Expertise is among the many many key routes in bridging the opening between the wealthy and the poor in nations like India, and will facilitate enchancment in some strategies. It could most probably allow free or quick entry to training (Cisco Dwara, Khan Academy, The Shuttleworth Basis), simplify commerce and commerce (ITC’s e-choupals), current employment (Desi Crew’s rural BPOs), present correctly being suppliers (Wipro’s distant foetal correctly being monitor, Neurosynaptic’s ReMeDi), improve agricultural yield (RTBI’s agri-advisory system, the Kisan Title Centre) and fairly further. On account of this reality, know-how does qualify as an ‘essential section’ for the inhabitants on the underside of the pyramid (BoP).

7BC_1That is furthermore a really massive and fascinating marketplace for tech corporations to enter.

Nonetheless, establishing merchandise for this market merely shouldn’t be straightforward. There are a selection of parts at play correct proper right here, from price and price to customized and economics. So, allow us to start out out this attention-grabbing journey of introspection (the 12 months finish is regularly a superb time for reflection) by speaking with just a few consultants on what it takes to assemble a worthwhile product for the BoP, after which take a look at some worthwhile examples.

Why make merchandise for the BoP
“That’s an easy one. The answer is size. Simply size. And it’s growing,” asserts Sunil Malhotra, founder and CEO, Ideafarms. “On one side, the share of the wallet of each player in the market is shrinking with increased competition. Overseas markets may not be shrinking but have saturated. India is one of the best hunting grounds for large international companies, not just due to market size (and the fact that it is one of the fastest growing) but also because the semi-urban and rural consumers are beginning to aspire for better lifestyles and therefore better products. Going early to a market that’s ready and eager simply makes good business sense.”

“India and China alone constitute around 40 per cent of the world’s population. Both are growing economies where the spending power is on the rise, but there is a high demand for products that offer value rather than products that command a brand premium. Even in developed countries, a large percentage of the population would fall into the category that looks for products that offer value for money,” says Kantheti Srinivas, director, Processor and DSP Apps, Analog Units India, an organization that offers processors, low-cost MEMS microphones, capacitive contact sensors and fully totally different parts for merchandise focused on the mass market.

He offers, “Considering the huge volumes and the opportunities knocking on our doors here, it is important that electronics companies tap the market. However, products in this segment need to offer value and not just be low-cost.”

What sort of merchandise must be made
Markets are shifting from the West. India is predicted to develop to be the fifth largest market on the planet by 2025 (in accordance with a recent analysis by the McKinsey Worldwide Institute). Whereas the scope of the Indian market is obvious, what precisely this market wants is a query that must be answered.
Alok Mittal, managing director of Canaan India, a major tech enterprise capitalist in India, says, “Given the mobile revolution in the country, electronics has become mainstream and is not a preserve of the wealthy. This has also brought in a lot of demand for localisation, which represents an opportunity for entrepreneurs and electronics companies. Handsets and telecom equipment are set to become one of the largest categories of imports for the country, and hence local manufacturing has risen up in the country’s priority list. All these factors make it attractive for companies to invest in this area. Interestingly, mobile phones are likely to become a platform for adjunct electronics devices, such as those used in remote healthcare and education. We have been seeing start-ups in the healthcare domain as well, like companies that are making sensors, which plug into mobile phones to provide low-cost diagnostics.”

In accordance with Malhotra of Ideafarms, “Leveraging the Internet to empower individuals and enable small businesses in semi-urban and rural areas is a foolproof strategy. The increased access to low-cost, high-speed connectivity in rural areas and cheaper access to content in a hyper-local way become powerful change agents in the way information will be delivered, consumed and shared to up the ante in fulfilling basic human needs. Throw in a smartphone and you have a winner. Much of the rural-urban divide is accentuated by a lack of or a lag in information availability. Smartphones, even the cheapest in the market today, will ensure that the consumer is ‘always on’.”

Designing a washing machine for India (Courtesy: Incubis Consultants)
Designing a washer for India (Courtesy: Incubis Consultants)

Srinivas furthermore agrees that the cellphone is among the many many hottest merchandise on this half. He offers that smaller-screen tv and audio-visual methods, the home-theatre-in-a-box (HTIB) and {photograph} voltaic lighting that use renewable vitality take care of the wants of the BoP too, whereas vitality conservation could possibly be a worthwhile theme for this market.

