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Wednesday, March 25, 2009

Video Games for the Next Billion?

By Rob Katz

The Zeebo is targeted at consumers in emerging markets

In an Associated Press article posted yesterday, Qualcomm announced its backing of a videogame startup targeting BoP markets.  I heard about it in an e-mail from my father, who wrote under the subject line "tacky! tacky! tacky!".

While my first instinct was to agree with his assessment, I've been thinking about it more and more.  No, video games are not basic goods and services, nor do they have much of a "development" impact if you're looking to NextBillion.net for your development-through-enterprise news coverage. 

But the very idea of selling a new product (modern videogame consoles) into an underserved market (the approximately 800 million people making $7 to $10 per day) is the definition of a bottom-of-the-pyramid strategic approach, at least as defined by C.K. Prahalad.

Then again, if I keep writing about videogames, I'll open myself up to criticism from Aneel Karnani, who has rightfully pointed out that simply selling things to poor people does not necessarily improve those people's lives.

The bottom of the pyramid concept is not black and white; nor is the next billion (as a market, a business strategy or a term).  It's foolish to lump drip irrigation systems (positive development impact) in the same pile as videogame consoles (negligible development impact).  But it's also dishonest not to celebrate Qualcomm's move here - they see an underserved market and look at poor people as customers, not aid recipients.

One step at a time, right?

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