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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, Mobile, Originally posted on the GBI Portal

Leveraging mServices for Development: An Opportunity for MNOs

Photo Credit: City of Dallas

The importance of mobile network operators (MNOs) who are currently investing in mobile agriculture services (m-agri) to view and utilize their investments as part of the wider “mServices strategy” that includes m-health, m-financial services, m-education, m-governance, m-women, etc came up in the just ended mFarmer and e-Agriculture online discussion.

“As competition between operators continues to escalate, the large rural customer base (a great deal of whom are farmers in the markets we are talking about) represents a sizeable business opportunity for MNOs” said an expert.

This comes as new developments are taking place with mobile financial services across the continent of Africa that has a huge market for all kinds of mobile services. Orange, one of the most prolific mobile financial services provider, is expanding further via a new partnership with Western Union to better meet the mobile services needs of its customers in Africa and Middle East.

The service will allow users to carry out simple banking operations and transactions in total security including money transfers – where users can send money using their phone to any Orange mobile customer in the country; payments – giving users an easier way to pay their electricity, water, television or phones bills, as well as providing a simple way to buy mobile phone credit from any location; and financial services – including solutions facilitating savings and insurance.

While all these services seem “financial”, analysts see the general penetration of mobile technology into the developing world as a great opportunity to facilitate services in other sectors such as governance, healthcare, education, agriculture, rural development, water and sanitation, and the overall economic development. Good partnerships among MNOs and between MNOs and other service providers that focus on the wider services should be the target for all.

GSMA has already initiated a number of programs that call for collaboration to leverage resources to better deliver these mobile services to the millions of rural folks currently left unconnected. Examples include:

m-Health service such as supporting community health workers in gathering and managing health information; capturing and analyzing data for disease surveillance; providing remote diagnoses via telemedicine; improving access to health information and resources through health hotlines; facilitating health education, training and emergency support; coordinating drug and medical supply distribution; enhancing rapid disease testing via mobile phone microscopy applications.

m-Farmer service aimed at driving scalable, replicable and commercially successful mFarmer Services; building services that impact farmers’ income and productivity; reducing the barriers for operators to launch or improve mFarmer Services; testing and proving models for delivering mFarmer Services via mobile phones; and promoting a culture of knowledge sharing in the mFarmer ecosystem.

m-Women service with the objectives of increasing access to mobile phones for 150 million women who live at the base of the pyramid over the next three years and leveraging the mobile channel to improve the socio-economic status of women across the developing world.

m-Learning service that will provide access to or deliver educational content and experiences through mobile devices using a number of technologies including Bluetooth, GSM/GPRS/3G, WiFi or WiMAX, via various mediums with the ability to learn anytime, anywhere.

It is time for the Mobile Network Operators (MNOs) to take advantage of these opportunities to maximize revenue for their investments and increase their social development impact on the society, especially the remote communities.

December 7, 2011/by actualize

Agriculture, Mobile, Originally posted on the GBI Portal

The Advent of Mobile Finanical Services in Agriculture

Close up of man in Africa looking at his cell phone As the global population continues to grow – it is expected to reach more than 9 billion by 2050. It will require a 70% increase in food production above current levels. Most of this increased yield will have to be achieved in less developed countries (LDCs), many of whose farmers operate on a small scale and are highly exposed to crop failure and adverse commodity price movements. This month, Vodafone, Accenture and Oxfam released a report on mAgriculture. The report titled “Connected Agriculture” assesses the potential benefits of new mobile data services such as mobile financial services, weather forecasts, and agriculture information and advice for smallholding farmers operating in marginal circumstances.

Additionally, in light of market saturation, MNOs face the task of growing average revenue per user (ARPU) and market share in rural areas. Agricultural Value Added Services (Agri VAS) present a considerable business opportunity due to the enormous potential user base in LDCs. The farming sector in these countries often suffers from chronically low productivity. Lack of information acts upon productivity and income levels like a glass ceiling. However, with increasing teledensity in the developing world – Africa is being tipped to pass one billion mobile subscriptions and become the world’s second largest mobile market by 2016, mobiles are uniquely positioned to address the information and financial needs of farmers – an intervention that can help increase their incomes, yields and economic wellbeing. Vodafone’s research indicates potential $138 billion addition to developing world farmers’ incomes by 2020

The financial and information opportunities at the base of the pyramid (BOP) in themselves hold significant untapped value for the private sector. The BOP has both intricate financial and information needs, which have the potential to be met through mobile money and information-based mobile services. Mobile Money can reduce the financial gap for farmers by giving them access to savings and insurance, which in itself reduces the impact of extreme weather and allows for greater investment in improving production.[1] Meanwhile, m-information services have the potential to open up significant markets opportunities, by relaying sales prices, GIS-based commodity demand information, as well as more basic yet essential information on agricultural best practices and reliable weather forecasts.

