Developing Applications to Drive Broadband Demand

6.5.1 The multiple dimensions of content relevance

Lack of interest or relevance appears consistently as one of the reasons cited by non- Internet users, regardless of their digital skills or income. This factor does not represent a barrier as such, and is linked to preferences and incentives that vary by community and from person to person. This represents a challenge for the development of public initiatives to address this aspect of the demand gap, since no single solution can act as broadband demand stimuli across the board. However, Internet adoption studies reveal diverse mechanisms that come into play in the adoption decisions made by potential users, from which several possible public policy tools can be adopted.

Internet access in itself is of little value in the absence of so-called complementary goods that confer value to such access. A complementary good is one whose use is interrelated with the use of an associated or paired product (for example, DVD players and DVDs, computer hardware and software).* Examples of complementary dynamics in broadband adoption include applications and content that users value, and therefore should be attractive enough to encourage the purchase of the service. While early broadband adopters have the capability of rapidly identifying complementary products, late adopters (in other words, the target population of demand stimulation programs) require some help in exposing them to applications, services, and content whose complementary character adds value to the adoption of broadband. Three dimensions of complementary goods exist for broadband.

In the first place, the value of some applications increases as the number of users grows because of the use of the application to communicate or share information. This phenomenon is known as network effects or network externalities. At their most basic level, network effects exist in a service where its value to a user depends on the number of other users. Value is defined as the willingness to pay (or maximum amount that a consumer would pay for a product) for acquiring the product. In general terms, willingness to pay in applications with network effects tends to increase as an “S” shaped function of number of users (see figure 6.33).

Image

FIGURE 6.33

Network Effects Growth

Source: Developed by the author

Research on broadband adoption indicates that network effects serve as a very powerful incentive to stimulate adoption. As mentioned above, applications designed for communication purposes between users have strong network effects. Four types of communications applications have these characteristics: point-to-point communications applications (e.g. email), social networking, content sharing platforms, and matching networks (e.g. eBay). In point-to-point communications, access to a network facilitating communications is extremely valuable for users looking to communicate with friends, family, and members of a community they belong to. Social networking adds the value of self-representation to a community to the basic communications functionality. For example, Facebook allows users to communicate to network members via its Connect facility while presenting a personalized profile to the entire community. Content sharing platforms allow users to share either social (for example, pictures in Instagram) or business content (for example, documents in Dropbox). Finally, matching networks provide the capability to link participants with idiosyncratic needs and offers (for example, eBay matches sellers and buyers of products, or Monster.com links job seekers and companies offering employment). Each of these communications applications is powered by strong single-side or two-sided network effects. The net result is that the willingness to pay increases as a result of the application network effects and broadband prices decline. The combined effect becomes a stimuli for broadband adoption increases.

However, evidence also indicates that for certain groups of users, communication network effects may not offer enough incentive to purchase broadband services. In other words, for some consumers, the ability to communicate with friends, family and community beyond voice telecommunications has little or no value. In this case, public initiatives should aim to provide high value-added applications, demonstrating tangible benefits to potential users in terms of saving time or money, or increasing welfare. Such is the case of the various e-government applications designed to help optimize the interaction of citizens with government, representing tangible benefits in terms of user access to different government services (health care, public administration, etc.).

In addition to the network effects and high social and welfare impact, a third driver of content relevance is embodied by language and cultural customization. This dimension is highly important in the case of users that belong to ethnic groups that communicate in languages not highly prevalent in the Internet or that do not find in the platform content more suited to their cultural background.

The following sections will provide examples of applications targeting each of these three relevance dimensions and review evidence of their impact in stimulating broadband demand.

6.5.2 Network effects applications driving broadband demand

• 6.5.2.1 Social Media Platforms

  A social network serves as an Internet-based platform to articulate and make visible the users’ current or past physical networks. In this sense, the platform allows users to construct a public profile within a bounded system, articulate a list of users with whom they share a connection, and view as well as navigate the user’s list of connections and those made by others in the system.

  The design of a social network follows a series of architectural choices. First, user profiles can be built around structured or flexible layouts and based on word descriptors or multimedia content. Second, the visibility of the profile can be open or user restricted. Third, the confirmation of network links (e.g. invitations) can be bidirectional or not. Fourth, the display of connections can be open or closed. Finally, the network can provide additional functionality, such as content sharing (e.g. pictures), built-in blogging, and mobile interface.

  Social networks are the fastest growing Internet platform, with time spent having surpassed that of portals (see figure 6.34).

  Image

  

  FIGURE 6.34

  USA: Monthly Time Spent, Portals vs. Social Networking Sites 6/08-7/11

  Source: ComScore Media Metrix USA panel-only data

  Social networks’ initial value proposition was sharing user-generated content (web links, news stories, blog posts, notes, photos, videos, events). However, very rapidly, they expanded into applications hosting platforms where developers would publish/upload applications, thereby enhancing allegiance to the site. For example, Facebook Platform comprises over 1 million developers who have uploaded over 350,000 applications. Games represent the largest category (over 13,000 applications being accessed by 418 million monthly active users) followed by the very distant lifestyle applications (4,800 applications), utilities (4,600 applications) and education (2,279 applications). Beyond user generated content and applications hosting, social networks have also become a communications utility among platform users. The network becomes the vehicle by which point-to-point communications is conducted through services like Facebook Connect or Linkedin Message. To these three dimensions (user-generated content, applications hosting and communications), social networks have in the past two years added the mobility dimension, which allows for “always-on” site connectivity.

  Social networks are a worldwide phenomenon, in terms of their country of origin (see table 6.25). 

  Image

  

  TABLE 6.25

  Major Worldwide Social Networks (12/2012)

  Source: http://en.wikipedia.org/wiki/List_of_social_networking_websites

  As table 6.25 shows, beyond the platforms launched in the United States, China has become a leader in social network development.

  Beyond the diversification of countries developing platforms, social networks initially developed within one particular country have grown into multinational platforms with a larger member base outside the country of origin. This is the case of Facebook, which has currently only 20% of its members in North America, but a total of 26% in Europe, 25% in Asia, and 19% in Latin America (see table 6.26).

  Image

  

  TABLE 6.26

  Facebook: Breakdown of User Base by Country

  Source:

  Internet World Stats 3Q2012 Report http://www.internetworldstats.com/facebook.htm

  This deployment has been achieved through a sequence of internationalization and customization decisions: 

  • July 2004: Facebook launches in the United States
  • January 2005: Facebook began to add international school networks
  • December 2006: Facebook reaches nearly 2 million users in Canada and 1 million users in the United Kingdom
  • January 2007: Facebook reaches 50 million active users worldwide
  • January 2008: Facebook launches translated versions of the site in Spanish,
  • French, German, and releases a translations application allowing users to translate the site into any language
  • July 2008: Site reaches 90 million active users globally; users have begun to translate Facebook into dozens of languages

  Social networks act as a powerful stimulus for broadband adoption. In general terms, countries appear to follow a sequential adoption process, whereby social network diffusion acts as an incentive for signing up on an Internet account through a ISP, lending itself over time to an increase in broadband adoption. The following three figures compile penetration time series for Facebook, Internet usage, fixed broadband and PCs for three emerging countries: Malaysia, Argentina and South Africa (see figure 6.35).

  Image

  

  FIGURE 6.35

  Comparative penetration of Social Network, Internet Usage and Fix Broadband

  Sources: Facebook statistics; World Bank; ITU; Telecom Advisory Services analysis

  In all three countries, the powerful network effects of social networks can be appreciated by witnessing the significant growth rate in Facebook penetration. Moreover, as mentioned above, the growth in Facebook penetration precedes by approximately one year the increase in fixed broadband adoption. This supports the notion that social networks act as a powerful incentive to adopt broadband. It should be mentioned that the growth in fixed broadband penetration is mitigated by the fact that a portion of the Facebook “stimulating effect” is absorbed by mobile rather than fixed broadband.

  In many emerging markets, carriers offer data plans, but with limitations. As a result, both Facebook and mobile carriers have begun experimenting with ways of offering free access to the social networking site.

  In 2010, Facebook announced the launch of Facebook Zero, a service designed specifically for mobile phone use. Mainly targeting developing countries, the service promotes mobile Facebook access without data charges. When users go the Facebook Zero URL on their devices, they find a text-only version of the site, which carriers can offer free of charge. This “trimmed down” Facebook eliminates such data- intensive features as photos, but when users switch to the multimedia version of the site, they will then incur regular data use charges.

  Table 6.27 lists the countries and carriers that partnered with Facebook for its initial Zero rollout.* 

  Country or Territory	Operator
  Anguilla	Digicel
  Antigua & Barbuda	Digicel
  Aruba	Digicel
  Austria	tele.ring
  Barbados	Digicel
  Belgium	BASE
  Benin	MTN
  Bermuda	Digicel
  Bolivia	ENTEL
  Bonaire	Digicel
  Brazil	TIM
  Bulgaria	M-Tel
  Cote d'Ivoire	MTN
  Curacao	Digicel
  Congo, Democratic Republic of the	Zain
  Denmark	Telenor
  Dominican Republic	Viva
  El Salvador	Claro, Digicel
  Finland	Saunalahti
  Greece	Vodafone, WIND
  Guatemala	Claro
  Guinea Bissau	MTN
  Honduras	Claro
  Hong Kong	3
  Hungary	T-Mobile
  India	Reliance, Videocon
  Indonesia	3, AXIS, Telkomsel
  Jamacia	Digicel
  Lithuania	Omnitel
  Macedonia	ONE
  Madagascar	Orange
  Nicaragua	Claro
  Pakistan	Mobilnik
  Palestine	Jawwal
  Philippines	Sun Cellular
  Romanina	Vodafone
  Rwanda	MTN
  Sri Lanka	Mobitel
  St. Kitts	Digicel
  Sudan	MTN
  Swaziland	MTN
  Tunisia	Orange, Tunisiana
  Turkey	Avea, Turkcell, Vodafone
  UAE	du
  Uganda	MTN

  TABLE 6.27

  Facebook Zero: Countries and Carrier roll-out

  Source: Hopkins 2010

  In other instances, carriers offer their own Facebook incentives to promote data use. As an example, Etisalat Egypt offers “Facebook+,” granting unlimited Facebook access as part of its “Save More” mobile Internet plans. *   

  Image

  

  TABLE 6.28

  Etisalat Egypt: Facebook+ offer for prepaid customers

  Source: Etisalat

  In Nigeria, Etisalat offered a Facebook promotion that allowed subscribers to download and use the mobile app for 90 days free of charge. Through the Etisalat Facebook Service, Facebook users could update statuses, post on walls, and upload photos by sending SMS messages to a specified number at a cost of N20 (US$ 0.13) per text.

  In addition to major private sector sites acting as broadband demand stimuli (Facebook, Linkedin, Twitter, etc.), social networks can also be created ad-hoc to fulfill specific purposes or solidify links across certain communities. For example, Ushahidi is a social platform developed in Haiti to facilitate networking among earthquake disaster victims. In other situations, existing platforms can be utilized to build links within a specific segment of a population. Such is the case in Russia, where the government utilizes Twitter to facilitate communication with its citizens. In these cases, ad-hoc government sponsored networks can also play a role in stimulating broadband adoption.

  Meaning “testimony” in Swahili, the non-profit tech company Ushahidi specializes in the development of free and open source software for information collection, visualization, and interactive mapping. Initially designed in 2008 as a website for citizen journalists to map reports of violence and peace efforts via their computers or mobile devices following Kenya’s election fallout, the website reached 45,000 users in Kenya alone. The project subsequently grew from a small group of volunteers and into a global organization comprised of individuals ranging from human rights workers to software developers. The platform operates on the fundamental belief that the collection of crisis information from citizens offers a real- time and real-life glimpse into the situation, both raising awareness and allowing for more efficient assistance and emergency deployment.

  In 2010, a 7.0 magnitude earthquake caused the destruction in Haiti that resulted in more than 230,000 deaths and devastation in some of the country’s most populous areas. In response, the international community rallied to offer search and rescue missions and emergency assistance. Unfortunately, Haiti’s system of information dissemination lacked the sophistication needed to aggregate and prioritize data effectively. Ushahidi allowed victims and volunteers to coordinate through social media sites like blogs, Twitter, and Facebook as well as through mobile phone messages.

  Reports submitted to Ushahidi included information about “about trapped persons, medical emergencies, and specific needs, such as food, water, and shelter” and were received and updated by volunteers in real time as well as by anyone who had an Internet connection regardless of their geographic location.

  Ushahidi deployed its platform within two hours of the earthquake, but quickly realized that it did not have the manpower to support the need for its services. In response, Ushahidi’s Director of Crises Mapping, Matrick Meier, reached out to volunteers at Tufts University to continue mapping the crisis live. The initial group of volunteers – all located in Meier’s living room – covered Twitter, Facebook, and blogs to identify the information that needed to reach first responders on the ground. Utilizing Google Earth and OpenStreetMap, they tagged information based on GPS coordinates to upload it on the publicly accessible website Haiti.ushahidi.com. People from all over the world logged into the site to contribute information they received via email or phone from relatives in Haiti.

