Welcome to the United Nations | Department of Economic and Social Affairs

Sixth Annual Meeting of the Internet Governance Forum
27 -30 September 2011
United Nations Office in Nairobi, Nairobi, Kenya

September 27, 2011 - 9:00


The following is the output of the real-time captioning taken during the Sixth Meeting of the IGF, in Nairobi, Kenya. Although it is largely accurate, in some cases it may be incomplete or inaccurate due to inaudible passages or transcription errors. It is posted as an aid to understanding the proceedings at the session, but should not be treated as an authoritative record.


>> VLADIMIR RADUNOVIC:  Good morning, everyone.  I hope you had your cup of coffee this morning.  And I hope you're awake now.  We'll try to keep you awake until the end of this session.

My name is Vladimir Radunovic from the DiploFoundation.  I'll moderate the session.  And I wish to welcome you for coming to one of the first meetings during the IGF here.

To welcome you in the room we have a distinguished set of distinguished panelists with us that will help us to discuss today.  Of course your contributions are more than welcomed.  And besides, we also have the remote participants.  And we just received a note we have a hub from Papua New Guinea.  So it's very late there.

Remote participation is one of the examples what we are going to talk as well today.  It's a service that brings some of us online for a purpose.  It's useful.  It's reliable.  We have a trust in it.

If we have more of these services that can bring us online, it can maybe help the access.  But there are many more services that are of course more complex.

Remote participation has been to some extent copied along or around the world in different hubs.  We are still trying to copy to other type of forums.  Not only the Internet forums but then when it comes to mobile payments, when it comes to e-Health, when it comes to content, quality content and so on, there's a lot to be done to make it copied and to make it without problems, without obstacles to be implemented.  And then we need to see how this can impact the development of infrastructure and how this can impact the access and get more people to get connected, especially in the Developing World.

I have a pleasure to welcome Ambassador Philip Verveer from the U.S. State Department who is going to try to help us set up the scene and start with the keynote.  And then we can try to discuss later on.  Ambassador.

>> PHILLIP VERVEER:  Vladimir, thank you very much.  I appreciate the opportunity to participate with you.  Among other things, it's an opportunity for me to join a good many friends of many years standing who are going to be serving as expert commentators on this important subject.

It's obviously quite appropriate that we're meeting here in Nairobi to discuss these kinds of issues.  Given the enormous success that Kenya has had in recent years in terms of attracting broadband infrastructure and in probably -- the most well-known success of an application, practical application, in the world.  The tremendous success of mobile banking here, which I think provides a kind of inspiration for all manner of other applications that have the ability to greatly improve everyone's life.

This particular subject is one that I think is very well designed today.  Talking about both supply and demand at the same time is something that is absolutely the right way to go.  There is a true symbiosis between the ability to distribute and having things that you need to have distributed.  And that symbiosis is one that we have seen a good deal of success with in the Internet.  But it's also something that we shouldn't take too much for granted.

It's quite clear that we are very dependent upon having sufficient transmission capacity to continue to see the Internet grow, expand, become all of the things that people of great imagination can make it.

We have come to some view in the United States both in terms of our USSD and also the World Bank joins in this that there are still contributions that could be made around the world in terms of technical assistance, in terms of advice with respect to rule of law, with respect to regulation, with respect to things that make countries attractive for investment, make them suitable for expanded investment of the kind that we're going to need very, very significant amounts of in the years ahead.

That is I think an important recognition.  Because it reflects something that is very different in the world of the last 10 or 15 years.  And that is that private investment has actually come to provide most of the infrastructure we need in the world of communications.  It's a very happy development.  It's a development we want to see continue.  But it is a development that's quite plainly a function of adequate rule of law of having legal and regulatory arrangements that are attractive from the standpoint of investment.

On the demand side it seems to me we have a rather different picture.  With respect to content, I think it is probably been true all through history that there are more imaginative and inventive people who are willing to try to figure out ways to provide content, whether it's of an aesthetic nature or practical nature or both, than we have been able to absorb as societies.

So the key here I think is to have a -- the kinds of platforms that are necessary to enable content developers to succeed in providing their prototypes, permitting them to come to the marketplace with ideas giving them a fair and good opportunity to try those products out.  And then again to have an adequate rule of law that protects Intellectual Property that finds ways to see to it that there are adequate rewards for those who have been able to develop significant amounts of applications of the kind that make a difference -- will make a big difference in people's lives.

One of the most interesting developments -- and I think one that we will see in an absolutely increasing amount over the next several years is the appearance of video on the Internet.  Video in all of its forms.  Whether we're talking about full feature entertainment kinds of videos or we're talking about other things including especially video used for distance learning.  Now, that has huge implications for the amount of capacity we need in terms of transmission systems.  But it also has huge implications for the spread of knowledge around the world.  For providing the kinds of educational requirements that the modern world requires.

And in that regard, I would like to conclude by mentioning one distance learning application that's being developed it's quite relevant to what we're talking about today.

One of the really great NonGovernmental Organisations in the ICT space is something called the U.S. Telecommunications Training Institute it was in a sense founded here in Nairobi 20 years ago.  And it has over the years served to provide training for literally thousands of people from the Developing World who are interested in ICT activities especially from a governmental perspective but more broadly than that.

The U.S. Telecommunications Training Institute has developed it's first distance learning course.  It happens to involve cybersecurity.  It will become available during the month of November.  And the something that we hope through the magic of broadband transmission will become very, very widely available to audiences that are interested in this important subject of cybersecurity.

So I thank you very much for letting me reflect a little bit on the importance of supply and demand in the world of ICT.  And I wish you the very best with your session.  Thank you.

>> VLADIMIR RADUNOVIC:  Thank you, Ambassador.  It was great outline.  And thank you for your time for joining us for the workshop.

You outlined and you mentioned a couple of things that are really mapping what we are going to discuss.  And it's about the different services that are coming.  It's about supply and demand.  It's about rule of law of course to provoke investments.  It's about enabling the content development.  Different services like video, education and so on.  So there is a lot to talk.  And we expect a lot of comments from your side.

To start with the talk, we'll try to listen firstly to you.  How do you use -- you or the people in your countries -- the Internet in these days?  What are the predominant services that you use when you wake up, when you're on work, when you're in the city.

So to try to map how we are using Internet now.

And what do you think that the services are going to be in the future?  Now, is there anyone who wants to bring be a little bit of your own perspective?  How do you use Internet in your countries?  What are the dominant services from your side?

Or to break the ice we may start with Bevil who can tell us a little bit about how it works in the Caribbean, what are the dominant services in Caribbean.  And how do you see the development of content in response to the demand over there, Bevil Wooding from the Caribbean.

>> BEVIL WOODING:  Hi, good morning, this is a very timely discussion for a lot of us in the Caribbean region.  I represent Packet Clearing House, an infrastructure and research organisation.  But I also do a significant amount of work with the Caribbean Telecommunications Union which is an organisation that's focused on raising awareness of ICT and ICTs use and application in a wide cross section of -- in a wide range of areas.

