PC Kiosk Trends in Rural India

1. PC Kiosk Trends in Rural India Kentaro Toyama1 Karishma Kiri1 Deepak Menon1 Joyojeet Pal2 Suneet Sethi1 Janaki Srinivasan3 1Microsoft 2University of California Berkeley 3Indian Institute of Information Technology Policy Options and Models for Bridging Digital Divides Tampere, Finland March 14, 2005

2. What is a rural kiosk? A shop or community center in a rural village equipped with one or more Internet-connected PCs.

4. What we’ve looked at so far… Data sources: • Literature in journals, books, web sites, whitepapers • In-depth interviews with kiosk agencies (Drishtee, n-Logue) • Discussions with third-party observers (academia, gov’t) • Over 30 site visits in India and Africa (Akshaya, Drishtee, ITC e-choupal, MSSRF, n-Logue, …) • Ethnographic studies • Kiosk surveys

6. The Survey Goal: to understand rural kiosk operation from a business perspective • Three types of questionnaires for each kiosk: • A: Village baseline, one time only • B: Operator, 1 per kiosk, recurring • C: Customers, 5 per kiosk, recurring • Translated to local languages • Delivered orally • N-Logue • 150 villages • Recurring questionnaires every 3 months • Over 2 years • Drishtee • Two sets of 75 villages each • Recurring questionnaires every 6 months • Over 2 years • 2 surveys completed, 3rd begun

7. Kiosk operator Demographics Main source of income? Kiosk operation What services offered? Customers How many customers do you see per day? Miscellaneous Would you consider opening another kiosk? Kiosk customer Demographics Your profession? Spending habits How much do you spend on food per month? Kiosk usage How often do you visit? What services do you use? Sample Questions

8. Findings • Predominant customers are students and unemployed youth • Customer survey capped at 2 students out of 5 per kiosk

9. Findings • Kiosk customers almost always reflect gender of operator

10. Findings • Word-of-mouth critical for spreading use • First usage for >60% based on word of mouth, in spite of marketing efforts in village

11. Findings • Kiosk customers not necessarily PC literate • 70% of customers never touch the PC (operator mediates)

12. Findings • Top services: computer skills education, entertainment, e-government, desktop publishing

13. Findings • Average monthly kiosk revenue not enough to sustain • Required: between Rs. 3500-6000 per month (€ 50-85) • Current mean and median: Rs. 2000

14. Villages that can sustain a connected PC Income Literacy &education Knowledge- based needs Infrastructure Economies of scale (population) Villages that cannot sustain a connected PC

15. Focus on Sustainability Villages that can sustain a connected PC Income Literacy &education Knowledge- based needs Infrastructure Economies of scale (population) Villages that cannot sustain a connected PC

16. Focus on Development Villages that can sustain a connected PC Income Literacy &education Knowledge- based needs Infrastructure Economies of scale (population) Villages that cannot sustain a connected PC

17. Bridging the Digital Divide? Other possible models for IT in development: • Non-PC computing platforms • PCs for village administration • Government-subsidized kiosks • Rural business process outsourcing (BPO) • Computers in schools • IT for existing non-IT development projects • Etc.

18. Thank you!

20. Backup Slides

21. Common Applications Applications: • E-agriculture • E-government • Computer training • Telemedicine • VoIP, chat, e-mail • Etc.

22. Successful PC kiosks may not be about the PC. Some non-IT functions: • Cooking classes • Public announcement system • Phone service • Etc.

23. The kiosk operator can make or break the kiosk. • Operators need business skills, computer skills, entrepreneurial ability • Careful selection of kiosk operator important • Training and follow-up critical

24. Spending habits Q. Please specify the approximate amount spend by you on each of the following? Sample size: 275 • All segments spend equal on various basic necessities • Monthly spent on kiosk by most of the segments is between Rs. 14 - 20 ($.30 - .45) which is .37% of the total monthly HH income

25. Kiosk revenue vs. other revenue Q. From the various income groups mentioned below, please select the one in which your monthly household income falls? Q. How much do you earn on an average every month from your kiosk Sample size: 150 The major source of income for most kiosk owners is not the kiosk

26. Forrester’s projections for installed base of PCs worldwide Millions of PCs Emerging markets to be responsible for 70% of growth in PC sales by 2010

27. VSAT for kiosk in Kodia, Madhya Pradesh n-Logue corDECT wireless tower

28. ITC e-choupal would take… 600,000 villages 6 villages/day x 365 days/year » 274 yrs Q: What are the challenges with rural kiosks? A5: Scaling to 600,000 villages (for India alone)

29. 2007 Source: UN, 2003 A: Yes, of course. Source: United Nations, 2003

30. $400 a month! data from Vivek Dhawan’s Masters thesis (IIT-B) Rupees per month

31. Needed to break even: $70-140/mo. Rupees per month data from Vivek Dhawan’s Masters thesis (IIT-B)

32. CRT display: $50 Q: What is the cheapest a PC could be, anyway? Keyboard/mouse: $10 Power supply: $10 Disk: $40 Memory: $10 for 100MB Other silicon: $20 A: $150? Processor: $20 courtesy of Chuck Thacker (who says closer to $250)

33. IIT-Madras/Midas Metel low-cost phone and e-mail device

34. HP Labs’s Script Mail for pen-based e-mail

35. LeapFrog LeapPad for healthcare education in Afghanistan

36. Rupees data from Vivek Dhawan’s Masters thesis (IIT-B)

37. A tractor and cart in Madhya Pradesh Teachers in Karnataka Government-sponsored lunches at a school in Tamil Nadu A well-water hand-pump in Madhya Pradesh