Feature phones - Rising from the ashes or the walking dead?

It would probably come as a surprise to some of us but multiple reports suggest that there are still close to 400 Mn feature phone users in India today, other reports put this number to even half a billion! To put things in perspective, that is roughly the entire population of United States and Germany put together ….. with everyone using feature phones. As India makes bold bets in the technology space, we should remember to carry everyone along, especially those 400 Mn people using feature phones.

The Promise of Technology

Thousands of years ago the primitive man was roaming around the jungle, when he suddenly encountered a ferocious lion staring right at him. What happened next? No one knows because that man did not live to tell the story. Other men quickly caught up and invented weapons and tools that helped them domesticate the same animals they once feared. So much so that while once way at the bottom, today man has risen to the top of the food chain. That’s technology. Once upon a time it took days, even months to travel short distances and used to cost a bomb but today you get your brand new headphones shipped all the way from Bengaluru to your doorstep in Mumbai in 2 days….for FREE. That’s technology. Nikola Tesla practically invented the world around you but did you know, at 86 Tesla died broke, while a YouTuber from Faridabad, India is already a millionaire at 21? Well, that’s technology too. Right from the steam engines to the digital revolution, all industrial revolutions have presented a grand promise to mankind, a promise that has not only kept humans alive but also enriched our life on this planet. We are now in our fourth industrial revolution and are on our way to another huge upgrade in terms of Life 4.0 …… unless you are carrying a feature phone. 

Tesla Coil - Image Credit: Dickenson V. Alley, Wellcome Collection, CC BY

‘Technology for Social Justice’ 

India has a rich demographic dividend. But this perk comes with an expiry date. As with all nations, India too will get demographically old soon and as Vijay Kelkar and Ajay Shah point out in their book titled In Service Of The Republic, ‘we must get rich before we get old’. If used wisely, technology is a great enabler for that wealth creation. 

A case in point being artisans sitting in a remote village in India can open Amazon, list themselves as a seller and sell their products to a potential audience of crores across India, hopefully at a premium that they would not have gotten otherwise had they decided to sell local — provided they have a decent internet connection and a smartphone. Another example is that of a plumber who can register as a professional on Urban Company and create a livelihood for himself in an otherwise disorganized market — again, provided he has a smartphone. As Freeman Dyson points out in his book The sun, the genome and the internet, technology has the potential to contribute to social justice. Mobile phones definitely qualify as being that technology. It does not matter if you are super-rich or middle class or somewhere in between — if you have a smartphone, any smartphone, you still have pretty much the same access to opportunities as people more privileged than you. Now compare that opportunity landscape with someone having a feature phone. Unfair? Exactly. Feature phones typically cater to lower end of the spectrum, so by definition they limit access to opportunity and hence work against the principle of technology enabling social justice.  

The Compounding Effect 

Image Credit : Rob Stothard/Getty

The first smartphone, ‘Simon’, was invented by IBM in 1992. It was nowhere near the sleek, light-weight, bezel-less, computer-like smartphones that we carry today in our pockets. Those became a feature in 2007, when Steve jobs decided to make a dent in the universe by introducing the world to the first iPhone. It is important to understand the significance this event had, in the history of wealth creation. A hand-held device conceived in America created enormous wealth for people around the world. Kushal Bhagia (CEO, First cheque) explains How Uber, Ola, Swiggy and other companies worth billions of dollars are able to call themselves tall because they are standing on the shoulders of smartphones. One invention spawns another which in turn spawns a couple more and the cycle continues. These inventions create companies which create lakhs of jobs and eventually create wealth. But if you really think about the mobile app eco-system, all dominant players like Google, Apple and the likes cater mostly to smartphones, while feature phones are completely left out of this equation. But imagine how pronounced the compounding effect will be if the mobile app industry is able to bring feature phones into the main stream by actively creating apps for them. It could almost qualify as a ‘blue ocean strategy’. 

The Role of Government

Over the last couple years, the Indian government (with the IT industry) has played a leadership role in setting up digital frameworks that are state of the art. It is also reassuring to see involvement from creme de la creme of IT like Nandan Nilekani and Bill Gates. What most of India does not realize is the power of one such government initiative titled India Stack. India stack works on a ‘cashless, presenceless, paperless’ framework and lays out a solid foundation of a robust digital infrastructure that Indians can build apps on top of, to solve some of the hardest problems India is facing today. As Nandan Nilekani rightly points out — ‘This is India’s single most important innovation to formalize India’s domestic economy through digital services’. These are the types of levers that a country needs to pull to ‘get rich before it gets old’. But most of India Stack products like the Digilocker, Aadhar, eKYC, UPI, eSign — operate only on smartphones, and that is because India Stack was primarily designed keeping smartphones in mind. Okay, then what about the feature phones? Government has a key role to play. While conceiving national digital frameworks like India Stack and National Health Stack, government will need to actively think about feature phone use-cases. Beyond that, the government could potentially incentivize private players to actively think about feature phones. When it comes to operating at scale, government along with some big private players can really accelerate wealth creation.

Once bitten, twice not shy? - National Digital Health Mission

On our 74th Independence Day, Prime Minister Narendra Modi announced the ambitious National Health ID as a part of National Digital Health Mission. This is a unique ID for each of the 1.25 billion Indians. The vision is to tie all of your longitudinal health information to this unique ID. So it doesn’t matter if you are a person living in Mumbai, who went for an initial check-up in Chennai, performed lab tests in Hyderabad and went for an X-ray in Kolkata. All of this information will magically come together when a doctor in Pune punches in your Health ID in his system and pulls all of these reports up. But prima facie it looks like even national health ID is going to exist in the form of a smart-phone based mobile app. There goes the opportunity of the humble feature phone, to rise from the ashes, again. The proposed national health ID, which is built on national health stack, is again primarily conceived keeping smartphones in mind. Are we committing the same mistake again?

Winds of Change or Twilight?

Image Credit : Erik Page on Flickr

Some companies have woken up to this unusual reality of a significant number of people still using feature phones in the 21st century. Paytm has developed a workflow that would let feature phone users use its service. Albeit slowly, handset players are also developing apps for feature phones because they just can’t afford to ignore this big a market. Even Bill Gates put his weight behind this by announcing a highest reward of $50k for whoever comes up with creative solutions that enable use of UPI on feature phones. Are these really winds of change or with so many significant stakeholders consciously ignoring the feature phone population — is this the beginning of the end?

India is a price sensitive market. It is very difficult to nudge a feature phone user to purchase a smartphone unless both phones and data get so cheap that the feature-phone user becomes indifferent to the switch. But until that happens, it is in our country’s best interest to cater to those 400 Mn feature phone users. 

We want to get rich before we get old, remember?