  Just days later, a volunteer team at Tulane collaborated with Frontlines MS, the United States State Department, and Digicel to create a system allowing Haitians to submit alerts via SMS text messages on their mobile phones to the number 4636. At the time, 85% of Haitians had access to mobile phones and while many of the towers were destroyed, most were repaired prior to the launch of 4636. The service was publicized over Twitter, radio announcements, and physical posters. Nearly immediately, the number received 1,000 to 2,000 SMS texts per day, but with a team of volunteers located in the U.S. and Canada, the system saw the messages conveyed to responders within 10 minutes. Volunteers translated more than 25,000 messages, emails, and social media communications, creating nearly 3,600 reports mapped on Ushahidi.

  In response, United States Secretary of State Hillary Clinton discussed the power of crisis mapping and the importance of Internet access, stating, “The technology community has set up interactive maps to help us identify needs and target resources... [today] a seven-year-old girl and two women were pulled from the rubble of a collapsed supermarket by an American search-and-rescue team after they sent a text message calling for help.” An analyst from the U.S. Marine Corps echoed her praise, ““In this postmodern age, open-source intelligence outperforms traditional intel...The notion of crisis mapping demonstrates the intense power of open- source intelligence... [W]hen compared side by side, Ushahidi reporting and other open sources vastly outperformed ‘traditional intel’ [after the Haiti earthquake].”

  Researchers concluded that the Ushahidi-Haiti project demonstrated the role crowdsourcing can play in disaster response, recommending that it serve as a model for the international community. They emphasized the importance of leveraging local knowledge and collaboration with community and grassroots organizations while integrating a variety of platforms such as mobile devices or other communication technology.

  BOX 6.5.1

  Ushahidi (Haiti)

  Source:

  "About Us." Ushahidi. N.p., n.d. Web. http://ushahidi.com/about-us

  Heinzelman, Jessica, and Carol Waters. Crowdsourcing Crisis Information in Disaster- Affected Haiti. Rep. United States Institute of Peace, Oct. 2010. Web. http://www.usip.org/files/resources/SR252%20-%20Crowdsourcing%20Crisis%20Information%20in%20Disaster-Affected%20Haiti.pdf

  In October 2010, the global media and ICT analytics firm ComScore released the results of the study it conducted earlier in the year, revealing that Russia ranks number one in terms of the world’s heaviest social network usage. At this point in time, three-quarters of all Russians – or 34.5 million people – visited at least one social networking site in a one-month period. With the average user spending just shy of 10 hours a month on such sites, Russians spend nearly twice as much time using social media than their global counterparts. Throughout the study, the top-ranked site, Vkontakte.ru, had 28 million visitors, though the number of Facebook users in the country grew 376% in 2010.

  To keep up with his constituents, then-president Dmitri Medvedev visited the San Francisco- based headquarters of Twitter, a global social networking and microblogging site. While there, he joined the site and sent out his first Tweet under the handle, KremlinRussia. From Russian, this message translated to “Hello everyone. I am now in Twitter, and this is my first message,” but he also established an English-language version of KremlinRussia. This Tweet emphasized Medvedev’s larger strategy of enhancing ICT innovation and investment back home and also demonstrated his push for a more transparent government. Within one year, Medvedev had created four verified accounts that attracted more than half a million followers.

  Beyond showing his commitment to the aforementioned objectives, Medvedev and the Russian government have used Twitter not only to share updates with the public, but also to “humanize” the president. The government’s social media use now also includes other sites, such as i-Russia.ru, which the Presidential Commission for Modernization and Technological Development of Russia's Economy created for citizens to post comments and link government resources to their social network accounts. Further, the Commission also has its own mobile app.

  In mid-2012, as part of its “Open Government” project, the Kremlin announced plans to create its own social network to mimic Facebook, whereby citizens would create personal accounts to which they could upload content, create groups, and connect with their peers. The government also noted that the site would foster an environment where Russians could openly voice their concerns and criticism surrounding local public officials.

  BOX 6.5.2

  Twitter (Russia)

  Source:

  Sniderman, Zachary. "How Governments Are Using Social Media for Better & for Worse." Mashable. N.p., 25 July 2011. Web.Block, Berit. "Russia Has Most Engaged Social Networking Audience Worldwide." ComScore, 20 Oct. 2010. Web.

  "Dmitry Medvedev Visits Twitter HQ and Tweets." The Telegraph. N.p., 24 June 2010. Web. http://www.telegraph.co.uk/technology/twitter/7852258/Dmitry-Medvedev-visits-Twitter-HQ-and-tweets.html 

  Jagannathan, Malavika. "Russian Government Latest to Propose State-sponsored Social Network." Herdict Blog. Berkman Center for Internet and Society at Harvard University, 12 July 2012. Web. http://blogs.law.harvard.edu/herdict/2012/07/12/russian-government-latest-to-propose-state-sponsored-social-network/

  On September 1, 2011, the government of Uzbekistan launched its own alternative to Facebook in partnership with the state telecom monopoly. The social networking site, known as Muloqot, translates to “dialog” or “conversation” in English and went live to coincide with the country’s 20th anniversary of its independence from the Soviet Union. Government officials in Uzbekistan promoted the launch, saying that Muloqot would “create conditions...for the formation of high morals, for creation of spurs to successful development of modern knowledge and achievements of technical progress, with objective of realization of the idea of the comprehensively developed person.”

  At the time of the launch, 85,000 Uzbeks had Facebook accounts, and as many as 400,000 Uzbek citizens used the Russian social network, Odnoklassniki, daily. Skeptics of Muloqot saw it as a way for the government to cut down on the opposition found on Facebook. By offering services in the Uzbek language and requiring a local Uzbek mobile phone number, it effectively created a site with less foreign influence. The organization Radio Free Europe / Radio Liberty, which works to promote uncensored news throughout the world, tested the openness of the site, posting its own content on Muloqot’s public wall. While the information was initially published, their profiles were deleted within 15 minutes. The accounts of users posting pro-government posts, however, remained active.

  At the time, more than half of the country’s 7.7 million Internet users connected via their mobile phones, so developers designed the site with this platform in mind. Within one week, Muloqot had 1,700 users. Muloqot users will likely benefit from the site’s backing from the state telco, which can offer free services such as faster connections, free email storage, and media downloads. Though censorship issues may pose a concern, the site will likely serve as an effective means by which to disseminate pertinent government information to a generation that likely pays little attention to traditional news outlets.

  By late-2011, however, the site did not seem to reach the popularity the government had anticipated. In response, it launched another social networking site, YouFace, which looks nearly identical to Facebook. Authorities insist that these networks are not designed to discourage opposition, but rather to promote “national platforms” and reduce citizens’ reliance on foreign-based social networking sites. The owner of the site, Uzbek national Ayubhon Abdullaev, stated that he designed YouFace to ““boost patriotism among young people in Uzbekistan.” The homepage features a quote from President Islam Karimov, “Our children must be stronger, smarter, and happier than we are.”

  BOX 6.5.3

  Muloqot (Uzbekistan)

  Source:

  "Uzbekistan Launches Its Own Facebook, Except It's Not For Everyone." RadioFreeEurope/RadioLiberty. N.p., 26 Aug. 2011. Web. http://www.rferl.org/content/uzbekistan_launches_its_own_facebook_except_its_not_for_everyone/24308909.html

  "Uzbekistan: ‘National' Social Network Not Quite a Facebook Clone." Global Voices. N.p., 10 July 2012. Web. http://globalvoicesonline.org/2012/07/10/uzbekistan-national-social-network-not-quite-a-facebook-clone/

• 6.5.2.2 Games and gamification

  Internet-based games, particularly the category known as social games, are applications strongly interlinked with social networking. As mentioned above, games represent the highest application category in Facebook Platform.

  The importance of the games and social networking link is substantiated by the former’s implicit value as a socialization tool. Research indicates that games allow users to overcome socialization obstacles by interacting with friends. Social games provide users with an opportunity to socialize when they lack content to post on their profiles. As such, they provide a structured way of interacting and keeping in touch with people. Additionally, the social game provides an excuse to re-engage with Facebook friends that are not that close to the user initiating contact.

  For example, some of the more popular Internet-based games, such as Cityville or Farmville, present players with obstacles to build a business. Players can tackle obstacles by asking friends for help through a messaging system, or posting on their Facebook wall. Friends can reciprocate for help by sending free virtual gifts.

  Along these lines, most social games tend to run inside social network platforms. This leads to a sequence of adoption processes leading to broadband: social game acts as an accelerator of social network usage, which, in turn, leads to broadband adoption.

  An extension of game mechanics in non-game contexts is known as “gamification”. Gamification is an approach utilized to enhance user engagement in internet-based applications. Initial gamification techniques entailed providing reward points to users who share experiences on location-based platforms. For example, Foursquare, a location-based platform rewards members with achievement badges to those users that become more active “checking in” with the platform. A more common “gamification” technique entails displaying in a platform a progress bar or other type of visual meter to indicate how close the user is to completing a task the platform operator is trying to encourage (e.g. a survey, a social network profile, a higher status in a loyalty program). Gamification techniques can be utilized in applications such as employee-training programs, primary education, wellness programs, and market research.

  When it comes to utilizing gamification techniques in stimulating broadband demand, the best application could be through social media. Sequential causation would work as follows: gamification acts as an incentive of user engagement in social network platforms, which in turn, become a driver of broadband service acquisition.

  At the TED Global 2012 conference, Jane McGonigal presented her findings on online gaming, a talk that was viewed online by an audience of nearly 1.5 million people from around the world. In the talk, McGonigal displayed statistics on the power of online gaming, insisting that it “can be more effective than pharmaceuticals in treating clinical depression and that just 30 minutes a day is correlated with significant increases in happiness.” She went on to insist that online games can help people who are healing from injuries, and that these same games can also be used to address such global problems as obesity and climate change. 

  In a similar talk from 2010 – which reached an audience of more than 2.7 million viewers – she stated, “My goal for the next decade is to try to make it as easy to save the world in real life as it is to save the world in online games.” Following a severe concussion in 2009 that left McGonigal bedridden for months, she found that viewing her pain as a game was the only way for her to get through the ordeal, which led to her development of the online game SuperBetter. The game incorporates activities “designed to boost physical, mental, emotional and social resilience,” which she said ultimately helped to alleviate her depression and anxiety.

  Working with doctors, psychologists, scientists, and medical researchers, she eventually made the game public, reaching users all over the world including cancer patients and sufferers of chronic pain. The game encourages positive emotions as well as a social connection, two contributing factors to physical and emotional health. As is true with most games, participants learn that facing and overcoming obstacles makes them stronger, not weaker. McGonigal cites the “post-traumatic growth” theory, whereby positive changes in one’s life can occur through the exposure to challenges – which can include illness or depression.

  SuperBetter, which – according to its website – is not easy, forces users to dedicate themselves to reaching various goals and milestones. It also offers a way to build physical, mental, emotional, and social strength and is customizable to each user. Users can access the game on their web browsers and also through the SuperBetter mobile application designed for iPhones and iPads.

  Beyond the actual game, the SuperBetter website offers tips for users to keep a positive attitude and stick to their commitments. A user ultimately “wins” the game by achieving the “Epic Win,” a real-life goal set by the user before beginning the game. Once achieved, the user can choose a new goal to begin a new game. In late 2011, Ohio State University Medical Research Center began conducting trials for the game to determine its effectiveness.

  BOX 6.5.4

  SuperBetter (United States)

  Source:

  "Jane McGonigal: The Game That Can Give You 10 Extra Years of Life." TED: Ideas worth Spreading. N.p., July 2012. Web. http://www.ted.com/talks/jane_mcgonigal_the_game_that_can_give_you_10_extra_years_of_life.html

  SuperBetter. Web. https://www.superbetter.com/

  Kanani, Rahim. "Gaming for Social Change: An In-depth Interview with Jane McGonigal." Forbes. Forbes Magazine, 19 Sept. 2011. Web. http://www.forbes.com/sites/rahimkanani/2011/09/19/gaming-for-social-change-an-in-depth-interview-with-jane-mcgonigal/

  In 2010, the World Bank Institute launched its online game, EVOKE, to serve as a “ten-week crash course in changing the world.” Designed for users around the globe, it particularly targeted the youth population in Africa. Ultimately, the game encourages users to tackle pressing social issues while providing them with the real-world skills necessary for social innovation. Anyone – regardless of age or location – can play EVOKE for free.

  Set in the year 2020, users follow “the efforts of a mysterious network of Africa’s best problem-solvers.” Players discover clues to solve the mystery each week while developing their own networks and work together to develop solutions to development challenges. 

  The game first began in March 2010 and ran until May 2010. This first round saw more than 4,000 players from over 120 countries. Players who successfully completed all ten challenges within the ten weeks were recognized as World Bank Institute Social Innovators – Class of 2010. The top players also qualified for mentorships with social innovators and business leaders as well as for scholarships to attend the EVOKE Summit, held in Washington, D.C. In that sense, winning the game translates into real-life rewards.

