We’re in Peru on vacation and enjoyed Machu Picchu just today. What struck us throughout this trip is the level of connectedness, even in the more remote areas of the country. We bought local rail tickets from an iPhone, texted from the Incan ruins and made it back in time to catch the World Series (in Spanish) on our hotel TV. From a tech perspective, it’s like we never left home.
Working in Silicon Valley, it’s easy to write off the remarkable technology we see around us as a bubble…a unique place in the world where money flows in and innovation flows out. Spend enough time outside the tech corridors and it quickly becomes apparent that the shift to pervasive connectedness is happening everywhere…and the impact will be enormous. There are 2 billion smartphone users today and there are predicted to be 2 billion more in the next couple of years. The net effect of doubling the number of connected people will have several effects, including the following:
- Mobile first will matter even more. If mobile first seems a bit premature in North America where smartphones are a secondary computer, it makes perfect sense in a world where the only computer is the one in your pocket. Smartphones more quickly break the digital divide than anyone predicted a few years back.
- Distribution will become far more distributed. Shopping on Amazon or Ebay today means selecting from products in similar countries. Americans can order from Canada and the UK and vice versa. With 2 billion more connected users, the opportunity to order from far more places and fulfill orders from far more places is enormously disruptive. Suddenly, it makes sense for Amazon to have a distribution center in…Lima, Peru.
- The rise of the Indian or Chinese smartphone. Fat profits for Apple and Samsung are a strong disincentive for developing a much cheaper model for the next 2 billion users. This presents an enormous opportunity for China, India or another country to create an inexpensive smartphone and potentially disrupt the current smartphone superpowers. Consider this: India is already the third largest smartphone market in the world.
- Microfinance happens even faster. Apps are being developed that allow microfinance to be funded and requested in a remarkably short timeframe, giving much-needed capital to the most remote corners of the earth. When a lender can communicate easily with borrowers, lending becomes more personal and accelerates. What the developing world needs more than ever is fewer gatekeepers…the middle men in government and the NGO’s that meter out aid and loans like personal favors.
The full impact of a doubling of the number of smartphones is probably beyond what we can predict accurately from 2013, even though we’ve thrown out our best guesses. We can safely say, though, that the changes will be significant and will leave the world a different place.