“In the West, mobile phones started out as products for the affluent, and a decade passed before they were widely available to the middle class. In Africa, we needed to make them available right away to the very poor consumers. Our customers wouldn’t have access to the kind of money that Westerners paid for monthly mobile contracts. So we created better options for each market, such as prepaid or scratch cards that for just a few dollars’ worth of the local currency could be used to buy cellular service.” – Mo Ibrahim, in HBR.
How did these differing adoption patterns impact the design and business model of phones and the mobile ecosystem? In the West, the phone business model’s core thesis is to get consumers to spend more time / money (hence easy to use, elegant design), whereas in the 3rd world, the thesis is to save money and time. Is it any surprising that Apple’s iPhone took off only once the App store came up (spend time) and Nokia lost its way because they did not back it with time or money saving devices or services (they did launch Nokia Life but somehow could never really make it take off)?
Just wondering – Could Nokia have purchased businesses in the financial inclusion space and related services space to ring fence their dominance? Did they not understand the power in their business model? Nokia was growing fastest in 3rd world and hence moving down in price – ideally they should have said “Screw the revenue on handset. I will use the handset as a Trojan horse to sell these life tools and services (poor man’s apps).” Instead they got confused by Apple’s success and lost their way.