I stumbled on to a fascinating study by Kentaro Toyama, a researcher in the School of Information at the University of California, Berkeley and the assistant managing director of Microsoft Research India. The paper called Integrating Social Development and Financial Sustainability: The Challenges of Rural Computer Kiosks in Kerala, examines the social and political challenges related to the implementation of information and communication technology (ICT) kiosk projects for rural development in India. The project has two goals: social development through increased access to computers for rural people and financial viability through entrepreneurship. The findings are quite interesting and illustrate the tension between social development and financial sustainability.
“The tension exists because entrepreneurs who emphasize the social development goals of the project, such as e-literacy, may not be financially successful and may continue to expect government subsidies. The more business-oriented entrepreneurs address the commercial goals of the project by targeting those customers that will help them generate a profit. Specifically, since the people in need of development services are often distinct from the people who can help a kiosk financially, entrepreneurs face branding challenges to attract both groups of people. On the one hand, they must recover their costs, which requires selling to wealthier clients who expect a state-of-the-art facility with high-end services. On the other hand, kiosk operators are also being asked to serve the poor, who expect the state to provide free or subsidized development services.”
Somewhere in the middle was a group of “balance-driven” entrepreneurs, who tried to combine the two goals of social development and financial sustainability. They provided subsidies to the poorest users and also tried to maximize their profits from higher-class users. This group saw the initiative as a partnership with the government, expecting them to provide some assistance, but more reliant on their own skills to attract business.
A final point illustrates the branding tensions that exist with such efforts. There were more problems when try trying to serve both populations – the ones in need and the ones who can make it profitable. The imagery associated with state-led development programs (those helping poor people with free, low quality services) proved to be detrimental to the profitability.
I love reading about things like this that seem so far removed from my daily reading routine of digital and media blogs, etc. It reminds me that there are learnings and lessons everywhere.
