[liberationtech] SMS local India news

[Terry Winograd]

http://www.techcrunch.com/2009/11/30/smsone-micro-local-india-news/

Of the hundreds of companies I meet in any given country, I only write
about a handful. Sometimes it’s the ones that seem to be copying a US
idea, but in reality are building their company in a completely
unique—and frequently more profitable—way.  Other times, I’m
captivated by an idea that’s perfect for an emerging market, but
probably wouldn’t work in the US.

But every once in a while I find a company that hits the trifecta:
It’s addressing a big problem locally, it’s something I don’t think is
offered in the US, and…. I want it. And when a product in undeveloped,
chaotic, messy India can make someone in Silicon Valley feel jealous,
you know that entrepreneur has come up with something good.

I’m talking about SMSONE Media, a company I met in Pune about a week
ago. Like most of the impressive companies I saw in India, it’s aimed
squarely at the base of the pyramid and is using basic SMS to deliver
services to people some of India’s most unconnected areas.  It was
started by Ravi Ghate, who proudly points out that none of his core
team graduated from high school, much less attended an IIT or IIM.
(Typically not something you brag about in India.)

SMSONE is basically a very-local newsletter. Ghate goes to a village
and scouts out an unemployed youth—preferably one who’s had jobs as a
street vendor or has experience going door-to-door shilling for local
politicians. The kid pays Ghate 1000 rupees (or about $20) for the
“franchise” rights to be the local reporter for that village. He goes
door-to-door singing up 1,000 names, phone numbers and other basic
information, then mails the slips to Ghate. Ghate enters it all his
databases and all those “subscribers” get a text introducing the kid
as their village’s reporter. In India all incoming texts are free so,
the subscribers don’t pay anything.

And what readers get is pretty powerful. Right now there is no way to
get a timely message to people in a village. There’s no Internet
access, no TV, no local paper, and frequently no electricity. All they
have is a basic mobile phone. SMSONE’s service can give farmers
instant updates about crop pricing or news of a seed or fertilizer
delivery a town away. That means the farmer only makes the trip when
he knows the shipment is there, rather than wasting days of travel
hoping the shipment is there.

Consider something even more fundamental: Water. Much of the villages
have government-owned water pipes that are turned on for an hour or so
once a day, or even in some areas once a week. Everyone has to bring
their vats, pitchers and empty kerosene cans and get as much water as
they can while the pipes are on. But these pipes don’t really run on a
schedule so people frequently miss getting the day or week’s water.
Now, SMSONE subscribers get a text when the pipes are about to be
turned on.

I know it’s not as life-changing, but I’d pay to get micro-local,
highly relevant news about my neighborhood in San Francisco in
160-character bursts, whether it’s about a power or cable outage, a
construction project that’s disrupting traffic or details on a
shooting that just happened. And I might even welcome local ads that
report a hot new restaurant opening or a sale at a boutique two
streets over. I feel like modern, uber-connected life has made us less
interested in “local news” as we used to think of it on a city or
region level, but more interested in the micro-local, hence the
excitement in the Valley around Foursquare, CitySourced, and a host of
location-aware iPhone apps.

But the beauty of what Ghate has built is its simplicity. It doesn’t
need a $300 smart phone and it doesn’t need GPS locators or a platform
like Twitter to run on. Sometimes the most powerful innovation is
built in the most extreme constraints.

I’m hardly the first to be impressed by what Ghate has created. He has
won a host of awards including the Clinton Global Initiative’s YES
Fund Award in 2008. And similar models are being built in parts of
Africa where there’s similar mobile ubiquity and little else in the
way of communications.

The change in life is not only pretty huge for subscribers. That
once-unemployed kid suddenly has important local standing in his
community. In addition to writing 160-character local news stories, he
also sells local ads. Like a newspaper, Ghate enforces a ratio of ads
to stories, so the news doesn’t get overrun by promotions.

The economics work out like this: Out of a 1000 rupee ad sale, 300 of
it goes to the reporter, and Ghate pays him an additional 50 rupees
for each news story. That adds up to a nice income for a village kid,
but not so high that he picks up and moves to the big cities.
Ambitious franchisees can even hire a few other reporters, expand
their subscribers and make more money.

Right now Ghate’s operation is in 400 communities, reaching roughly
400,000 readers.  He just got an investment from the government of
Bangalore to boost that reach to five million readers in the next four
months.

Ghate is clear that the money will be used strictly to reach more
people. The company already breaks even and Ghate makes enough to pay
his basic living expenses. He doesn’t care about fancy cars or
clothes. It wasn’t too long ago that he was one of those disadvantaged
kids, selling flags and berries on the side of the road and being told
to go away. He still regularly travels between villages by bus and
stays in $5/a night hotels. He’s promised to take me with him on my
next trip to India, to see how the service works first hand and meet
some of these young “reporters.”

“I’ll be back in February,” I said. “Will you have 5 million readers by then?”

“Not quite,” he said looking up at the ceiling, seemingly counting in
his head. He looked down at me again, smiled and said, “Come in
April.”

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