While there are existing agricultural information services provided via traditional channels such as radio and television, government extension services as they are usually referred to can be made much more efficient by leveraging the mobile channel. This can help improve their quality and trust amongst user communities increasing their potential for scale. In addition, by linking to them to mobile financial services, farmers will not only improve their productivity but will also be empowered to make better investment and risk management decisions (e.g. request credit for new fertilizers or other inputs they need to grow more and better crops). These benefits are also likely to extend to the wider community as increased agricultural income helps rural families afford education, healthcare and other services.

The GSMA mAgri Programme

The Development Fund’s mAgri Programme was set up in 2009 to accelerate the development, provision and adoption of mobile solutions to benefit the agriculture sector in emerging markets. In June 2011, the programme announced the second phase of their mobile agricultural programme, the introduction of the mFarmer Initiative, a partnership between GSMA, USAID and the Bill and Melinda Gates Foundation. The scope of the mFarmer Initiative is to support mobile phone operators and agricultural partners in launching commercially viable mobile information services that bridge the information gap and increase the productivity and income of rural small-holders. It aims to attract 2 million of the worlds’ poorest farmers to become users of mFarmer Services by 2013. This compliments their previous work on mobile agricultural services in India and Kenya.

The team has recently launched the Agri VAS Market Entry Toolkit which explores the opportunities for Agricultural VAS and covers emerging best practice on marketing, service design and business modelling. It is primarily addressed to Mobile Network Operators (MNOs), other service providers, and agricultural organisations that are looking to partner and launch Agri VAS.

Just as the successful provision of mobile financial services for the BOP requires innovative partnership models; Agri VAS will require similar efforts from the part of its stakeholders. While MNOs have a leading role to play, they will need the collective support and partnerships from key stakeholders in the agricultural supply chain in order to fully unlock the benefits for farmers in LDCs.

November 21, 2011/by actualize

Agriculture, Mobile, Originally posted on the GBI Portal

Farm Extension Services: an Update

Photo Credit: Mr.S.Vithiyatharan

Two weeks ago, USAID held an event on the current initiatives using ICT to strengthen Farm Extension Services (FES). Judy Payne, ICT Advisor at USAID, was joined by Chris Locke, Managing Director GSMA Development Fund, to update the ICT4D community on new initiatives, approaches, and challenges in FES.

To start the discussion, Judy Payne provided an overview of some promising examples under USAID’s Fostering Agriculture Competitiveness Employing Information Communication Technologies Project (FACET). Some of these include Reuters Marketing Light, Mali Shambani, Community Knowledge Worker, Manobi, and Digital Green. She did not linger on the technicalities of these projects, opting to focus on how new technologies can complement traditional tactics for the most sustainable use.

The combination of the “push” and “pull” information allows a feedback loop from the farmer to the organization, crucial for monitoring and evaluation. “Push” services are those are those that are being used to provide the farmer with information, such market information through SMS or voicemail. “Pull” services consists of the feedback from the farmer, such as their queries on demand in the market via SMS.

Ms. Payne asserted that the combination of new ICTs with more traditional tactics, such as face-to-face training and verbal feedback, are necessary for the most efficient implementation.

She also explained that collaborative new business models, such as sponsor mobile network operators (MNO) and farmer pay services, are non-agricultural components of FES that ensure well-defined distribution channels and access to users.

Chris Locke, Managing Director, GSMA Development Fund

Chris Locke of the GSMA Development Fund echoed the importance of leveraging the private sector and combining ICT channels for FES in current e-agriculture projects.

The Development Fund works with mobile operators to accelerate mobile solutions for people living on under US$2 per day. They have been working with the Gates Foundation and USAID on a new e-agri initiative called mFarmer in Kenya and India.

Currently in its second phase of the project, the goal of the mFarmer program is to work with MNOs and partners to support the launch of quality agricultural value-added-services accessibly to over 2 million smallholder farmers. The program aims to provide a sustainable way for farmers to obtain critical agricultural information that can help them improve their farm productivity and income.

The role of GSMA in this program is to develop this content database for ICT-enabled farm extension services to share and create, but building alliances with local MNOs is equally important.

Mr. Locke discussed how partnerships with local MNOs play a major role in disseminating information in developing areas. Local private sector involvement allows organizations to tap into previously established distribution channels that are culturally relevant and have widespread reach.

Unlocking the power of MNOs provides potential nation wide scalability. He argued these are distribution channels where:

Operators have the capacity to spread it across at a national level

Post-discussion, it was apparent (as it always is) that there has to be more than just the use of ICTs to help rural farmers in FES projects. ICT channels should be complemented with traditional tactics to heighten impact and sustainability; and organizations should establish alliances with local MNOs to leverage their local distribution channels.

April 25, 2011/by actualize

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