Right at the bottom of the pyramid are phone users who can\u2019t afford the minimum cost for a SIM to share in someone else\u2019s phone. Movirtu has produced a cloud-based, login account which will enable anyone who has access to a GSM phone to share it but still retain their own number.<\/p>\n
Russell Southwood spoke to the CEO and founder, Nigel Waller about the potential market for this low-cost telephony product.<\/p>\n
Nigel Waller used to work in telecoms back-end infrastructure and during this time, an African operator asked him how it would be possible to deliver a phone service more cheaply in rural areas: just getting a SIM card to someone costs the operator around US$7 in markets without high taxes.<\/p>\n
He was driving on a snowy road in Moscow when the idea came to him: why not make the mobile service for the user based on a login like e-mail and then they could share phones?<\/p>\n
The product was being tested in 2010 and started being deployed as a pilot with several operators in Africa. Two weeks ago it went live with Airtel Madagascar.<\/p>\n
But as Waller told us:\u201dWe\u2019d like to see it rolled out across all the Airtel territories\u201d. To back its expansion it raised US$5.5 million from London-based TLcom Capital at the end of last year.<\/p>\n
The product has two markets: low-income individuals who want access to a phone without buying a handset or a SIM card and agents who will be able to offer access to phones and individual accounts to use them.\u00a0 It costs as a little as US20 cents to deliver the service set-up compared to anything between US$14-21 to deliver a SIM card.<\/p>\n
The account details are stored in the operator\u2019s hub and each individual user on the platform gets to store contacts and can have a service which forwards missed calls to another phone for when they are not logged in.<\/p>\n
It also contains a gateway that will allow them to use m-money services like M-Pesa. For the wealthier users in this low-end user group, there is a product called ManyMe with which the user can get several different numbers on the same basis.<\/p>\n
It currently works on any GSM handset but not CDMA, although they may extend to it in the future.<\/p>\n
According to Waller:\u201dWe need the involvement of grassroots NGOs. In one country we\u2019re working with an organisation that needs to reach 500,000 farmers and only 1 in 5 has a phone.<\/p>\n
The NGO wants to communicate with this group, including doing surveys and sending out pricing information.\u201d The 400,000 without a phone can in many instances share with the 100,000 who do have a phone.<\/p>\n
The product is aimed at those who are earning US$1-2 a day. At the upper end of this range, the user will often save for six months to buy a branded handset and from Movirtu\u2019s research, it\u2019s clear they understand and want to have a warranty.<\/p>\n
In this range, Waller reckons as much as 40% of the market will be interested in the product:\u201dWe\u2019re pragmatic and know that in the short-term the take up is likely to be in the hundreds of thousands and we\u2019re working hard with the local local marketing people to explain how it works.\u201d<\/p>\n
\u201cIt\u2019s clear from our research that those who share phones \u2013 either with family or friends \u2013 are paying up to a 50% premium (when they pay the phone owner) for air time. With our platform, the owner of the phone gets an airtime incentive to lend the phone. There\u2019s also a huge gender and geography disparity: 70% in this segment without a phone are women and 80% are in rural areas.\u201d<\/p>\n
\u201cPeople feel a lack of dignity (when they have to borrow a phone) and there\u2019s no privacy because the phone owner can see who they\u2019ve called. So we\u2019re trying to ease the ecosystem and offer a solution that meets their needs. All you need to log in is a 4-digit pin code.\u201d<\/p>\n