Third-world lending program to encompass technology

Friday, August 26, 2005

SAN FRANCISCO: If the world?s poorest people are willing to take out small business loans to buy a goat, executives at Intel Corp. believe they?ll do the same thing to purchase computers and cell phones.

While the chipmaker is gathering developers this week to discuss products for its enterprise customers in the Western world, a professor at Intel?s research centre in the University of California at Berkeley said micro-credit financing and franchising may open untapped market opportunities in developing countries. Intel is preparing for those opportunities by fine-tuning software that creates wireless networks and rethinking what it needs to pack into future microprocessors.

Eric Brewer, lab director for Intel Research Berkeley, said there are at least three to four billion people worldwide who possess the equivalent spending power of US$2 a day. Often living in rural communities with limited access to education and capital, these people have the potential to boost their income, quality of learning and health care through technology, Brewer said, but donated computers are not necessarily the solution.

?There?ll be a big kick-off party, but if you go back six months later you?ll find out that half of the computers aren?t working anymore,? he said. ?If you really want to see the technology deployed, (microcredit) is the financial mechanism to make it work.?

Communities in Bangladesh, for example, are using microcredit loans of about $200 to purchase cell phones through an organization called Grameen Telecom, Brewer said. Users then rent the phone on a per-minute basis to their neighbours, bringing cellular communications to an estimated 50,000 out of 68,000 villages. These ?phone ladies?, Brewer said, are proving to be highly effective business managers, purchasing new batteries well before their existing power runs out, or setting up their own antennae on top of their houses to provide better coverage during poor weather.

?They don?t know the word ?downtime? but they understand it conceptually,? he said.

Michael Simpson, executive director of One Sky, The Canadian Institute of Sustainable Living in Smithers, B.C., said technologies for developing regions need to be locally available, affordable and easily understandable if they are to deliver results.

?If you don?t have those three things, you end up back in the 1960s idea of development where you drop in the tractors, and then they end up in a field for need of parts,? he said. ?Some of the newer technologies like cell phones are so important to people that they?re making it work.?

Intel would like to make similar progress with PCs, but the technology challenges are harder to tackle, Brewer said. Although Intel typically designs is business strategies around Moore?s law that computing power will double every two years, it doesn?t completely apply to developing regions because CPUs are not the most expensive part of the machine. Packaging, batteries, screens and other components make systems too expensive, which is why the chipmaker may have to integrate motherboard functionality on the chip itself to satisfy those customers, he said. Coming up with ways to share technology also lowers the cost and increases utilization.

Simpson said One Sky has tried to champion what he calls ?leapfrog technologies? that will help developing communities catch up to their Western counterparts. Five years ago, for example, One Sky helped establish solar-powered access to the Internet in Freetown, Sierra Leone, during the middle of a civil war. ?It was a pretty high-tech computer Internet connection,? he said.

Brewer said networks in developing regions rarely connect end to end, but Intel is exploring how intermittent connections (as when low-orbit satellites connect overhead, for example) could allow limited use of applications such as e-mail or search. Though it might mean waiting hours or even until the next day to send a message or obtain a search result, the technology could still be highly valuable to users trying to process transactions such as government forms, he added.

?It?s not what we would think of as a Web search, but if you have no access to information it?s quite an improvement,? he said.

Intel is also pouring R&D into creating processor-based systems that will operate on lower power available in communities whose electrical systems were primarily designed to provide lighting and enough heat for cooking, Brewer said.

IDF continues through Thursday.

Source: IT Business