DIGITAL
ENABLEMENT

Bridging the Digital Divide to
Connect People and Society

THE DIGITAL DIVIDE IS GETTING

NARROWER

As more networks are built, and internet connections and smartphones become more affordable,digital divides are narrowing.
By building more than 1,500 networks in 170 countries, Huawei has brought affordable Internet connections as well as smart phones and enterprise services to people across diverse economies, and helped provide more than a third of the world’s population access digital services.
Today, more than 87% of the world’s population is within range of a mobile signal (55% for 3G networks).

BUT IT IS ALSO GETTING

DEEPER

There are still up to 1 billion people completely unconnected to any form of telecommunications.
An additional 3 billion people not connected to broadband internet.
An even greater challenge is that still only a third of those living in emerging economies use the Internet - compared to eight out of 10 in developed economies.
While more people are connecting every day, particularly in developing markets, but even by 2020, the GSMA expects 48% of the population to still be offline.

In the future, more connections, sensors, devices, data, video, analytics will lead to even more productive agriculture, healthier individuals, stronger economies, thriving ecosystems, and efficient transport.

A new divide between things will accentuate a deeper divide between the people that use them.

We must take action now. In the next 10 years, we must bring the power of fast connections, smart devices and intelligent applications to close the divide and not increase it.

WHY IS

DIGITAL
ENABLEMENT

IMPORTANT?

Precisely because the digital divide is deepening between the digitally enabled and the digitally excluded, it’s never been more urgent to provide digital enablement.

Increasing the value of that connection by providing people and organizations with the relevant skills and services is the second necessary step towards digital enablement. Without this the digital divide will actually deepen.

Used to their full potential, digital technologies such as mobile broadband, cloud computing, big data and the Internet of Things can:

Huawei’s Global Connectivity Index finds that a 20% increase in ICT investment will grow GDP of a country by 1%. The ITU has shown that there is an important relationship between ICT development and other development indicators in developing countries.1

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1
Technology innovation in fixed broadband

Example: New technologies like G.Fast as well as FTTx that can bring higher speeds and/or lower costs of connections.

Consequences: Lower costs and faster roll-outs to those without broadband connections as well as expanded speeds to those with older technologies.

2
Technology innovation in mobile communication

Example: New satellite or unmanned aerial vehicle technologies and new uses of unused broadcasting frequencies and wi-fi.

Consequences: Lower costs and faster roll-out to expand access for those in rural and isolated areas.

3
Expansion of pay-as-you-go renewable energy

Example: Low-cost solar power systems for home or small building use which are paid for in small amounts regularly.

Consequences: Electricity that is cleaner and cost competitive with existing fuel sources that can power electronic devices.

4
Growth in use of advanced analytics

Example: Analysis of images to detect skin cancer and of large amounts of data to predict weather impacts on crops or the spread of diseases.

Consequences: New actionable information and knowledge as well as smarter systems to improve health, education, agricultural productivity and more.

5
Growth in smartphone adoption

Example: Low-cost smart phones that can access the internet and use capabilities such as accelerometers, cameras and GPS for $30-$50 and payable through affordable installments.

Consequences: Timely, affordable, relevant and accessible information and services and improved abilities to communicate.

6
Improvements in machine learning

Example: Machine learning provides new, intelligent and futureorientated information to users by analyzing existing data. Coupled with speech recognition, it can enable a smart phone to be navigable by voice only.

Consequences: Access to the internet for the illiterate and visually impaired as well as better user experience and smarter lives for all users.

7
Growth in social media, crowdsourcing and user generated content

Example: Social network services, such as Facebook, information services, such as Wikipedia and Youtube, and local information sites such as Bridge Africa

Consequences: Provision of local content and services in local languages and relevant to local users.

8
New services leveraging peer-to- peer technologies to drive collaborative consumption

Example: Services enabling sharing or direct purchase of transportation, accommodation, daily goods as well as peer-to-peer money lending.

Consequences: New sources of income, better use of infrastructure, and more efficient provision of services.

9
Lower costs and new capabilities of sensors and expansion of the Internet of Things

Example: Low-cost sensors that can detect water, heat, movement, light etc and communicate results to other devices.