  Per Robert Hawkins, a Senior Education Specialist at the World Bank Institute and the Executive Producer of the game, “EVOKE helps players learn 21st century skills to become the social innovators who shape the future.” Explaining the game’s name, Creative Director Jane McGonigal – who has made it her mission to create online games with social purpose – says, “"When we evoke, we look for creative solutions and learn how to tackle the world's toughest problems with creativity, courage, resourcefulness and collaboration."

  The World Bank Institute – the World Bank division that focuses on learning – developed the game, which InfoDev and the Korean Trust Fund on ICT4D sponsored.

  BOX 6.5.5

  EVOKE (Africa)

  Source: World Bank. World Bank Institute Launches Online Game EVOKE, a Crash Course in Changing the World. World Bank News & Broadcast. N.p., 3 Mar. 2010. Web.

  Developed in early 2011 through a partnership with ad agency McKinney and Urban Ministries of Durham, the online game Spent shows users what it is like to live on only $1,000 a month in America. The game exposes the average player to real-life challenges, who must make the same decisions about money and resources that families across the country also face.

  When a player first logs in to the http://playspent.org website, he is greeted with a message: ““Urban Ministries of Durham serves over 6,000 people every year. But you’d never need help, right?” Below this message is a link, where users can “Prove It” and accept the challenge. Once accepting the challenge, users are greeted by this question: “Over 14 million Americans are unemployed. Now imagine you’re one of them. Your savings are gone. Can you survive? You’ve lost your house. You’re a single parent. And you’re down to your last $1,000. Can you make it through the month?” He can then choose “Find a Job” or “Exit.” Once the game begins, players can choose from a selection of jobs, at which point the game breaks down the weekly take-home pay after deducting such expenses as taxes and the cost of supplies or uniforms. They then are faced with such decisions as whether they can afford health insurance or whether they should live in the city or the suburbs, taking into account the cost of housing and transportation. Other issues include the costs of childcare, the decision to join a union, and when to see a doctor. If a player hits a point where the only option to avoid homelessness is to seek help from a friend, he is directed to Facebook, where he can share the Spent link. At the end of the game, a player can also choose to donate to UMD.

  By August 2011, users had played the game more than 1 million times in nearly 200 countries around the world. As a result of the game, users have gained a better understanding of poverty and homeless, which has led to an increase in the global dialog surrounding such issues. The creators of Spent have received feedback from people and organizations all over the world, each contributing a different anecdote to support the mission. As McKinney Chief Creative Officer Jonathan Cude states, the game shows and the feedback supports the idea that “poverty and homelessness can happen to anyone.” 

  The Urban Ministries of Durham has used the game as an exercise to drive this point home to the community. McKinney and UMD also partnered to launch a petition to the U.S. Congress, asking “men and women of Congress to take 10 minutes from their debating to experience for themselves the challenges that more than 14 million Americans are facing” by playing the game.

  BOX 6.5.6

  Spent (United States)

  Source: Urban Ministries of Durham. Spent, The Online Game About Surviving Poverty and Homelessness, Reaches Its Millionth Play and Invites Congress to Accept The Challenge. N.p., 31 Aug. 2011. Web.

• 6.5.2.3 Mobile broadband applications

  The accelerated diffusion of broadband access mobile devices has significantly increased the impact of mobile applications. In many cases, especially in emerging countries, mobile broadband may represent a substitute for fixed services in three types of situations: 1) the fixed service is not offered in the area where the user lives; 2) the quality of fixed services (for example, low speed) is less advantageous (or at least comparable to) than the available mobile service; or, 3) for economic or convenience reasons, the user opts to consolidate services and acquire only mobile broadband, which provides connectivity combined with mobility.

  In the case of mobile applications, the adoption sequence is different from social media and games. In the prior two network effect groups, applications adoption precedes the purchase of a broadband subscription. Along those lines, the user becomes aware of the applications, begins using them, leading to an increase in the willingness to pay, which results in acquiring broadband services for home or individual access. In the case of mobile applications, the migration from an early generation (typically 2G feature phone access) to a 3G or 4G smartphone based device, which is an implicit adoption of broadband service, allows the user to gain access to mobile applications of which he/she was not previously aware. In sum, while in social network and games, the applications use may precede fixed broadband adoption, in mobile broadband adoption service purchasing precedes applications use.

  In this context, mobile broadband users represent a “captive” market, ready to adopt mobile applications that enhance the value derived from wireless broadband. The installed base of wireless broadband users has been growing significantly, reaching a 73.20% penetration in the developed world and 17.57% in developing countries (see table 6.29).

  Image

  

  TABLE 6.29

  World: Penetration of Mobile Broadband (2007-2012)

  Mobile broadband is defined as total subscribers of the following technologies: CDMA2000 1x EV-DO, CDMA2000 1x EV-DO rev. A, CDMA 2000 1x EV-DO rev. B, WCDMA HSPA, LTE, TD- LTE, AXGP, Wimax, LTE advanced, TD-LTE advanced, Wimax 2 Source: Wireless Intelligence

  It should be considered, however, that, only a portion of this base corresponds to smartphones, devices whose screen format and keyboard are particularly suited to conduct Internet-based transactions. Nevertheless, the installed base of smartphones and data-only devices (USB modems, dongles) is also growing at a fairly rapid rate. In 2011, the most advanced regions in terms of shift to 3G and 3.5G smartphones are Western Europe ( 50% of 3G and 3.5G base) and North America (49% of base). In terms of the total installed base, North America has the highest smartphone share (40.3%) followed by Western Europe (22.9%). The rest of the world exhibits a smartphone share of 3G and 3.5G devices around 20%. By 2015, smartphones in North America and Western Europe will reach 65% and 47%, of mobile connections, followed by Eastern Europe (11.7%), Latin America (13.1%) and Asia Pacific (12.4%).* 

  In the context of explosive adoption of broadband enabled devices, mobile applications serve to reinforce the awareness of broadband services. Governments can play a role in promoting the development of mobile broadband applications. Such is the experience of Canada, the United Kingdom and Singapore, reviewed below.

  In November 2012, Canada’s Minister of State for Foreign Affairs announced the launch of its website, travel.gc.ca, which serves as a reference for international travel information and is fully accessible on mobile devices. In addition to the website, the federal government also released the free travel-related mobile app, Travel Smart, available for download on Blackberry, Android, and iPhone smartphones and tablets. The app addresses such issues as airline restrictions, security checkpoint wait times, passport and visa requirements, and letters of consent for travelling minors. All of this information is placed in one easily accessible portal.

  Travel Smart connects with travellers through platforms like Twitter, Facebook, and SMS messages. It funnels information from 12 other federal agencies ranging from the Canada Revenue Agency to the Canadian Food Inspection Agency to the Public Health Agency of Canada.

  The app is also designed for Canadians traveling outside the country who need to access safety information, learn about local laws and customs, and check on health conditions. They can register to the site before traveling so that the government will know where Canadian citizens are in the event of an earthquake or uprising abroad. Subscribers to the website’s Twitter and Facebook feeds will receive travel updates and crisis information.

  Beyond serving as a means for Canadians to access pertinent information more easily and quickly, such services allow the government to cut back on some of its more tangible expenditures. As the Department of Foreign Affairs cuts spending, it is closing international consulates and domestic trade offices. At the same time, the number of Canadians living abroad continues to increase year after year and citizens made 56 million trips out of the country in 2010 alone. An additional 2.8 million Canadians live abroad. As such, despite the need for cost cutting, there is also an increased need for available resources. In response, the government issued a statement saying that it must “find alternative and less costly ways to deliver routine services through the better use of technology.”

  BOX 6.5.7

  Travel Smart (Canada)

  Source: MacKinnon, Leslie. "Government Touts New Mobile App for Smoother Foreign Travel." CBC News. N.p., 23 Nov. 2012. Web. http://www.cbc.ca/news/politics/story/2012/11/23/pol-ablonczy-government-website-travel.html

  Singapore’s Ministry of Information, Communication and the Arts (MICA) released a mobile app in June 2010 to serve as a supplement to its website, Gov.sg. The “user friendly” app allows smartphone users on the go to access government-related news stories and services such as event calendars, directories, and feedback forms. It serves as a seamless, one-stop platform for citizens to receive pertinent information from various agencies in a single integrated location.

  At the time, Singapore boasted some of the world’s highest smartphone penetration rates in the world, in large part a result of its broadband and mobile infrastructure. With a 141% mobile penetration rate, many citizens already had 3G and WiFi access, and this connectivity offered an “opportunity for the government to extend its range of services to better reach out to the people.” Prior to the Gov.sg app, the government already utilized more than 300 mobile services.

  The ministry initially launched the app for iPhones, but followed with an app designed for Android phones in November 2010 to meet the growing popularity of Google-based devices. With this second launch came an updated app design for the iPhone OS 4 that emphasized multi-tasking and built in a user-friendly interface.

  Prior to the launch of the Android app, the Gov.sig iPhone app was downloaded 14,000 times in the first four months following its release. In its first week alone, the app ranked amongst the top three most popular App Store downloads in the “News / Free application” category. While the Singapore Government has already demonstrated its commitment to online government services, it hopes to encourage participation amongst the younger population through the development of mobile apps. 

  One year later, Infocomm Development Authority of Singapore partnered with NTUC’s Employment and Employability Institute, SPRING Singapore and the Singapore Tourism Board to invest US$ 12 million to develop mobile applications for the service sectors. In response, the Ministry for Information, Communication, and the Arts stated that it “wants to harness opportunities presented by the mobile space and to develop mobile solutions for businesses.” The development fund hopes to encourage growth in the mobile commerce and wireless sectors.

  BOX 6.5.8

  Gov.sg Mobile App (Singapore)

  Source:

  Singapore. Ministry of Information, Communications and the Arts. Singapore Government Connects through New Mobile Application. By Medha Lim. N.p., 29 Nov. 2010. Web. http://app.mica.gov.sg/Default.aspx?tabid=36

  "Singapore Government Sets aside S$15 Million Fund for Mobile App Development." Infocomm Investments. N.p., 27 June 2011. Web. http://www.infocomminvestments.com/2011/singapore-government-sets-aside-15-million-fund-for-mobile-app-development/

  By 2010, the British government had developed and released dozens of mobile applications for its citizens. These apps served a wide range of purposes, ranging from helping users quit smoking, to teaching them how to change a tire, to calculating mileage. One app, Jobcentre Plus, allowed users to search for open job listings across England, Scotland, and Wales.

  Following a 2010 Freedom of Information request, the government revealed that it had spent between US$ 15,000 - $61,000 on the development of each app. At the same time, it spent US$ 143 million on website development and maintenance and an additional US$ 52 million to support the necessary staff. The rollout of mobile apps could cut down on the website expenditures.

  In 2012, multiple government agencies and service providers launched their own apps. The Socionical Crowd Sourcing app, for instance, was developed through a partnership between the London School of Economics and the UK police. The app – which is available for download through the Apple App Store - allows users in London to download police-related information and offers notifications of catastrophic incidences. Unique to other police apps, the Socionical Crowd Sourcing app allows police to monitor the movement of crowds through real time crowd sourcing technology. The development of this particular app came through funding from the EU and at no cost to the Force.

  Another government-launched mobile app now offers citizens a free online tax calculator to total the amount they owe and see how the government spends it. The app works on iPhones, iPads, and Android phones and is downloadable at the App Store and the HMRC website. The development of the app followed a report that revealed that more than half of taxpayers did not know the amount they paid in taxes. The government hoped that this new service will make the system more transparent.

  By late-2012, Britain continued to push for the development of apps for government-related services. In November 2012, Prime Minister David Cameron announced that he was testing an app to aid in decision-making and day-to-day government affairs. The app has allowed Mr. Cameron to keep track of data as it pertains to areas such as jobs and housing in real time while monitoring political polling and social media. Following his approval, more government officials will have access to the app. 

  BOX 6.5.9

  Government-developed Mobile Apps (United Kingdom)

  Source:

  Schroeder, Stan. "UK Government Spends Thousands Developing IPhone Apps." Mashable. N.p., 6 July 2010. Web. http://mashable.com/2010/07/06/uk-government-iphone-apps/

  Lee, Dave. "David Cameron Testing App to Aid Government Decisions." BBC News. N.p., 7 Nov. 2012. Web. http://www.bbc.co.uk/news/technology-20240874?print=true

  Townsend, Christine. "City of London, UK Police Launches Smartphone App." ConnectedCOPS. N.p., 15 Aug. 2012. Web. http://connectedcops.net/2012/08/15/city-london-uk-police-launch-smartphone-app/

  "Government Launches New Tax App." Government Computing Network. N.p., 29 May 2012. Web. http://www.governmentcomputing.com/news/2012/may/29/tax-app-hm-treasury-hmrc-ipad-iphone-android

6.5.3 Broadband-enabled services with high social and welfare impact

• 6.5.3.1 E-Government services

  Governments can enhance broadband demand by providing access to government services and broadband content online. A 2008 study by the Organization for Economic Co-operation and Development (OECD) notes the growing popularity of policy initiatives that foster more sophisticated online government services (OECD 2008). These initiatives include expanding secure government networks, putting administrative processes and documents online, supplying firms and citizens with more cost-effective ways to deal with the government (including once-only submission of data), and assigning firms and citizens a single number or identifier to conduct their relations with government. Government information available online in various countries includes legislation, regulations, litigation documents, reports, proposals, weather data, traffic reports, economic statistics, census reports, hearing schedules, applications for licenses and registrations, and even feeds from surveillance cameras. Some OECD countries even offer one-stop platforms for government procurement, bidding information, and so forth.

