Twenty years ago, in an online discussion with someone, I expressed scepticism about the value of privatisation in telecommunications. Back then we were communicating on the Fidonet BBS network, which was a fine example of private enterprise socialism. Telkom, our telephone network, had recently been separated from the post office, and was being semi-privatised. There were ominous rumbles that they would be charrging the amateur BBS sysops business rates for their phone lines, because they were carrying “third-party traffic”, which Telkom thought ought to be part of their monopoly.
I thought privatisation of the telephone network would be a bad idea. The infrastructure of fixed-line telephones made it a natural monopoly. I couldn’t imagine five telephone companies setting up five different exchanges for our suburb, for a fifth of the traffic, and five times the infrastructure, five sets of lines to each place. And in rural villages with five subscribers — the school, the police station, the shop, the church and a couple of others, erecting five sets of phone lines would be wasteful. And if the shop-keeper wanted to phone the police, who were subscribed to a different company, it would probably cost more.
My interlocutor predicted that cell phones would change all that. Cell phones would make it possible to provide cheap telecommunications in rural areas. I remained sceptical, but his predictions have come true in ways that I doubt that even he had imagined, as this blog post shows: brett’s morning blend (25may10) | aliens and strangers:
This, though, may be the most surprising feat of technology: People who have never had a bank account, and never will, are using their cell phones to save money. They make their deposit at a cell phone store, and the money is kept in the phone network through their SIM chips. If they need to make a withdrawal, they go to a phone shop, and receive their cash. But increasingly now, they are not dealing with cash at all. Instead Tanzanians are paying one another by sending money from one phone to another. I pay for electricity here in Geita through my cell phone, and receive a code to enter into my electric meter. When I enter those numbers, my account is recharged with money. Pre-pay electricity through a telephone. That’s high technology, and people who’ve never seen a credit card are using it every day.
And there’s more. Africa leads the way in mobile money – The Globe and Mail:
It’s part of a phenomenon that has people in Africa adopting new technologies that have been slower to catch on in more developed parts of the world, where individuals and institutions cling to older, existing infrastructure. People in Africa who have never used an ATM card, banked online or even had a bank account are using their mobile phone for financial transactions, while Internet users are skipping cable modems and going straight to wireless broadband.
Five years ago we were planting a new church in Tembisa. Most of the people were unemployed, and one of them was a cell phone mast rigger. A couple of months later he got another job, and we haven’t seen him since — his job takes him all over the continent, where cell phone technology had begun taking off.
Update 20 June 2010
For an interesting post on a related topic see First World Technology in a Third World Country | Mission Issues