The thing to note is the last few years we've seen a massive proliferation in content, in Caribbean content.  Applications ranging from e-Health to eGovernment.  A lot of innovative use of entertainment-based content as many of you know the Caribbean region is known for it's music and arts and culture and a lot of the artisans have been using the Internet as a vehicle for extending their reach at the same time there's been within the educational sector that the ICT represents a significant platform for extending the region and developing new skill sets across the region.  But one of the things that has prevented the region from seeing the kinds of benefits that one would normally associate with technology is that a lot of this content is hosted outside of the region.

And so the connection between the proliferation of content and the expected benefits particularly the economic and social benefits are simply not being realised.  And so there's been a lot of consideration as to why this is so.

And countries, industries, organisations, are now recognizing that there is a direct connection between developing what we call the regional Internet economy and the requirement for new levels of attention and investment in infrastructure.  Critical Internet infrastructure.  The development of Internet Exchange Points, domestic curing facilities that allow for new traffic route options.  Educational reform has also come up as one of the major areas of priority there's a recognition for example that the schools are not producing in the quantity that we would like to see the kinds of innovative thinking and the kinds of approaches to taking full advantage of the Internet that we think is possible.  That we think are possible.

Research is another area that requires significant investment.  And attention.

And finally, the development of new approaches to a policy on regulation is seen as one of the critical factors in developing and enabling environment whereby innovators, if they have their way, would not have the kinds of restrictions to developing from ideas to businesses to sustainable enterprises that is now the case.

So while we are seeing an increase in content across many sectors, there are some very real challenges that are being faced.

And these challenges are being addressed by a number of organisations.  But it takes more than just the work of policymakers to bring about this change so there's a great emphasis on a multi-stakeholder approach to addressing some of these issues.

The CTU for example the Caribbean Telecommunications Union has embarked on a Caribbean ICT roadshow which is designed to raise awareness amongst Government officials Private Sector and also to get into the communities to discuss issues of how technology actually applies to areas like agriculture, fishing, the development of new Government services and so on.  And this has proven to be a remarkably successful venture and one that we intend to continue as we move along.

But again, that's not enough.  Innovation has been one of the areas highlighted as a priority for attention to be placed on how can technology be used to create new opportunities within the region.  And how can it be used to identify new areas for growth that go beyond tourism and the natural resource extraction that is so typical for Caribbean economies.

And that is one of the areas in which the educational reform and the development of new research models to identify what are the areas of priority is now being looked at very seriously.

I should make one note in closing about the state of access within the region, which is playing a part in how much content can be delivered and how many services can actually be accessed by the region.

There is broadband access in most markets.  There has been liberalization of the telecom and Internet service industry.  However, that broadband access is not what we call quality broadband access.  So you have the development of -- or the promotion of the different kinds of Internet services but when you get into the countries and actually do tests on latency and do tests on how much traffic and how many applications can actually be accessed by different sectors of the society, you realise that there's still a whole lot of work that needs to be done in creating the kind of bandwidth and access environment that allows for the real use of and advantage to be taken of Internet services.

>> VLADIMIR RADUNOVIC:  Thank you, Bevil.  You pointed to the prospective Developing World that inspite of all of these beautiful services we have, infrastructure is still quite a problem.  And Ambassador also mentioned and pointed out that the importance of video online.  And we all know to what extent we use video more and more and the high definition video and so on.  And the next billion that we now have and that was the mode of IGF the last couple of years ago the next billion we have is to start using the Internet with high definition videos with all of these new services and then we have a challenge of an infrastructure and a challenge of a demand.  And there is I guess no better person than Robert Pepper to discuss and let us map how the demand is growing, especially in the Developing World.

Now, in order to confuse you Robert is sitting over there and not right here so you have to switch your head here and there and wake up.

But Robert also has a PowerPoint.  Robert, the floor is yours.

>> ROBERT PEPPER:  Thank you.  So while the screen is -- it's warming up and I apologize to the online folks.  I'll make this available.

One of the things that we've been doing I think some of you know is a five-year rolling study, five-year rolling projection of demand on the Internet.  And then looking also at what kinds of services are driving that demand.  It's now in its fifth year called the Visual Networking Index.  I'm happy to talk to anybody about that.  And it's all publicly available data.

What we see globally on average is a compounded annual growth rate of 32% between 2010 and 2015 that's averaged across the globe.  And in emerging markets, emerging countries, emerging economies it's greater than that.  We're looking at and we're seeing the growth in the 40 to 50% compounded annual growth rate across the networks.  And the question is:  What's driving that?

And the short answer is:  Video and I'll get to that in a moment.

What we see in the emerging economies, and this is a little bit -- people are always surprised.  These are actually sort of real data based upon 2010 traffic.  The average user in emerging economies is consuming about 4 gigabits of data per month we're projecting that will be 14 gigabits per month by 2015.  The average family in emerging economies is consuming 9 gigabits a month and we're projecting it will be 32 gigabits per month by 2015.

And then when you add on top of that the fact that by 2015 we're projecting there will be 3 billion Internet users, you can see how that drives the global traffic.

So the question is:  What's driving that?  And what you can see here is that on average we're projecting that by 2015, 60% of the consumption of data traffic across the global Internet consumer consumption will be video, 24% file sharing which is diminishing in relative size.  And then there's web data and surfing.  You know, Voice over IP and gaming is a rounding area.  In emerging economies in 2010 we saw 36% of the traffic consumption as video.  And that will be in emerging economies 60%.  So by 2015 emerging economy consumption will look like the global average there will be essentially no difference but what do we mean by video.  And video is actually not just traditional broadcast television.

So we look at this and break it down.

We look at what is -- what we call a short form video.  Seven minutes or less.  And long form video.  And what you can see here is that what we're projecting by 2015 is about 39% of the consumer video consumption will be Internet video to the PC long form.

So that will be things like a Netflix or a Hulu or equivalents around the world.  And Dorothy will talk later about movies, television programmes.  More of the traditional video will be about 40% of the traffic but it will be to the PC not to the television we then see Internet video to the television is another about 17% and then short form video which would be the YouTubes of less than seven minutes about 14.5% to the PC this is not just about fixed it's mobile as well that across the total Internet we see almost 10% of the traffic as video going to mobile devices.

And then when we separately we look at what is going to be the consumption model on the mobile device, whether it is a SmartPhone or a tablet, it's going to be a large portion of that between -- depending on where -- 40 and 60% of that will be video to that device.

So it's not just about fixed.  It's also about mobile.

And by the way, the mobile networks, what we're seeing is a compounded annual growth rate for the data consumption of over 120% per year.  That's averaged globally.  And in emerging economies it's going to be even greater than that.  Because the mobile device, whether it's the SmartPhone or the tablet, has become and is already the primary method of connecting to the Internet.

What we've also found is that on a per monthly basis for those people who actually watch video over the Internet, they are spending about ten hours a month, this is the average viewer.  This is in the U.S.  Ten hours a month watching Netflix, five hours a month at Hulu and about two hours a month with YouTube which makes sense.  YouTube are the short video clips of less than seven minutes.

So I'll stop there.  I'm happy to unpack this.  This is the Web site where all of the data are available.