Consequences: New and better information from monitoring and controlling physical things electronically leads to more efficient use of resource and transportation; improved prevention, detection and treatment of health; and smarter operations of cities, workplaces, homes amongst others.

10
Expansion of government influence over ICT use

Example: Use of ICT to provide government services and deliver public services, and regulations that provide new spectrum or investment for expanding connectivity.

Consequences: More efficient access to and delivery of public services at lower costs to greater populations as well as increased access to connectivity.

UNDERSTANDING

THE BARRIERS

TO DIGITAL ENABLEMENT

There are a number of barriers to digital enablement including availability, affordability, attitude and ability, each of which needs to be addressed at three levels: the network connection, the device, and the cloud application. We’ve identified 6 key barriers to focus on.

Availablity
Affordability
Attitude
Ability
Cloud Application
Accessibility and capability of applications
Value and cost of applications
Awareness, desire and fear of applications
Digital literacy and individual restrictions on using applications
Device
Accessibility and capability of device
Value and cost of device
Awareness, desire and fear of device
Digital literacy and individual restrictions on using device
Network Connection
Accessibility and capability of connection
Value and cost of connection
Awareness, desire and fear of connection
Digital literacy and individual restrictions on using connection

A lack of poor quality network connection

Physical access to a network is important and despite great progress in recent years, around 13% of the world's population still live out of range of a mobile network connection, But availability is not only about physical access but also the capability of that access and a key barrier is the lack of a capable network which also has a reliable power supply, consistent access, and high speed.

A lack of locally relevant applications and services

Locally relevant content in local languages is part of the solution to providing a capable service meeting consumers’ diverse needs. Women and girls are a large and often disadvantaged group that frequently are unable to access traditional services or who need services specifically to meet their needs.

A lack of business that increase the value of being connected as well as reduce the costs

While solutions do need to provide services that are valued by end-users or other customers they must also find a way to pay for the solutions.

Increasing the value provided is one option, so consumers are willing to pay for them;

Another is to reduce the costs or make the costs easier to afford such as by spreading payments out over time.

A lack of awareness of the benefits of the internet and a growing fear of using the internet and some of its applications

Many in developing and developed countries are not interested in going online or who only use a online services due to lack of awareness of the benefits of other services. Security and privacy of information over networks and on devices, and the use of data by service providers are increasingly mainstream concerns for users.

Increasingly certain groups of users are not willing to share information such as health, or may not trust service providers with financial details.

Many users also worry about children seeing unsafe content, the sending of hate messages, stalking or cyberbullying.

Serving those with restricted abilities and impairments

Using a device can be a major barrier for many; though there are some customized devices and user interfaces that can make this easier they are not available to all.

There are major barriers for many disadvantaged groups to use the majority of the services online—not least the ability to read the online content for the 700 million illiterate adults.

Those with restricted abilities such as the physically or mentally disabled, many elderly, or the illiterate are a major underserved group, yet one that could benefit tremendously from ICT.

Digital literacy

For many new to smartphones with a plethora of icons, not only can they be hard to navigate but also bewildering and can scare some people off using their device.

A McKinsey survey in 2013 found that the top reason 10 Africans do not access the internet is a lack of digital skills.

This is a gap that is dramatically widening: whilst students across the UK are learning how to code, many students in the developing world are not in school or have teachers who cannot even use computers.

OVERVIEW OF BARRIERS

AT A COUNTRY LEVEL

MEXICO
BRAZIL
UK
TURKEY
KENYA
SOUTH AFRICA
MYANMAR
INDONESIA

BRAZIL

The biggest barrier to greater digital inclusion in Brazil is affordability, coverage in rural areas and broadband speed. Tax on mobile services remains high at 37% and mobile data costs represent over 2% of average income, higher than in Indonesia or Turkey.
Digital Divide Priorities:
  • Connecting remote areas – there still exist many unconnected cities and villages.
  • Data from Web Index suggests Brazil scores very highly in terms of ICT training for healthcare professionals, but less well in ICT training for teachers.
  • Improve broadband speed.