Malhotra spells out a type of thumb rule. “From my point of view, it makes sense to go from the bottom up; to create a portfolio of products and services to fulfill basic needs before going after the goodies. My list of ‘basics’ has healthcare, education and finance at a category level; those areas that create better living conditions such as sanitation, clean water, food and energy at the next; and then communication as a means to keeping abreast with the world as well as a channel for feedback, fun and information exchange. Some of the products we saw in the movie ‘3 Idiots’ are pointers to the kind that we need to look at. Not jugaad but concerted reuse of available and existing technologies to take these prototypes to the commercialisation stage with the help of interdisciplinary experts and groups,” he says.

How do corporations make a low-cost product
“Addressing the BoP is neither easy nor cheap. Quite the opposite!” exclaims Malhotra. “There’s no intelligence required if all we have to do is to strip a product down to its essentials to reduce quality. I’m also not a big advocate of inventing niche products to go into these markets. These products must be simple, intuitive, safe and sexy, aka world-class.”

Mittal feels that, “In most cases, cost re-engineering is the first important step. This involves understanding the customers at the BoP, and then designing to those specifications. This may involve introducing features (such as ruggedness and long battery life) and eliminating features (such as accelerometers). Since electronics manufacturing is fairly standardised, the functionality drives most of the cost. As you will have noticed, the current examples of BoP products are mostly from the mobile phones’ domain—from Nokia’s Asha series to Micromax’s dual-SIM phones.”

Malhotra recollects, “Earlier this year, Amit Gulati, who runs Incubis, invited me to participate in an interactive session to think through design ideas for a low-cost washing machine. The workshop brought out some very interesting and fascinating ‘ways of seeing’ that completely overturned the engineering/tech/product way of approaching design problems. Did we need to redesign the washing machine (product) under stricter constraints, like the way most people think—start with an existing product, strip it of features, use cheaper materials and processes, reduce quality and make it low-cost. Or did we need to go up a level and reframe the problem itself?”

The reply, he says, lies all through the context, which is about customized, geography, native local weather, behaviour, property and vitality all by means of the boundaries of environmental friendliness and ecology. Every little issue else is secondary—design, offers, processes, know-how and, lastly, financial factors.

MACi ECG machine
MACi ECG machine

As quickly as we take into consideration the BoP, we are inclined to place economics first, nonetheless in accordance with Malhotra, that is flawed. “I have deliberately kept economics at the bottom of the list. Call it ‘inversion thinking.’ Economics drives everything in today’s world, whereas it is merely a function of supply and demand. In my view, the concept of low cost itself is deeply flawed. What we should really concern ourselves with is lower price and, however counterintuitive it may seem, lower price is not simply lower cost. I’m no economist, but my business sense tells me that I can drive the price down by increasing volumes and reducing profits. Besides, adopting newer business models such as crowd-sourcing and collaborative manufacturing can help address this key issue. So, we must all remember that low cost is different from cost-effective, which is different from value-added. Unless the envisaged product enhances value, low cost has no meaning,” he says.

From the know-how standpoint, Srinivas feels the an equivalent. He says, “A low-cost product is a misnomer in my opinion. It is a product for the low-cost segment of the market but it need not be a low-quality product. Products in these segments need to be designed ground-up for success. There is no way an existing product replaced with lower-cost components can be a success here.”

That talked about, he parts out that digital half prices have furthermore gone down considerably all through the most recent earlier. “The mass-volume products drive down the cost of these components. Interestingly, OEMs in other industries now tend to use products or components from the PC and mobile industry to drive costs down. Processor costs for a single-core Cortex A8 at 1 GHz have gone down to as low as $6 this year, while two years back these commanded a healthy premium of $20. Memory costs have also been driven down, though they fluctuate due to the changes in supply and demand. The other major component for which costs went down significantly is the display. However, for applications that need strict qualification, like in the military and automotive domain, the price erosion has been far lower.”

Dorai Thodla, founding father of iMorph Inc., offers us his take: “There are two ways to build a product for this market—innovation in low-cost methods, or high volume of sales with normal methods.” So, you’ll be able to ponder each schemes to steadiness worth and worth for this market.

