On January 12, 2016, CNNMoney.com ran a story about the Golden Globes award ceremony that began:
“I want to thank Amazon, Jeff Bezos…”
Those words were spoken at a Hollywood awards show [by the director Jill Soloway] for the first time on Sunday as Amazon’s comedic television series Transparent picked up two Golden Globe awards, beating shows from HBO, Netflix, and the CW.
The awards were an affirmation of the widening television landscape, as streaming services like Netflix and Amazon Prime Instant Video are beginning to play host to award-worthy programs just like television networks …
A little while later, the star of Transparent, Jeffrey Tambor, won the award for best actor in a television comedy. He called Amazon “my new best friend.”
I wonder how HBO feels about that?
For all of these reasons, McKinsey has created its own measure of globalization that basically asks a country or a company or a citizen: Are you in the flow? It’s called the “MGI Connectedness Index.” It ranks different countries on how much they are participating in all the different kinds of global flows, and it is a pretty good indicator of prosperity and growth. Singapore tops the list—followed by the Netherlands, the United States, and Germany.
But there is a message in the bottle: Singapore invested in both the infrastructure to make sure it was participating in every digital flow as well as the education of its workforce, to make sure they could take advantage of those flows if the government made them available. Individual cities that now do the same thing can reap the benefits. So this isn’t complicated: the most educated people who plug into the most flows and enjoy the best governance and infrastructure win. They will have the most data to mine; they will see the most new ideas first; they will be challenged by them first and able to respond and take advantage of them first. Being in the flow will constitute a significant strategic and economic advantage.
A research study published in the International Journal of Business, Humanities, and Technology in February 2013 found a correlation between countries with high GDP and “high Internet penetration,” not only in the highly developed and Internet-saturated Nordic countries, but also beyond. “A pattern begins to emerge; ICT [information and communications technology] growth occurs, and as the population becomes more comfortable with the technology and more productive, the GDP level begins to increase as well.”
It’s a big shift—but that is what this era of globalization is all about.
The Big Shift Goes Everywhere
What is most exciting about this acceleration in the globalization of flows is that these digital rivers now run everywhere with equal energy, and with mobile phones and tablets people anywhere can now tap into them to compete, connect, collaborate, and invent. I was lucky enough on a visit to India, in November 2011, to actually see and write a column about how the poorest people in the world can join the flow. I was on a reporting trip and was invited by Prem Kalra, then the director of the Indian Institute of Technology in Rajasthan, one of the elite MITs of India, to give a talk on his campus, meet with his students, and take a look at a project he was working on at his institute in Jodhpur that was specifically designed to connect the poorest person in India to the global flows.
Kalra explained that there is a concept in telecommunications called “the last mile”—the section of any phone system that is the most difficult to connect—the part that goes from the main lines into people’s homes. He said he was dedicating his IIT to overcoming a parallel challenge: connecting to “the last person.” If you want to overcome poverty, he argued, you have to answer that question today: How will we reach the last person—meaning the poorest person in India? Can “the financially worst-off person” in India “be empowered?” he asked. That is, be given the basic tools to acquire enough skills to overcome dire poverty? In a country where 75 percent of the people live on less than two dollars a day, what bigger question is there?
Specifically, India’s Human Resources Development Ministry put out a challenge that Kalra and his technology institute back then decided to take up: Could anyone design and make a stripped-down, iPad-like, Internet-enabled, wirelessly connected tablet that the poorest Indian family, saving about $2.50 a month for a year, could afford if the government subsidized the rest? More specifically, could they make a simple tablet usable for distance learning, teaching English and math, or just tracking commodity prices for under fifty dollars, including the manufacturer’s profit, so millions of poor Indians living on the edge could also join the global flows?
Kalra’s team—led by two IIT Rajasthan electrical engineering professors, one of whom came from a village that still had no electricity—won the competition and unveiled the Aakash tablet. Aakash is Hindi for “sky.” The original version was based on the Android 2.2 operating system, with a seven-inch touchscreen, three hours of battery life, and the ability to download YouTube videos, PDFs, and educational software. If Indians could purchase only tablets made in the West, the price points would be so high they’d never reach the last person, said Kalra, so “we had to break the price point” in a big way. They did it by taking full advantage of today’s globalization of flows: pulling commodity parts mainly from China and South Korea, using open-source software and collaboration tools, and employing the design/manufacturing/assembly abilities of two companies in the West—DataWind and Conexant Systems—and Quad in India.
But what I actually remember most about my visit was a story that Kalra’s wife, Urmila, told me about a chat she had had with their maid after the Aakash was unveiled in Indian newspapers on October 5, 2011. Urmila said that her maid, who had two young children, came to her one day and said that she had heard “from the night watchman that Mr. Kalra has made a computer that is very cheap, and is so cheap that even she could afford to buy it. The watchman had given her a picture of it from the paper, and she asked me if it was true.”
Urmila told her maid that, yes, it was true and that the machine was meant for people who could not afford a big computer.
