that Reuters says is the case for India:

"What customers want right now in India is good quality voice calls and basic data services that do not require a 3G network yet," said Sigve Brekke, Asia head of Telenor (Fornebu, Norway), which sat out of India's recently completed 3G license auction.

What is a farmer working on the fields in India going to do with high-speed Internet access? He is more likely to need information about crop prices, which we can easily send over existing networks.

But what about Africa? Are smartphones just for the rich and techno-elite, or can 4G networks really offer in-demand services to everyone? What's your opinion?

The rise of the smartphone has unleashed a wave of excitement and income generation across the software development community. Applications that can run on iPhones, Android phones and Blackberry's, can be written quickly, and on the cheap, and have generated outsized returns for their creators.

Even more impressive is that this application revolution is just starting. As Darrell Owen pointed out in the Apps4D presentation at a Business Growth Initiative meeting, iPhone adoption is growing at an order of magnitude faster than any other Internet technology - 11x the rate of AOL at its peak.

In addition, smartphone adoption in the developing world is only at 3-5%, compared with 70-80% for mobile phones in general. Smartphones are the emerging middle class aspiration, and will be the mark of financial arrival that can be conspicuously displayed for all to see.

So the demand is there for smartphone applications in the developing world. Around this demand, Darrell and Steve Schmida ask three very pivotal questions to the international development community:

1. Does smartphone application development offer a real opportunity for advancing entrepreneurship in the developing world?
2. How could donors facilitate the efforts of private industry to accelerate application development?
3. What impact would investments in application development have on international development goals?

To these three questions, I propose these answers on how software application development can be an engine for entrepreneurship and economic growth in the developing world, on a limited basis.

Smartphone applications are within reach of African developers

Right now, Facebook is driving ICT adoption in Africa. But Facebook is not coded in Africa - its written in Silicon Valley, where the majority of commercial and website software comes from. Yet there are a number of successful software companies in Africa.

In fact, MXit, a mobile social network holds its own in South Africa and just expanded into Kenya with Safaricom.

In addition, software development centers like Accra, Lagos, Nairobi, and Kampala are churning out applications for smartphones and even basic mobile phones, which can only SMS. Applications like OhmSMS and iWarrior show you what's possible - and that's without any donor support.

Donor support would increase competitiveness

Now imagine if these same mobile application software developers had access to mentoring from established leaders in the field, if they were able to share experiences and resources with their peers in a results-focused environment, and if seed funding and growth financing were easy to obtain.

That's exactly what Limbe Labs and Appfrica Labs are attempting to bootstrap with their incubators. And its what infoDev at World Bank aims to achieve with its Regional Mobile Applications Laboratory grants - seeding world-class entrepreneurship in at least two locations in Africa.

Donor support would increase diversity

The private sector will be quick to capitalize on Africa's software development for their own mobile applications - and let them. The donor community should leverage this opportunity to ensure there are social development applications as well. Just look at what the Kenya ICT Board is doing.

They're investing $4 million in grants from the World bank's International Development Association for mobile applications to enhance citizen participation in eGovernment.

I could see an Apps4D program using the same approach to bring eGovernment services to businesses, or eLearning to expand the reach of secondary or adult education.

Apps4D would have limited employment impact

Before we get too excited about Apps4D, a little history. Back when every country thought they could become a Business Process Outsourcing (BPO) hub, like India, by proclaiming themselves a Silicon Valley and investing in software development industries, USAID spent many millions on improving software development business skills and enabling environments.

The expectation was that BPO would magically employ thousands and the IT industry would be the path to middle class incomes for all. That didn't happen, and BGI found little long-term employment impact from all those millions.

But that should not be a surprise - IT isn't a high-employment industry. It only takes a handful of coders to produce the most elaborate software. One person can write good mobile software applications, which is both a strength and a weakness.

Homegrown success would be an inspiration

Youth are the largest cohort of unemployed in Africa, with young males the most listless. Yet they're also the most tech-savvy and mobile phone addicted. By showcasing one or two young mobile application software development stars, coders who make it relatively big through their apps, we could engage an entire generation to focus on positive role models.

Just look at the following Google has across Africa at their developer-focused Google Technology User Groups - software development hopefuls flock to their meetings.

Still, there isn't a need for that many software developers. So don't expect an Apps4D program have a big employment impact. It will only create a handful of good jobs. Instead, measure it by how many youth look to mobile application development as an inspiration for the basics of good grades and dedication to employment.

Apps4D should be a targeted investment

While mobile software application development can be an engine for entrepreneurship and economic growth in the developing world, it should only have a small role within a larger context. It's the sizzle that can help sell the development basics of improvements in education, employment, and business climate.

At a few hundred thousand dollars, the infoDev regional mobile application labs are a rounding error in USAID mission budgets, yet imagine the positive publicity and impact when one of them creates the next ChildCount+ or Ushahidi!

The $100 smartphone price barrier is broken! Nokia recently announced the 2730 Classic and Synchronica released the MessagePhone. Both mobile phones will retail for $100 or less across the developing world.

Price is also the major selling point for the Vodaphone 150, a self-proclaimed "world's cheapest mobile phone". Its only $15. But it only supports SMS and voice. Which brings us to an interesting question:

Which is better: price or functionality?

You could argue that its better to have something, even a stripped down $15 mobile phone, than nothing. But is price really the only factor? Even for the poorest, I would argue not. Consider the $35 Simu ya Solar which has its own solar panel, a perfect phone charging solution.

In addition, Ken Banks points out the "emerging market" handset trap with these low-end phones:

The prices may have changed, but functionality has largely stagnated. You couldn’t browse the web on the Motorola in 2005, nor the ZTE in 2008, and today you’d have the same problem on the Vodafone 150. You can’t download applications onto any of them, either. They all have monochrome screens and look pretty-much-the-same despite having a five year gap between them. Very little has changed other than price

More mobile phone functionality, please

Voice is the killer mobile phone application - bar none. Next up, SMS is the most popular application - bust should it continue to hold that title? For multiple reasons, I believe that Africa's mobile phone future is IP based, not SMS. To gain, IP needs data enabled phones. Handsets like the 2730 and the MessagePhone.

So while I applaud Vodaphone for cutting costs, might all this gone a bit too far? Could we have innovation on functionality at a higher price point? I could see a $50 smartphone having greater impact than a $15 voice/SMS phone.

A $50 smartphone would drive data usage out to rural areas now limited to SMS-only. It would also allow for much greater opportunities by all the actors involves - rural communities and the business and development organizations that want to reach them.

A $50 smartphone would also challenge the high costs of smartphones in the developed world. A South to North innovation we all could applaud.