How about one issue like…
In case you could get into making or promoting tech to the quite a bit, look to those attention-grabbing examples steered by our consultants for motivation.

Inspiring DIY tales. “There is something called the Maker Movement in the US. It is a self-help culture of building things you need. People who are involved or touched by the Maker Movement build simple prototypes and turn them into low-volume products (initially). Many of them involve electronics. Of late, I have been hearing of many Indian examples too,” remarks Thodla. For example, a pupil created an app that {{{couples}}} a moisture sensor with an Arduino, which tweets when the moisture content material materials supplies is beneath a sure diploma (he wished to attach this to a drip irrigation system). An entire lot of current merchandise are being powered by Arduino (and its variants), Raspberry Pi and others. Plus, a wide range of sensors hooked as a lot as cell fashions are serving as low-cost diagnostic and healthcare gadgets. {Photograph} voltaic lamps, cookers and the like are furthermore changing into regular themes, for each start-ups and unbiased innovators. “Though expensive initially, these will eventually lower running costs (due to the reduction in oil and electricity usage) and make sense for the BoP. The next generation of these devices will be enabled by intelligence (such as lamps that turn on/off based on ambient light),” says Thodla.

MACi ECG machine. “GE India has been a pioneer in reverse innovation, leading product design for emerging markets. Its innovations are not just a cost reduction of existing designs, but completely redesigned from the ground-up to make a product that is several times cheaper and yet offers reasonable value,” says Srinivas. GE’s low-cost MACi ECG machine, launched just a few years beforehand, was developed by researchers in Bengaluru after understanding the necessity for a low-cost, sturdy, moveable ECG machine for low-income communities. MACi is battery-operated, moveable and ready to printing in three channels. With one battery worth, it will most probably full 500 three-channel ECGs or 250 single-channel ECGs. So, with one battery worth, it could be utilized in a rural hospital with out electrical energy for near a month. MACi is priced at spherical Rs 25,000 and is maybe purchased by straightforward month-to-month instalments. After worthwhile early adoption, the machine was furthermore tailored within the market to value-oriented prospects in developed nations just like the US.

Lullaby Child Hotter. One totally different of GE’s low-cost, high-value enhancements, Lullaby Child Hotter offers 69 per cent warm-up, enabling nurses to deal with new-born arrivals with fairly a bit quite a bit a lot much less stress. The product presents worth for cash and ease of use, each of which could be essential for mass utilization. GE has included know-how contained in the form of the Calrod heater for uniform warmth distribution, which makes it straightforward even for novices to put the child all through the warmer. The hotter furthermore has colour-coded security alarms, a visually-coded administration panel and well-positioned lights for easy utilization. In accordance with the corporate’s tales, the instrument presents price financial monetary financial savings of as quite a bit as ` 107,000. It consumes 60 per cent quite a bit a lot much less energy on start-up and 20 per cent quite a bit a lot much less energy over 24 hours. There are additional price financial monetary financial savings attributable to Calrod’s lifetime guarantee, decrease wattage and dependable probes. “GE’s MACi ECG machine and the Lullaby Baby Warmers have won international acclaim. Now these products are exported to several countries including developed nations,” says Srinivas.

Lullaby Baby Warmer
Lullaby Child Hotter
Low-cost smartphone
Low-cost smartphone
Low-cost tablets
Low-cost tablets
Tata Nano
Tata Nano  Low-cost tablets. Low-cost tablets, resembling Aakash with primary selections and open present software program program program, are furthermore changing into regular as we converse. Comparatively than utilizing these tablets as general-purpose machines which have the whole choices, customised variations, which have solely the alternatives necessary to a bunch, could possibly be utilized. That is one totally different methodology of creating a product cost-effective.

Cell-controlled irrigation. Nano Ganesh is an utility developed by Pune-based Ossian Agro Automation. It has been in use for spherical 5 years now, and continues to be regular in Maharashtra. It has even been recognised by the World Financial institution as a notable know-how for rising nations, attributable to its simplicity and affordability. Nano Ganesh, which furthermore obtained a Nokia innovation award, permits farmers to level out their irrigation pumps on and off by remotely utilizing a cellphone. A cell modem is positioned on the pump and related to a primary cellphone. This enables distant administration of the pump’s starter panel. When the farmer calls this cellphone from any location, a tone is heard if the motor is on, and there’s no sound if the motor is off. The farmer can then flip the motor on or off by a 440-volt starter change that responds to a code quantity despatched by way of SMS from the farmer’s cellphone to the cellphone hooked as a lot because the motor. Nano Ganesh is maybe hooked as a lot as any electrical starter and motor pump. It prices Rs 2800 plus taxes, and setting it up is simple and automated. Purchasers do not must be literate to know the easy tones. Full, it is sensible for the agro group.

