In emerging markets it might be hard to find the money to start up a business. Could cloud computing be a game changer in these markets?
The emerging markets are definitely interesting to cloud developers and providers. Cloud computing is popular because of the low running costs and low need of knowledge, but for the emerging markets, there are still obstacles to overcome.
One of the main advantages with cloud computing is the low cost of implementation. You don’t necessarily need a server, but can instead use of one of the many cloud providers out there. Most small and medium businesses will find that the cloud has a solution to suit their needs. Furthermore this also means that you won’t have to pay for an expensive license. As we’ve seen in both webOS’s and dedicated cloud OS’s most of the software bundled with an OS is included in the monthly subscription or even free. Furthermore if developers need more resources cloud servers are easy scalable, due to the fact that many of the providers offer pay-as-you-go solutions.
Another advantage is, that the cloud can be set up anywhere with an internet access. Since it is possible to store everything in the cloud, you can practically access your systems from a bamboo hut in the jungle. Furthermore if you provide your employees with a cheap netbook, you actually don’t need to provide an expensive office. This also means that if you require a person with certain competences, but such a person isn’t available in your region, you can still collaborate on projects over vast distances. As we saw in LotusLive communication and collaboration isn’t a problem since these functions often are integrated in cloud interfaces.
Then what about finding clients? Well, since your business is already using the internet on a daily basis it is even easier for you to bring it online and by this making your services available to customers worldwide.
To be productive in the cloud requires some sort of a computer device. One obvious example could be a chromebook, but they are still as expensive as an ordinary laptop. Netbooks are much cheaper and it’s easy to install a hybrid OS or use a webOS. Simmtronics have tried to make use of this and are now selling their 199$ netbook in emerging markets. This is of course positive since several organizations have stated that 200$ is the point where computers becomes widely available to the public in poor countries. It can still be done cheaper. Raspberry Pi, a UK-based nonprofit organization, are currently working on a computer of the size of a credit card. The expected price for their device is 25$. The cheapest monitor on Bestbuy.com is sold for 80$, and then you’ll need a keyboard and a mouse which is 20$. This way you’ll have a full set-up for 125$. Their system runs on Ubuntu, but another Linux distribution, TinyCore, could be configured to start up directly in the web browser.
In developing countries and also emerging markets power isn’t always stable. Since power is necessary for a computer to work, then this is definitely an obstacle. The solution to this problem could be solar power since many of the emerging markets are located in sunny locations.
Another problem is connectivity. In quite a few emerging markets the access to broadband connections is very limited. The reason why the advanced economies are so well connected is that they had a huge density of preexisting phone lines which were easy to convert in to broadband connections. But digging cables in to the ground is expensive. Wireless internet access is much more interesting for small and medium businesses in emerging markets. VSAT was one of the first solutions, but with low bandwidth and high pricing it isn’t a viable solution. Instead 3G and Wimax could be the solution for these countries, but of course wireless as well as wired connections requires investments.
Each year the World Economic Forum publishes a report on the global ICT (internet and communication technology) and measures the network readiness of each country. In this statistic education plays an important role. Education must be prioritized in emerging markets for them to evolve in to an advanced market. In relations to cloud computing the question is if they know about this great concept. Is information available to entrepreneurs in emerging markets?
Three ways to evolution.
The development in the countries which are emerging markets moves to a more urbanised society. Therefore cloud computing knowledge centers need to be established in the biggest cities in these countries. By doing this both providers, developers and users can benefit from the concept. IBM is a huge player in the cloud industry and seems to spend a lot of time on developing new markets. They could be a great provider of such a facility.
To reduce costs and improve connectivity, new businesses could start out in a shared office facility. That way the firms could share a wired broadband connection, which is often more stable and faster than a wireless connection. There are obvious advantages for governments supporting such a facility. If you make it easier to start up new companies, then even if only a small percentage of these grow bigger over the years, these companies create jobs, income, export and in the end an increase of the annual GDP.
Of course we can’t just invest in the main cities. If a country’s leading communication providers don’t continuously work to expand the country’s communication infrastructure, the government has to step in. It must not act as a service provider itself though. It would be far better to present the providers with a reward as for example an exemption of taxes on new network areas within a limited period of time.