Question 1: In a partnership between a mobile network operator and agricultural partners...

 The comments have been very good and have mostly focused on the 'partnership' providing some sort of content.  

Another way to think about it, however, is that the mobile operator can leverage the 'strengths' or financial receipts from many new users to provide a robust and reliable network. The new users, who might be farmers or farm advisers, can leverage the local experience of their counterparts in day-to-day farm management, with early identification of pests or diseases, being an example.

By sharing observations and experiences through a 'virtual community' that's hosted on the local network, there is increased usage of the network and increased revenue. The 'experential knowledge' of what problems other farmers are facing and how those problems are ameliorated, can be extremely valuable.

I hope this helps, even if it doesn't get to issues like the longer-term need for subsidy.

Mark

 I want to put into discussion the profitability of the alliance. In particular, the profitability of the operator, because the profitability of the agricultural partner seems obvious.

To provide the services, the operator must make a significant investment in infrastructure in areas with a very low return. Generally, where more has to invest, less profitable it will be. And in economic terms of mobile network operators, such terms are usually unviable.

In these cases a new player enters the scene. In developed countries is the government and in other countries may also include development cooperation agencies. The function of this new actor is to support infrastructure investments that make viable investments by operators.

The investments of these third parties should focus on the telecommunications trunks and other infrastructure that can be shared by all mobile network operators concerned. This will generate a profit for the common good of society as a whole (the common infrastructure must be publicly owned and privately managed), allowing a viable business model for mobile network operators and encouraging competition to increase the added value for agricultural partners.

In this scenario, the relationship between operators and farmers occur at the same level. Disappears the domain of the network owner over users. And establishing a real win-to-win partnership.

I slightly disagree with Mr Fortuny. There is no way, through a partnership or not, that you will convince an operator to extend its covers just to deliver one agri service.

Then i don't know any operator with real CSR activities. They are supporting services that bring them directly or at maximum on short term benefit.

I believe the coverage extension discussion is a different discussion, that includes different partners. It is not a role of a service provider imho. There are lots of instrument, such as the universal service fund (or whatever name it takes in different countries) to work in this domain. So again i really doubt that a farmer service would be the incentive for operator to extend coverage.

In all case, if the infrastructure cost is covered by donor funds, then be sure that if the maintenance is not then covered, this will stop as soon as the funding stops. If you integrate infrastructure maintenance in the business model of the agri service, then the chance you will ever reach sustainability is below 0%.

So all in one, i think that it relatively outside the discussion to consider areas not covered by a mobile signal.

One a more general basis, i've the feeling in many posts that mnos are quite often seen as a magic wand that will suddenly provide sustainability to unsustainable service. In my experience, it is very very very rarely the case.

As underlined few times, mnos will always focus on their benefit and business, which is perfectly normal. So starting from this fact, we have to look at the service and the related costs. In practice, as i mentioned, what the mnos bring to the partnership is scale in terms of infrastructure (the ability to manage thousands of users), payment management, and discount in public telecommunication costs.

From a pure practical point of view, in a given project, one can expect to get up to 50% rebate on the communication cost plus free hosting of the service. This is in the best case solution. For the case i know well, this is not the part that makes a service sustainable or not. In most cases, the problem is the architecture of the service that makes the service unsustainable, not the presence or the absence of an mno. I'm sure this will come again later in the discussion.

steph

@Steph I think you are right that a mobile operator wouldn't extend their network coverage purely for one agri value added service (VAS), just as they are unlikely to see Agri VAS as a standalone product. Instead, as Collins Nweke mentioned in Question 2, some operators view agriculture services as part of a wider "mServices strategy" that includes health, financial services and education. As competition between operators continues to escalate, the large rural customer base (a great deal of whom are farmers in the markets we are talking about) represents a sizeable business opportunity for MNOs.
 

Have you seen the recent report by Vodafone: ‘Connected Agriculture’? [PDF file] The report concludes that 80% of a potential $138 billion uplift in emerging market farmers' incomes will be derived from the growth of:

• mobile information services providing detailed and localised weather forecasts, crop prices and resource management information
• helpline services giving real-time guidance on issues such as pest control and the challenges linked to climate change, including water scarcity
• mobile money transfer systems, such as Vodafone M-PESA, which provide farmers with the ability to exchange, save and borrow small amounts of capital as well as take out short-term insurance policie

The report on 'connected agriculture' is quite good, even if i feel that the underlying hypothesis is quite wrong. I've developed my view on this report in a recent post.

I tend to think that the global question is to know if MNOs should be or not value-added service provider.  I personnaly think that not only they should not be service provider, but more over i even think that this is even particularly bad for the mservice in general.

First of all, i think that mobile operator are not well structured to support innovation. Most innovative services on the web as started from nothing, and because it was easy to deploy, lots of innovation happened. Same for lots of successful apps, or for services like twitter. It is pretty clear that the fact that it was easy and costless to try an app and make it easily available was a reason of emergence of innovation. If one had to deal individually with operators, nothing would have happened. This was the case at the early days of wap portals.

Then i think also that it is quite unfair that mobile operators owning their network compete with service providers who are also their customers for the infrastructure. This is really unfair competition. I think it is essential to have a separation between infrastructure provider and service providers, and that both are separated. Btw, one can start to see that regulation is going in that directions in few countries like Rwanda, and Tanzania (iirc).

All in one, if you look at developed countries, you see that mnos are not even fighting for being a service providers any more, they just surrender and are back to infrastructure provider only (see appstores, mobile web access etc). They have tried hard in the past, back in the years 2000-2004, with WML and their own private closed wap portal. This is now dead, and i had wished they learnt from this history. On the contrary, they are now trying to push for the walled garden in developing countries again, and this is terrible. I believe that it is safe to bet that this will die because at the end everybody will want to be fully connected to the whole information space but i wish we would not go through the same path again.

so all in one, we are all witnessing competition between operators. This is great when this drives the price down, but somehow this is insane when it comes to social oriented services such as agri services or financial services.

i tend to think that yes there is a huge potential for mservices, but the partnership with mnos should stay at the infrastructure level, so that services can go accross operators, and serve all people independently of their operator.

steph

Reality has to convince MNOs to expand coverage because the business of mobility can not have the same discrimination to rural field as in the past happened with cable telecommunications. New uses of urban users, mServices strategies and ease of deployment of the network, should allow the presence of MNOs in rural areas. My previous contribution wanted to expose that the necessary infrastructure should be shared and should be made available to all service providers.

The MNO partnership should be with service providers. Service providers should remain independent of the MNO, but this is not possible if there is no regulation of the telecommunications sector. What has happened in developed countries (as Steph indicated) is that the MNO has offered services because it was a profitable business. When third parties have entered into market services with innovative proposals, MNOs have returned to their business core. To avoid that operators provide services in developing countries, regulation of telecoms are needed.

Everyone must be devoted to their specialty. And added value partnerships are to be made in direct client-supplier relationships.

         (partnership)                           (partnership)

MNOs <----------> Service Providers <----------->   Users   

<---------------- (telecom regulations) ------------------->
                              Government
 

Hello All

Telcos are the major technology platforms with better penetration into rural areas, and may be the best alternative of agriculture modernization with the right partners. Mobile technology can provide better opportunities for both small  and large farmers, offering better products access and opportunities for communication and development. In the case of the company I represent, as a small new startup we dont have yet any partnership with a Telco, but having good mobile platform is the basis for our business plan and the support of our main technology products.
 

Best regards

Eddie, we look forward to hearing more from you on the other topics in this forum. It's great to have the perspective of an entrepreneur in our discussion!