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Institutions and Connectivity: Wasted Resources or Big Impact?

By Alex Blum on February 3, 2016


When I started my company, Rugged Communications, a few years ago, speaking with investors and institutions about the importance of connectivity felt like pulling teeth. There seemed to be a stubbornness to stick with traditional development methods, like digging wells and making latrines for rural people in developing countries. Since then, I have seen an unbelievable emergence of a number of serious institutions, like Facebook, CraigConnects Foundation, The UN Foundation, The GSMA, The Microsoft Foundation, and others, embracing and moving towards the connectivity and digital divide ecosystem. However, these organizations seem to feel uncertain about how to best engage in this sphere. In “The New Digital Age”, Eric Schmidt and Jared Cohen of Google predict that most of the world will be connected to the Internet by 2020. But how and what role do institutions play? Here are the top five questions these organizations should consider:

1) Project Based or Ecosystem?

Many institutions wonder where they can best make impact within the world of connectivity. There is a tension between executing on-the-ground projects in specific locations or helping to develop the ecosystem. Large institutions must ask themselves if they want to provide support services, seed competitions, or fund actual entrepreneurs in the field. In my experience, I have seen that local entrepreneurship and innovation emerges organically. The challenge comes in finding the resources and support to survive long enough to scale these incredible digital/infrastructure technologies for real impact. Big institutions are probably best served by providing support for emerging entrepreneurs. For example, Microsoft Philanthropies just announced they would donate $1 billion in cloud services to support nonprofits and universities. All of this will not go towards rural development, but it does provide a valuable resource to, potentially, the entire planet. More of these types of initiatives would go a long way in connecting the remaining 4 billion people that lack Internet access and accompanying digital services.

2) Regulatory and Political Lobbying?

A huge challenge for almost everyone working this space is navigating the regulatory and political hurdles to entering into a new country. I spent several years working on this in the small country of Panama before I even looked to scale elsewhere. Large institutions have the opportunity to play a role in making the regulatory environment more navigable for small entrepreneurs that lack the resources to compete with entrenched interests that stymy innovation. Creating regional regulatory initiatives or coalitions so that entrepreneurs could enter into multiple countries at once could significantly change the pace of Internet adoption on our planet.

3) Partner or Create from Scratch?

At this point, a number of initiatives, like internet.org (from Facebook), DIAL (digitalimpactalliance.org) from the UN Foundation, and others, are already actively moving into this space. New organizations interested in entering into this space should consider if their efforts would be best served by creating an entirely new program or by adding to an existing one. A huge issue is the duplication of efforts and wasted resources. While this is inevitable to a certain extent, organizations should keep in mind that there are real people in need right now that are surviving on almost nothing. Each dollar wasted could have gone to them. Institutions should ask if they are truly creating something new or if there is an opportunity to build off of what already exists. Where can the most impact arise?

4) Foundational or Investment-Oriented? 

Another tension exists between how to best disburse financial resources. There is a place for both grant-based awards as well as equity-based investments. With over 4 billion people lacking Internet access, it seems highly unlikely that this can be simply donated sustainably. How can institutions help to rapidly create the conditions to foster true, scalable connectivity/digital growth to some of the poorest people in the world. For this to happen, these rural economies need to grow alongside the connectivity. Luckily, as The World Bank has stated, a 10% increase in Internet penetration leads to a 1.3% increase in GDP. The proper sequencing of different financial vehicles will be critical to this sector. Participating institutions that can find financially sustainable solutions will succeed the most.

5) Short-Term or Long-Term

While Internet penetration is rapidly growing, it seems that to really connect the entire planet with adequate service, it will be a number of years before the task has been achieved. Even once everyone has some type of connectivity, there will be a differential in quality of coverage. Institutions should ask themselves how long they intend to remain in this space and what amount of resources they intend to provide. Short-term projects will have a different strategy and focus then groups looking at the long-term, when low-orbit satellites, software-defined radio base stations, and other technologies really start to scale.

There is a complex world of connectivity solutions and styles of engagement growing by the day. Large institutions have the potential to really impact this space or to waste a lot of money. These questions, amongst others, should be well understood before institutions start to commit significant resources to this space.

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Written by
Alex Blum is the Founder and CEO of Rugged Communications, a designer of holistic ICT4D solutions and consultancy. He holds an MS in Global Technology and Development and is a Technology Advisor to The Bill and Melinda Gates Foundation TPN. He writes about ICT4D, entrepreneurship, emerging technology, and telemedicine. Find him on Twitter @ruggedcomms or follow up with him at [email protected].
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2 Comments to “Institutions and Connectivity: Wasted Resources or Big Impact?”

  1. Patrick Fine says:

    The five tensions that Alex describes are not unique to ITC4D. They also characterize human development more generally. Having them laid out clearly is a useful reminder of the policy trade offs we face when designing and implementing human development programs. Thanks, Alex.

    • Alex Blum says:

      Thanks Patrick. I agree. I think it’s easy for the human element of our work to be forgotten amidst the technical aspects. Having served in The Peace Corps prior to my work with Rugged, I aim to keep the human element at the forefront of my efforts. Technology is a means to human development, not an end.