TradeNet - Development with a twist?
TradeNet is a service developed in Ghana by Mark Davies, a British business man who founded MetroBeat during the dotcom boom, and moved to Ghana in 2000. Development was funded by Mark Davies (US$800,000 investment), and also by aid agency USAID (approx US$200,000 investment).
The concept is comparible in some ways to Ebay - it is a place where people buy and sell goods online. TradeNet however is designed specifically for the market within Africa, targeting those who do not necessarily have access to the Internet, by giving them access to these services via SMS instead. It almost goes without saying that SMS is the most suitable way to implement a service such as this in Africa, with the statistics for mobile usage rising massively over the last few years, and predicted to rise further.
The service has been developed for the exchange of agricultural products, and allows users to submit information about products they have to sell, subscribe to allow users to request what kind of products they are interested in, and then allows the potential buyers and sellers to communicate directly to make a sale. The issue of facilities for farmers to buy and sell efficiently is one that has been widely identified as a need (for example, this blog post from the VeSel group).
The service is free to the buyers and sellers (submitting sale information and receiving SMS) and the sellers get to set up their own webpages with their information if they wish.
TradeNet’s Vision:
‘Our goal is to increase revenues for farmers and traders by making markets more transparent, and by shifting the balance of power slightly towards producers who suffer from the thinnest margins on what they trade. We also aim to assist projects and associations to serve their members with better and current information to sell more and buy better, and to market their products to a global audience. More recent tools enable producers to enhance their yields and find better buyers by managing their information networks more effectively.’ (source)
So, why is this service deemed to be so potentially successful? What makes it different from others such as Trade at Hand funded by the UN.
The business model behind TradeNet is one that it seems has not been implemented before. There are two areas of the project that are unique to TradeNet and it is these that make it a more viable long-term solution.
The first is that TradeNet not only make money from advertisements posted into the SMS that the users receive (good point regarding this raised in Trisignia’s article, asking how all that fits into one SMS?), but they also make money from selling data that it collects from the users (their personal info - telephone numbers, names, locations etc) to advertisers.
This concept of collecting and selling data is one that seems to have different interpretations from different people. The Economist’s opinion is:
‘The price of economic development may be junk mail by mobile phone.’ (source)
Whereas Trisignia’s article sees it as:
The service is…gathering valuable economic data about the marketplace it’s helping develop, and it’s leveraging its knowledge about the marketplace to sell more ads. (source)
Whilst both these articles recognise that the collection of the data helps to sell more adverts, the Economist see the data as enabling junk mail, whereas Trisignia see it a collecting valuable data. My question would be, exactly what data are they collecting? Because that question has not really been answered from the research I have done. How can that data be used in the future? Who can have access to it?
In short, there is a recognised problem in Africa that there is a lack of data available, and it seems that potentially this service may be helping that issue (White African blog wrote a post about it a while back). But I would want to know a lot more about what data, and how it could be used or accessed before making that judgement. (Although that is not to say that if the data is not going to be of direct benefit to Africa itself, but solely to advertisers, that it is a bad thing. It is still enabling development through enabling this service to run and therefore may be a necessary evil.)
The second area that gives TradeNet an edge over other comparative services, is that the company is making it’s software available for use by other projects. This means that the concept can be applied to other markets and uses, by other developers having the ability to create their own websites using the same back-end software. However, I have not been able to find a lot of information on this area on the web, but am going to do some investigating and will post again when I find out more about this.
Overall, TradeNet seems like a very positive step in development within Africa and I will be extremely keen to find out more about its progress. A comment that Mark Davies made on White African’s post made me even more positive, as it seems that his ideology and approach to the project have a solid foundation which is something I believe is crucial:
‘This must be a profitable venture, a service-based venture, a customer focussed venture, and it must unleash what i imagine is loads of commerce opportunities leading to wealth generation. I’m skeptical about technology ’solving’ things, but it’s one contribution to the debate.’
