In the ICT industry, the price of access and of computing power has steadily decreased year by year to the point where a laptop now costs what a personal digital assistant (PDA) once cost. In the developed world, broadband Internet — once the preserve of universities and corporations — is now a commodity service affordable by the masses.

North American pundits predict that telecommunication infrastructure will soon be so cheap and ubiquitous it will be effectively free for most users. In the ICT industry, businesses increasingly find that economic value can be derived from delivering services at marginal profit to large numbers of users — a so-called economics of abundance. In addition, the spread of the Internet has enabled the aggregation of tiny amounts of demand into viable markets. This capacity, known as the Long Tail, has fostered many new markets where none existed before. Finally, Internet users are being exposed to innovations on a daily basis. This regular connection to new ideas leads to yet more innovation and increased competition. Competition itself plays its role in spurring further innovation. This spiral shows no sign of slowing.

This escalation of competition and innovation, however, is largely unknown in the developing world. In these areas, access is either non-existent or over-priced, which means that people are cut off not only from practical gateways to markets, but also from an extremely fertile environment for innovation. With some notable exceptions, policy-makers in developing countries have failed to act on this important shift in economics.

Access devices

Mobile phones are the single fastest growing technology in history with 2.7 billion users worldwide. What is more, Africa is the fastest growing mobile market in the world. Evidence shows that, with voice and short message service (SMS) alone, mobile phones are having an economic impact in developing countries. This has not gone unnoticed by entrepreneurs who have begun to offer innovative services such as credit transfer, mobile banking, and even mobile payment services. In the developed world, such services are rare, suggesting that the infrastructure of the knowledge economy will evolve differently in the South.

As mobile devices become “smarter,” more services and applications become available on them. Email access, still the “killer app” of the Internet, is increasingly common among mobile phone users. One key question will be: what are the limits of smartphone and other advanced mobile devices? What kinds of applications do not lend themselves to a small screen and keyboard? For instance, is it reasonable to suppose that children might use phones as learning tools?


Internet Infrastructure

In the developing world, broadband infrastructure is spreading in several directions.

New players in the world of ICTs

In the past, only national governments or large companies could afford to invest in expensive ICT infrastructure, but now the drop in the cost of ICTs in general has opened new possibilities.

Around the world, cities are beginning to deploy their own broadband to support government services and to attract industry. In developing countries, an opportunity exists for municipalities to establish local broadband infrastructure. For most cities there is only a marginal cost to deploying fibre optic infrastructure that can be rolled out with other infrastructure such as water, electricity, etc. This infrastructure can facilitate government communication, attract businesses dependent on robust communication networks, and, offer a level-playing field for digital service and content providers. It may also challenge incumbent telecommunication services to be more competitive.

Smaller communities too are beginning to take matters into their own hands. In Sweden, under-serviced towns are deploying their own fibre-optic infrastructure and acting as collective buyers of broadband services. On a smaller scale, remote communities in Africa are leveraging their expensive satellite connections by sharing connectivity with inexpensive WiFi links. Finally, WiFi connection-sharing networks like FON and others are allowing users to pool their WiFi access privileges in order to increase benefits for everyone.