Nathan Eagle on mobile phone usage in the developing world


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Nathan Eagle, Founder and CEO of txteagle spoke at the weekly Liberation Technology Seminar Series on Dececember 2, 2010 about mobile phone usage in the developing world.

Although txteagle began in 2007 as a purely academic project, the current goal of the company and of its founder and CEO, Nathan Eagle, is to give one billion people a five percent raise. In his presentation, Eagle described the context for which txteagle was designed, how the company's focus has evolved over the past three years, and what steps the company is taking to move closer to achieving this goal in the future.

Eagle began by offering some background information to explain the initial impetus behind txteagle. Today, about 63% of global mobile phone usage takes place in the developing world, making airtime usage in emerging markets worth about $200 billion a year. Mobile phone users at the so-called "Base of the Pyramid" typically spend 10% of their income on mobile phone airtime. Through his experience living in emerging markets and teaching mobile application development in universities across sub-Saharan Africa, Eagle began to see that a significant opportunity space existed to reduce the cost of airtime for people at the base of the pyramid, in effect giving these people a raise.

Mobile applications developed as a part of MIT's Entrepreneurial Research on Programming and Research on Mobiles (EPROM) project offered some insights into the potential of mobile-based tools. In Rwanda, where electricity is a prepaid service, one of Eagle's former students quickly cornered a significant share of the market by creating scratch cards for crediting one's electricity bill via mobile phone. In Eastern Kenya, a program called SMS Blood Bank was created to enable real time monitoring of blood supplies at local district hospitals in Eastern Kenya. Although SMS reporting of low blood levels resolved the huge amount of latency in the system of local district hospitals (where responses to dips in supply had typically taken up to 4 weeks), the price of reporting blood levels via SMS represented a pay cut for local nurses; despite nurses' initial enthusiasm, SMS reporting tapered off within weeks. When the idea of sending about 10 cents of airtime to compensate nurses for each SMS report of blood level data proved a success, the model behind txteagle was born.

Designed as a means to monetize people's downtime, txteagle has grown rapidly through partnerships with over 220 mobile operators in about 80 countries around the world. In turn for helping these operators analyze their customer data, txteagle has gained access to about 2.1 billion mobile subscribers. Partnering with txteagle is a winning proposition for mobile operators, since the airtime compensation mobile subscribers receive from txteagle improves operators' Average Revenue per User (ARPU), a statistic that had been plummeting as more and more poor people became mobile phone users. By enabling people to carry out work via web browsers or SMS and compensating them via mobile money or airtime, txteagle has become a market leader at efficiently gathering data in the developing world.

Since txteagle was first created, the company has attempted to move from an outsourcing/back-office model to an emphasis on work that leverages a person's unique local knowledge and information. Typically outsourced tasks such as forms processing, audio transcription, inventory management, data cleaning, tagging, and internet search, tend to be less rewarding to the worker. By focusing on local data instead, txteagle enables unprecedented insight into emerging markets, all while optimizing engagement with local customers. Typical tasks include: maps and directions, local market prices and businesses, survey research and polling, and other forms of local knowledge gathering.

One of txteagle's central initiatives, GroundTruth, leverages this local knowledge-based model to carry out better market research. Today, global brands are already spending about $125 billion annually in emerging markets to engage the "next billion," but they typically carry out this research in a sub-optimal way. Through the txteagle platform, Eagle suggests, brands and organizations can use advertising money to design better products and services, conduct market research, and carry out brand engagement. Recent success cases include the use of txteagle to help a program of the United Nations to reach survey respondents directly and to enable the World Bank to obtain better local market price data at lower cost. 

Although txteagle's rapid growth and early successes have been encouraging, the company has ambitious goals for the next two years. The company began by focusing on outside sales through its GroundTruth market research program. Next year, the company  hopes to generate syndicated data and ultimately to create a self-source platform enabling anyone to conduct their own population-level surveys.  By continuing to focus on improving the quality of both their data and workers over time, txteagle aims to have an even greater positive impact on the incomes of the hundreds of millions of mobile phone users at the base of the pyramid.