“She asked, ‘How much will it cost?’” Urmila told me.
“I said, ‘It will cost you around fifteen hundred rupees [$30].’”
The maid, dumbfounded by the low price, asked, “Fifteen thousand or fifteen hundred?”
Urmila answered, “Fifteen hundred.” But, Urmila added, the maid “was sure that if the government was doing something so good for the poor, it had to have a catch. ‘What can you do on it?’ she asked me. I said, ‘If your daughter goes to school, she can use it to download videos of class lessons,’ just like she had seen my son download physics lectures every week from MIT’s website.”
Urmila’s son was already watching lectures on MIT’s OpenCourseWare platform—a predecessor to MOOCs, or massive open online courses, which MIT had put up on the Internet for free; it consisted simply of video lectures and course guides. Urmila told her maid: “You have seen our son sitting at the computer listening to a teacher who is speaking. That teacher is actually in America.”
The maid’s eyes “just kept getting wider and wider,” Urmila recalled. “Then she asked me will her kids be able to learn English on it. I said, ‘Yes, they will definitely be able to learn English,’ which is the passport for upward mobility here. I said, ‘It will be so cheap you will be able to buy one for your son and one for your daughter!’”
Urmila’s son was already drawing from the global flows to effectively study at his home in Jodhpur on MIT’s platform, and the maid’s kids would not be far behind. The farther you get from the connected capitals of the developed world, the more you can see how today’s globalization is rapidly distributing energy through these flows right out to “the last person.”
That is not an exaggeration. And that is, for me, an enormous source of optimism.
The early stages of modern digital globalization tended to be all about “outsourcing,” another name for American and European companies leveraging the fact that connectivity was becoming fast,
free, easy for you, and ubiquitous, so they could hire enormous numbers of relatively cheap engineers anywhere in the world to solve American problems. When this first became possible at scale in the late 1990s, the big problem most people wanted solving was Y2K—the fear that many computers would stop working because of a bug that would kick in on their internal clocks on January 1, 2000. Millions of computer systems needed to be remediated, and India had hundreds of thousands of low-wage engineers to do it. Presto, problem solved.
What happened, though, with the emergence of the supernova, when complexity became fast, free, easy for you, and invisible, and globalization meant that everyone anywhere with an Internet connection could access the digital flows, was something very exciting: Indian, Mexican, Pakistani, Indonesian, and Ukrainian engineers, and many others, began tapping in to solve their problems. And now some of those low-cost innovations are coming back in our direction and to our benefit. India always had a strong tradition of educating people in math, science, and engineering, and America was once the big beneficiary—in the 1950s, 1960s, and 1970s, when global flows were in many countries either nonexistent or barely a trickle, those Indian graduates could not get jobs in India, so they flocked to America and helped America overcome deficiencies in its workforce. Now, thanks to the digital flows being pushed out to them from the supernova, they can stay home and act globally more than ever. As a result, many more people are now working on the world’s biggest opportunities and biggest problems.
I see this everywhere I travel. Every time I visit India to write columns, I visit NASSCOM, the high-tech association, to meet with the newest crop of Indian innovators. They account for only a tiny fraction of India’s 1.2 billion people, most of whom remain painfully poor, but I focus on these innovators because so many of them today are focused on making India unpoor.
In 2011, the NASSCOM team introduced me to Aloke Bajpai, who, like others on his young team, cut his teeth working for Western technology companies but returned to India on a bet that he could start something—he just didn’t know what. The result was Ixigo.com, a travel search service that can run on the cheapest cell phones and helps Indians book the lowest-cost fares, whether it is a farmer who wants to go by bus or train for a few rupees from Chennai to Bangalore or a millionaire who wants to go by plane to Paris. Ixigo is today the biggest travel search platform in India, with millions of users. To build it, Bajpai leveraged the supernova, using free open-source software, Skype, and cloud-based office tools such as Google Apps and social media marketing on Facebook. They “enabled us to grow so much faster with no money,” he told me.
It can be incredibly uplifting to go to a place such as Monterrey, Mexico, that country’s technology hub, and meet a critical mass of young people who just didn’t “get the word”—they didn’t get the word that their government is a mess or that China is going to eat their lunch or that the streets are too dangerous. Instead, they take advantage of how connecting to global flows can now enable them to start stuff and collaborate on stuff really cheaply—and they just do it. Monterrey has tens of thousands of poor living in shantytowns. They’ve been there for decades. What is new, though, is that it now also has a critical mass of young, confident innovators trying to solve Mexico’s problems, by leveraging technology and globalization.