Low-cost smartphones. The preliminary smartphones arrived at a price-point of ` 30,000, which was method an excessive amount of for a indicate Indian. So, how most fascinating can this product be optimised for a low-income group? “The high-end phones came with support for multi-band 3G roaming capability. For an average Indian, this is not needed. So, costs are saved by removing this feature. Optimising the software for lower memory footprint gives the opportunity to save some more costs. Earlier, systems used NAND flash boot while still having an SD card. Products for the low-end markets pushed technology to use an SD card boot, thus saving the cost of additional memory. While a natural drop in the prices helped this market, lower-resolution displays and using a single speaker to give virtualisation effects all helped address the needs of this market. Adding dual-SIM capability added the icing on the cake for this segment,” explains Srinivas fantastically!

Tata Nano. It is a reasonably worthwhile automotive, with respectable worth and low price. “The car is designed for those who can afford a two-wheeler but can stretch a bit to get the comfort of a car,” says Srinivas. “This meant the car had to have all the necessary features but be priced effectively. This implied optimising the space inside the car, which also meant re-positioning the engine accordingly, for both efficiency and space. This needed a complete re-design of the engine and chassis. Tata Motors also went ahead and re-designed the doors and windows for lower weight so as to improve the efficiency. Components have been manufactured indigenously to the extent possible to save on the import costs.”

Worth-effective computing. In 2011, the federal authorities of Rajasthan focussed its consideration on an enormous pc training program, which concerned organising computing labs in spherical 2000 colleges unfold all by means of the state’s 33 districts. If utilized the same old method, it might need meant an insufferable preliminary funding atop the continued prices in help, repairs, energy current and so forth. Exploring selections to this, they purchased proper right here all by means of NComputing’s sensible and cost-effective computing reply. NComputing presents desktop virtualisation selections, which give entry to computing at a fraction of the worth of ordinary server-PC primarily based networks. This enables instructional establishments, hospitals and rural BPOs to know their wants at lower worth parts. Usually, a indicate pc particular person makes use of merely 5-10 per cent of the PC’s performance; the remaining (approx. 90 per cent) goes waste. Contained in the case of the Rajasthan colleges too, their totally different of NComputing reply was primarily based on the logic that faculty kids use solely a fraction of a indicate PC’s computing performance, since their discovering out wants are fairly easy. Establishing specific particular person PCs for every pupil is subsequently a waste of performance and cash. On account of this reality, they set up 10 NComputing digital desktops in every lab, which utilise the unused computing energy of the PC and share with fairly a number of prospects utilizing NComputing’s vSpace desktop virtualisation software program program program. A keyboard, mouse and monitor are related to every NComputing entry machine, making it seem as if every pupil has a PC to work on! Other than the low {{{hardware}}} acquisition price, the reply furthermore meant 75 per cent quite a bit a lot much less help and upkeep prices, and 90 per cent quite a bit a lot much less vitality consumption as NComputing fashions use merely 1-5 watts {{of electrical}} energy in contrast with 120-150 watts in a regular PC. It is a important revenue in distant parts of the state the place energy current is a perennial subject. In some strategies, together with price, NComputing’s reply appeared a most fascinating match for rural India’s computing wants.

Worth-effective computing
There are tons additional alternate choices and far more concepts, if solely we pause to consider the wants and earnings ranges of the quite a bit. In accordance with a Press Notion of India launch dated February 2013, after the unlucky ladies harassment incidents in New Delhi, Union Minister of Communications & IT, Kapil Sibal, talked about to Rajat Moona, director widespread, C-DAC, “I want a wrist watch that will videograph, set up an alarm and will call up dedicated lines. Let’s have a GPS system, and let’s produce this watch for less than ` 1000 for the safety of the citizens of our country.” Allow us to hope to see this and fully totally different concepts come to life, shortly!


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