(Categories: Wzzup)

Emerging regions leapfrogging, but to what?We hold the view that the adoption of products and innovations typically evolves in three stages. First the product is a luxury good (highly priced, adopted only by a small percentage of people), that phase is followed by a phase of commodification in which the product becomes a good that most people can afford and use in their daily lives. That phase is followed by the final stage in which the new product becomes a necessity that we can’t live without anymore. When visiting the conference ‘The African Mobile Revolution: hype or hope?” about the adoption of mobile telephony in Africa, I questioned that view, in the context of that continent and wondered what the often heard ‘leapfrogging of emerging regions’ actually means…



To illustrate the example of the three stages we can look at the development of the car. In the beginning only a few people could afford that product. It was highly priced and mainly used as an innovation that you could show off. From that time stem the pictures of people in or in front of a car, showing that they could afford such a product. When Henry Ford innovated the production process of the car, he was able to get the price down to a level that everybody could afford it. As a result various companies (Disney, McDonalds) created ‘places’ to go to with a car. Right now, the car has become such an important asset of our daily lives, that we think we can’t live without it anymore. We don’t have to live where we work anymore, but we can only do so IF we own a car.

Something similar applies to all new technologies, as for instance the mobile phone. It is often said that emerging regions are able to ‘leapfrog’ in the adoption of a new technology, because they ‘lack’ the old infrastructures that stand in the way of wide adoption in Western societies. So we talk about the problems of ‘the last mile‘ that prevent every household in Europe to be connected to high bandwidth internet because that last mile is still made of copper. The argument goes, that, because continents like Africa can leapfrog us and jump onto the high bandwith wagon with more ease, because the don’t have to replace the inferior infrastructure.

But are they really jumping ahead, when they leapfrog to a better infrastructure? The conference last Friday made me doubt that, specifically when you relate it to the adoption cycle from luxury to necessity. Various speakers during the conference told first hand accounts of the need and the want of Africans to be able to communicate using mobile phones as a means. But the costs of making a call are still higher than we are used to in the West. Thus, a digital divide inside an African country is created when one entrepreneur is able to use the mobile phone and the other is not. Increasingly the mobile phone has become a necessity for people in Africa to stay connected, to keep in touch, to do business, to make a living, etc. But the technology is still priced at the level of the luxury good.

So could it be, that leapfrogging has led to a jump into the phase of necessity with the economic side still lagging behind? A situation has arisen that did make a lot of Africans own a phone, but not use it as a mobile to make phone calls, but rather as a camera, a torch, a voice recorder and a videocamera. Now, I’m not necessarily saying that is a bad thing. I’m just saying that we shouldn’t automatically think that leapfrogging leads to a jump in prosperity, and adoption of new technologies per definition. And it might just be, that the leapfrogging to a wireless network has created a lagging behind in especially that area we tend to see they’re leapfrogging over: the use of network communication and data transfer.


2 Comments
Stefan January 16, 2008

I’m not sure if I understand your reasoning. Is leapfrogging in developing areas the jump to western standards instantly or is it the much faster adoption of already existing technology? The adoption of new technology by the majority has to do with price at which the technology is offered, which partially has to do with the initial investments and competition in the market. Is it not just that Africa is still in its jump, still rolling out the competitors and earning back their initial investments? My guess is that Africa is going through the same adoption curve as the developed world, but in an increased pace, but is still in its jump.

I do find it very interesting where this leapfrogging leads to once the technology is fully adopted. If the adoption is ahead of the adoption of other IT, wishes and demands for mobile devices are different from those in the developed world which had other IT devices in place already before adopting the mobile technology. Also interesting to see how their cultural heritage might enrich the device.

 
Jörgen January 16, 2008

From Wikipedia: “Leapfrogging is a theory of development in which developing countries skip inferior, less efficient, more expensive or more polluting technologies and industries and move directly to more advanced ones.” So, they move from having no phones to using cellular phones. I don’t know if I would call that Western standards, but they are skipping a few steps in the technological development.

I thought I agreed with what you are saying, that a technology will be mass adopted as soon as the price is right. And I do think that that is the case in the Western world. But it is exactly that which I’m questioning in the context of Africa. Because the mobile phone is being massively adopted there (hence in other applications), but the prices have not come down at all. And the high prices are not created by earning back initial investments, but are mainly created by monopolies of single operators in various countries. So price might come down in the end, but that will not have been the cause for the massive adoption of the technology. The necessity is already there but the prices to match that necessity are far from it. Let me rephrase that: the price is not the cause for the massive adoption of the new technology in the way we think the technology should be used…

 

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