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In the Slums of Nairobi, a Mobile Phone is More Valuable than Clean Drinking Water

BY Lisa Goldman | Monday, July 30 2012

Ethan Zuckerman, the director of MIT's Center for Civic Media traveled recently to the Nairobi slum of Baba Dogo to see if there was demand for some simple hardware that he and his MIT students are working on that could enable people with their own generators to supply energy to multiple customers for low fees paid via mobile payments. He thought Kenya would be an ideal market because it had a very successful mobile payments system,Safaricom, that was used by more than 70 percent of Kenyan adults. Given the poor infrastructure in the slums, he thought it was fair to assume that few people had access to electricity. It turned out he was wrong about that--and about a few other things, as well, and he's written one of his characteristically invaluable posts sharing what he's learned so far:

I had assumed power would be scarce in Baba Dogo. Nope. Legal power is scarce, but power is extremely common. Kenya Light and Power is quite good about extending the grid into this neighborhood, though few houses are directly connected. Historically, that’s because it was both expensive and time consuming to get a grid connection – friends tell horror stories of connections that cost more than $10,000 and took half a year to get in place. Now connections cost closer to $350 and take only a week… but they’re still way out of reach of ordinary Baba Dogo residents. What usually happens is that a single dwelling within an apartment building has a meter, and they distribute power to their neighbors.

So one homeowner who was connected to the grid would sell electricity to his neighbors for a small monthly fee. But if the homeowner didn't pay his bill then all his customers would be cut off, with no recourse; similarly, if the customer didn't pay, the landlord had no legal recourse --because he was selling electricity illegally. So why not use generators? Because:

They’re simply too expensive, even the cheap, dirty Tiger generators that are sold by the hundreds on River Road in Nairobi. The customers for those generators are middle-class Kenyans, looking for backup power when the grid fails, not the residents of Baba Dogo, seeking a primary source of power.

Zuckerman made a few other fascinating discoveries. For example, he learned that people would rather pay to charge their mobile phones than to purchase clean drinking water--even though charging a phone cost the equivalent of 200 liters of clean water. Phones, it turned out, had become "indispensable infrastructure in the developing world."

If you are a carpenter, you probably don’t have an office or a shop – you have a mobile phone number that people call if they want to hire you. If you’re a market trader, you use your phone constantly to figure out what prices are in other parts of a city or the country. If you’re seeking a business permit, you call before you visit an office, so you don’t waste time on transport if the person you need to see is out. Even independent of payment systems like M-PESA [See our recent story on whether mobile payment systems can help reduce corruption in the developing world], a phone is a difference between being an economic actor in Kenya and being outside the economy.

In Baba Dogo, Zuckerman realized that the slums of Nairobi were too advanced--too well wired--for his product. He would have to think of other, more suitable test markets.

This is a well-told, thought-provoking story that illustrates the importance of taking local culture into account when designing products--and provides yet another reminder that mobile phones have become essential tools of survival in the developing world.