  E-services that improve openness and access to democratic institutions are also becoming feasible as a result of increases in broadband transmission capacity. Examples include Internet broadcasts of parliamentary debates and agency meetings. 

  Such applications allow citizens greater participation in the governance process. Applications for polling, voting, campaigning, and interacting with government officials can increase the demand for broadband services. In the United States, for example, two models of e-government citizen participation are emerging. One is a deliberative model where online dialogue helps to inform policy making by encouraging citizens to scrutinize, discuss, and weigh competing values and policy options. The other is a consultative model that uses the speed and immediacy of broadband networks to enable citizens to share their opinions with the government in order to improve policy and administration. Actions to encourage citizen participation through e-government include the following:

  • Connecting citizens to interactive government websites that encourage citizen feedback and participation in policy making, design, and innovation;
  • Encouraging citizens to participate in online dialogue on topics such as health care and the economy;
  • Participating in government experiments with a variety of tools, including “wiki government,” where citizens participate in peer review;
  • Educating citizens about their civic role and providing opportunities for them to interact with government agencies and officials using tools that fit individual or specific community needs;
  • Partnering with government officials and citizens to facilitate well- informed and productive discussions online;
  • Providing citizens the ability to create “my e-government” so they can personalize their interaction with government agencies and officials;
  • Creating “online town halls” to promote e-democracy for agenda setting and discussion of public issues as well as to promote accountability in the provision of public services.

  A major goal of developing such services is to make government information more readily available as well as to increase transparency of government activities. The Netherlands is a leader in creating digital content and offering it via online government services (Atkinson, Correa, and Hedlund 2008, 39). In 2006, in an effort to support the development of broadband, the Dutch government decided to give all citizens a personalized web-page—the personal Internet page—where they could access their government documents and social security information as well as apply for grants and licenses. In the United States, the U.S. government embraced e- government as an educational tool, particularly in providing online education programs for new immigrants seeking citizenship and for school support programs within the Department of Education. In Colombia, the 2010 Plan Vive Digital aspires to create a digital ecosystem by 2014 that would achieve several demand- related goals.

  Types of e-Government applications that drive demand

  This section will examine the different types of broadband enabled e-government applications that have been launched in different countries. Government services and applications fall into the following broad categories: (a) making government information available, (b) conducting transactions with the government, and (c) participating in the political process. 

  In some cases, governments chose to implement discrete initiatives. Turkey’s Land Registration and Cadaster Modernization Project serves as an example of the implementation of a discrete application to facilitate conducting transactions with the government. In other cases, governments opted to formulate holistic e-government policies and plans, such as the e-Government Act of the United States, the e- Governance Tools in the Netherlands, and the program Vive Digital in Colombia.

  An example of the Turkish government’s expansion of e-government applications, the Cadaster Modernization Project was designed to make the land registry process more effective and efficient. To do so, the project took responsibility for the following items, per a report released by the World Bank:

  • Renovating and updating cadaster maps to support digital cadaster and land registry information;

  • Making the digital land registry and cadaster information available to public and private entities;

  • Improving customer services in land registry and cadaster offices;

  • Improving human resources in the Turkish Land Registry and Cadaster Agency (TKGM);

  • Developing policies and capacity to introduce in Turkey best international practices in property valuation.

  While the land registration process will benefit from the initiative, it is the government’s ultimate intent to improve its services while providing relevant information to the public and private sectors. In effect, it will raise awareness of the benefits of using online services for government-related matters, thus increasing the demand for broadband.

  The project received funding approval in 2008 with an expected completion date of 2013. In total, it is expected to cost US$ 210 million, US$ 203 million to be loaned by the World Bank. Turkey’s General Department of Cadaster and Registration oversaw its implementation.

  Based on the World Bank’s progress matrix, the project looks to reach many of its goals and commitments by the 2013 deadline. The reduction in time for registrants to receive a response, for instance, decreased from 1 week to 2 hours as a result of the online services. The number of agencies with online access to the services increased from 0 to 35 and the website processed approximately 6.5 million requests in 2012. Additional provisions were included to address such issues as technology training and policy drafting.

  BOX 6.5.10

  Land Registration and Cadaster Modernization Project (Turkey)

  Source: "Turkey Land Registration and Cadastre Modernization Project." Projects & Operations. The World Bank, n.d. Web. http://www.worldbank.org/projects/P106284/turkey-land-registration-cadastre-modernization-project?lang=en

  The United States’ E-Government Act of 2002 worked with its Office of Management and Budget (OMB) to create an Office of Electronic Government within the department and establish IT polices and guidelines to promote online government services and capabilities. It designated a Federal Chief Information Officers Council to take responsibility for “improving agency practices related to the design, acquisition, development, modernization, use, operation, sharing, and performance of federal information resources.” To ensure efficiency, the agency must submit an annual report to Congress and conduct Privacy Impact Assessments. As a part of the Act, the Federal Information Security Management Act (FISMA) worked with OMB to “link information security with enterprise architecture.” Amongst other responsibilities, it developed IT security standards, policies, and training for all agencies while reporting to various Congressional committees.

  The act defines e-government as “the use by the government of the Internet and other information technologies, together with the processes and people needed to implement them, to enhance the delivery of information and services to the public and others to make improvements in government operations.” Thus, the act aims to promote the effectiveness, efficiency, and quality of government service through online services.

  The E-Government Act of 2002 also allowed state and local governments to purchase updated technology approved by the General Services Administration (GSA). As one of the largest purchasers of technology, the government could benefit from reduced prices on IT hardware, software, and services, saving millions of dollars annually. In 2007, the GSA signed a US$ 68 billion contract to provide 135 federal agencies in 191 countries with telecommunications services for 10 years at a price discounted up to 40%.

  Prior to the act, the federal government lagged behind the IT advances of the private sector due to “poor management of technology investments.” The Office of E-Government aimed to achieve the same technological standards as the top performing private sector organizations. To do so, the Office developed Internet-based government services, encouraging interaction of citizens and businesses with the federal government. Ultimately, these services were designed to increase participation while promoting government transparency and improving its efficiency.

  The act budgeted US$ 345 million for 2003 – 2006 and, to ensure compliance, stipulated that federal agencies report into the OMB regarding their progress in enhancing public participation and developing electronic services. That said, the office did not always require such reporting, saying that the time and resources required to develop the reports took away from the efforts spent toward the end goal.

  In its 2012 Annual Report, The Government Accountability Office addressed concerns voiced by Congress, recommending a plan for the future and also highlighting its initiatives over the prior 10 years. Such noteworthy accomplishments included:

  • A framework for electronic signatures;

  • A federal Internet portal to provide a consolidated point of public access to government information;

  • Availability of government information and services to individuals with diminished access to the Internet and those with disabilities;

  • A website to provide the public with information and the ability to comment on proposed federal regulations;

  • Steps to improve the accessibility, usability, and preservation of government information through, for example, organizing website content and electronic records management;

  • Policies on protecting the privacy of individuals’ personal information on government websites.

  The report concluded by praising the significant integration of e-government into agency business and the resulting increased public participation, recognizing OMB’s role in providing implementation leadership, raising awareness, and disseminating information. It did, however, concede that it needs to require more detailed reporting from the agencies in the future and should focus on reducing the burdens of this process. As the title of the report suggests, “Agencies Have Implemented Most Provisions, but Key Areas of Attention Remain.”

  BOX 6.5.11

  The e-Government Act of 2002

  Sources:

  Connecting America: The National Broadband Plan. Rep. Federal Communications Commission, n.d. Web. http://download.broadband.gov/plan/national-broadband-plan.pdf

  "E-Government Act of 2002." U.S. Department of Education, 23 Aug. 2003. Web. http://www2.ed.gov/policy/gen/leg/egov.html

  United States. Government Accountability Office. Electronic Government Act: Agencies Have Implemented Most Provisions, but Key Areas of Attention Remain. N.p., Sept. 2012. Web. http://www.gao.gov/assets/650/648180.pdf

  Recognized as an international leader and innovator in terms of e-government, the Netherlands recognized early on the power of ICT tools to ease the administrative and bureaucratic burdens and improve the government services available to its citizens. The country placed high priority on citizen inclusion and participation, relying on extensive consultation when developing online programs and activities to ensure demand of such services.

  In 2011, the government announced “i-NUP,” an extension of the National Implementation Program (NUP), clearly stating its plan to introduce further e-Governance measures through 2015. Prior to this point, many of the country’s ministries had already gone online, publishing pertinent information on their websites, archiving digital documents, and allowing citizens to book appointments with elected officials. The i-NUP program ultimately aims to create “a more accessible government,” providing basic e-Services for citizens and creating e-Business opportunities.

  The NUP, which ran until year-end 2010, represented a partnership between municipal and provincial governments, water boards, and the central government. Together they established the basic requisites for e-Government, promoting e-Access, e-Authentications, and e- Information. As a result, citizens can now perform such tasks as applying for permits, registering for unemployment, accessing social security information, and working with various departments. By the end of the program, more than 8 million citizens could reach their municipal government.

  Responsible for the development of e-Government policy, the Ministry of the Interior and Kingdom Relations coordinates initiatives with various levels of government and works closely with the Government ICT Unit (ICTU) and the Government Shared Services for ICT (Logius). The Ministry of Economic Affairs, Agriculture, and Innovation oversees e- Government initiatives as they pertain to businesses.

  The project includes many portals, including the “Rijksoverheid.nl” citizens’ portal. Accessible through a personal DigiD login, the portal offers every citizen access to e- governance services including personal data and tracking. The portal also offers relevant government information and news.

  BOX 6.5.12

  e-Governance Tools (Netherlands)

  Source:

  "OECD E-Government Studies: Netherlands." Public Sector Innovation and E-government. Organization for Economic Co-operation and Development, 2007. Web. http://www.oecd.org/gov/publicsectorinnovationande-government/oecde-governmentstudiesnetherlands.htm

  "EGovernment in the Netherlands." EGovernment Fact Sheets. European Commission, Nov. 2011. Web. http://www.epractice.eu/files/eGovernmentTheNetherlands.pdf

  The Colombian government’s Vive Digital, which aims to connect all citizens to the Internet by 2019, incorporates a nationally recognized plan to develop a digital ecosystem through projects that focus on infrastructure, services, applications, and user experience. By making more services available online, the plan promotes efficiency and transparency at all government levels while curbing corruption and encouraging citizen participation. To generate demand, Vive Digital projects allow citizens to conduct transactions and access emergency services and value-added services online. It also incorporates such applications as an online Congress, tele-working, and government intranet while aiming for “zero paper” in the central administration. By bringing more everyday services online, the government hopes to make broadband more attractive.

  Various ministries offer individualized services online. The Ministry of Finance, for instance, will offer mobile banking services while the Ministry of Education promotes ICT awareness amongst schools, teachers, and students. The Social Protection Ministry has taken ownership of e-health programs and rights verification services. Cultural initiatives are also supported through a National Digital Library and the Ministry of Defense has taken a role in ramping up cyber security and cyber defense mechanisms.

  Between 2010 and 2014, Vive Digital has a budget of US$ 12.5 billion in ICT investment, with US$ 2.2 billion provided by the central government. The program is recognized as an integral component of the larger “Prosperity for All” plan.

  As a result of Vive Digital, Colombia currently ranks #1 in the Latin America region in terms of both e-government and citizen participation. By 2014, the set deadline for the project, 100% of all national entities and 50% of all local entities will offer online services. The plan will continue to utilize modern ICT technology to promote the development of affordable, online services and foster an environment to make broadband relevant to everyday life. Ultimately, it aims to increase national productivity and improve the standard of living in the country.

  BOX 6.5.13

  Plan Vive Digital (Colombia)

  Source: Colombia. Ministry of Information and Communication Technologies. Vive Digital. N.p., 2011. Web. http://vivedigital.gov.co/files/Vive_Digital_2011_Ingles.pdf

  Expected impact of E-Government services on broadband demand

  This section will provide evidence of the impact e-government applications have on broadband adoption. As in the case of network effects applications, e-Government services have also been found to stimulate broadband adoption. In a recent study conducted for the Colombia government, Katz and Callorda (2011) researched the causality linking e-Government services introduced by the program Vive Digital and broadband penetration. The researchers found that both variables were linked through a bi-directional causality (in other words, e-Government stimulates broadband adoption, but broadband adoption also acts as a stimuli of usage of e-Government services (see figure 6.36).

