The first question many people asked when Nobel Peace Prize winner Muhammad Yunus proposed the Village Phone idea was: Who will they call?
Village Phone is the project that turns primarily poor women in developing countries into entrepreneurs by offering them micro-loans to buy a cell phone that they let other villagers use for a fee.
Now that there are more than 220,000 Village Phone operators in Bangladesh and more in Uganda, Rwanda, Cameroon and Indonesia, we know the poor have people to call, said Peter Bladin, founding director of the Grameen Technology Center and executive vice president for programs and regions at the Grameen Foundation.
Bladin helped prove that the Village Phone idea would work outside of Bangladesh, where Yunus founded the bank that gave the loans and was part owner in the mobile-phone company. Bladin heads the little-known Seattle-based Grameen Technology Center, an arm of the Grameen Foundation, which is the U.S. organization that raises money to support micro-finance around the world.
The center was founded in 2001 to create business opportunities for micro-entrepreneurs around the world using technology. "The Village Phone was an obvious starting point for that," Bladin said.
It turns out that some of the first calls made by customers of the original Village Phone operators were by farmers to relatives in market towns, asking them how much a product was selling for. Such farmers often lack the means to transport their crops to the market so they rely on middlemen, who buy the products from the farmers and deliver them, Bladin said. But if the farmer knows the price the product is going for at the market, he can often convince the middlemen to pay a fair price.
"When the opportunity cost is high, people are willing to use this technology," Bladin said. While the cost of that phone call might seem expensive relative to the user's income, if the call will result in more income, the user will pay for it.
The Grameen Technology Center identifies countries that might benefit from the Village Phone and works with operators there to roll out the project. In countries like Uganda, the center has helped prove that the Village Phone is good not just for the people who build businesses around the phones or for the people who use the phones, but also for the operators that might otherwise think it's not worth the investment to build coverage into poor areas. "It's a good business model for the phone company," Bladin said.
The center has developed a Village Phone kit that includes a phone, air time, marketing signs and a way to charge the phone, to get the individual small businesses going.
But Village Phone isn't the end of the story for the technology center. Bladin wasn't yet ready to divulge many details of a new project that may be launched in a few weeks, but he hinted at what it will do.
"The next step is, what if you use the phones that are already out there to make information searchable through text? What if you digitized information or made it available to people, how would people use that to empower themselves?" he said.
The center has been investigating ways that people can use the low-cost phones to find important information, like the weather or health-care help. The phones usually aren't Internet-capable, nor are the networks they run on. So the best way to provide information to users may be through text messages, he said.
So far there have been a few hurdles to the idea, which the center has worked on solving. One is making available the content people are interested in. "If you look at the content on the 'Net, the vast majority is in English and it's Western-world-focused," he noted.
Another problem is that many people, sometimes the majority of people in regions that have the Village Phone, are illiterate. But that's not insurmountable, Bladin said. "Not everyone has to be literate to use this ... there's always somebody who can read," he said. "This is the beauty of shared access. All it takes is one person who is literate and they can be the intermediary," he said.
The technology center is already training people to use the forthcoming text information service. "We can train and empower them, and maybe they can make a living out of distributing the information to the subsistence farmers out there," he said.
People might want to get other kinds of information too, beyond that which can help them improve their health or their crops. "Wherever I go in the world, including in the most remote village in Africa, people love to find out the soccer scores," Bladin said.
In addition to the mobile-phone projects, the technology center has also been working on ways to improve the efficiency of micro-finance banking systems. Grameen has helped drive the effort to create Mifos, an open-source information management system designed for micro-finance. Without it, micro-finance institutions rely on inadequate manual systems or overly expensive off-the-shelf technologies that don't meet their needs.
The technology center has a broader mission too. Rather than base the center in Washington, D.C., alongside the foundation, Yunus wanted it to be based in a technology hub in hopes of influencing nearby companies.
"He wanted large technology companies to start thinking of the poor as an opportunity," Bladin said. While cell-phone companies and operators once thought the poor could never afford their products, Yunus has proved them wrong. That's good news for the world's poor, who often benefit from access to the technology, as well as to operators and cell-phone manufacturers who have discovered a business opportunity in the developing world. The same can be true for other kinds of technologies as well, Bladin said.
Yunus considered both Seattle and San Francisco. Seattle won out, in part for its interest in international development, nearby organizations like the Bill and Melinda Gates Foundation, and existing micro-finance institutions.
The source of the startup money for the center was fitting: The Craig and Susan McCaw Foundation gave US$2 million to help start it. Craig McCaw is often called a wireless pioneer for cobbling together wireless licenses to form one of the first nationwide mobile-phone networks in the U.S., later selling it to AT&T. Susan McCaw sits on the Grameen Foundation's board.
Bladin has high hopes for the center's newest initiative, the text information project. "Devices or technology can shorten that gap between where the information exists and where people who need it are. That's really a great empowerment," he said.