Low Cost Computers for People in Developing Nations

Read "Splitting the Digital Difference" in the Economist of September 21st, 2006. (Subscription required.)

The personal computer revolutionized life and work in developed nations because so many people could afford PCs. PC manufacturers have made PCs commodities in OECD countries by dropping prices year after year. They have also increased the power of the PCs, no doubt striking a balance between price and power to maximize their profits. My nephew, who is a "computer guy" for a big company recently pointed out that home computers are more powerful than those you find in the workplace. Companies, buying lots of PCs opt for machines that cost less but have enough power for the day to day work of word processing, spreadsheet creation, and making presentations. (They in fact don't want the powerful machines that are so great for games, for obvious reasons.)

I suggest a result of the business decision is that PCs today are much more powerful than those we used 15 or 20 years ago but still too expensive for wide distribution in developing nations. Many alternatives were tried. Large numbers of computers are discarded in developed countries as users upgrade, and the discards are often quite usable. Some have tried shipping used computers to developing nations. Indeed, there have been projects started to recondition used PCs for developing country users.

Donor organizations have provided loan and grant funding for computer purchases (usually for critical, high-value applications)

Meanwhile some relatively low-cost computing devices have come on the market, including PCs labeled as "game machines", PDAs, etc.

People started to look at the possibility of developing low cost, low power computers that would be good enough to get a really wide market in developing nations.

Probably the most famous such effort is the Simputer, which has been the subject of interest and discussion for several years. (The Simputer Trust was founded in 1999.) Amida makes Simputers for the commercial market in India, but still does not sell them internationally.

One Laptop per Child (OLPC), a non-profit association with close links to MIT and dedicated to research to develop a $100 laptop, has been getting a lot of publicity in the past year or two. It has announced some big deals to provide large numbers of laptops to specific developing nations, while others have formally reject such purchases. (See my earlier posting and still earlier posting.

Brazil in 2005 announced a "Computers for All" program that was to sell a half million computers at prices not to exceed US$440 (including open source software), and that were to be available on an installment plan.

The Ndiyo Project is based on the recognition that computers can multitask, and the in many developing countries applications a single PC can serve many users, if each of those users has a simple, inexpensive workstation. It has been developing a low cost connector box to link a number of workstations to a PC via standard cables. (Ndiyo, pronounced 'nn-dee-yo', is the Swahili word for "yes". Ndiyo is a donor-supported non-profit UK organisation.)

Microsoft® FlexGo™ is looking at a business model that allows people to make a downpayment on a low-cost computer, and then use a pay-as-you-go system similar to that used in pre-paid mobile phones.

FlexGo is a rent-to-buy arrangement in which the customer determines the frequency of payments. People pay around half the price of the computer and software at the start and then pay to use it by buying scratch cards. Once their credit is depleted, the machine goes dark, just as a mobile phone does. But after about two years of use, Microsoft estimates, the full price of the PC and the software has been paid, and the owner then has unlimited use of it. Craig Fiebig of Microsoft says this approach can open up an untapped market. In a trial in Brazil 30% of participants said that they could not otherwise have afforded to buy a PC.

Forty or fifty years ago, when I started in this business, hardware costs dominated our thinking, but software became the more important cost, and then Internet connectivity costs became a factor. Not only have many free and open source software solutions become available for PCs, but "Microsoft has developed a scaled-down version of its Windows operating system for developing nations, called XP Starter Edition." Moreover, competition is reducing Internet access costs, and new technologies are extending Internet access.

There remains a digital divide in access to personal computing, but adequate, affordable devices are becomming more common. I worry more about the digital divide in human resources -- people able to utilize the technology fully.

I worry even more about the digital divide in organizational ICT applications. A lot of the money spent on ICT in developed nations is not on the PCs and software, but on expensive tools for complex tasks. These remain beyond the reach of developing nations.