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Who wins: Rural Agriculture or Mobile Sector?

mAgri Panel @ GSMA Mobile World Congress

Is rural agriculture a big business opportunity for the mobile industry or the mobile industry is a big business opportunity for rural agriculture?

This is the question that I continue to grapple with as I browse through presentations at the mAgri event during the just ended GSMA Mobile World Congress 2012 in Barcelona, Spain, and also analyze the “charge” by the Chairman of Microsoft at the IFAD Governing Council Meeting in Rome, earlier this year. Below is the recap of the presentations at the event that seem to highlight the importance of these services to the rural smallholder farmer followed by the perspective from Bill Gates.

GSMA Mobile World Congress

Introducing the mAgri event at the Congress, the Managing Director of GSMA Development Fund, Chris Locke reiterated the importance of mobile technologies in improving food security by reaching rural farming communities that are otherwise, not served by the traditional agricultural extension services. He stated that with the continuous support from the Bill and Melinda Gates Foundation and USAID, the goal is to expand the mAgri program to six more countries. “What we are really looking for is a delta in a data – a delta that shows that there is a significant mobile penetration among the audience we are trying to reach but the lack of access to existing services that are trying to give them valuable information to help improve economically and socially, said Locke.”

Subrahmanyam Srinivasan, the CEO of IFFCO Kisan Sanchar Ltd (IKSL) then shared their experience in India through push and pull model of information delivery to their clients. Through an enviable partnership between IFFCO, Bharti Airtel, and Star Global Associate, m-powering utilizes mobile technology to provide agricultural information to over 3million revenue earning farmers in India and another 1million listening farmers.

The Global Product Leader of Nokia Life Tools (NLT), Bhanu Potta also emphasized the importance that Nokia place on educating rural farmers about production of new crop and animal varieties. According to him, these farmers are now switching from the traditional food crops to commercial and cash crop commodities and therefore need actionable, timely, locally relevant information in their local languages, and from trusted sources. The Nokia Life Tools provide farmers with market price information, weather updates, and news and tips on crops within their geographic location. A new feature that was released during the congress will enable interactions among the users and with experts through voice. NLT currently serves over 50million users in the area of health, education, agriculture etc. in India, China, Indonesia and Nigeria.

Mark Davies, CEO of Esoko then explained how access to agricultural information through mobile phone has improved revenue generation of smallholder farmers in Ghana. According to him, through the mobile services of esoko, farmers are able to better negotiate price with traders, avoid traders and go directly to the regional markets, delay selling their products until they can obtain the best price, and socially help address trust issues in marriages when women return from the market with their sales. With the challenge of scaling their services, esoko now serves between 10-20 thousand farmers in Ghana and also franchising their tools to other countries to deliver their own contents.

Finally, Marc Ricau, Vice-President Country and Partnerships of Orange AMEA outlined how the company is shifting focus from urban customers to rural customers in 25 countries (18 in Africa), since about 60-70% of the population in these countries live in rural areas and are farmers. According to him, they are developing and expanding network coverage in these countries and partnering with content developers to serve these rural farmers with mobile services and solutions for their agricultural needs. “Mobile services can bring development in these areas by increasing productivity of the farmers, said Ricau.”

IFAD Governing Council Meeting

Bill Gates at IFAD GC Meeting

From a different perspective, the Microsoft chairman recently charged three UN Organizations – the International Fund for Agricultural Development (IFAD), the World Food Program (WFP) and the Food and Agriculture Organization (FAO) to do better to serve farmers. “Right now, a digital revolution is changing the way farming is done, but poor small farmers aren’t benefiting from it” said Bill Gates. The billionaire philanthropist also criticized countries, food agencies, and donors that aren’t working together in a focused and coordinated way to provide the help small farmers need, when they need it.

So my question remains as to whether the digital revolution is an opportunity for the mobile industry or an opportunity for the smallholder farmer? In other words, who is benefiting from the this huge opportunity – the smallholder farmer or the mobile industry? Is the smallholder farmer really benefiting from all these interesting stories by IKSL, NLT, esoko, Orange and hundreds of ICT and mobile solutions being designed for agriculture? If yes, how and if no, why?

March 21, 2012/by actualize

Agriculture, Agriculture Markets, Extension Service, Mobile, Originally posted on the GBI Portal

Reflections on mAg. Services: Barriers to Scale

Photo Credit: Spore

NB: This is my personal analysis of contributions to question two from the forum. This post is the second in series of six, analyzing each of the six forum questions that were discussed.

