I have increasingly been focused on the mobile and digital opportunities in the Developing World (or perhaps should be called Emerging World). I mean the over four fifths of the planet that was not lucky enough to be born into Europe or the USA and Canada, or Oceania, or any of the Industrialized parts of Asia like Japan, Taiwan, Singapore or Hong Kong. Yes, the 'rest of the world' so to speak, all of Africa, all of Latin America, almost all of the Middle East and most of Asia that is in that Emerging World, ie China, India, Indonesia, Philippines, Pakistan etc.
The 'West' where most of our readers live, consists of 1.2 billion people. the Emering World has 5.6 billion people. So I recently did a bit of analysis about the main technologies and split it along the digital divide. Yes, there are 1.5 billion TV sets on the planet, but they are not uniformly distributed. We in the Industrialized World have most of them, as we have most of the internet connections, broadband connections, personal computers, cars, credit cards etc. Only one device on the planet has more owners in that part of the world where 4/5 of the planet lives - and that is mobile of course.
PEOPLE, CARS, LANDLINE PHONES
So lets do a bit of a comparison. 6.8 billion people at the end of this year. 1.2 billion in the "Industrialized World" and 5.6 billion in the "Developing World". Lets see how they split up.. Oh, and for all those statistically minded - I will use throughout this blog the metric of 'per capita' penetration rate, not 'per household' and not 'per adult' but per every person alive. Bear in mind this includes child-age people who won't drive cars etc..
But yes, lets start with cars. I have been struggling to find a very current count of all automobiles in use, but am certain it is near 920 million in 2009. Where are they? We in the Industrialized World have 600 million of them, or there is a car for every 2 people or 50% per capita penetration rate. The Developing World? they only have 320 million cars, so there is one car for every 17 people. Only 6% cars per capita.
Lets take fixed landline phones. We in the Industrialized World have had total household penetration of fixed landlines for many decades now, and in many markets the total landline penetration rate is actually declining. But the total is about 725 million fixed landline phones for 1.2 billion people or a penetration rate of 60%. How does that compare with the Developing World? There 5.6 billion people have to make do with 425 million landline phones, for a penetration rate of 8%. That means in Latin America, Africa and emerging economies of Asia, there is on average one phone for every 13 persons. Wow, thats a lot of sharing, or going without..
COMPUTERS AND INTERNET
Well, we see ever more impressive numbers of internet users, now nearing the 1.7 billion user level. That seems a nice number, but it includes those who access on a PC at home or work, plus those who access at a shared PC like an internet cafe or a school, and those who access the 'mobile internet' on a phone. So lets take a breather here. To start with lets examine personal computers. Actually, not all of them even are connected to the internet...
So yes, there are now just about 1.1 billion personal computers in total in use around the world, counting all desktops, laptops, notebooks and netbooks. How do they divide?. We in the Industrialized World have most of them, 675 million PCs for 'us' meaning a penetration rate of 56% per capita, The density means there is a little less than 2 people per computer in use. How about the Developing World? Well, they have 425 million PCs in use. Those are spread very widely, with 12 people having to share, the penetration rate of PCs is only 8% in the Emerging World.
Now, what of internet access at home and work PCs? In the Western economies, essentially every PC has either dial-up or broadband access. It will not be 100%, but is close enough, that we can call it 675 million actually connected PCs to the internet, so the per-capita internet connectivity on home and work PCs is 56% in the Industrialized World. But in the Developing World not all PCs are yet connected to the internet. Only about three out of every four PCs is, so the total home and office connected PC internet penetration rate is only 6%, at 325 million connected PCs. Yes, one internet PC for every 17 people on average.
So then there is shared PC access to the web. The internet cafe style of access, for those who do not have a PC at home or at work. Again, this is a difficult number to pin down, so this is based on only sporadic data from around the world, but I am reasonably confident the scale is right. In the Industrialized World, there are an additional 25 million people who do not have access to a PC at home or at work but still use the internet, via an internet cafe. Note most users in the internet cafe situations do have access at home or work, this is those who have not. This forms 2% of the population in the Industrialized Countries, and gives a total combined PC based internet access population, at home, at offices, and at shared internet cafe types of situations, of 58% per capita. 700 milllion internet users.
Compare that with the Developing World. Here the majority of PC based internet users do not have access to a PC at home or work, and use only an internet cafe. I measure that at 375 million people or 7% of the total population in the Emerging World who use internet cafe access. When we add the 325 M who use home and office PCs, we get total PC based internet users at 700 million, or 13% per capita. One internet connection for every 7 people and only half of them have reasonably easy daily access via their home or office PC. Makes you re-think the digital opportunity, doesn't it?