But the bottom line is that what we see is that as we grow from a billion to 3 billion people on the Internet by 2015, the consumer Internet user will be -- that demand will be driven by video.  And about 60% of the use of the Internet will be a video consumption.

There's also a small component of this for consumers on video communications where you'll be communicating face to face using video and that's again a different category.

Implications for networks.  We just heard about the needs for higher speed, more robust networks globally especially for example in the Caribbean.  There are significant implications for the buildout of networks whether they are fixed or they are wireless or they are going to be mobile, broadband, significant implications for the capacity required and the architecture of those networks to keep up with this growing demand.  Thank you.

>> VLADIMIR RADUNOVIC:  Thank you, Robert.  I don't know if this should be frightening or motivating.  But I hope it's motivating.

Now, one of the corporates for the content is also Walt Disney I'm confusing the panelists now and Dorothy Attwood from Walt Disney you are working on creating the quality content around the world and how does that impact and how do you manage to get into the Developing World and do you think that you are one of the corporates why the bandwidth is becoming congested.

>> DOROTHY ATTWOOD:  Well, I actually find those statistics not scary.  In fact I can only hope that they reflect a lot of Walt Disney movies.

But I think I would actually like to build on what Pepper had said and approach the question a little bit from the other way.

This is an access panel.  This is in the Dynamic Coalition of the access world.  And why are we talking about content when we're talking about access?  And I think it's really important to understand that question.

And I would also -- looking at it from the U.S. perspective, I'll point out we have our Commissioner Clyburn from the FCC who has been leading the effort to build greater penetration for broadband services in the United States.  And what the FCC did was look at this question from why aren't people in fact engaging in the online world?  Because you have at least the framework in the Developed World of greater penetration.  You have multiple competition platforms.  So why aren't people getting involved or getting online?  And there were three answers.  One was expense.  Which would be understandable.  The other was technical confusion and I think you spoke to that about people still are not sure how to use the medium.

And the third is the question is it didn't seem important or relevant to them.

And as we talked and as the panelists talk more about the incredible applications of mobile health, of education, of things that would be traditional Government services or at least public/private partnerships to develop those kinds of social services, we also have to look at the market model that says what makes the Internet relevant to people.  And what you see with Pepper's statistics and what you understand by the global traffic is entertainment does in fact drive a lot of the interest in the Internet.

That entertainment is such that as that grows, then you see more and more people feeling comfortable with the platform.  Interested in it.  Taking advantage of it.  And then the advantages that Government services and other important elements that can benefit from the Internet as a platform like health and education, those come along, too.  Because people now understand and use and become -- find that the Internet is central to their lives.

And so that was -- we start off by saying let's recognize the importance of a premium content to the growth of the Internet from its ability to bring people online and grow.

I would say as a second point, though, that we've got to think about video and premium content even more than the refinement that Pepper identified in terms of short form, long form, that kind of thing.  We have to think about it much more as an interactive, collaborative platform.

It's no longer -- so the Walt Disney Company is involved with Hulu, it's involved with direct consumer ABC video reel.  You can buy our products in a number of ways transactionally.  You can buy them -- they are free ad supported.  But what's important and what's exciting about the way in which even premium content is developing is that you see collaborative applications occurring around that premium content.  You see communities of fans forming.

You see families communicating with each other on the basis of sharing their experiences in the entertainment environment.

And that kind of interactivity where you have real-time watching by multiple people of the same sort of content and commenting on it and sending that information and having a discussion is something, again, that is really kind of the next phase of the use of -- and the driver of the content.

And finally, the final point I want to make is really one to lead to the rest of the discussion on the panel.  And that is recognizing while ecosystem is an overused term recognizing the absolute importance of how each of the elements that grow the Internet work together.

So there can be no premium content and growth of the Internet without the development of the infrastructure, the physical infrastructure platform.  Equally the physical infrastructure platform can't develop without content that is interesting and worthy of being purchased.  And sustaining the incredible heavy capital investments that are necessary to build an infrastructure that's capable of delivering that kind of video.

So when you think in terms of growing a thriving Internet platform, you need investment in each one of these areas.  In the services layer.  In the content layer.  And in the infrastructure layer.  And together those build the kind of access and the reach to the next 5 billion Internet users.

And with that, I'll go -- we have such interesting folks on this panel so I don't want to talk too long.

>> VLADIMIR RADUNOVIC:  Thank you, Dorothy.

Yes, I mean I guess you're right that all of us are firstly up to entertainment and the first thing we do is probably Facebook and stuff and then watch the video and so on.  There are so many ways to use the videos and you mentioned interactive ones and especially for education.  I know from our own experience in DiploFoundation when we do online courses we are always cautious to do the platform that contains video because we target people from the Developing World and we're not really sure if they can have the video or rather if it should be based on text messages and so on.

But I know that some of the infrastructure providers or -- so to put it -- have also been investing in facilitating the Developing World.  And then we have Jacquelynn Ruff from Verizon who has experience in working in the infrastructure field.  And Jacquelynn.

>> JACQUELYNN RUFF:  Thank you very much.  I'm with Verizon Communications which --

(Audio lost).

>> JACQUELYNN RUFF:  All around the country.  And I would like to touch on two areas relevant to this workshop.  One is a couple quick thoughts on the access piece.  And then on the content side some current trends in education.

So if I think about today's Internet Governance Forum as compared to a year ago, two things very related to particularly what Bob Pepper said.  One is that we are really seeing the opportunity on the mobile wireless side for fourth generation wireless which is very, very fast.  Conservatively speaking 8 to 12 megabits per second download which means it can carry all of this streaming video.  It can carry Disney.  But it can also carry extremely interesting and useful content in the education context.

So the challenge of all of these nations that are represented here is to try to make that happen as quickly as possible.  Try to have spectrum planning that will make available really good spectrum well suited to that in the United States we're using 700 megahertz which is the digital difficult vend broadcast perspective and that's very suitable for covering rural areas as well as urban areas.

The other quick point I would say is on the device side, the availability of tablets I think is huge.  And some of these studies on the trends for the next five years are really correlating the high volume to tablets and SmartPhones.  And again, these are mobile learning devices.  When you think about education.

So let me just give you very quickly a couple of examples of what I think are good practices on the education side in terms of putting to great use from a societal perspective all of this access, which is growing and hopefully we can leapfrog on the mobile side in the fourth generation.

So the first point, of course, is just connectivity.  And here in East Africa, thank goodness there are finally undersea cables coming in.  We're getting the connectivity.  Verizon for example in many -- several countries, the U.S. and the United Kingdom is a provider for the education and research networks.  Very high speed in the UK.  We're now doing 100 gigabits for that.

So first the connectivity is critical on the education side.

Secondly, the mobile learning devices.  Now, we have examples in the U.S. with third and fourth generation mobile of using SmartPhones in the schools.  Say with eight-year-olds, third graders and so on, working with them and using these devices.  And the information is starting to come in.  The reports.  That the children do their homework more.  They pay more attention.  It's interesting.  It teaches new skills such as collaboration with their teachers and their fellow students.  And in the end, the results when tested with the evidence that's there, it's just beginning, but what's there is that they are testing better.

