Good intentions towards poor countries, a neat idea and a favorable press launch a lot of projects - and garner many billions of dollars from donors, private and public. That, of course, was the story of The World Bank in its first several decades.
But the refusal of well-intentioned politicians, academics, and otherwise intelligent people to work with market forces to provide a better life for several billion souls is an unending, costly drama. The latest example appears to be Nicolas Negroponte's "One Laptop Per Child" (OLPC) project . The objective has been to design and distribute $100 computers to children in developing countries so as to provide them with access to web-based knowledge.
As discussed recently in the New York Times and by Steve Nussbaum in Business Week, the project's directors suddenly realize that developing country governments are not terribly enthusiastic about the project. And since they were expected to buy the laptops, Negroponte is now looking to the American public to "Give 1, Get 1" - buy two laptops for $399 and donate one to a child in a developing nation.
Technology Isn't Everything. Negroponte seems to have been seduced by the rhetoric of "the digital divide" crowd. Shortly after PCs and then the web burst on the scene, the usual foundations, non-governmental organizations and UN agencies started agitating for resources to distribute PCs to the developing world.
The OLPC project has been part of this movement. But, until very recently, the project had precious little input from the intended users. The main objective appears to have been a technology oriented push to get the cost of manufacturing a basic laptop down to $100. Very little serious thought has been given to (1) how the laptops are to be distributed and (2) once distributed, how to persuade children (and their parents) not to sell the laptop for something more immediately necessary (medicine?) in a societies where the per capita income might be under $1,000 a year.
Negroponte's answer to the first problem is that distribution will be "exclusively through national or government agencies of the countries involved." Clearly, he has never walked through an African market where bags of American corn labeled "A gift of the American people" are on sale at market prices. Has Negroponte never been briefed on the distribution and corruption problems in getting hybrid seeds and pharmaceuticals distributed through developing country government agencies?
His answer to the second problem is to admit it exists and to handle it by designing the laptop to be "so distinctive that it is socially a stigma to be carrying one if you are not a child or a teacher." I wonder how many village chiefs Negroponte's team interviewed to come up with that solution.
Is the Digital Divide Already Bridged? The deployment of cellphone technology is the relevant case to study. In developing countries the information revolution is already touching peoples' lives through cellphones, including those with web access. The technology is being deployed wherever governments have permitted two or more companies to deploy the technology - and to charge prices that give those companies a reasonable return on their investment.
Africa, collectively, is the fastest growing cell phone market in the world. In many countries, individuals buy and then rent out cell phones by the minute so that merchants can place orders, sellers can determine market prices, and would-be workers can contact potential employers.
Here's some reasonable advice: forget OLPC's distribution problem. And instead of giving a single Taiwanese manufacturer (Quanta) monopoly manufacturing rights, why not make the technology freely available to all? That would be a major public service. If the market for the laptop is really as large as OLPC believes, it should be large enough for more than one manufacturer to enjoy the necessary economies of scale - and to figure out what improvements can be made, in conjunction with private distributors selling them for their highest-valued uses.
Just like Motorola's ill-fated Iridium satellite phone project (which cost the company's shareholders more than a billion dollars in losses - and has emerged from the ashes of bankruptcy a smaller and more focused company), the OLPC project may prove to be helpful in deploying technology, learning, and ideas. But it needs a market test, not public or private charity if it is to truly succeed.