TV AND RADIO
So lets go to television. There are about 1.5 billion TV sets in use on the planet. In the Industrialized World we have nearly one TV set for every person alive, at 79% per capita, and 950 million TV sets in total. In some countries like the USA, there are more TV sets than people. So what of the Developing World? there are 550 million TV sets in the Developing World, so there the penetration rate is just shy of 10%. Not one TV per person, one TV per ten people. Where the average household size is 4.3 people, it means that outside of the Industrialized World, of the rest of the world, essentially half live in households that do not have even one TV set. Obviously nearly a billion people live in homes with no electricity, so we need to understand this in context..
So then radio? FM type of radio has a total worldwide installed base of 3.9 billion receivers (not counting the new mobile phones with in-built FM radio). We in the Industrialized World have tons of them, in our cars, our HiFi stereo sets, our boom boxes and our clock-radios. There are 2.7 billion FM radios in the Industrialized World, so we have on avereage 2.2 FM radios per person, a penetration rate of 225% per capita. In the Developing World there are 1.2 billion FM radios, so that penetration rate reaches an impressive 21%. Or of all technologies mentioned so far, the most widely spread, where there are a little under 5 people per FM radio. Still clearly this leaves hundreds of millions of homes without even a radio to entertain and inform the family.
MOBILE BREACHES DIGITAL DIVIDE
So then we have mobile. Here in the Industrialized World we have more mobile phone subscriptions than we have people. At 1.6 billion subscriptions, there are 1.3 mobile phone subscriptions for every person alive, in the Industrialized World today. In many cases, but not all, this means two phones, so for example an iPhone owner can also carry a Blackberry. But in other cases, typical of Eastern Europe for example, there are multiple subscriptions via inter-changeable SIM cards, using typically only one phone, and the user splits traffic across different networks to save money on calls, etc. Still, like with FM radios in the Industrialized World, we have more mobile phone subscriptions than people here.
What of the Developing World? Consider the math. There are 3 billion mobile phone subscriptions, for a per capita penetration rate of 53% ! Yes, even in the Developing World, mobile phones are now so common, that across the whole region, there are more than one phone subscription for every two people! This is an enormous number in and of itself.
But understand, in the Industrialized World, there are roughly similar 'scale' of the main technologies. More mobile phones than TVs, PCs or cars, yes, but not dramatically more. Roughly speaking twice as many phones as PCs or fixed landlines, only 50% more mobile phone accounts than TV sets, and actually less mobile phones than FM radios.
But in Africa, Latin America, the Middle East and the Developing parts of Asia, mobile is alone, far far bigger than any other. There are nine times more mobile phone accounts than cars. There are seven times more mobile phones than personal computers, nine times more mobile phone accounts than home or office PCs that are connected to the internet. There are seven times more mobile phone accounts than fixed landline telephone connections, and five times more mobile phone users than total number of TV sets in use. Even radio, there are 2.5 times more mobile phone subscribers than all FM radios in use in the Developing World.
By every measure, mobile is the giant, the only giant, and the other technologies are the lilliputs. If you intend to communicate with prospective customers in the Developing World today, then you cannot think of mobile as the 'fourth screen' and consider possibly including it in your communication mix, as we still can think in the Industrialized World, as a luxury today. No, in the Developing World mobile is the first screen - and obviously, for as many as 1.8 billion people - one quarter of the planet - it is the ONLY screen. These 1.8 billion people do not have a PC, not a TV, not even FM radio, but they have a live, active mobile phone account. Out of all 3 billion people in the Developing World who have some kind of connection, a massive 60% have no other way to connect, than their mobile phone! Did I get your attention now?
An internet connected PC will get you 325 million people or 6% of the population in the Emerging World. A fixed landline will ring in the homes of 425 million people or 8% in Africa, Latin America or Developing parts of Asia. A wealthy 10% of the population, 550 million people have a TV set and one in five, 1.2 billion people are lucky to own an FM radio. But more than half of the population have a mobile phone subscription, 56% per capita or 3 billion. And yes, 1.8 billion people - that is six times the size of the USA - have no other connection or technology, than a mobile phone.
SMS, MMS, BROWSING
While I have you. How do you communicate with them then? You don't buy ads on newspapers, and you don't put ads on TV or radio. You also can't send them emails or hope to reach them via some clever social networking marketing on Facebook or MySpace or YouTube or whatever is the current flavor of social networking. The way to reach the populations in the Developing World is four ways - voice calls on mobile, SMS text messaging, MMS picture messaging, and WAP basic banners and browser services on the very rudimentary 'mobile internet' services.