On the tertiary or higher education, amazing things.  As we are rolling out the fourth generation wireless in the U.S., we are making a priority to connect some universities.  We're working with the university in Indiana sort of top of the line from the beginning and helping them connect with other partners on the content side to figure out new ways to use this, virtual labs, a lot of interaction with the students.

Here in East Africa MIT, the Massachusetts Institute for Technology for some time has done science labs connecting students here with the university here and in the U.S. and to do that even more broadly using mobile technology will be extremely important.

Third, on the content side just a very -- a few sentences on something that Verizon has done through our foundation.  We have put together a programme of content for teachers, parents, children after school.

You can access it online yourselves.  It's called thinkfinity.org.  Thinkfinity.org and we joined with content partners to create materials for teachers for parents to help their own children it applies to what we call kindergarten through 12th grade and we partnered with our museums, our cultural institutions experts in literacy, science and technology to put together a very rich set of content which is also consistent with the teaching standards in our own society.  I truly believe this can be done in other countries.  I believe for example it can be done regionally in East Africa in a way that might be very useful particularly if you envision a point where you can have tablets in remote areas and distant access to that sort of thing.  In order for all of this to work we need fundamentals in literacy and again there's great examples of literacy training, online training I would be happy to share some information we did a project with UNESCO, online literacy and sharing of information.


And then finally speaking of sharing, best practices, what's so -- or good practice.  What's really important.  We're all experts in this room.  And I'm sure we could have an even richer discussion if we had half a day to just tap each other's understanding.

Last year Verizon along with many other multi-stakeholder entities coordinated a two-day seminar in Kampala with the arrival of the undersea cables to look at the ICT and broadband and tertiary education higher education every piece from the undersea cables all the way through the content the teacher training the capacity building the IT readiness for the universities.  And tomorrow morning we're going to be doing sort of a follow-on on that.  We put some flyers out.  There's a workshop that we hope anybody who is interested in more detail can have that opportunity to exchange good practices.

So thank you.

>> VLADIMIR RADUNOVIC:  Thank you, Jacquelynn.  It's always good to see what's happening, what's coming with the services.  And how the new services can be used in the best way.

But usually one of the caveats is how do we do it in the Developing World because we don't have the infrastructure.  We can't support the video.  At least the high definition and so on.  But the truth is there are services which do not have such a demand.  Which can be done in Developing World, it can be very helpful and useful and probably drive the people to use more.

One of these services is of course linked to e-Health and then we have a couple of examples from the Developing World how did e-Health services or assist people -- help or assist people in connecting and using them I'm start from my right with Edwin Macharia who has been working with mPedigree on some interesting mobile health things.  I'll pass the microphone.

>> EDWIN MACHARIA:  Thank you very much.

First of all, for those who are not from Nairobi or Kenya let me say welcome to this lovely country.  Usually we have a lot better weather than this.  But it's okay.  At least we are in a room.  So we should be fine.

My name is Edwin Macharia.  I essentially wear two hats in these kind of forums.  One is I work with a firm called Dalberg Global Development Advisors, a strategy consulting firm with our roots in classic McKinsey, Bain, BCG.  But we focus it on specifically emerging markets and development issues and so that's -- we do quite a bit work around access mobile health mobile technology globally so happy to share reflections on that.

But the reason I was actually asked to sit on this panel is because I'm representing mPedigree which is an elegant solution to what's said as an African problem an African solution to an African problem that's really began to take roots and get legs globally.  So let me tell you a little bit more about mPedigree essentially this is a service that's focused on one question which is a question of counterfeit products we all find in our markets we know with porous borders especially in Developing Countries their ability to compromise individual systems you have a lot of counterfeit products that actually come into our markets and ultimately compromise individuals, systems and people.

We decided to start our focus on the pharmaceutical industry specifically where depending on the data you're looking at, depending on the country, anything between 10 to 60% of drugs are either counterfeit or fake.  And counterfeit typically means that they don't have enough active pharmaceutical ingredient in them or they are completely fake so they are powders they are chalk they are not effective at all and this as we know has a major toll not only on the drug resistance that develops but actually directly livelihoods that are affected so people that go out and buy drugs those drugs don't work and that results in lack of cure and therefore ultimately in death.

So my good friend Dwight Simmons (phonetic) I would love to claim credit for thinking this through but he actually is the person that put this together decided there's a real possibility to crowd source the solution to these issues and what we've done is mPedigree is essentially a critical platform that says with the Democratization of access and data how can we use the individuals as the hub to counter this rather than the classic let's put up another system let's invest in more Government in more heavy external management systems rather than empowering the individual.

So the system is very simple.  What happens is when you come in -- when you go to a pharmacy and buy a packet of drugs, on it very similar to prepaid scratch cards is a serial number.  So you scratch off that serial number.  And then you SMS that number.  Usually it's a 12-digit code that goes up through the telcos to our database.  And here we in partnership with Hewlett Packard on creating that database.  And what it does is then it queries that database and asks:  Is this medicine legit or not legit within anything between 5 to 40 seconds you get a response that says this medicine is real or fake if it's real fine you know you're getting a good product if it's fake you can take it up directly with the pharmacist and refuse to take the actual product and go and look for a different product.

But beyond empowering the individual this has actually become an incredibly powerful tool for two critical stakeholders the first one being fundamentally the Government.  All of a sudden Government can have access to information that says:  In this geo location because you can geo locate by your phone or at the very least which base station you're connected to here are a couple of pings of negative drugs or negative results that are coming out in this location.  Government all of a sudden you're not focusing on looking at all of Kenya.  You are actually looking a lot more close and more pinpointed at a particular geography or region or part of a village and therefore able to take greater action and go and query where did these drugs come from and work your way backwards because now you really have robust information and data that's independent of your typical system.


So that's incredibly powerful.

The second one of course are the manufacturers of the drugs themselves.  That not only do they get the benefit of helping narrow down people being able to sell counterfeit --

(Audio lost).

>> EDWIN MACHARIA:  Saying that the power of the individual to be a critical answer in some of these challenges is tremendous.  And in Developing Countries where we've seen the mobile handset have far much greater penetration I think right now we're seeing between 60 to 95% of all digital content being consumed on the mobile space or Internet access on the mobile platform this is a powerful tool for uses.  So start it off as cool idea.  It's an African problem let's bring African solutions to it and clearly hopefully it becomes a global solution to problems that have been sourced from the Developing Countries very similar to what we have seen the mobile platform act in Kenya but really start taking tremendous root globally.  Thanks a lot.

>> VLADIMIR RADUNOVIC:  Thank you, Edwin.  We have another example from India, Pankaj Gupta.  You referred to a couple of things related to the databases and how this can help the health system.  Go ahead.

>> PANKAJ GUPTA:  Thank you.  Good morning to you all.  I am Pankaj and I represent Total Consulting Services $8 billion ICT company belonging to the famed Tata Group from India.

And to the question are we meeting the challenges of bringing content and access to the world I think I'll try to first one challenges bringing the content I'm very happy to see the presentation from Cisco saying there's already a huge infrastructure which is categorizing to entertainment the problem with the Developing World is what is important.  What is of importance?  And I would like to share two examples that we conceived way back in 2005 and '06 when the question was health care.  Can we have our own medical records with us?  I'm not sure how many of us in this room are getting the medical records with them.