INDONESIA

The biggest barrier to greater digital inclusion in Indonesia is digital literacy as exemplified by ICT being used very little to improve education outcomes. In addition there is still poor communications infrastructure (especially in remote areas) and expensive devices. Even the cheapest smartphones on the market can equate to 8% of monthly per capita GDP.
Digital Divide Priorities:
  • The Indonesian government has an objective of 60% broadband penetration by 2019.It has also set itself targets of improving awareness and education around the benefits of the Internet and ICT.

KENYA

The biggest barriers to digital inclusion in Kenya are cost and access with both these factors impacting the appetite to use digital services. The cost of mobile broadband data services is very high – at about 9% of income – and even low-cost PCs and smartphones remain very expensive compared to average incomes. These factors, added to a poor communications infrastructure, contribute to the fact that there is limited content available in local language.
Digital Divide Priorities:
  • The Kenyan government aims to build broadband infrastructure to ensure 90% mobile broadband access and 25% broadband hotspots coverage by 2017. In addition, it has set a target of 100% broadband coverage in schools and hospitals across the country.
  • The Kenyan government has created an ICT Authority to drive digital inclusion and to empower its citizens to access digital government services, and help businesses use ICT to improve production and services.

MEXICO

The biggest barriers to digital inclusion in Mexico are digital literacy and awareness. Mexico scores poorly in levels of ICT training for teachers and health officials. This is holding back the extent to which ICT is positively impacting education outcomes with Mexico lagging India and Kenya.
Digital Divide Priorities:
  • Mexico Conectado Project aims to connect 250,000 public sites by 2018 (most of them schools).
  • Mexico’s Digital National Agenda is responding to the need for digital literacy amongst all 14-18s. Perhaps this agenda can take on the important task of ensuring teachers are more ICT literate.

MYANMAR

According to these indicators, the biggest barriers to digital inclusion in Myanmar are access and awareness. Coverage of fixed Internet services is below 1% and mobile network coverage is restricted mainly to urban areas. Because of this, Internet usage is very sparse, not helped by very little content being available in local language.
Digital Divide Priorities:
  • Primary need is to improve infrastructure as more people come online and have access to mobile devices.
  • Insufficient local content is holding back popular usage of the Internet and digital literacy amongst general population is very low.
  • Both Telenor and Ooredoo are required to build rural telecenters, according to licensing regulations. They need to work closely with government bodies and NGOs to run local initiatives emanating from these telecenters, which will serve to create greater digital literacy.

SOUTH AFRICA

According to these indicators, the biggest barriers to digital inclusion in South Africa are digital literacy and awareness. Scores are low in South Africa for ICT usage in schools and in terms of teacher ICT knowledge; until this improves, digital literacy across the mass market will be hampered.
Digital Divide Priorities:
  • A National Broadband Policy aims to connect underserved populations in rural and urban areas.
  • The Government is increasingly working with private entities to run projects ranging from ICT training for teachers to free Wi-Fi networks to increase ICT usage and improve digital literacy.

TURKEY

The biggest barrier to digital inclusion in Turkey is affordability. Standards of digital literacy are high and access to communications is good, but the high cost of mobile services has an impact on the appetite for digital services. Tax on mobile services is very high and the cost of even the cheapest smartphone is significantly higher than in the other 11 countries covered in this research.
Digital Divide Priorities:
  • Like all the other countries, there is a priority to connect rural parts of Turkey.
  • The Turkish government's project FATIH is supplying students at schools with tablets and classes with smart boards to make education more interactive.
  • The government’s digital literacy program aims to help the digitally excluded (disabled, elderly, women in rural areas) to use technology and people’s digital skills to improve employability and create an ICT community.