I went to Monterrey in 2013 and wrote a column about a few of the young people I met: There was Raúl Maldonado, founder of Enova, which had created an after-school program of blended learning—teacher plus Internet—to teach math and reading to poor kids and computer literacy to adults. “We’ve graduated eighty thousand people in the last three years,” he told me. “We plan to start seven hundred centers in the next three years and reach six million people in the next five.” There was Patricio Zambrano from Alivio Capital, who had created a network of dental, optical, and hearing aid clinics to provide low-cost alternatives for all three, plus loans for hospital care for people without insurance. There was Andrés Muñoz, Jr., from Energryn, who demonstrated his solar hot-water heater that also purified water and could cook meat. There was the administrator from CEDIM, a start-up university offering a “master’s in business innovation.” And there was Arturo Galván, founder of Naranya, a mobile Internet company that created a range of services, including micropayments for consumers at the bottom of the pyramid. “We’ve all been here for many years, but I think that the confidence is starting to happen,” explained Galván. “You start to see the role models who started from zero and are now going public. We are pretty creative. We had to face a lot of challenges.” As a result, he added, “we are strong now, we believe, and the innovation ecosystem is happening.” “Naranya” is based on the Spanish word for “orange,” or naranja. Why that name? I asked Galván. “‘Apple’ was already taken,” he said.
But connecting to the flows is not just a story of how easily these developing countries can now innovate new goods and services for themselves and then push them out to the world as exports. It is also a story of what the poorest of the poor can now easily pull down from the global flows. Consider the 3-2-1 Service in Madagascar, founded by David McAfee, CEO of Human Network International. He explained:
At a moment of need, callers use their own simple mobile phones to proactively retrieve information across a range of topics. Callers dial a toll-free number anytime, anywhere and listen to a menu of options: “Would you like to know about: Health? Press one. Agriculture? Press two. Environment? Press three. Water and sanitation? Press four. Land tenure? Press five. Micro finance? Press six. Family planning? Press seven.”
We use the same out-of-the-box software that every 1-800 number uses—“Press one to continue in English. Press two to switch to Spanish.” But we repurpose it so illiterate audiences can use their telephone keypad to select and listen to prerecorded messages free of charge and on demand. The innovation here is the “pull” aspect. Callers can “pull” the information at a moment of need … Up until now, development and humanitarian organizations have struggled to meet this “moment of need.” Development workers managing projects with a behavior change component—like encouraging moms to have their children sleep under a mosquito net—use mass media channels—radio, television—or interpersonal communications—knocking on doors—to get their key messages out. But these “push” channels aren’t adapted to meet people’s individual moment of need. It sounds dumb and obvious … but people need access to information when they need it: at their own moment of need. And they can’t “pull” the information out of their radios!… In the six years since the launch, more than five million callers have made sixty million information requests … all free to the end user.
The 3-2-1 Service is currently live in Cambodia, Ghana, Madagascar, and Malawi, and the plan is to extend the service to eleven additional African and Asian countries by the end of 2016. Once the 3-2-1 Service is launched in these fifteen countries, more than 120 million subscribers will have free, on-demand access to key public service messages. In 2016, an average of four hundred thousand people contacted the 3-2-1 Service each month and made 1.7 million queries. That’s a lot of flows being pushed and pulled. McAfee’s team then mines these flows, because they are digital, as a resource to improve the service. Unlike radio and television stations in Africa, noted McAfee, “we know exactly how many people have listened to our key messages. We collect metadata on each call: telephone number, time/date stamp, decision at each menu, and key message selected.”
What cannot be stressed enough is how early we are in this acceleration of flows. You can already see the next stage forming—the creation of clearinghouse platforms that will efficiently match the flows coming out of the developing world with those that want to come into it, weaving the world together ever more tightly. One of the most interesting start-ups I came across in this space was Globality.com, cofounded in March 2015 by Joel Hyatt and Lior Delgo with a mission to create a platform that uses artificial and human intelligence to enable small and midsize companies to become “mi
cro-multinationals” by participating in the global economy as easily as the big guys.
Say you are a small manufacturer in America who needs a law firm and marketing firm in Lima, Peru, or you are an Indian data services company buying a three-person start-up in Houston. You would go to Globality’s platform and create a project brief, using their technology dashboard. “Then we take the project brief and, using artificial intelligence and human curation, bring back to your company—for free—a small selection of the best-qualified firms to meet your needs, which we determine on the basis of our industry expertise, research, and matching algorithms,” explained Hyatt.
Globality then connects you, on its site, to the firm or firms you choose, providing the video technology for the two parties to forge deal parameters and hammer out legal frameworks, check references, conclude contracts, and do all the billing—along with a star system for both sides to rate each other the way Uber, Airbnb, and eBay do. Everything a company would need to act globally “from the first moment to the last is on the platform in one easy and uniform format,” said Hyatt. Globality—which makes its money by charging the service provider (that is, the seller) a commission based on the value of the transaction—aims to do for small companies wanting to work globally what Airbnb did for small homeowners wanting to rent rooms globally and for individual tourists who wanted to travel globally and have a homestay experience. It hopes to create a platform of trust among strangers that will allow more global commerce to flow among much smaller players.
Already some large multinational corporations are exploring the Globality platform to identify small and midsize firms that do high-quality work at lower fees than the large international firms. When the big guys stop transacting only with the other big guys—and start including more and more small players in the global game—another accelerator kicks in for globalization.
Thank You for Being Late Page 16