It's impossible to get the physical records.  But few of you would be lucky to get it in this form.  And that's where we conceived the programme called Health and Hospital Management System in a state called Gujarat in India which has a population of 16 million and the programme has been rolled out in 29 hospitals which helps close to about 50,000 outpatients and about 6,000 inpatients.  It is serving 400 doctors.  And the key success has been creation of electronic medical record.  I think that's the fundamental to any health care services that has to be rendered in the city.

In the Developing Country you have problems of migration for employment.  There are people who can't afford traveling to hospitals.  And that is where creation of a centralized electronic medical record was of key importance.

Today they are able to go and access their information from any of the hospitals that are hooked on to the system.  And that is where sharing of data has become very important.

This programme is now being very effectively used for providing medical care to about 200,000 females in the state.  And that is used for periodically giving them counselling, reminding them about their appointments, vaccinations, medical care and so on and so forth.  And in case of divorce there can be personal attention provided.  The same the programme is named Emimta (phonetic).  It's also helped other patients in getting proactive information on what are the you know cautions that they have to take.  What are the new things that they are to do in addition to getting alerts on taking their medicines.

We have another programme called WebHealthCentre that was done by Tata Consulting Services.  It has close to 50,000 medical records created across the country.  And what is happening is there's a growing awareness among the people that we should have a shareable medical record, share able results because in case of any exigency those records are useful I'll cite some examples it has biometric identification a patient who has met with an accident and is not in his conscious health and taken to a public environment the doctor can take his biometric and pull out the medical record of course subject to the fact that the medical record exists so that's the power of the content that has been creating and I'm really waiting to see when the share of M-health in the e-Health in the Internet users that exists today actually goes up and it actually competes with the entertainment field.

That will be -- because Developing Countries and I can talk about India.  India has funds.  India has good infrastructure I would not say it's absolutely sufficient but it can grow.  The point is what utility does it deliver.  And that's the key point.  And we were discussing that the problem that is existing in high replication and high usage of the system is policy initiatives.  Protection of data.  Medical liabilities.

I think that's a key issue.

Infrastructure definitely is one.  But I think the moment we have policy initiatives around them, patient care is going to improve.  Developing Countries need content which can be delivered in a very cost effective manner as my colleague Edwin said mobile penetration is probably the highest.  And I can cite an example in India way back in 2000-2001 embarked on mobile telephony the first question that was actually asked was why do we need mobiles and the question that was addressed by somebody was that a postcard, a returned postcard, postal card, would cost something, 15 pesas in India.  That's less than a cent and if a cost of a call is less than that people will switch to mobile and that's what's happened today so we need to be in an effort to build our own content we have Internet services a dedicated unit serving the e-Health industry and the bioinformatics and we are working with a couple of hospitals in creating this.

We are also embarking on an initiative of partnering with the pharmaceutical manufacturers and laboratories and the R & D associations on the other side.

The biggest question that has been asked in Developed Countries has been is my data secure?  Is my medical ailment private?  I would like to on behalf of the Developing Country present the case that lists 40, 50% of the population would care more for money and less for data privacy.

And I think that's the need of my country.  And I said well if somebody is going to subsidize my medical care, I don't mind.  My medical records being checked.  With of course authenticated agencies like pharmaceutical companies or you know the R & D laboratories and the doctors of course.  This system is also becoming very useful in becoming a knowledge base for medicals and paramedicals.  We are short of medical professionals definitely in rural areas and what we have been able to get onto is telemedicine.  Our paramedicals at the remote areas they are able to hook on to the system access EMR send the medical, clinical findings on the system and doctors are able to prescribe.

Wherever we don't have Internet connectivity, mobile phones are being used as a query module.  And those mobile SMS messages are being stored in the database to take care partially of the medical liability issues because all medical advice is based on whatever feed is being provided by the patient by the paramedical so those are some of the initiatives and I think we can talk -- I'm available and we can talk about those initiatives and I would really feel if we get some policy support some standardisation around how this can proliferate in the future being developed.  Thank you.

>> VLADIMIR RADUNOVIC:  Thank you, Pankaj.  I was so happy to know that there is a service which is low bandwidth at least for the beginning and then you frightened Me again with telemedicine which again is going to be a high bandwidth one.  But that's something that's coming.  The point is we keep talking about the importance of local content, local services and this is probably one of the good examples of how a local service can be developed and if I'm not wrong it was developed in India.  It came from there at least.  This particular example.  And there is another example which goes out of e-Health which is mobile payments and mobile money and in Kenya is probably one of the best examples of that mobile payments in pesa and then we have two distinguished persons here Betty Mwangi-Thuo from Safaricom who is going to give us a little bit of the introduction on how all of this started in Kenya.


>> BETTY MWANGI-THUO:  Good morning.  Apologies for being late.  Battling the traffic.

Okay.  I'll just give you a brief history.  M-PESA was launched in this country in 2007.  And just to give you a brief view of what the market currently looks like we have four telecom companies currently 83% of the Kenyan adult population have access to a mobile phone.  In order to register for the M-PESA services it's a straightforward registration you just need your identification now when you compare this to the banking sector, there are 43 commercial banks with only 12 million bank accounts.  40% of Kenyan adults have a formal bank account and of course as a rigorous KYC that goes with banking and that's expected.  They have approximately 1,000 bank branches.  And 1948 ATMs.  M-PESA has 140 cash in and cashout points you can see where they are playing.  this was piloted initially for micro finance loan repayments but when it came to March 2007 time to launch we positioned it as a money transfer platform.

Basically a send money home service.

A lot of people work in urban and support people in deep rural and it provided a fast instant way to just get money home without having to trust a third party a bus driver or even get yourself onto a bus and travel up country to go and take money to your mother or wife or whoever you are supporting up country.

Since then in 2008 and 2009 we expanded functionality beyond normal money transfer services.  We have Pay Bill now so you find utilities.  People can pay for their utilities.  Kenya power is on board.  Water services.  And even DStv as example so now with what you find with M-PESA currently it's evolving from pure send money home transfer service to a payments platform.  So there's a lot of opportunity there.  And we continue to drive innovation.

In terms of mobile active customers we currently have over 14.5 million customers using M-PESA, which is 82% of Safaricom's subscriber base currently.

We talked about agents.  Other services that we have introduced include international money transfer.  So remittances from Kenya or anyone who wants to send money home to an M-PESA registered subscriber can do so from over 52 countries we have done this in partnership with Western Union and a couple of other agents in the UK and we continue to continue to expand that beyond those partnerships.

Services that are currently available on M-PESA include ATM withdrawal so you can go to an ATM and do a cardless withdrawal just with your mobile phone.  The ATM dispenser acts as a cashout point as an agent.  And it's actually quite an interesting concept.

Then we do of course a P2P, the Peer-2-Peer transfers.  I've mentioned the IMT service.  And airtime topup you can also topup your airtime and I mentioned some of the bills.  If you look historically at how people sent money home and I eluded to some of it about 58% sent money -- well delivered money by hand.

