NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Monday, October 15, 2007

Manohar Lakshmipathi does not own a computer. In fact, workmen like Manohar, a house painter, are usually forbidden to touch clients’ computers on the job here. BANGALORE: Manohar Lakshmipathi does not own a computer. In fact, workmen like Manohar, a house painter, are usually forbidden to touch clients’ computers on the job here.

So you can imagine Manohar’s wonder as he sat dictating his date of birth, phone number and work history to a secretary who entered them into a computer. Afterward, a man took his photo. Then, with a click of a mouse, Manohar’s very own social-networking page popped onto the World Wide Web, the newest profile on Babajob.com.

Babajob, an Indian start-up aiming to bring the Facebook/MySpace revolution to the world’s poor, is just one example of an unanticipated byproduct of the outsourcing boom: Entrepreneurs and large multinationals are making India a hub of computer innovation targeting the poor.

Outsourcing brought hundreds of multinationals and hundreds of thousands of techies to Bangalore. Now, more than a decade into the outsourcing surge, many of those companies and their employees are applying their skills not just to developing software, but to confronting the grinding poverty around them too.

“In Redmond, you don’t see 7-year-olds begging on the street,” said Sean Blagsvedt, Babajob’s founder, referring to Microsoft’s Washington State headquarters, where he once worked. “In India, you can’t escape the feeling that you’re really lucky. So you ask, ’What are you going to do about all the stuff around you? How are you going to use all these skills?’ “

Perhaps for less altruistic reasons, but often with positive effects for the poor, corporations have made India a lab for extending modern technological conveniences to those long deprived. Nokia, for instance, develops many of its ultracheap cellphones here. Citibank first experimented here with a special ATM that recognizes thumbprints to help slum-dwellers who struggle with personal identification numbers. And Microsoft has made India one of the major centers of its global research group that is studying technologies for the poor, like software that reads to illiterate computer users.

Babajobs is a quintessential example of how Indian back offices have spawned poverty-inspired innovation.

The best-known networking sites connect the computer-savvy elite to one another. Babajob, by contrast, connects the Indian elite to the poor at their doorsteps, people who need jobs but lack the connections to find them. Job seekers advertise skills, employers advertise jobs and matches are made through “friend-of-a-friend” networks.

For example, if Rajeev and Sanjay are friends, and Sanjay needs a chauffeur, he can surf onto Rajeev’s page, travel onto the page of Rajeev’s chauffeur and then see which of the chauffeur’s friends happen to be looking for similar work.

Blagsvedt, 31, joined Microsoft in Redmond in 1999. Three years ago, he was sent to India to help build the local office of Microsoft Research, the company’s in-house institute.

But the Microsoft employees who worked here led very different lives than their counterparts back home. They had servants and laborers. They read newspaper tales of undernourishment and illiteracy. The Indian employees were not seeing such conditions for the first time, but many of them felt newly empowered to confront them.

Equipped with world-class computing skills, many felt an urge to do something to help their society.

At the same time, Microsoft, with software piracy limiting revenues in India, was looking to low-income consumers as a vast commercial opportunity, so engineers’ altruistic urges were encouraged.

In Blagsvedt’s research office, poverty became a major focus. Anthropologists and sociologists were hired to explain things like the effect of the caste system on rural computer usage. One day, in the course of that work, Blagsvedt stumbled on an insight by a Duke University economist that first unnerved and then inspired him.

The economist, Anirudh Krishna, found that many poor Indians in dead-end jobs stay poor not because there are no better jobs, but because they lack the connections to discover such jobs. Any Bangalorean could confirm the observation: the city teems with laborers desperate for work, and yet wealthy software tycoons complain endlessly about a shortage of maids and cooks.

Continue “Internet Revolution Reaches India’s Poor“