In our discussion of the ICT4D debate (and important actors engaging in it), my group read “ICT *or* Development, Part 3: The Jester Meets the White African,” which is Kentaro Toyama’s blog post in response to Erik Herman’s “The Subtle Condescension of ‘ICT4D.’’ Referring to himself in the third person as “The ICT4D Jester,” which is also the name of Toyama’s blog, he agreed with Hersman that the term “ICT4D” is indeed condescending and began discussing the role of both capitalism and progressive activity in the context of development.
The Jester’s post that we read for class is the third in a series he calls “ICT *or* Development.” Since I was intrigued both by his argument and his writing style, I decided to back-track and read “Part Deux” of this series. In this post, the Jester explains why “It is very difficult to make a lot of money by selling goods or services to poor people in a way that has meaningful, positive impact on their lives, particularly with ICT.” He provides six principle explanations, as follows:
1. The “Two Birds” Problem: It is more challenging to achieve two goals than it is one. Making money can be difficult to begin with, as is fostering meaningful development. Doing both together is obviously harder than doing each separately.
2. The Ethics Problem: Selling products or services to poor customers makes the selection of a price an ethical dilemma – losing money or breaking even on a business venture is obviously not optimal, but if one makes a large profit, the Jester wonders, “Are they laying the conditions for commercial investment, or profiting off the backs of the poor?”
3. The Cost-of-Business Problem: While potable drinking water, for example, is considered “free” in the United States, obtaining clean water can be pricey or laborious in certain developing areas. The Jester assures his readers that this is not an opportunity to make money. The “poverty premium,” as the Jester calls it, “exists exactly because poor communities are harder to serve (e.g. bumpy roads to rural villages), riskier (e.g. no credit history), and more likely to buy in small quantities (e.g. sachets).” These conditions make the cost of doing business higher.
4. The Competitive Pressure Problem: The Jester warns that social entrepreneurs willing to take a hit in profits so they can have a meaningful impact on development will not be able to beat out “not-so-social entrepreneurs” who are “ruthlessly chasing higher margins and greater share.”
5. The Branding Problem: Entrepreneurs must often choose between marketing a good or service to either the rich or the poor – rich customers will find products associated with the poor less desirable and poor customers will be intimidated by fancier products that seem beyond their reach.
6. The “It’s Good for You” Problem: The Jester argues that most people (rich and poor alike) choose not to buy things that are “good for them.” He says, “Normally, human beings are precariously perched between self-improvement and sloth. Then, when you have to pay for it, sloth looks pretty good.”
The Jester finishes his post by dispelling the idea that poverty can be reduced through consumption: “Consumption is the result of having the ability to consume, not the primary cause of that capacity. What matters in development is increasing that capacity, not selling people stuff.” What do you all think: Does the ICT4D Jester make convincing points about the conflict between making a profit by selling goods and services to the poor in developing countries and contributing meaningfully to development?