  Image

  

  FIGURE 6.36

  Interrelationship between Broadband and e-Government Services

  According to Effect I, the deployment of e-Government services acts as a complementary service to broadband, enhancing the consumer surplus and, therefore, the willingness to adopt broadband. On the other hand, broadband adoption due to ancillary network effect applications (e.g. social networking) leads to the identification of e-Government services to be adopted. The authors built two econometric models to test both relationships (see table 6.30).

  Effect I: e-Government Stimulates Broadband Adoption		Effect II: Broadband Adoption Stimulates e-Government Service usage
  Dependent variable: Broadband Pentration 2008-10		Dependent variable: Use of e-Government
  Independent variables: e-Government use, Employment Rate		Independent variables: Broadband Penetration, Employment Rate
  	Total		Total
  e-Government use (% of Internet use)	0.555*	Broadband Penetration	0.099*
  	(0.2990396)		(0.0561522)
  Employment Rate	0.003*	Employment Rate	-0.0003
  	(0.0006617)		(0.0003668)
  R^2 adjusted	0.2654	R^2 adjusted	0.0549
  Number of observations	69	Number of observations	69

  TABLE 6.30

  Relationship between Broadband and e-Government Services

  Source: Katz and Callorada (2011)

  According to the regression measuring Effect I, an increase of 1 percentage point of e-Government users yields an increase of 0.55 percentage points in broadband penetration. This finding would imply that e-Government services represent a strong incentive to purchase broadband subscription for home usage.

  The results of Effect II also indicate a positive inverse relationship between both variables. An increase of broadband penetration of 1 percentage point increases the use of e-Government services in 0.10 percentage points. This means that, when controlling for employment rate, growth in broadband penetration reduces the cost to access e-Government from the home, yielding an increase in growth. 

• 6.5.3.2 e-Health services

  Broadband also contributes in an important way to the delivery of health care services. E-health involves a variety of services and tools provided by both the public and private sectors, including electronic health records and telemedicine. The communication technology is useful in tackling the economic challenges derived from delivering quality services, particularly in handling the relationship with patients, the provision of clinical care, and administration. In general terms, three priority areas can be identified where broadband can contribute to increase the efficiency of health care delivery. In the first place, the administration of health care information can be significantly improved on the basis of hospital information systems, digital archives of clinical histories, and treatments and digital libraries containing diagnostic images and records.

  Secondly, patient-doctor/nurse communication can be conducted more efficiently by installing on-line registration, telemedicine (in areas such as tele-psychiatry, tele- cardiology, tele-radiology and tele-surgery), remote monitoring, and the creation of community and social networks linking patients and health care professionals. The application of these technologies in the processes of both primary and specialized care has a positive impact not only on the quality of delivery but also on its flexibility and adaptation to patient needs. Hernandez, Leza, and Ballot-Lena (2010) argue that citizens in rural areas, as well as those with limited mobility, may use e-health to access specialized care previously unavailable to them. For example, broadband capabilities are essential to medical evaluation and other medical applications that use imaging extensively. High-definition video consultations allow rural patients and immobile patients (for example, incarcerated individuals or nursing home residents) to be seen by specialists in a timely manner when urgent diagnosis is needed and the specialists are not able to travel to where the patients are located.

  Thirdly, the communication among health care professionals through the deployment of social networks, distance learning programs, and video-conferencing leads to an improvement in skill level and the delivery of up-to-date information. In this way, health care professionals residing in remote areas can continue their training and updating by means of eLearning platforms.

  The contribution of these applications is far reaching. On a social dimension, research has identified an improvement in the quality of health care delivery, a decrease in time required for delivery of services, an increase in service quality, coupled with higher efficiency in the information exchange among professionals and the benefit of their continuing education. From an economic standpoint, the contribution of information and communication technologies to the health care sector results in better management of material and human resources, a reduction of care delivery and patient transportation costs, and the consequent reduction in information handling costs.

  With the increased adoption of smartphones in low-income nations and the relative lack of wireline broadband penetration, mobile health (m-health) is establishing a new frontier in health care in those countries. Although basic voice and data connections are useful in improving health and medical care, broadband connectivity is necessary to realize the full potential of e-health and m-health services, particularly in rural communities.

  On the other hand, broadband availability renders possible the development of new services as improvements in telemedicine and other e-health initiatives will rely on increasing bandwidth capacity, more storage and processing capabilities, and higher levels of security to protect patient information. As an example, Cape Verde has exploited growing broadband connectivity by connecting two of its hospitals to the Pediatric Hospital of Coimbra, Portugal (Favaro, Melhem, and Winter 2008). The telemedicine system supports remote consultations through video conferencing. One goal is to reduce the number of Cape Verdeans who must travel to Portugal for medical service. In addition to the Cape Verdean hospitals, two Angolan hospitals also are connected to the network and over 10,000 remote consultations have been carried out (CVTelecom 2010).

  Types of e-Health applications that drive demand

  This section will examine the different types of broadband enabled e-health applications that have been launched in different countries. There are three types of broadband-enabled e-Health applications: 1) transmission and remote access of patient information, 2) patient-professional and inter-professional communications, and 3) mobile e-Health (adding the mobility functionality to the prior two applications categories). The three case studies reviewed below illustrate examples of all three categories. The Cape Verde experience illustrates categories 1 and 2, while the Indian and Ghana experience are examples of category 3.

  A study published in 2011 by the World Health Organization (based on 2009 survey information) developed six categories of mHealth interactions. These initiatives included not only established mHealth programs, but also informal programs that used mobile technology for health-related communications and pilot programs undergoing evaluation.

  Image

  

  TABLE 6.31

  World Health Organization. m-Health Initiatives

  Source: mHealth: New Horizons for Health through Mobile Technologies. Rep. World Health Organization, 2011. Web. 12 Mar. 2013. http://www.who.int/goe/publications/goe_mhealth_web.pdf

  At the global level, the study found the most common initiatives to be:

  • health call centers/health- care telephone help lines (59%)
  • emergency toll-free telephone services (55%)
  • emergencies (54%)
  • mobile telemedicine (49%)

  These four initiatives primarily rely on the voice feature of the phone. The occurrence of other functions of mobile health – such as raising awareness and downloading health information - will likely increase with increased access to mobile devices offering Internet connections and data storage capacities.

  The adoption of specific mHealth initiatives also varied by country income (as measured by World Bank). The high-income countries reported a larger and more diverse range of initiatives, although all income groups reported that the health call center / help lines were the most frequently seen examples. High-income countries tended to utilize mobile devices to remind patients of appointments nearly twice as often as their low-income counterparts. The majority of these initiatives utilized voice, SMS, and Internet features of the phone. The service benefits not only individual patients and health care providers, but also the larger industry and economy. The United Kingdom and Northern Ireland, for instance, estimated that missed outpatient hospital appointments cost an annual US$ 1.2 billion.

  In recent years, low and lower-middle income countries have looked to capitalize on the surge in mobile phone ownership to increase access to health care information. In doing so, they have addressed such issues as lack of quality health care professionals, high costs, and unreliable information. In the past, health call centers were limited to the high-income countries, where they have existed for decades. The present day ubiquity of mobile phones has closed this gap. In some instances, governments partner with local telcos to complement pre-existing health care services. In others, citizens pay a flat rate (e.g. $5 per month in Mexico) that allows for call center access and offers discounted physician services in instances that cannot be resolved over the phone.

  Developed in late 2011 by the International Trust Fund (ITF) and the International Virtual e- Hospital (IVeH) Foundation, the Integrated Telemedicine and e-Health Program in Cape Verde (ITEHP-CV) focuses on the provision of health-related online services. IVeH “is a non-profit organization that was created to assist in rebuilding the public healthcare system in developing countries by introducing and implementing telemedicine, telehealth, and virtual educational programs through the concept of the IVeH Network.” The project aims to create a sustainable system of telemedicine in Cape Verde that will extend beyond its 2014 deadline.

  In cooperation with the Ministry of Health of the Republic of Cape Verde, the program will establish one telemedicine center with 9 local centers in pre-existing hospitals across the country. Beyond the infrastructure and equipment installations, the creation of the centers will also include the training of medical professionals who are competent in telemedicine as well as an electronic medical library. In doing so, the project will “improve treatment outcomes, increase patient satisfaction, provide physicians’ and other experts continuous education, reduce health care costs, and induce revolutionary transformation of the healthcare system in Cape Verde.”

  As citizens utilize these online services more frequently and see the value they add to their hospitals and healthcare system, they are more likely to recognize the value of high speed Internet as it pertains to their everyday lives.

  The program falls under the larger Development Cooperation Program, an agreement between the Cape Verde and Slovenia governments. The ITF was initially established by Slovenia to assist Bosnia and Herzegovina with mining-related funding, but has since expanded to include general humanitarian projects. The Fund partnered with Slovenia’s Ministry of Foreign Affairs to offer a US$ 29,000 research grant that would lead to future implementation. This research focused on the country’s medical sector, identifying the potential for the development of telemedicine and potential obstacles to the project’s success. Together, ITF and IVeH finalized a proposal and plan for project deployment.

  In a matter of months, two of the country’s hospitals were linked to Portugal’s Pediatric Hospital of Coimbra via a broadband connection. Because this service offers video conferencing and consultations, fewer citizens need to travel outside of the country for medical services.

  BOX 6.5.14

  Integrated Telemedicine and e-Health Program (Cape Verde)

  Sources:

  "Broadband Strategies Handbook." Ed. Tim Kelly and Carlo M. Rossotto. The World Bank, 2012. Web. https://openknowledge.worldbank.org/handle/10986/6009

  "International Virtual E-Hospital Foundation Begins Cape Verde Telemedicine Project with ITF Enhancing Human Security." International Virtual E-Hospital Foundation. N.p., n.d. Web. http://www.iveh.org/?id=82

  "Republic of Slovenia Supported Needs Assessment Mission in Cape Verde." ITF, 27 Sept. 2011. Web. http://www.itf-fund.si/News/Republic_of_Slovenia_supported_needs_assessment_mission_in_Cape_Verde_369.aspx

  In 2008, telecommunications company Ericsson signed a Memorandum of Understanding with Apollo Telemedicine Networking Foundation (ATNF) to establish an e-health program. The program offers instant telemedicine services remotely over applications run on broadband networks. In doing so, it decreases the costs of healthcare while improving its quality and making it more available, particularly in the case of the rural population. While Ericsson provides the necessary equipment, ATNF delivers its telemedicine expertise through the creation of applications that transmit medical advice instantly and remotely. The HSPA network and mobile technology allows for increased access to quality healthcare and related services.

  Beyond the actual services provided, a key component focuses on training citizens to use the technology while also publicizing its availability and benefits. The declining costs of ICT and mobile technology make it easier and more cost effective to provide telemedicine services to a larger portion of the population. As more citizens benefit from the services, they will likely realize and appreciate the value of broadband.

  In India alone, more than one million citizens – particularly women and children – die as a result of limited healthcare. An additional 700 million rural citizens cannot access specialized services, as nearly all specialists reside in urban areas. As ICT improves and becomes more widespread, it can allow healthcare to permeate additional regions regardless of geographical boundaries, resulting in more accessible and higher quality services that do not require the same time and financial expenditures.

  Prior to this agreement, Ericsson received a special license in 2007 to use 3G spectrum to demonstrate the impact it could have on e-governance, e-education, e-entertainment, and m- health through a pilot project known as “Gramjyoti.” To address the m-health component, ATNF worked with Ericsson to show the ways in which 3G can be utilized to improve the transmission process of health information. Consultants at Apollo Group hospitals worked with patients in remote villages via text, audio, and video technology to “examine” patients with a web-based camera. This examination coupled with the patient’s medical history and information such as blood pressure allowed doctors to make a diagnosis for 240 patients across 18 villages and 15 towns in remote areas of the country. Both doctors and patients reported high satisfaction.

  Apollo hospitals conducted a similar pilot, this time using EDGE technology to offer tele- consultations to a small village in the state of Tamil Nadu. Utilizing the group’s Hospital-on- Wheels (HoW) bus, volunteers took x-rays of patients, which they then developed on board. After uploading the images to a laptop computer, software compressed the images and emailed them to doctors at the hospital. Doctors also conducted ultrasound examinations of female patients, but at the time, live video streaming could not take place due to bandwidth constraints. In this instance, volunteers took videos of the ultrasound and then emailed them via the wireless network to the hospital where internists could utilize the web cam to finish the exam.

  These pilots have demonstrated the power of broadband to transform healthcare in India, but they have also shown the barriers to this progress, namely the lack of pre-existing infrastructure and the mindset of citizens in the targeted areas. Policy makers must focus on raising the awareness of telemedicine programs and their benefits in order to stimulate demand for broadband and additional e-health services.