UK

The UK is by far the most mature country surveyed and, while it has one of the most competitive broadband markets in the developed world, there are still digital divides to address.
At the end of 2014, Ofcom reported that around 18% of UK households had no home access to the Internet, fixed or mobile. Although the availability of broadband services is improving, specific challenges remain for some consumers and businesses which include, rural availability, city hotspots and the availability of superfast broadband to small and medium sized enterprises (SMEs).
Digital Divide Priorities:
  • The UK is aiming for superfast fiber broadband for 90% of premises by 2020.
  • The Digital Inclusion Charter aims to get those people currently offline, online and to keep them online. The focus is on those on low income and the elderly.
  • Access may be an issue for some but the greater concern is around digital awareness and demand creation for digital services. There needs to be a clear motivation for some to learn digital services.
  • Government is looking to use e-government services to engage with citizens – an example of this is the government’s NHS participation program to encourage citizens to engage with medical professionals online.

BUSINESS MODELS THAT

CREATE VALUE

Develop a business model to build for scale:
What ICT4D Business Model?

Use this tool to help think through the different options for developing a business model:

  • Are there other resources you could monetize to increase your solution’s economic feasibility?
  • Are there other customers you can consider selling these resources to that increase revenue?
  • Are there are other ways you can collect revenue that better meets customers’ ability?
  • Are there others who can help you sell or distribute to reach end-users efficiently?
WHAT RESOURCE
CAN YOU MONETIZE?
WHO CAN YOU
SELL IT TO?
HOW CAN YOU
SELL IT?
WHO WILL SELL
OR DISTRIBUTE IT?
  • Product / service
  • Relationship
  • Consumer network
  • Trust
  • Users
  • Data / market insight
  • Space/excess capacity
  • Venue
  • Expertise
  • Individuals
  • Affinity groups
  • Government
  • Academia
  • Charities
  • ICT vendors
  • Other companies
  • One-time revenue
  • Recurring revenue
  • Revenue share
  • Pay-as-you-go
  • Commission
  • Freemium
  • Subsidized
  • Direct sales
  • Agents / franchises
  • Online
  • Local independent retailers
  • Regional chain retailers
  • Government
  • Telco operators
  • Charities
  • Relation solution providers
  • Unrelated solution providers
Clarify your value and demonstrate impact:
WHERE IS THE VALUE IN ICT4D SOLUTIONS?

Who benefits from the initiative? What type of impact is the result? Impact can be indirect, uninteded or consequential, i.e. preventing other problems from happening. ICT can create tremendous knock-on effects and is a true enabler of other industries (consider the sharing economy and peer-to-peer lending that has disrupted and stimulated major industries such as travel, hospitality and finance). ICT can drive transparency and more efficient marketplaces and can dramatically improve customer relations and retention. Understanding value is important in knowing the customers and evolving a sustainable business model. The list could be endless, but a few ideas to get you thinking:

WHO BENEFITS
DIRECTLY?
WHO BENEFITS
INDIRECTLY?
HOW CAN YOU
SELL IT?

Tip:
1. Look for micro-value or shared valued that ICT can help identify and measure.
2. Is there negative impact you need to mitigate/avoid?

  • Consumer/beneficiary
  • Consumer’s dependents
  • Government revenue (e.g. tax)
  • Infrastructure
  • Environmental
  • sustainability
  • Efficient market (e.g. better data and better matching of supply and demand)
  • Efficient economy (e.g. less corruption or more competition from transparency)
  • Cultural change (e.g. women empowerment)
  • Better data
  • Less need for or damage of infrastructure
  • Society from more engaged and empowered citizens (e.g. less crime, more innovation)
  • Economic gains from saving time
  • Environmental gains from savings of travel or waste generation
  • Productivity gains
  • Social and economic gains by reducing long-term healthcare, disability, or unemployment costs
  • Social and economic gains from reducing migration or resource stress
WHO IS IN THE ICT4D VALUE CHAIN?

Many organizations, from non-profits to for-profits, academics to governments, are often involved in the successful roll-out of a product/solution and all need to be considered carefully.
What they do, how they do it, how much they cost, what and where they have capacity or limitations, where they have influence on the market - these are all important considerations.
Involving them early is the best so you can take account of these considerations in designing your product or service for maximum success and impact.