So you find that those dynamics have changed with people sending money.  The largest way that people are giving money or passing money on is through M-PESA which currently has 47% you find that hand has gone down to 32% from the 58%.  And previously buses used to play you know the up country going up country used to play a big role at 27%.  And that's come down to about 9%.

We've carried out research to see what the impact is, third-party research to see what the impact is on Kenyans and Kenyans say M-PESA customers say they are saving approximately three hours per transaction and what they are saying what they are doing with their spare time they are performing economic generating activities like they are farming.

They also say that they are saving up to 3 U.S. dollars per transaction.  And their savings they are using mainly to buy food.  The savings will come from time spent maybe at work or you know farming or -- and also savings from not having to take physical transport to deliver money.

Okay.  M-PESA continues to change lives.  We play a big role in education in the repayment of high education loans and also more recently in the payment of school fees we have a number of schools that will now only take money from M-PESA which enhances the safety on opening day as well as added convenience for parents who have children in boarding schools.

We also play in the health sector.  For example in the payment collection of health insurance premiums payment for inpatient and outpatient services at hospitals.  And we have also partnered with Gruen (phonetic) First Life Link, who is a company that digs boreholes in semi arid parts of Kenya.  And what happens is we are providing clean and safe drinking water.  And what happens is previously women had to walk up to 5 kilometers to go and fetch or get access to water which is not necessarily clean, either.  But now through these boreholes they are each given a little key forbe they can load remotely from M-PESA they go and stick this thing into a pump and it dispenses water it's an amazing project.  In agriculture we have a few projects where we -- Kilimo Salama programme where farmers are insured against crop failure and those are all done by M-PESA there's a lay-away programme this allows farmers to save towards the purchase of irrigation pumps and of course the savings are submitted by M-PESA.

M-PESA has created job opportunities directly but also indirectly through our agent network and other service.  So 100,000 Kenyans currently are directly employed as a result of the M-PESA service more currently we are playing a large part in fundraising you may have heard of the Kenyans for Kenya Initiative where through M-PESA over 165 million Kenyan shillings about 165 million dollars were donated to help with the famine relief that the Kenya Red Cross was doing for northern Kenya and Kenyans were able to contribute as little as 10 shillings it was all inclusive it was no longer just those that were deemed to have or willing to contribute so even you found -- a watchman was able to contribute his 10 part and be part of that whole initiative and we intend to do more of that.


M-PESA has been globally recognized.  I won't go through the records.  It was a world first.  It started here in Kenya.  And our commitment is to continue to innovate and also to drive the financial inclusion in line with vision 2030 for this country.  Thank you.

>> VLADIMIR RADUNOVIC:  Thank you, Betty.  You have the representative of another telecom company here which is TelkomKenya.  Snehar Shah how is it possible that this model that you also to some way extended really made it's way in Kenya?

>> SNEHAR SHAH:  Thank you.  I would like to say that although M-PESA has led the way we are healthy competitors in this market.

We talked about access.  And actually I've been in Kenya for the last three and a half years.  And you know when I came to Kenya, there was no submarine cable.  Connectivity was still via satellite.  That's just when M-PESA was launched in the last three and a half years of course we have seen the phenomenal success in the field of mobile money but also as far as infrastructure goes since the three and a half years we've got various submarine cables that have landed here.  We now have two fully fledged 3G networks in Kenya.  In fact Orange was quite proud to launch the second 21 megabits per second network in Africa.  The first one being in -- I think in South Africa.

So you know we now with those kinds of speeds we can do all the kind of applications that we talked about.

So you know infrastructure for Kenya is not an excuse anymore.

But now what we are seeing is a lot of innovation happening out of here.  And you know we've seen what's happening in the field of M-health and of course mobile payments and that's actually reverse innovation.  And it's quite exciting to be working in this field.

So I was tasked with launching our mobile money product after our three competitors had launched.  And I would say I would have -- I have the toughest job in the world to compete against M-PESA which kind of has become a currency in itself.

Orange operates in 17 countries in Africa.  In most of our other African countries, especially in West Africa, Botswana, Madagascar, we have followed the same kind of model like M-PESA which I'll call a telco led model based on a mobile wallet which worked quite well as Betty said when there was a real need from consumers to transfer money to each other.  And it started from there.  And like we have seen how it's expanded into various other add-ons like bill payments, paying loans, et cetera.

So in order to be able to compete against M-PESA for Kenya we chose not to copy-paste but to follow a slightly different model.  And this is when you know three years on technology has moved on.  I believe when M-PESA launched many of the banks were sleeping and banks certainly in Kenya have now woken up.  Since last year we've had the introduction of agency banking.  Like has been the case in Latin America.

So the regulator here made a lot of visits here and learned a lot from what has happened in Latin America and brought it here.

As Betty mentioned we've had around 1,000 branches up until last year.  And now while we have around 30,000 mobile money agents we have close to 10,000 bank agents.

So things are moving.

So really the strategy for Orange for our product it's called Eco-Pesa, eco meaning the money is now and here for partnerships.  We as a telco, we realised what our limitations are.  You know we are not set up to do financial services.  But you know at the end of the day we want loyal customers and we also believe in financial inclusion.

So our strategy was one of open partnership where we partnered with a bank to offer mobile banking services which provide all of the services that we have heard about, that you see with a mobile wallet.  But because it's linked to a bank account, the customer has a better feeling of security.  Because the bank is set up to do -- to deal with all of those processes and procedures.  The customer can save limitless amounts on his account and earn interest.

So it promotes a savings culture.  Because it's based on a bank account, customers can also through their mobile phone borrow money.  So they can apply for loans using their mobile phone.

And also unlike a traditional mobile wallet, there are no limits to how much one can transfer.

So you know being in this situation with a very tough competitor and also having seen our other two competitors not really make a success of the traditional mobile wallet, it forced us to think differently.  And to innovate.  And with the success that we're having here.

Now, some of our other countries are actually adopting a similar model.  So we're about to launch something similar in Uganda.  Our colleagues in Egypt because of regulatory issues are also considering going our way.  In fact in many countries like India and Nigeria, Egypt, you know the regulator is more tougher than what we've had here in Kenya.  And that's also one of the reasons why we have had such success of the mobile wallet.  And I think in the discussion today it's a strong message to also bear the importance of having favorable regulation policy in order to enable some of these services to work to benefit the consumers in the end.

So you know we're very excited.  And I think both with our competitor we have a common aim to extend financial inclusion and also ultimately make Kenya a cashless society.

>> VLADIMIR RADUNOVIC:  Thank you, Snehar.  This is really challenging.  And I bet that there would be again people coming from Developing World that would say that's nice but we don't have the infrastructure.  Even for these things.

Now, there are of course many policy aspects of that and we are leaving that for some other discussion about privacy security and all of these things.  But the question of building up the infrastructure and to what extent that can be done without too much funds but still in a quality way that can assist launching some of these services and then probably the question of involvement of all of the business and I realise that I'm the only Civil Society, businesses around me but you can ask them in what way they are supporting the infrastructure later on.  But I leave it to Kristin Peterson from Inveneo who had a lot of experience in building up the networks in I would say a cost efficient way.  And one of the examples that I really liked was Haiti, which you all know the history of.  So Kristin.