  BOX 6.15

  Remote Telemedicine Services (India)

  Source:

  Bollineni, Raja. Apollo Telemedicine Networking Foundation (ATNF). Rep. ACCESS Health International, 2011. Web. http://healthmarketinnovations.org/sites/healthmarketinnovations.org/files/ACCESS_ISB_ATNF_Final_Report.pdf

  Ericsson. Press Releases. Ericsson and Apollo Hospitals to Bring Healthcare Access to Rural India. N.p., 5 June 2008. Web. http://www.ericsson.com/news/1225191

  In 2009, Grameen Foundation launched its Mobile Technology for Community Health (MOTECH) initiative, focusing on the reduction of infant and maternal mortality rates through the utilization of mobile phone technology. Healthcare providers use their mobile devices in a variety of ways to address the issue, beginning, for instance, with the collection of patient information that they then upload to a centralized database. Mobile technology is also used to communicate with pregnant women, providing them with healthcare information and encouraging them to visit local medical centers for prenatal care and to assist community healthcare workers in targeting women and newborns that could need their care, offering an automated service to track patients.

  The Ghanaian government launched its Community-based Health Planning and Services (CHPS) Initiative in 2000, relocating urban clinic nurses to rural communities and encouraging volunteers and social workers to assist them. While ambitious, the program ultimately did not take off because many of the women who needed healthcare could not access the village clinics and did not receive the necessary care because the nurses were not equipped with the necessary knowledge and information to offer their services on a door-to- door basis. Building on this initial program, MOTECH delivers relevant information to the nurses via mobile phones while pregnant women register for care by providing their phone numbers, location, and due dates. Once registered, they then receive SMS and / or voicemail updates relating to prenatal care, the location of clinics, and treatment recommendations. Some messages are personalized based on a woman’s medical records and may, for instance, suggest certain vaccinations for her and her newborn child. In other cases, patients may send SMS questions to the nurses.

  In collaboration with Columbia University’s Mailman School of Public Health and the Ghana Health Service, MOTECH is made possible with a grant from the Bill & Melinda Gates Foundation. Johnson & Johnson, USAID, and the Norwegian government also provide project-specific funding. The MOTECH Suite is an extension of the project, representing the collaboration between international mHealth implementers, open-source solution providers, and funders to develop relevant software and establish best practices to guide future endeavors.

  The program keeps costs low by running on the low cost mobile devices that citizens already own. The Gates Foundation covers the cost of messages. The country already boasts high mobile phone ownership and penetration, so device distribution and the associated costs associated are unnecessary. The project began in 2009 with small-scale field tests and was not officially deployed until June 2010. In the pilots, the low literacy levels and variety of spoken languages posed the largest barrier. To overcome this challenge, MOTECH delivered either pre-recorded voicemails or standard SMS messages in the local language based on patient preference.

  BOX 6.5.16

  Mobile Technology for Community Health (Ghana)

  Source:

  "Mobile Technology for Community Health (MOTECH)." Grameen Foundation. N.p., n.d. Web. http://www.grameenfoundation.org/what-we-do/technology/mobile-health

  "MoTeCH: A Mobile Approach to Maternal Health Care." MobileActive. N.p., 10 Feb. 2010. Web. http://mobileactive.org/motech-new-approach-health-care

• 6.5.3.3 Broadband enabled financial services

  Online banking has evolved considerably, with the Internet becoming an integral part of the delivery of banking services around the world. It is generally recognized that e- banking services can provide speedier, faster, and more reliable services to customers and thus also improve relationships with them. Although many types of Internet connections have the capability to support online banking (for example, some m- banking transactions are conducted with narrowband short message service, SMS, messages), high-speed broadband is essential for effective e-banking.

  Broadband enabled financial services have become prevalent in the industrialized world. A 2007 study, for example, found that in the United States, banking online was performed by 66 percent of households with a home broadband connection compared to 39 percent of households with a narrowband connection (DuBravac 2007, 9). This phenomenon is also prevalent in the developing world. Standard Charter Bank (India), for instance, now reports that an estimated 50% of banking transactions in the country now take place online.

  Moreover, delivering financial services to low-income users or populations of isolated areas through e-banking can also offer the potential to decrease operational costs dramatically, but more importantly, facilitate financial inclusion. Adoption of financial services in the developing world remains fairly limited. As of December 2010, over 2.7 billion people across the world did not have access to financial services. In Africa in particular, only 20% of families have bank accounts,* leaving the vast majority of the continent “unbanked” with few prospects of ever creating viable savings. The vast majority of this demographic live in rural areas, beyond the growing urban sprawl of capitals and large towns leaving them with little exposure to the banking industry. Traditional banks have had very little interest in involving this lower income population in financial services. Beyond the usual fees required to open a bank account in most sub-Saharan countries, which most of the population cannot afford anyway, minimum deposit requirements can be as high as 50% of per capita GDP.*   

  This problem is not limited to developing countries. For example, one in four U.S. households are defined as “unbanked” (not having a traditional checking account) or “underbanked” (forced to rely on other methods of money payment and management)*. Additionally, FDIC studies in the United States show that amongst the 25% of households that are underbanked or unbanked, the majority comes from a minority background. These households still need a method of paying bills and storing funds. In the past, when something needs to be paid for, cash was the first option. Traditionally, when cash couldn’t be used money orders and money transfers were the solution for these individuals. However, today these methods are becoming more cumbersome and less generally accepted. Credit and debit cards are being used for more and more transactions, and online shopping is becoming the cheapest and most efficient way of procuring goods.

  For these markets in particular, mobile money services have proved to be of particular importance. In countries such as Afghanistan, Bangladesh, Kenya, Indonesia, Pakistan, the Philippines, and South Africa, various forms of m-banking services are expanding the financial services frontier. These services allow users to make payments and remittances, access existing bank accounts, conduct financial transactions, engage in commerce, and transfer balances. A number of diverse financial transactions are broadly referred to as “mobile payments”. It is important to understand that these various transaction types, however, possess very different characteristics and are often at significantly different levels of technological maturity and adoption. Below is a summary overview of the key categories in the mobile payments market.

  Image

  

  TABLE 6.32

  Categories of Transactions in Mobile Payments

  Source: Oreizy (2011)

  Types of applications that drive demand

  This section will examine the different types of broadband enabled financial services applications that have been launched in different countries. There are three models for mobile payment that have been either discussed or implemented in various countries:

  • Cellular provider serves as intermediary in transaction and stores the value as seen in the M- Pesa model (Kenya);
  • Cell phones serve as a mobile wallet and allow the user to use existing accounts, or to consolidate charges made onto the cell phone bill or an internal credit card account (DoCoMo in Japan);
  • Cell phones serve as mobile wallet but require a credit card / debit card to remit payments to (current US ISIS model).

  In 2007, Vodafone’s Kenyan subsidiary Safaricom developed and launched the M-PESA system - derived using “M” for mobile and the Swahili word for money, Pesa - allowing customers to conduct electronic payments over their mobile phones. To use the service, customers register at authorized M-PESA retail stores, where they then receive their own electronic money accounts linked to their phone numbers and SIM cards. The retail stores serve as a point of cash transfer, converting customers’ cash into an electronic value up to US$ 500, which can be used to pay bills, purchase mobile airtime credit, and transfer funds. Safaricom compensates the retailers for each transaction.

  The global growth in popularity of mobile phones largely contributed to the success of the program. In the five years prior to the launch of M-PESA, mobile phone penetration grew from just 3% to 48%, and is expected to reach 72% by 2014. Kenya in particular demonstrated certain qualities that are also attributed to the program’s takeoff, including its “strong latent demand for domestic remittances, poor quality of available financial services, a banking regulator which permitted Safaricom to experiment with different business models and distribution channels, and a mobile communications market characterized by Safaricom’s dominant market position and low commissions on airtime sales.”

  Unlike many other banking services, customer registration and deposits are completely free. Customers must pay a US$ 0.40 flat fee for transfers and bill payments, US$ 0.33 for withdrawals, and US$ 0.01 for balance inquiries. Vodafone manages a server with all customer account information, but Safaricom manages these accounts. M-PESA accounts do not offer interest payments to customers, instead depositing this interest into Safaricom’s not- for-profit trust fund.

  Safaricom deserves credit for its strong promotion of M-PESA, a service that, at the time, was an entirely new concept in a market with very little exposure to a formal financial system. The provider aimed to reach 1 million customers – or 17% of its customer base at the time – within the first year. Before the nationwide launch, M-PESA underwent small pilots across the country and Safaricom ensured that 750 stores across all 69 districts of the country were capable of handling the transactions. The emphasis on seamless customer service and brand recognition also contributed to the popularity of the system, which outpaced the initial 1 million-customer goal.

  M-PESA demonstrated the power of mobile phone technology to impact the availability of financial services, particularly to the unbanked poor segment of the population. Because many of these citizens already owned and knew how to use mobile phones, this technology allowed the system to come to fruition without extensive infrastructure deployment or training costs. Further, by designing a usage-based revenue model, M-PESA offers incentives for users, financial institutions, and mobile providers, eliminating the inherent discrimination as banks and providers targeted the more profitable customers. By connecting to this e- payment system, citizens now have access to a variety of financial services; creating the opportunity to save money in savings accounts, for instance, and receive welfare disbursements and send payments for services. 

  While not the first mobile banking model, M-PESA has grown globally to become the largest and most successful program of its kind. By 2010, more than half of Kenya’s population had used the service; by its fifth birthday in 2012, the number of retailers outnumbered the country’s bank branches. Kenya alone reported 15 million M-PESA accounts. Other developing countries have seen success of similar models. MTN, Africa’s largest wireless provider, rolled out the service across the continent while central banks in countries like Brazil have experimented with their own version of the program in an effort to expand their reach to the poor and rural population. The Indian government has also shown an interest in developing a mobile banking system to increase financial inclusion, which shows particular promise given the country’s preexisting IT infrastructure and dense population.

  BOX 6.5.17

  M-Pesa (Kenya)

  Sources:

  Mas, Ignacio, and Dan Radcliffe. "Mobile Payments Go Viral: M-PESA in Kenya." Microfinance Gateway. World Bank, Aug. 2010. Web. http://www.microfinancegateway.org/p/site/m/template.rc/1.9.43376/

  O'Sullivan, Olivia. "The Invisible Bank: How Kenya Has Beaten the World in Mobile Money." National Geographic Emerging Explorer. National Geographic, 4 July 2012. Web. http://newswatch.nationalgeographic.com/2012/07/04/the-invisible-bank-how-kenya-has-beaten-the-world-in-mobile-money/

  In 2008, Telco Roshan launched its mobile money transfer program, modeled after the successful M-Pesa service first seen in Kenya and known as M-Paisa in Afghanistan, in partnership with Vodafone Global Services. The two companies agreed to share profits, utilizing Vodafone’s platform developed for M-Pesa. The word “paisa” means cash in Afghanistan’s local languages, Dari and Pashto.

  In 2010, in conjunction with the Ministry of the Interior, the National Police in Afghanistan began receiving their salaries through the M-Paisa system rather than in cash. Once the program was initiated, many of the policemen thought they had received a raise; in some instances the difference in pay equaled an increase of more than 33% once higher-ranking officials could no longer take cuts for themselves from the cash payments. Beyond curbing corruption within the system, the M-Paisa also discouraged policemen from defecting to the Taliban, who could previously offer higher payments for their services and loyalty. The funds are delivered to the policemen via an SMS and IVR system. The IVR system is particularly important given than 70% of the country cannot read; these voicemails are available in Dari, Pashto, and English.

  The Roshan mobile network that powers the program covers 3.5 million subscribers in 230 cities in all 34 provinces across Afghanistan. The Aga Khan Fund for Economic Development (AKFED), Monaco Telecom International (MTI), and TeliaSonera back the provider. The Bill & Melinda Gates Foundation provides additional funding to M-Paisa through the US$ 12.5 mn grant it awarded to the GSMA trade association to provide mobile banking services to 20 million global citizens by 2012.

  The program has received praise for the contribution it has made in boosting Afghanistan’s economy by curbing corruption and enabling small businesses and the Afghan people who previously had to deal with the risks associated with cash-only transactions. Beyond salary transfers, M-Paisa also enables “national remittance, salary disbursements, airtime purchase, bill payment and merchant services.” The program has particular potential to impact Afghanistan’s economy, as less than 3% of the population is banked and the financial sector is virtually non-existent, in large part due to the past 20 years of conflict. The high need for microfinance systems in the country drives the demand for such services and the Central Bank of Afghanistan has supported the development of M-Paisa.

  BOX 6.5.18

  M-Paisa (Afghanistan)

  Source:

  Munford, Monty. "M-Paisa: Ending Afghan Corruption, One Text at A Time." TechCrunch. N.p., 17 Oct. 2010. Web. http://techcrunch.com/2010/10/17/m-paisa-ending-afghan-corruption-one-text-at-a-time/

  M-Money Channel Distribution Case – Afghanistan. Rep. International Finance Corporation, 2010.

  In 2011, Splash Mobile Money Limited partnered with MoreMagic Solutions and the Guaranty Trust Bank to launch Sierra Leone’s first mobile money service, Splash. Designed to address the flaws in the country’s inadequate banking system, Splash lets consumers use their mobile devices for financial transactions, eliminating problems such as high transaction costs, security, and limited transparency. More than 150 agents throughout the country are certified to register new users in the program, converting their cash to “splash cash” credit on their phones. The users can then send or receive electronic funds, make purchases at participating retail vendors, or buy prepaid airtime through a text message. After receiving splash cash, a customer can go to any certified agent to convert the electronic money to cash.