Product
designer
Manufacturer
and Suppliers
Logistics and
transport
Distributors
Product
take-back and
recycling or
re-use
Marketing
Regulators
Testing and
standards
bodies
Salesforce
User servicing
and support
User training
centers
Billing and
payment
providers
Insurance or
Finance provider
Market
research
and analysts
Consumer
protection
or support e.g. media,
associations, charities
Product
accessories
or upgrades
Data users or
connectors
Data analysis
Product
or service use
monitoring
Complementary
services

From

ideation

To

commercialization

Digital enablement needs lifecycle management.

Ask the right questions of your front-line and of the data: Identify, capture and analyze data from existing or related solutions, and from the market. Asking the right questions means getting to the root of a problem through multiple uses of “why”; it also means identifying possible solutions using the phrase “what if”.

Make internal education viral: Internally some may be skeptical or unclear of a business case for digital enablement solutions. Use on-the-ground workshops, internal social media campaigns, as well as internal instant messaging and social network systems to build traction and keep people informed and engaged.

Understand existing solutions and standards: Avoid the risk of duplication and wastage by reaching out to customers, government and industry groups for guidance, reusable knowledge, and tools.

Identify your innovation or unique selling point (USP) and the role of ICT: Be clear what you will do that is different to what is already happening and why you will succeed; or be clear what you will build on that already works. Be clear on why you are using ICT in the solution, and how; don’t just use ICT for the sake of it, and don’t neglect the non-ICT aspects of a solution otherwise the whole solution may not be sustainable.

Work out the ICT4D business model: ICT4D models have some unique aspects– and huge potential to achieve scale. Unique aspects include the ability to generate, analyse and sell data, pay for services digitally and distribute services through powerful channels such as telecom operators - either through their physical networks or their retail sales networks (see tool 1 for ideas on generating a business model). The ICT industry is easily able to utilize business models such as freemium, advertising funded, cross-selling and upselling, or high-volume and low-margins, some of which might be relevant for your solution. Meanwhile the telecom operators are relentlessly seeking solutions to lower churn, increase loyalty, and provide more value-added services to users.

Identify strategic partners: Too many ICT4D solutions only focus on the customer-facing software, and neglect to think through the wider value chain and ecosystem. Some partners are indispensable to give approval for distribution, credibility to the solution, and for their stakeholder reach; governments and telecom operators are good examples of power partners.

Leverage the cloud and its services. The cloud’s operational and commercial model exemplifies the commercialization that is mandatory for ICT4D success: Services that can be easily updated, on demand, frequently, remotely and cheaply, with customization easily implemented for different users based on their profiles and locations.

Leverage the cloud and its services. The cloud’s operational and commercial model exemplifies the commercialization that is mandatory for ICT4D success: Services that can be easily updated, on demand, frequently, remotely and cheaply, with customization easily implemented for different users based on their profiles and locations.

Learn to fail fast and pivot: If the business model isn’t quite right, tweak it. ICT is interactive, allowing direct interactions and feedback with users a well as rapid iterative improvements through what's known as A/B testing (providing some users with a slightly different version of the product and using feedback to select the best one).

Find and exploit the value: Understand where you are providing value and how you can provide more value more efficiently to more people. Are there forms of value like data, adverts or complementary products that you can monetize. The best companies work out how to get commission, up-sell or cross-sell services and increase revenue. Why can’t digital enablement solutions be the same?

Analyze and share evaluations: A joy of ICT is the ability to easily generate and analyze data. What were the key strengths and weaknesses?

Use a personal touch in order to build trust offline as well as online: Use local partners to sell into local communities. There is no substitute for feet on the street if you want to build trust and boost take-up in a local community. Partner strategically with NGOs, local social enterprises and academic institutions that may possess a stronger brand cachet, field presence and trust than you—and working with them may be faster and a better route to scale than seeking to do this alone.

Make things valuable, whether they are free or not: Focus on value creation, not only price or cost. While the beneficiaries of digital enablement may be on a low income, this doesn’t mean that services should necessarily be free. Indeed, demanding some form of payment or contribution (such as of time, or a deposit) to use a service only underscores that value is being supplied. Even if something is free (paid for by a government or third party, for example), there must be a business model behind it with the payer receiving value, not just providing donations, so that it is likely they will continue to pay for it and it can be sustainable.