One of the objectives of the mFarmer Initiative is to drive scalable, replicable and commercially successful mobile agricultural solutions that bridge the information gap and increase the productivity and income of rural smallholders. With this mind, the second forum question was about barriers to scaling mobile agricultural services as stated below:

Question 2: What are the barriers to reaching scale with mobile agriculture information services and how can partnering with a mobile network operator (MNO) reduce these?

To really answer this second question, discussants needed to first understand what a successful ‘scaled’ mobile agricultural service is; identify the barriers to scale; and then look at the unique value propositions that each partner brings and their roles in the partnership.

Successful Scaled Mobile Agricultural Service?

The challenges associated with scaling ICT projects in general and mobile services in specific came up several times during the discussion. Scale by default may be seen in terms of wide-reaching impact of the service through adoption by a large number of individuals, communities, regions, etc. It is about moving projects from being islands of excellence to serve and empower a larger audience. Others also look at quality benefits of the service to more people over a wider geographical area, more equitably, more quickly, and more lastingly. So what are the barriers to taking mobile agricultural services from small-scale level to a larger scale and at the same time maintaining the quality and ensuring sustainability?

Below is my summary of barriers to scale of mobile agricultural services from the forum:

Infrastructure strength – weak presence in terms of infrastructure of MNOs could be a challenge to scaling
Reliability of message delivery – less reliability in delivery of messages to the customers may prevent future expansion
Cost of delivery mechanism – high cost of the delivery mechanism could also be a challenge to the MNO
Average Revenue Per User (ARPU) – low ARPU of customers shows how unprofitable the MNO will be and a barrier to scale
Language – high diversity of local languages within a given country/region of service deployment could affect smooth scaling
Literacy – low illiteracy rate in a country or region may affect successful scaling of mobile agriculture service
Technology – highly complex mobile handsets, difficult-to-use interface and medium of delivery could be a barrier
Government Policies – since most of these mobile agricultural services are private sector driven, without sound government information and agricultural policies and regulations, it will be difficult to scale
Accessibility – to MNO for smooth and easy enrolment process and Point of Presence for post-sales service
Affordability – expensive services to the user will prevent wide-scale adoption
Local needs of users – lack of understanding of local needs and demands of the users

“If right products in which the targeted beneficiaries find value are created, scaling should happen by itself.”

Part B: How can partnering with a mobile network operator (MNO) reduce barriers to scaling mobile agricultural services?

The first post in response to the main question seemed to address this second part of the question that focus more on “intermediaries.” The post argued that barriers to scale of market information systems are more about the ‘architecture’ of the system than the kind/type of partnerships formed between and among the service providers and MNOs. In other words, partnership with MNOs is not a magic wand for scaling mobile agricultural services.

So does it worth it for agricultural value added service provider to partner with MNO for scaling?

This interesting post critiqued the role of intermediaries in delivering market information to users within the agricultural value chain. The contributor argued that the cost involved in identifying potential intermediaries, training and maintaining them to access agricultural information through SMS or helpline services and then delivering it to the farmers is a huge challenge to scaling and sustainability.

Based on the contributions from the forum, I have identified two types of intermediaries namely ‘human intermediaries’ and ‘technological intermediaries’ in the context of mobile agricultural service delivery.

Human Intermediaries

This includes intermediaries working directly with farmers such as the agricultural extension agents and also the Grameen Foundations Community Knowledge Workers (CKWs). The challenges associated with the human intermediaries have led to the enormous utilization of the technological intermediaries.

Technological Intermediaries

The technological intermediaries are the communication technologies that ensure direct-to-farmer services, and in this case mobile services such as SMS, data, voice, etc. that are all critical channels for delivering targeted, relevant and actionable information to as many farmers as possible. But the need to use the right technology at the right stage of the value chain for effective content delivery was deliberated upon.

a) SMS services: The ability of SMS services like Esoko and Reuters Market Light (RML) to timely deliver market information to farmers has been well documented but the actual impact of these services on the production of the farmers and their living conditions is yet to be documented. Meanwhile, the social and technological challenges associated with SMS in these rural areas have been mentioned as a barrier. While the cost of providing SMS service may be cheap, due to the low literacy rates in these areas and the complexity with some of the user interface, some discussants do not see the future of SMS in providing mobile agricultural services to farmers.

Some other contributions pointed out the challenge with illiteracy and SMS use but cited examples where farmers are overcoming this by engaging other family members to read and translate the SMS messages for them, especially with Mobile Money services. With agricultural information, farmer groups/cooperatives are the target rather than individual farmers so that within each group, at least one literate member can play the intermediary role by reading and translating text messages to other group members.