  At the time of Splash’s launch, a mere 6% of the Sierra Leone population had access to traditional banking services, making citizens more reliant on cash-only transactions. Beyond the aforementioned benefits of removing cash from the equation, Splash also greatly impacts rural citizens by eliminating the burden of traveling long distances to a physical bank only to wait in line.

  The company targets individuals and organizations alike. While every day citizens take advantage of the services, so too do businesses. Splash allows Sierra Leone’s largest microfinance institution, for instance, to send loan disbursements and repayments. The country’s largest satellite television provider uses Splash to accept payments from customers.

  Splash received its initial financing by way of equity funding from Manocap, the Soros Economic Development Fund, and through a grant from the Africa Enterprise Challenge Fund. When getting off the ground, one of the largest challenges to the organization’s business model was the reluctance of citizens – who were so reliant on cash transactions – to trust electronic money. Similarly, the transparency of mobile-money transactions revealed the flaws and corruption in the traditional banking system, and this exposure resulted in resistance. Further, the low literacy rates posed a problem to the SMS platform.

  Within the next five years, the company hopes to expand beyond Sierra Leone and into at least five additional West African countries. As part of its growth plan, it aims to increase the number of agents as well as the opportunities for micro-franchising. It also plans to target the region’s rural areas, thus bringing financial services to the unbanked population.

  BOX 6.5.19

  Box caption

  Sources:

  Rudd, Melissa. "Making a Splash in Sierra Leone." African Business Review, 2 Nov. 2011.

  "From Harvard to Sierra Leone -CEO of Splash Mobile Money Finds His Path." The AWP Network. N.p., 28 Nov. 2012. Web. http://awpnetwork.com/2012/11/28/from-harvard-to-sierra-leone-ceo-of-splash-mobile-money-finds-his-path/

  In 2004, NTT DoCoMo and its eight regional subsidiaries launched the i-Mode Felica mobile wallet application, designed for use on its i-mode smart-card 2G and 3G handsets. The company designed the devices to serve as train passes, debit cards, credit cards, and personal identifications. At the time of launch, customers could purchase the handsets – which came equipped with Sony’s Edy e-money system - at 9,000 shops throughout the country. 39 mobile providers offered m-wallet functions through the Felica service, available for download on the providers’ websites.

  In 2006, DoCoMo launched the “DCMX” consumer credit services through iD, its brand of mobile credit cards. The company offered its Felica phone users two different plans from which to choose based on their credit and purchasing behavior. The first plan, known as DCMX mini, offered a monthly credit line of US$ 100. Use of the service did not require a membership fee and allowed customers to use their phones to purchase goods without requiring a separate identification or signature. The payments were applied directly to the monthly phone bill. The other plan began at US$ 2000 and offered cash advances, requiring a four-digit password for purchases over US$ 100 to enhance security. To encourage use, this plan came with a US$ 13 fee when the card wasn’t used within 12 months and offered customers the opportunity to earn points redeemable for products and services offered by DoCoMo and its partners. Customers also received a Visa or MasterCard plastic credit card for use in stores that did not have readers or when making purchases overseas.

  By 2009, more than 30 million DoCoMo customers had purchased the Felica-enabled handsets, available for use on more than 420,000 readers through the country’s retailers, restaurants, convenience stores, and taxis. Of these customers, 10 million regularly used the credit card service, reflecting the world’s largest mobile payment market. In 2011, the company announced plans that the new models would support not only the FeliCa technology, but also the international standard N.F.C.

  While mobile payments are a very specific sector within the company’s business in Japan, analysts feel that it could lead the way to increased mobile phone demand and adoption. They liken the initial hesitation of customers to use mobile payment to banks’ early struggle to encourage customers to use ATM machines.

  BOX 6.5.20

  NTT DoCoMo DCMX Service (Japan)

  Sources:

  NTT DoCoMo. NTT DoCoMo to Launch Revolutionary Mobile Wallet Service Useable with New I-mode Smart-Card Handsets. N.p., 16 June 2004. Web. http://www.nttdocomo.co.jp/english/info/media_center/pr/2004/001182.html

  Kolesnikov-Jessop, Sonia. "Mobile Wallet Gaining Currency." New York Times. N.p., 6 Sept. 2011. Web. http://www.nytimes.com/2011/09/06/technology/mobile-wallet-gaining-currency.html

  "NTT DoCoMo to Launch DCMX Mobile Credit Services." Wireless Watch Japan. N.p., 4 Apr. 2006. Web. http://wirelesswatch.jp/2006/04/04/ntt-docomo-to-launch-dcmx-mobile-credit-services/

  White, Peter. "NTT DoCoMo Hits 10m Mobile Wallet Accounts." Rethink Wireless. N.p., 25 Aug. 2009. Web. http://www.rethink-wireless.com/print.asp?article_id=1826

  Expected impact on broadband demand

  There is some initial evidence that successful communications-enabled financial services act as a powerful incentive for communications adoption. The example of M- Pesa is quite illustrative. Research by Jack and Suri (2010) conducted among M-Pesa non-adopters indicated that the primary reason indicated for non-usage was lack of access (either lack of agents or cellular coverage) (21%), while other factors (safety, ease, cost, confidentiality) scored significantly lower. This would indicate that, once the network is in place, adoption would greatly increase. 

6.5.4 Content to drive broadband demand

• 6.5.4.1 Local content promotion policies

  In order to increase demand for broadband services, citizens must first view the service as relevant. Without resources, information, and applications designed with local communities in mind, the demand for such services will only come from the segment of the population for whom the Internet was first developed – native English speakers. Even with the rise in Internet users in countries where English is not the first language, comparatively fewer websites written in other languages and characters exist. Further, the defining characteristics of a culture – such as “geographic location, religion, ethnicity, and area of interest” - shape an individual’s interest in available content.

  The Internet has offered citizens the chance to create and distribute their own content more quickly and cost-efficiently than ever before. As discussed in prior sections, it has also allowed them to come together in such instances as crowd-sourcing or mass broadcasting.

  At the same time, however, lack of access further stratifies various segments of the population. Lack of access is only exacerbated by lack of local content, but in recent years, many developing countries have taken charge of the promotion and development of such resources. These efforts have commenced both to increase access and also to build a new industry of digital content.

  In Kenya, for instance, the government allocated a budget of nearly US$ 4 million in an effort to increase locally relevant digital content and software. By working directly with developers, it hopes not only to increase demand for broadband services, but also to increase revenue within the industry. In the case of Egypt, governments have worked to digitize pre-existing cultural content, in turn encouraging Internet use while also allowing more people to benefit from its resources. In the Middle East, the UAE and Qatar have both developed industries centered on the distribution of digital content within the region.

  In many instances, the governments turn to international corporations and organizations for both implementation and financial assistance in these endeavors. Much of this help allows these initiatives to benefit from pre-developed best practices while also establishing international support for the budding industries. Increasing content in areas such as education and technology training will also serve to strengthen the countries’ economies.

  In addition to direct grants for the production of local content, governments can support the development of local content and applications in other ways, such as the development of standardized keyboards, character sets, and character encoding. This type of indirect intervention would affect the content available by enabling users to create content in their own languages. Additionally, translation and standardization of operating systems into local languages can help to facilitate the development of local applications that are relevant and comprehensible to local users. Governments can also play an important role in developing local content and local applications by directly creating local content and local applications in the form of e-government applications, as described above.

  Some forms of user-generated content, such as YouTube videos, face fewer barriers to expression, as the speaker is recorded directly in his or her own language. YouTube has launched a localization system, where YouTube is available in 31 local versions as well as a worldwide version. This helps to overcome some of the barriers to content reaching a possible community of interest, but not entirely, as content generated in languages other than those used in the 31 local versions or the worldwide version may encounter barriers to reaching an audience.

  It is likely that greater amounts of local content will continue to become available in the near term. For example, a website called d1g.com is a platform in Arabic for sharing videos, photos, and audio, a forum, and a question and answer facility. Launched in 2007, d1g.com is one of the Arab world’s fastest-growing social media and content-sharing web- sites, with more than 13 million users and 4.8 million unique monthly visitors. It has 15 million videos and streams an extensive amount of Arabic videos—600 terabytes of data per month. Notably, nearly 100 percent of d1g. com’s content is user generated, with a small amount produced in-house. d1g.com became the most popular Arab social media site (after Facebook and Twitter) when a user created the “Egyptstreet” diwan during the Egyptian revolution. During that time, unique visitors rose from 3 million to 5 million per month, and visits per month grew from 6 million to 13 million.

  Operating within the Kenyan ICT Board, Tandaa “promotes the creation and distribution of locally relevant digital content through the Tandaa Symposium and [through the distribution of] seed money to ICT entrepreneurs.” Tandaa defines digital content as “any content that can be consumed from an electronic device,” such as a personal computer, digital television, or mobile phone, and is distributed through the Internet. The Tandaa website offers users the option to stay connected through Facebook and Twitter and also houses resources that focus on the protection of intellectual property rights. In 2010, the ICT Board designated US$ 3.7 million for Tandaa’s endeavors.

  Tandaa-sponsored activities range from digital training to research to the digitization of content. In 2010, for instance, the Company Registry of State Law saw all of its records digitized, with more than 20 million pages and records from 1936 to 2010 scanned and made available for online searches. This project was carried out by the private company, DPH, that won the tender offered by the ICT Board. The task involved 215 staff members working 24 hours a day to scan 450,000 pages daily. Later in the year, the Board awarded its Digital Content and Software Application Grant to various firms in the three categories of: Government Information Portal, Private Sector (Individuals), and Private Sector (firms). Grant winners were chosen based on their plans to introduce such resources as an HIV and AIDS in the workplace e-Learning Course, a teacher’s portal, and a digital museum.

  In 2011, the Tandaa team hosted four workshops around the country to promote the second round of the Digital Content Grant. At each workshop, attendees learned about intellectual property rights and the confidential, secure nature of the application process. They also learned how to submit a proposal that would appeal to reviewers. The number of applications rose by 68% from the year prior and nearly half of all applications came from outside of Nairobi, attributed in part to the workshops and also to the redesigned easy online application process. Following the submission of proposals, the top applicants – as chosen by a team of consultants – attended a business plan training session at Strathmore University.

  In early 2011, the ministry created the Creative Content Task Force to promote Kenya’s Visual Effects sector, which at the time was hindered by its fragmentation. Beyond connecting the various sub-sectors – such as animation, performing arts, and cultural expression – the task force, per the ministry’s website, also worked to:

  • Seek input from sector players towards the enhancement of the creative industry;
  • Establish a formal classification of the creative industry;
  • Catalyze trade opportunities for the creative industry;
  • Accelerate and facilitate access to creative industry knowledge.

  In 2012, the IBM Service Corp Team developed a roadmap for the industry, meeting with representatives from UNCTAD-identified industry sectors. The roadmap identified the segments with “high levels of innovation and thriving economic activity” that the government should target. These sectors included new media, publishing, and visual arts industries. The work also demonstrated that such issues as lack of recognition, insufficient education and training, and government policy issues held back the development of some segments. These issues also included intellectual property rights and a limited use of ICT within the country.

  As a result of these findings, the roadmap established the following six main themes:

  • Raise the profile and increase recognition of the creative industries;
  • Implement policies that support creative industry growth and its measurement;
  • Reinstate arts in the education system and increase creative industry training opportunities to raise quality standards;
  • Implement programs and policies to enhance general business and marketing skills of creative practitioners to promote brand Kenya;
  • Implement changes to address current intellectual property issues;
  • Gain further leverage through new technologies to facilitate growth.

  Ultimately, per its mission statement, the roadmap identifies “how the creative industry can contribute 10% of Kenya’s GDP by 2017.”

  BOX 6.5.22

  Tandaa Local Digital Content (Kenya)

  Source: "Tandaa Kenya." N.p., 2012. Web. https://sites.google.com/a/ict.go.ke/tandaa/home

  As the name implies, Egypt’s Center for Documentation of Cultural and Natural Heritage (CULTNAT) oversees the documentation of Egypt’s cultural and natural heritage and the dissemination and promotion of such resources. Topics range from archaeology, to national history, to music and folklore. Such projects have included:

  • Implementing the national plan of action’s documentation program, making use of the most up-to-date information technology in collaboration with the national and international specialized organizations;
  • Increasing public awareness of cultural and natural heritage using all available media; and
  • Capacity-building for professionals in the fields of conservation and documentation of cultural and natural heritage.