Strategically partner to scale: It takes time to build up a brand, sales force, or even local employee base in a new market. Find partners with these assets already that you can leverage to speed up growth and reduce risk. Will you want to put boots on the ground, develop a joint venture, license your solution, create an alliance of local implementation partners, try to reach customers directly through the internet, or find another method that works to scale up?

Productize with flexibility: Countries, cultures, languages, ethnicities; all are different and scaling requires adapting your software and hardware to local needs. Understand and adapt to those needs but don’t lose sight of the need to productize to be efficient. Personalization can be crucial in building customer loyalty and can be achieved at low cost with modern data collection and analysis tools coupled with appropriate algorithms and machine learning.

Identify corollary benefits: When there are multiple beneficiaries and multiple benefits, digital enablement programs really take off. Both hard and soft benefits should be evaluated in order to quantify potential value to be generated over the long term.

Plan for lifecycle management from the beginning: Huawei is an advocate for cloud services; assuming users can access their data or applications when they need to, they enable much faster and cheaper upgrading of software as well as monitoring of usage. So, we recommend hosting solutions online. Also consider building in upgrades, insurance, guarantees or service contracts from the beginning to improve product and service maintenance whilst also maintaining customer relationships and improving customer satisfaction.

Build a sustainable ecosystem: Not only can a support ecosystem double as a sales channel, it helps customers use the solution appropriately to get maximum impact, can obtain useful information for future solutions, and helps set-up future sales.

Prepare for the next pivot: Use these analytics to assess if goals are still being met, or if it’s time for a change. Share your experiences and be on the lookout for the next opportunity. Proactively plan your pivot into a new community or extension of services.

  1. Ask the right questions of your front-line and of the data.
  1. Make internal education viral.
  1. Understanding existing solutions and standards.
  1. Identify your innovation or unique selling point(USP) and the role of ICT.
  1. Work out the ICT4D business model.
  1. Identify strategic partners.
  1. Leverage the cloud and its services.
  1. Set and monitor quantifiable metrics.
  1. Learn to fall fast and pivot.
  1. Find and exploit the value.
  1. Analyze and share evaluations.
  1. Use a personal touch in order to build trust offline as well as online.
  1. Make things valuable, whether they are free or not.
  1. Strategically partner to scale.
  1. Productize with flexibility.
  1. Identify corollary benefits.
  1. Plan for lifecycle management from the beginning.
  1. Build a sustainable ecosystem.
  1. Prepare for the next pivot.
Ideation
Prototype
and Pilot
Launch
and Scale
Manage
and Retire
In Huawei’s experience, the process of ideation is collaborative, and the product of many conversations with many stakeholders. It’s critical to maintain dialogue with various interest groups, and particularly customers in order to stimulate, prioritize and refine ideas.
The purpose of a pilot is not just to test the solution, but to also test the solution’s business model: such as the route to market, the pricing strategy, the partnerships, and the solution quality.
We like scale; that’s because a proven product at scale becomes increasingly cheaper to produce (and provide) while it expands tis customer base at ever higher speed.
Over time, technology infrastructure and software needs maintenance, upgrade and occasional replacement – moving to a service or leasing model rather than a product or scale model can help better manage costs, customer relationships, and environmental impacts.

CONCLUSION

Divides are getting deeper.

Powerful new technologies have the potential to create unprecedented digital divides almost overnight creating even greater separation between those with and without access or the skills to exploit them.

It’s time to shift from ideation to a focus on scaling-up.

Digital enablement solutions need to run on market principles. They must be built for scale and industrialization.

Business models that create value are critical, even if what’s on offer is ‘FREE’.

Poor and disadvantaged groups often targeted for digital enablement should be treated like any customer. They need to be convinced that they can benefit in order to “invest” in a digital enablement solution, whether it actually costs them money or not.

Everyone wins when value is delivered, but the understanding of value also needs to change.

Better outcomes result when everyone has something to gain from digital enablement, but gain is not about raw financial returns, it’s about delivering benefits across people and communities.

SOURCES:
1 Measuring the Information Society Report, 2014, ITU.

Please provide feedback and comments on the white paper to digitalenablement@huawei.com.