The idea of using volunteers or exploring national service or youth service schemes in some parts of Africa to provide agricultural information through the technological intermediaries to smoothly transition into more sustainable economic models was also brought up.

b) Voice-based services: When it comes to voice-based services, discussants were concerned with their economic sustainability. They argued that interactive voice response (IVR) that allows computers to interact with humans, and call centers are the most costly information delivery mechanisms. And since farmers’ willingness to pay for agronomic information tends to be low, any business model that depends on IVR or call centers may need some other funding alternatives for sustenance. So the key question to ask is, if there are any indications that farmers’ willingness-to-pay will increase to the point of equilibrium with the cost of these services?

Another view is to go automatically with IVR without any real time human input, which can empower farmers directly to search and find information they need, or feed the system with information they have through voice technology. Some examples of systems currently exploring this system includes Voice Browsing Acceptance and Trust (VBAT), Web Alliance for Re-greening in Africa (W4RA), and Voice-based Community-Centric Mobile Services (VOICES).

And so What?

The need to take some of the existing mobile agricultural services from one level to another has been acknowledged. Even though partnering with a MNO is not a magic wand to scaling of these projects, the potentials for such a partnership as noted in the discussion of question one, and the barriers outlined above may necessitate collaboration for scaling.

The issues of intermediaries that dominated the second part of the discussion is a good example for experts (both from MNOs and agricultural partners) to understand all the complexities with mobile agricultural services. It is more than technology. It is about using the right technology at the right time to deliver content in the right format for users. It is about combining social and technological processes to deliver user-centered content.

The success story of IKSL in India came up again to attest to the fact that, partnership can help in scaling mobile agricultural services. But the success of IKSL is linked to the partnership with IFFCO, a 40 year old co-operative that has a strong base with the users. The idea of working towards removing human intermediaries in mobile agricultural system can me catastrophic. The citing of Direct2Farm project of CABI which aims at enabling farmers to seek and source information, tailor-made to their individual need, at any time in any form/format sounds great. But a search on this Direct2Farm project does not give any further information.

We will have to wait to see how this works – either through the automatic IVR system or the CABI’s Direct2Farm project. But I believe the consensus at the end of the discussion is that the technological intermediaries are not to replace the human intermediaries but to be used in stages of the value chain where the human intermediaries are not needed. I agree with another contributor who stated that “The issue is to remove people where they are not critical, so that services can increase in quality, quantity, and efficiency.”

The next in series (3rd) is Reflections on mAg Services: Is there a Business Case for Serving Farmers? and available on 12/29/2011.

The first post is “Reflections on mAg Services: Partnerships Between MNOs and APs”

December 26, 2011/by actualize

Agriculture, Agriculture Markets, Education, Extension Service, Food Security, Mobile, Originally posted on the GBI Portal

Reforming Ag. Extension, One ICT at a Time!

Photo Credit: M-Kilimo Project

Two recent case studies on some ICTs for agricultural development projects supported through the GSMA Development Fund – mAgri Program reveal an emerging trend within the broader Agricultural Extension Services (AES) and specifically in the developing nations, that worth commenting on. The revealing trend I’ve noticed, is that, either drastic policies and actions be taken to restructure the current educational systems of agricultural extension agents/officers or nations be prepared to seed-off their agricultural advisory services to the private sector (full privatization).

The projects are M-Kilimo in Kenya which has been developed as a result of cooperation between Rockefeller Foundation and KenCall the largest BPO Company in East Africa. The second project is IFFCO Kisan Sanchar Limited (IKSL), which is also a tri-lateral venture between Indian Farmers Fertilizer Cooperative Ltd (IFFCO), Airtel, and Star Global Resources Ltd.

The following two stories tell the kind of impact these two ICT4Ag projects are having on the lives of rural farmers in the respective countries.

Sanjay Mondal, a farmer from India had his cucumber farm infested with necrotic leaf lesions. After discussing his problem with IKSL staff remotely, the disease was diagnosed and a topical spray of Sectin fungicide in the ratio of 2mg per litre of water was prescribed. The total cost of the treatment was 500 Indian rupees. The yield increased by 50% as a result, and income also went up by 50% (India – IKSL).