  The Center emphasizes the importance of placing resources online using the latest digitization technologies, allowing the world to view and benefit from them regardless of their geographic location. To promote access to the Eternal Egypt project, for instance, CULTNAT partnered with IBM to develop an interactive, multimedia website where users can take guided tours of the country’s pyramids in English, French, Arabic, Italian, or Spanish. The website utilizes “interactive technologies, high-resolution imagery, animations, virtual environments, remote cameras, three-dimensional models and more.” CULTNAT also offers public exhibitions and projections that are available in print and CD formats, such as the atlas series that features maps, locations, and descriptions of the country’s archaeological sites. Other initiatives include the world’s first nine-screen interactive projective system, CULTURAMA.

  The center is located in Cairo and falls under the direction of Egypt’s Ministry of Communication and Information Technology. Much of the outside financial support comes from UNESCO, though project-by-project partnerships with the international private sector also offer a source of funding.

  CULTNAT’s work has not gone unnoticed by the international community. In 2003, the center received a Special Mention at the World Summit Award (WSA) for its work in the e- Culture category. In 2010, CULTANT won the WSA in the m-Tourism category as a result of its mobile-app, CULTMOB, which offers a tool for locating archaeological sites via 2.5G and 3G mobile devices. Its “Archeological Map of Egypt” program received the Stockholm Challenge Award in 2003/4 and an award from the Arab Federation for Libraries and Information for the digitization of the country’s National Historical Archives project. China’s AVICOM International Committee for Audiovisual and New Image and Sound Technologies recognized CULTNAT’s work in producing educational films.

  BOX 6.5.23

  Center for Documentation of Cultural and Natural Heritage (Egypt)

  Sources:

  "The Center for Documentation of Cultural and Natural Heritage (CULTNAT)." Bibliotheca Alexandrina. N.p., n.d. Web. http://www.bibalex.org/researchcenters/cultnat_en.aspx

  "WSA-mobile Outstanding Regional Achievement Awards 2010." World Summit Award. N.p., 2010. Web. http://www.wsa-mobile.org/regional

  "CULTNAT." The Center for Documentation of Cultural and Natural Heritage. N.p., n.d. Web. http://cultnat.org/

  The Abu Dhabi Government published a long-term plan in 2007 that detailed its strategy for diversifying its economy away from its dependence on fossil fuels. Known as the “Abu Dhabi Economic Vision 2030,” it emphasized, among other factors, the importance of a strong private sector, a knowledge-based economy, and a transparent regulatory environment while also detailing plans for the development of certain industrial sectors. The media and entertainment industry received special attention, largely due to the projection that its regional growth would exceed 19% annually. With comparatively low broadband penetration rates that were expected to grow at 12%, the government also saw this investment as a way to boost connectivity while taking advantage of the region’s 3G mobile take-up and rise in popularity of social media. Further, the publishing industry in the MENA region – unlike in the rest of the world – continued to see positive growth in revenues and demand.

  Named for the geographic coordinates of Abu Dhabi - 24°north by 54°east – twofour54 promotes the development of Arabic-language media and entertainment. Launched in 2008, the initiative serves to place Abu Dhabi at the forefront of the media content industry, covering such segments as film, broadcast, music, digital media, gaming, and publishing. The project’s campus includes three main segments: a training academy (Tadreeb), state of the art production facilities (Intaj), and support (Ibitkar).

  Tadreeb, the training academy, offers 200 bilingual, international-standard courses through three of the project’s partners, BBC, Thomson Reuters, and the Thomson Foundation. The courses reflect market demands and are offered either on campus or at client offices. Intaj offers such services as state-of-the-art HD production, post-production, media asset management and broadcast facilities to international production companies, producers, and broadcasters.

  Ibitkar supports ventures for Arab entrepreneurs and businesses needing funding for the start- up phase, business development, or operational support. Ibitkar’s creative lab offers grants to Arabs in need of seed funding or development assistance.

  These three pillars are supported by tawasol, which looks after organizations and individuals looking to join the twofour54 community. Encouraging education, investment, collaboration, and partnership, the project provides Arabic companies and organizations with the tools, support, and infrastructure necessary to create high quality content. It also works to establish a seamless licensing process while working with intellectual property concerns.

  Twofour54 boasts an impressive roster of media business partners. Many of these partners – like CNN, HarperCollins, and National Geographic – hail from all over the world and are leaders in the media, television, and publishing industries. Because the campus is a free trade zone, companies working with twofour54 enjoy the benefits of a tax-free environment with 100% foreign ownership. The project has helped many of these organizations to expand their business to include the Middle East region, a virtue of both its geographic location and its understanding of the Arabic culture and market.

  BOX 6.5.24

  TwoFour54 (United Arab Emirates)

  Source: "Twofour54 Abu Dhabi." Abu Dhabi Media Zone Authority, n.d. Web. http://twofour54.com/en

  Qatar’s Supreme Council of Information & Communication Technology (ictQATAR) offers incubation services to new services, encouraging digital content innovation and the use of ICT. The Council ultimately envisions these companies contributing to the availability of Arabic digital content. Its Digital Content Cluster (DCC) offers resources such as innovative platforms, access to international partners, business development services, training, and office space. The entrepreneurs, start-ups, and small online businesses with which DCC works have access to conference facilities, IT services, government resources, coaching services, and accounting and legal services. They also receive support from multinational organizations like IBM, SAP, and Houghton Mifflin Harcourt.

  This project is one of the Qatari government’s many initiatives designed to support a knowledge-based economy with less dependence on hydrocarbon revenues. Investment in the ICT industry is expected to lead to the economic transformation that will drive sustainable development. Recent ICT projects have included the implementation of ultra-fast networks, international submarine cables, and satellite technology. More than 360 government e- services are now available online and the telecom sector now has a second mobile and fixed line operator. These innovations and the country’s growing youth population and high purchasing power have led to an increase in demand for ICT services, and much of the growth in available services has come as a result of private sector investment.

  To work with the incubation center, aspiring entrepreneurs must first pass through three phases - the eligibility phase, the admission phase, and the business phase - prior to admission. Once admitted, qualifying individuals will have access to the aforementioned resource for a specified tenure period and will eventually “graduate.” Companies working with the center have addressed such topics as gaming, e-commerce, and women’s issues.

  BOX 6.5.25

  Digital Content Incubation Center (Qatar)

  Source:

  "About the Digital Content Incubation Center." QITCOM 2012. N.p., 2011.

  Safla, Scheherazade. "A Call for Arabic Digital Content." TFOURME. N.p., 18 Nov. 2012. Web. http://tfour.me/2012/11/a-call-for-arabic-digital-content/

• 6.5.4.2 Digital content promotion policies

  “Digital content” is defined as the myriad of websites, applications, and services available to broadband users. It can be based on text, audio, video, or a combination. Much of the content available on websites today can be divided into three broad categories: (a) user generated, (b) proprietary or commercial, and (c) open source.

  User-generated content is produced within Internet-based platforms where users function both as consumers and as producers of content. Along these lines, consumers interact with one another instead of only dealing with site operators in a top-down fashion. User-generated content includes blogs, wikis, podcasts, Twitter updates, You-Tube videos, and Flickr photos. They can be produced within social and professional networks, as well as reputational systems. For example, in the last three months of 2011, Facebook users collectively uploaded more than 250 million photos per day. This number broke down to approximately 7.5 billion monthly photos, or 3,000 photos every second. The social media site stores more than 100 petabytes, or 100 million gigabytes of photos and videos alone.* These forms of social media help to drive broadband demand by engaging users and ensuring the local and personal relevance of content. Due to the “bottom-up” nature of social media, policy makers can support the development of such content by taking a more hands-off approach in regulating it. They can also promote such services by becoming active users of such applications and services; more and more government agencies and even politicians are realizing the value of such tools in reaching out to citizens (see the example of Twitter usage in Russia).

  As opposed to copyrighted materials, open-source content is available free-of-charge. In addition, the source code is also freely available to allow anyone wanting to incorporate the content or application into new forms of media, such as in mashups. Open-source content has led to the creation of property rights systems that encourage collaboration by publishing source code and allowing other users to extend those applications and develop them further, with the provision that the result should also be governed by the same open-source property rights.

  In 2011, Colombia’s ICT Ministry developed its Digital Content Policy, which aimed to increase its domestic sales from US$ 70 million to US$ 200 million by 2014. By encouraging the development of such products as smart phone applications, video games, and digital animations, policy makers hope that the country’s digital industry will serve as the regional leader in this area and attract higher levels of foreign investment.

  To enhance the resources available to the country’s professionals, entrepreneurs, and digital producers, MINTIC hosted Colombia 3.0, a non-profit initiative spanning three days. The conference aimed to gather industry leaders together to network, participate in conferences and workshops, and exchange ideas. In 2012, the ministry hosted Colombia 3.0 v.2, placing higher emphasis on technological innovation and the development of an interactive community while placing Colombia 3.0 in a position to serve as a single point of convergence amongst the international digital industry. In doing so, the conference will likely promote the industry and encourage outside investment while fostering an environment conducive to tech startups.

  The table bellow shows conference attendance in 2011and in 2012: 

  	Colombia 3.0 v.1 2011	Colombia 3.0 v.2 2012
  General assistance	2,873	4,000
  Virtual assistants	55,891	70,000
  Number of conferences	22	40
  Companies participating in Expomeeting	177	250

  BOX 6.5.20

  Digital Content Policy (Colombia)

  Source:

  "Colombia 3.0, First National Summit of Entrepreneurs and Representatives of the Digital Content Industry in Colombia." Ministerio De Tecnologias De La Informacion y Las Comunicaciones, 30 Aug. 2011. Web. http://www.mintic.gov.co/index.php/mn-english-news/368-20110907colombia30english

  "Colombia 3.0." N.p., n.d. Web. http://www.col30.co/index.php?option=com_content

  By 2001, Taiwan became one of the world’s largest producers of semiconductors and LCD technology. In an attempt to encourage the growth of this sector, in 2002, the Taiwanese government launched its Two Trillion and Twin Star program, investing in the country’s semiconductor industry as well as in the digital content industry. As a “rising star” industry, the government hoped that, in the future, digital would contribute an annual production value of more than US$ 30 billion. While the “Two Trillion” part of the plan referred to the growth of the semiconductor industry, the “Two Stars” part promoted the digital content industry by encouraging Taiwanese companies to develop Chinese-language software and digital content. While the industry had the potential to grow and contribute positively to the country’s economy, policy makers feared that without additional investment to enhance infrastructure and R&D, China’s manufacturing and electronics sector could surpass Taiwan’s progress.

  This program spurred several digital content initiatives, many of which represented a partnership between government agencies and the private sector. The National Science Council sponsored 9 initiatives beginning in 2002, including the five-year National Digital Archives Program (NDAP). The program aimed to digitize collections from the country’s museums, libraries, and universities, covering such themes as anthropology, painting, Chinese classics, and maps. For instance, the project created a database of the collections featuring 60,000 digitized artifacts, calligraphic works, and paintings as well as 190,000 archived documents from the internationally renowned National Palace Museum. The public could then access this content online from anywhere in the world.

  The Two Trillion and Twin Star program also strived to “build both real and virtual industrial parks to promote the digital content industry, establish digital content colleges ... and train new digital talents,” all of which were governed under the Digital Content Promotion Office. The government also established the Challenge 2008 National Development Plan, under which the Creative Industries Promotion Office designated 13 areas of interest, including digital games and entertainment, focusing on their potential to increase employment in the country. Similarly, the Development Fund Investment Plan for Digital Content, Software, and Cultural Creative Industries was established by the Executive Yuan to provide financial support for digital content projects. The fund totaled US$ 3 billion, 40% of which came from the government. As part of the Two Trillion and Twin Star program, the Executive Yuan also offered tax breaks and incentives for digital content producers.

  Taiwan’s electronic publication and digital archives output value grew 45.23% from 2010 to 2011, reaching US$ 2.5 billion, and the digital content industry as a whole is expected to create new job opportunities, employing more than 70,000 citizens. The industry’s output value reached US$ 18 billion in 2010, and grew to US$ 20 billion in 2011. This figure is expected to top US$ 26 billion in 2013, in large part due to Taiwan’s presence in the global mobile application industry. Many of these mobile apps work with electronic learning, entertainment, and gaming content. In 2011, the Industrial Development Bureau established the App Incubation Center, working with domestic companies to encourage development. The government hopes that such an initiative will bring the country to the head of the Chinese-language app creation industry, producing 20,000 apps a year.

  BOX 6.5.21

  Two Trillion and Twin Star Program (Taiwan)

  Sources:

  "Taiwan's Two Trillion, Twin Star (T3S) Plan." GLOCOM Platform. Japanese Institute of Global Communications, 6 Sept. 2002. Web. http://www.glocom.org/tech_reviews/geti/20020906_geti_s22/index.html

  Liu, Yu-li, and Eunice H. Wang. ".tw Taiwan." Digital Review of Asia Pacific 2007-2008. Ed. Felix Librero and Patricia B. Arinto. New Delhi, India: SAGE Publications, 2008. 304- 31. Print.

  "Taiwan's Digital Content Industry to Grow Larger on Mobile Apps." China Post. N.p., 17 July 2012. Web. http://www.chinapost.com.tw/business/asia-taiwan/2012/07/17/347878/Taiwans-digital.htm