>> KRISTIN PETERSON:  Hi, everyone.  It's a pleasure to be here.  You might get the idea this in many of the -- that in many of the discussion with the advance in cell phones across the world and with what's been happening with broadband that we're really far along to getting access to many places and most places in the Developing World.  But it's not the case.

Access is as everybody has mentioned here is truly critical.  Real broadband access is critical for delivering an opportunity, economic opportunity.  Better health care as in the applications that Tata is developing.  Better content, access to education, both interactive and just access to information where many places don't have books.

So access plays a critical role in our lives.  But it place a much more critical role in peoples lives in the Developing World in particular in rural areas.  And my organisation, Inveneo, is a non-profit.  I'm also a Civil Society.  Social enterprise based in San Francisco.  And we are focused on getting the tools of access and ICT out to people in organisations who need it most in very rural and challenging environments across the Developing World.

I would like to share with you one statistic about access in Africa that I learned recently.

I was in South Sudan, the newest country.  Who do you think has more access, the living room or the entire country of 9 million people in South Sudan?  It's my living room.  We estimated based on discussing with the Government NGOs that there are only 50 megabits available to the entire country of South Sudan right now.  That is creating a serious disadvantage in getting better services, health care, development, access to human rights out to South Sudan.  So what I've been asked to share is a little bit about how we've been working on creating better access to broadband in very rural and challenging environments.

The example that I'll share with you today is Haiti.  Inveneo was asked to come into Haiti right after the earthquake to help use some of the learnings that we've had in the 25 countries we've been working with to create a broadband network very rapidly to serve an organisation called NetHope and 20 of the NGOs that they were working with that were doing immediate relief for earthquake victims.

We were able to put up a broadband network in about two weeks across the entire Port-au-Prince area to help organisations get better access to communications, use mapping tools to identify where victims and issues were to reach out to the institutions to figure out what they needed for faster operations but that wasn't the end of the story what we did there were several ISPs working in Port-au-Prince which is where the major work we did took place we transferred them back to local IPs as soon as they were operating and back in form we quickly realised that to help build back Haiti after the earthquake and looking forward to the future and looking at economic opportunity what Haiti really needed was a rural broadband network.

Now, Haiti just to give you a sense is the lowest -- has the lowest economic -- the lowest standard of living and per capita income in the western hemisphere.  It's very equivalent to many of the countries in some of the poorest countries in Africa.  They make about 2 to $3 a day.

So what we looked at is how can it be possible to break some of the barriers most of the barriers in rural access beyond barriers that are regulation driven are really market failures.  Why isn't an organisation, why isn't an ISP serving this area?  Because they don't see the business case so what we did is we had to take a look at what could a business case be in an environment where a country was this poor.  Well, one of the helpful aspects of Haiti is there were a number of NGOs working there.  And we thought they have demand.  But no one has ever taken a look at how that demand can drive a business model.

So we started looking at where the NGOs were all across Haiti.  And if there's demand from the NGOs, there must be demand from the Government.  And from some of the micro finance offices and from some of the schools, even though it's a very poor environment.  So we started to take a look at how could we reach out to that demand.

There are two ways to look at how to reach out to the demand in rural areas one is to take a look at new technologies, technologies that providers aren't looking at now because they are used to using the big iron the traditional way they work.  They all work independently and they all use in many cases in places like Haiti they use WiMAX.  WiMAX is a very expensive and power consuming technology designed for urban areas.  And it simply doesn't make a business case for rural areas we took a look at long distance WiFi and how it can be used to deliver real broadband out to the organisations in rural Haiti.

Additionally another thing that carriers don't like to hear but can be very important in creating low-cost ability to serve rural environments is sharing assets so we took a look at how can the carriers share assets.  How can we create basically a transit network using a variety of assets, low-cost technologies and some of those towers you see bunched together instead of having towers bunched together why not put towers in different places so we took a look at that.  And the final thing we took a look at is how do you create the ability to deploy and support a network like this in very rural areas so the carriers don't have to send people out from the city.

Well one of the most important things about most places across rural Africa and even in Haiti is there are talented youth that are underemployed all across the country so we identified talented youth we vetted them for technical capacity and we started to train them on how to become essentially the cable guys in rural areas and girls but mostly guys.  I mean, face it it's kind of the way it is with technology, especially in these environments.

So what we did was we built up capacity using youth to deliver the broadband services and it essentially became a much higher level of distribution for the ISPs and service providers similar to their topup people but at a much higher technical level.

So putting this entire model together, what we found is that we can create a model by coming in as what we call an intervention in Civil Society for a small amount of money.  And we actually went to many of our funders who supported us in the early days in Haiti and said:  Look.  We can put this model together and leave a vibrant financially viable model.  We can hand over to the carriers once we leave and the carriers can grow as the demand grows across Haiti.

So that's what we're doing.  We're about two-thirds of the way there we'll be delivering a broadband network to six regions in Haiti and 20 population centres and can reach out about 40 kilometers and can reach out from each of the locations in Haiti.  We are covering the land mass in Haiti and reaching a good part of the organisations who serve the rural population, which is I believe about 7 million in Haiti.

So this is a model that we're -- can work in one of the poorest countries in the world.  Each country is different.  They have different regulations.  They have different typologies.  They have different service provider environments.  But it's very important to take a look at what can be done because something can be done to deliver better access and it can be done now it's a matter of looking at the ecosystem and putting the pieces together and coming in and making it happen and we're working as an organisation, Inveneo we're starting to work in many countries to use the framework that we've used in Haiti and Palestine and a number of places in Africa to look at how we can deploy large scale rural broadband initiatives that both benefit the rural public but also build jobs and extend service provider capacity.

>> It's an enterprise --

>> KRISTIN PETERSON:  It's enterprise quality.  So we started building the network in about February of this year.  We'll be done between December and March of next year depending on how fast everything goes the entire cost of the programme that we deployed is -- cash cost is about $1.65 million.

>> THE AUDIENCE:  (Off microphone).

>> KRISTIN PETERSON:  No this is actually going to be -- 1 megabit symmetrical is actually the standard ale that we offer but there are a lot of other options.  And we've got -- if I remember correctly and I'm not the techie.  We've got in some locations 50 to 100 megabits of capacity.

We deployed the first link of this in the town that was damaged by the earthquake in Leogane that was the epicentre.  Within about two or three months we had 25% of the NGOs where they had no broadband capacity with the exception of small service providers they immediately went to actually the first day it went to 10 megabits with a couple of the organisations, Save the Children -- Save the Children, Red Cross, International Federation Red Cross, and others and they were able to really move out and start to develop Haiti back better and allow their entire teams to have access to the Internet right away so they could move out more quickly.

Thank you.

>> VLADIMIR RADUNOVIC:  Thank you, Kristin, for wrapping up this set of cases and examples in a very optimistic way that we can develop the infrastructure, as well, in an easy -- not so easy but easier and cost effective way.  And I assume that the co-operation with the business is very important there, as well as with the Government.  So it might be an invitation for replication of this project.