Lets put these also into context. Voice? In the Industrialized World about 88% of mobile phone users place voice calls (oh, you didn't know that? Already 12% have stopped voice calls and use their handsets for primarily texting or instant messaging, or some other mobile internet services). In the Developing World there is the trend to abandon voice calls and it is even more pronounced in some markets. like in India where 30% of mobile phone users do not originate calls, but this then hits issues of illiteracy, such as in Africa, where if you can't write, you really can't use SMS, and voice calls are the only viable way to communicate. Still, voice is a viable communication method in the Developing World for about 85% of the mobile phone user base. That is 2.5 billion people - twice the total population in the Industrialized World.
Second comes SMS text messaging, used by 76% of the mobile phone users on the planet. In the Industrialized World out of 1.6 billion mobile phone subsciptions you can communicate using SMS and reach an active user base of over 1.2 billion. Yes, in the Industrialized World there are more active mobile phone subscribers, who send SMS text messages, than all internet based email users globally. Yes, SMS is that big. And we haven't even touched the bigger part of SMS.. Because in the Developing World, you can reach 2.2 billion active users of SMS text messaging. SMS has four times the reach of TV, twice the reach of FM radio, and 8 times the reach of home/office internet connected PCs in the Developing World. This is where you start, unless literacy is an issue in that country. SMS is the most widely used data application on the planet with yes, nearing 3.5 billion active users at the end of this year. Remember President Obama and why he used SMS in his campaign... This is the big one.
And then MMS. Yes, that 'quaint' picture messaging service that for some reason Apple didn't even include in its wonderful iPhone. Yet MMS is the second most widely used data application on the planet, having 50% more users than email or internet search... In the Industrialized World MMS is one of many interactive multimedia options, and only 550 million people use the technology or 34% of mobile phone subscribers. This is by the way the fastest growing part of our industry, in many leading countries it is very high majoirty of all mobile phone subscribers already, in Norway 84% of all mobile phone users send MMS messages. CNN iReport receives hundreds of thousands of user-generated pictures and videos and Informa counted that across all mobile phone subscribers on the planet, we average 3.5 MMS sent per month - counting yes you and me who don't send that many.. That means the average level is nearing one per week sent across all subscribers, and is far more among active users, obviously.
Now, lets switch over to the Developing World, where for most people their only multimedia device is the mobile phone, often a second-hand Nokia basic cameraphone from a couple of years ago, discareded in the West and imported to Africa etc.. How is MMS? This is a big number, MMS alone has a billion active users in the Developing World, and is used by one in five people in the Emerging World. Yes, 19% penetration rate by total users. While in the West we can still afford to experiment with MMS in our ad campaigns, in India, China, Indonesia, etc it is totally a must. Like with SMS, there are twice as many users of MMS in the Developing World as there are in the Industrialized World. If I could urge you the reader to do one thing with your company this week, I would urge you to expedite your involvement with MMS. It has globally 1.6 billion active users, is a very powerful interactive multimedia technolgoy, that has a 'reach' in terms of devices and networks already pre-configured for it, of over 3 billion. You can reach almost half the planet if you create something cool on MMS. The Apple Apps Store cannot reach 1% of the planet, and all forms of the internet access will not reach half of what MMS can do for you. And yes, in the Developing World, MMS is the next big thing, happening right now. Not WiFi, not Bluetooth, not 3G... MMS.
And what of browsing, basic WAP type of basic 'mobile interent' use? That splits globally so, that we have 420 million active users of the mobile internet in the Industrialized World, or about 26% of all mobile phone subscribers. We have a strong infrastructure of broadband connected PCs in our homes and offices, so the rival mobile internet is one of our options, and needs to find its place, like with the Blackberry for example, or the iPhone. But in the Developing World there is no viable rival. Mobile browsing on basic WAP services have already 780 million users, more than all other types of internet access combined, home, office and internet cafe based PC access. Globally about 1.2 billion people use the basic 'mobile internet' browser services, but the vast majority of these are in the Developing World. How many people is that per capita? it is 14%, or one in seven people in the Developing World use Yahoo or Google or Amazon or Facebook or YouTube on a phone, and importantly - more than twice as many do so than have an internet connected PC at home or work, and also, nearly twice as many access internet services on their phone, than use any internet cafe to access browser content.
So there you have it. The digital divide. In the Industrialized World we have TVs, PCs, FM radios, fixed landlines and mobile phones to consider and compare and use and more than half of the population has one of each of those. In the Developing World, the only technology that reaches half the population is mobile telecoms, and all others are tiny in comparison. For the Emerging World, mobile is not only the first screen, for over 1.8 billion people that is four Europes or six USAs in size, it is literally the only screen.
For anyone who wants to quote these numbers, the source for all is TomiAhonen Consulting 2009, except where explicitly mentioned as sourced from somewhere else like the ITU etc. Anyone who would like to read my Thought Piece, a free 2 page pdf file on understanding mobile in the Developing World, please send me an email to tomi (at) tomiahonen (dot) com and I will send it to you by return email.