Access to communications in emerging markets: performance 2007/08
We said:
We would continue to research the impacts of our products and services in society and the economy.
We have:
Continued to research the impact of mobile telephony in emerging markets
We have commissioned new research to be conducted in India on the impact of mobile phones in the local socio-economic development conditions. This was done in consultation with the SIM (Socio-economic Impact of Mobiles) Panel (see Socio-economic impact research). The research in India will cover the following topics:
- the spread of mobile in India and its impact in socio and macro-economic indicators
- the potential of mobile for agricultural productivity
- use of mobile to create new business models
- Social impacts of mobile.
Acquired a new local operating company, providing mobile services to 44.1 million people in India
We have secured a controlling stake in a local operating company in India – Vodafone Essar – having completed our acquisition of companies with interests in Hutchinson Essar Limited in May 2007. Vodafone Essar already provides mobile services to 44.1 million people. This is an 18% share of the market in India which has a 23% penetration of the population as a whole.
Our networks cover 16 of the country’s 23 circles (telecom zones), including four of its largest cities – Mumbai, Delhi, Kolkata and Chennai. In 2008, we plan to extend our services to a further seven states. Vodafone Essar’s expansion, which includes a network-sharing project, will extend access in rural areas and help the Indian government meet its target of 500 million mobile subscribers by 2010.
Expanded our range of affordable mobile phones
We launched two new Vodafone-branded, affordable handsets – the Vodafone 227 and Vodafone 228 – in Europe and emerging markets in February 2008. In April 2008, Vodafone launched three affordable, multimedia camera phones with internet access – the Vodafone 526, Vodafone 527 and Vodafone 725. The Vodafone 725 is a 3G phone for customers who want to use internet and entertainment services on their mobile with ‘plug and go’ internet connectivity using the Vodafone Mobile Connect software and a laptop. We sold more than 10 million affordable handsets in more than 50 countries in 2007/08. See affordable handsets.
Rolled out mobile payments services in Kenya and Afghanistan
Over two million people in Kenya have used our M-PESA mobile money transfer service since its launch, with 200,000 more on average signing up each month. M-PESA is being used by customers for a wide range of money transfer transactions, usually with a value below €20. A range of small businesses, including taxi drivers and grocers, now accept it as an alternative payment method, and larger companies also use the service to pay workers who do not have a bank account.
In 2007/08 we worked with local mobile operator Roshan to launch a similar service in Afghanistan, branded M-Paisa. Some 50 M-Paisa payment points have been established in the cities of Kabul, Mazar, Jalalabad and Heart, and we anticipate that the service will be available nationwide by the end of 2008. We are also trialling interactive, voice-recognition technology – due to be launched later in 2008 – that will enable customers who are unable to read and write to use M-Paisa services.
We launched Vodafone M-PESA in Tanzania in April 2008, and plan to launch secure mobile money transfer services in India and other African markets throughout 2008/9. See m-transactions.
Launched free text services enabling customers to request a call back from friends or family in Egypt and South Africa
Customers can send a free text with the message, 'Please Call Me', even when they have run out of credit. The service is funded by advertising that accompanies each message. Customers in South Africa sent more than six billion of these messages in 2007/08 – on average some 18-20 million daily.
Vodafone’s joint venture in South Africa, Vodacom, is also working on a ‘Social Txt’ initiative, replacing the regular advertisements with information promoting HIV/AIDS prevention services. A follow-up survey found that 41% of those receiving the messages accessed the HIV/AIDS prevention services offered. See new business models.
Engaged with experts on our approach in emerging markets
Vodafone organised a workshop in May 2007 with seven selected experts in emerging markets and development as part of a series of Vodafone CR Dialogues. The workshop focused on key aspects of Vodafone’s current approach to emerging markets and expectations for the future.
Participants agreed that Vodafone should continue to focus on improving access in emerging markets through its core business, but should be aware of potential risks as it moves into emerging markets, such as increased risk of corruption. They recognised the potential of mobile to bring socio-economic benefits and saw the cost of mobile services as the key barrier to access.
They suggested that access to internet and data services should be the next priority for Vodafone in emerging markets, and new areas to explore could include public services, small business, education and further development of financial services. Participants acknowledged that Vodafone is viewed as a leader in this area.
Continued to promote development of products with high social value through our social investment fund
The £5 million fund launched in 2005/06 enables innovative social products to be developed which may not otherwise be seen as commercially attractive ventures. It focuses on products designed to bring improvements in three key areas: health, inclusive design and emerging markets. In 2007/08, we established a governance structure for the fund and defined its scope. Research was conducted into inclusive handset design and the potential of 'green'mobile products. The design of new products and services is planned to start in 2008/09.
We will:
- Launch mobile payment services in a further three countries by March 2009
- Publish research on the socio-economic impact of affordable handsets by December 2009
- Continue our research on the impact of mobiles to India and Turkey, to understand where we can best contribute to advancing socio-economic conditions and publish the results by March 2010
- Launch at least one product or service by March 2010 that promotes access to communications and/or sustainable development in areas identified by SIM research in each market where we operate
- Increase the number and the range of Vodafone branded handsets targeted at customers in emerging markets
- Publicly report results in each of the four years of the social investment fund programme.