Nahomi, a chicken farmer in Kenya had problem with thin weak egg shells that did not allow her to sell or store the eggs in that quality. She called M-Kilimo and the livestock expert on the other end of the line suggested that she gives the chicken a feed rich in calcium. By using a calcium rich poultry feed or adding fishmeal to the feeds will increase the calcium content of her feed, the expert explained. Now, Nahomi’s chickens are laying good quality eggs and she can sell more eggs as a result of the advice and availability of M-Kilimo experts (Kenya – M-Kilimo).

A closer look at the design and operational models of IKSL and M-Kilimo predicts the future demise of most National Agricultural Extension Services (NAES) if the necessary reforms of the current educational systems delay. I will attempt to explain my argument from two perspectives – the human resources level of extension staffs and the medium of delivery of the information to the end users (which is also a factor of ICT human resource development).

Human Resource – Agricultural Extension and Education

The traditional agricultural extension service as the main platform for delivery of new innovations, technologies and information to farmers, has its strength in the extension staffs. The extension agent/officer/worker is seen as a “Change Agent”. These officers are mostly public servants trained and equipped to be, most of the time, in direct contact with their clients, the farmers. Even though the service has been engulfed with a host of problems, its human interaction capability is still strong which helps not only to deliver new innovations but also train users how to use these technologies through field demonstrations. However, my personal experience tells me of the poor quality of extension staffs currently on the field in most developing countries due to a number of issues.

A recent study I conducted with over 30 agricultural extension officers from three agricultural districts in Ghana shows that only 39% did receive some form of undergraduate degree in agriculture. The remaining 61% is made up of either certificate in agriculture or diploma in agriculture obtained in the late 70s and early 80s.

The IKSL and M-Kilimo projects have tended to improve upon this traditional human resource development in extension. For example the IKSL project acknowledged that the quality of its experts is critical for their success since these experts decide the content of the messages that are being delivered to the users. As a result, they have a minimum qualification of first degree in agriculture for their first line of staffs that are in direct contact with the users; highly experienced academics and specialists in agriculture for second line experts; and the third line of 10 specialists who regularly convene to vet and validate contents being delivered to the users.

M-Kilimo also has similar model with emphasis on trustworthy and effective system to deliver appropriate information to the end user. The project also requires the experts to have a minimum of bachelor’s degree in agriculture and at least 2 years of relevant field experience. This first line of experts is supported by Subject Matter Experts (SME) to help provide quality assurance service for content and delivery. Also the contents are obtained from the Ministry of Food and Agriculture, National Weather Station, and other Research Institutes within and outside the country.

Photo Credit: IKSL

Medium of Delivery – Timely and Remote Access to Information

Even though the traditional medium for agricultural extension has improved over the years including the mass communication technologies such as radios and televisions; and recently with mobile phones, the face-to-face interaction still dominates most NAES. Extension officers are expected to visit individual farmers’ field and other farmers groups to deliver new information. This continues in the wake of high extension officer-farmer ratios (1:3000 and over), one of the primary indicators used to measure the intensity of extension coverage in a country. Ironically, most of the public extension officers who have access to the new ICT facilities through public telecenters, and other community information centers are not well trained and equipped to use them to facilitate their work.

The result is the deplorable condition of information or knowledge gap as seen in the stories of the two farmers above prior to the intervention of M-Kilimo and IKSL in Kenya and India respectively. But how many rural farmers have access to M-Kilimo and IKSL and similar projects across the developing nations?

With the IKSL and M-Kilimo projects, a critical part as seen in the stories above is ‘remote delivery of information to users’ – either through their mobile phones or SMS messages. The use of these tools facilitates timely delivery of information to users. Apart from the information communication systems that are put in place, ICT human resources development of the helpline experts is important. These features of the emerging information communication systems are helping to ensure more accurate, appropriate, timely and remotely accessible information to end users such as rural farmers whose farming success are previously determined by extension agents/officers.

Implications for National Agricultural Extension Services (NAES)

ICTs are not here to replace the rich human interactions between rural agricultural farmers and extension agents. It should be recognized that the social capital created through face-to-face interactions during extension visits are irreplaceable. ICTs are “technologies” that can enable social behaviors. But without some drastic reforms of the existing extension system, especially the educational standard of the extension staffs, I see the gradual downfall of the public agricultural extension system in most developing countries. Could this be a journey towards a kind of partnership/collaboration in the future where research and development will remain in the public domain while extension and advisory services go to the private sector? With the general acceptance of “Agribusiness Models” across the world within smallholder agricultural production, I do expect to see changes within agricultural extension and advisory services in the next few years – I do expect to see more private sector involvement in extension delivery.

November 1, 2011/by actualize

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