We don't have much time to go into -- we don't have time at all to go into how we could replicate these things.  But unfortunately you have the workshop which is taking place in Kenya moderated for a Balkans guy.  So we'll be late and we'll continue for another five to ten minutes if you have any questions.  Otherwise we'll go for coffee.  Any questions?  We'll take three try to be precise if you can who you would like to address the question to.  We'll start with the lady.

>> Thank you very much.  I would like to congratulate all of the presenters.  My question is about collaboration with all of the stakeholders who did this tremendous experience in Developing Countries.  You know, I can see we are only working with English-speaking countries.  In Africa we also have French-speaking countries like Senegal and Mali and so forth.

How can we work together to replicate what you're doing in English-speaking countries?  Thank you.

>> VLADIMIR RADUNOVIC:  Thank you.  Let's take three of them and then we'll go on.  Yeah.

>> My name is Jim Solifaia (phonetic).  I'm the Vice Chairman for WTSA, World Technology on Subsidies Alliance in Africa for ICT to fulfill the promise of the Digital Age.  I have two quick questions.  The first one is to Gupta of TCS and the second is to Betty.

You actually talk about the challenge before Developing Nations is about knowing what is important.  What is important.  In the face of access.  The need for access.  The need for content.  Maybe -- so my question is:  How do they pick that that is most important merely in the face of scarce resources?

Then No. 2 for Betty.  Like in the face of the cyber challenges of late -- Betty is gone.  Okay.

In the face of the cyber challenges in recent times, I just wanted to find out what they have done to kind of strengthen confidence on this platform because it's cyber based.  Thank you.

>> VLADIMIR RADUNOVIC:  Thank you.  We'll take two more questions and then we'll finish here and here.  Yeah.

>> Hi.  My question was also for Betty as well as Snehar Shah.  The question is basically I come from Pakistan.  And we were trying to figure out if the -- if we should be bank led or telco led.  I see your smile.  Would it be a fair assessment to say had it not been telco led, it wouldn't have been as great a success as we have here in Kenya?  I wanted to get your thoughts on that.  I had a chat with Betty on the way out.  I'm sure we know what she might have said.  But I would like to get your thoughts on that.

And secondly, as far as infrastructure is concerned, as far as Safaricom, this is USSD and SMS.  Not necessarily IP.  Maybe some thoughts on that, as well.

>> VLADIMIR RADUNOVIC:  Thank you.  I think -- did we have one more question?  Try to be loud.

Thank you.  Snehar, do you want to start with all of these questions?  And try to put it in a minute if you can.

>> SNEHAR SHAH:  Sure.  I think I'll try to answer all three questions in one.

Starting with security and the cyber challenges, confidence of the platform.  I think that is one of the reasons to favor the bank-led model.  Because you know once you come under the jurisdiction of the bank who is really set up to do all of this, the confidence levels are clearly higher.  And you know in terms of the risk and the security you know it is much tougher.

As far as the access goes on the mobile phone so you're right that both USSD and SMS channels are used.  In fact for Orange Money it's open to all of the channels including IP, as well.

I think compared to USSD, if you compare USSD to SMS and IP, the security levels in SMS and IP are much stronger.  So for example in SMS, we use what is called triple desk encryption and also as far as the pin entry is concerned USSD actually has to be in the clear.

So if you are putting in your pin and somebody is watching your back they can know that whereas with SMS or WAP you know the security is stronger.

Regarding, again, bank-led versus telco-led, I think four years ago when the banks were sleeping, telco led made sense.  But since then because of the success of mobile, because of the penetration of mobile, banks have clearly woken up.  Our technology has moved on.

You know, Betty talked about how difficult it is to register a customer for a bank account.  But today with technology, it's not.

We are actually registering people on full bank accounts with the space of five minutes.  The way we do it, we use a very cheap 3G enabled phone with a 2 mega pixel camera so a bank account can be opened not necessarily in a bank branch but anywhere at an agent at a shop out there in the field so we have equipped our agents with this device so when the customer comes, they fill in a very simple one-page form which has all of the basics KYC requirements including the name, the ID number, their physical address.  The agent takes a picture of the form, a picture of the person.  A picture of their ID card.  And again utilizing infrastructure, utilizing the Internet, that information is then transmitted to the bank's central processing centre the customer is vetted if everything is okay in the space of one hour the customer can receive their pin.

So I think we're now reached a phase where through strong convergence you know we let the experts do what they are good at.  So you know the toll co-s are good at the access to the -- the telcos are good at access to the mobile phone, we are good at distribution.  But as far as the other experts are concerned we'll leave it to the banks in terms of financial security, et cetera.

>> VLADIMIR RADUNOVIC:  Thank you, I'm sure we could develop discussion more about it but we should come to the ending.  Pankaj.

>> PANKAJ GUPTA:  Coming to the issue of how do we compete, how do we use these cases yes we are competing with reality shows, opinion polls, telemarketing, education, entertainment, we are trying to compress the size and utilization of the bandwidth on one side and second policy interventions to subsidize networking companies and telecom companies in this space that's the only way we can maximize the scarce resources we have.

>> Two quick comments bank versus telco led that comes under the philosophy of your regulator and frankly it's a question of what pushes the envelope faster your telco model will tend to have faster penetration --

(Audio lost).

>> VLADIMIR RADUNOVIC:  Time to wrap up.

>> Okay.  Very quickly in general when we look at doing world deployments we look at WiFi first because WiFi is very cost effective and the kind of long distance WiFi specifically long distance WiFi working technology because the cost per location is very low and the power consumption is very low most places we work don't have traditional power you have to use solar or generator to battery backup so WiFi is most definitely the first choice.  Another thing -- but what we always are starting to look at is what is the right combination of technologies to get to where we need to get to and when you're starting to build shared networks for example in Haiti we have three of the four carriers in Haiti working with us.  So various carriers are using various of their own networks to get out to the shared network and I'm sure some of that is actually microwave so it's really a mix and what you can do is layer on the routing on top of the entire network so what we look at is what is the best way to reach some of the hardest to reach places.

From a backhaul standpoint that's one of the big issues in Haiti.  They have great access to bandwidth.  But it's exceedingly expensive.  Because right now they don't have access to an optical fiber.  They have to go through the DR. So right now they are a little bit -- they are captive.  And we're actually looking at what levers can be used to drop the international bandwidth by 75 to 80% in the short term and we have solutions we are working with that in the long term there's organisations working on fiber optical cable buildout.

(Audio lost).

>> Through a variety of carriers.  So in looking in rural areas in Developing Countries, there are a variety of things to look at.  And really it's a framework of looking at all of the different pieces and how do you pull that all together rather than looking at just one solution whether it's you know -- because there is no one solution.  It's really an entire framework or a value chain to deliver to the end point.

>> VLADIMIR RADUNOVIC:  Thank you, Kristin.  Time to finish this.  There is one big remaining question that you are both very well aware as well it's corporations of how we should establish the replication of all of these good models.  Well that's a question for all of us to gather around the coffee break that's why we are here at the IGF to find the ways for that.

I would like to thank you all for your attention.  Thank you to the remote participants.  And of course thanks to the panelists.  And I think they deserve a round of applause.  Thank you.



(Session ended at 10:53 a.m.)




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