Weekly Review May 19-25

Every week, we read dozens of articles on our favorite industry trends that relate to our investment thesis. We pick the most popular trend from the week and share the top articles along with our thoughts.

Articles and blog posts this week cover news on mobile technology in emerging markets.  We’re featuring news from iHub’s blog, MIT Technology Review, Business Daily Africa, and Mobile Payments Today. A common trend you’ll find in each article is the continued proliferation of SMS-based and feature phone applications; significant smartphone penetration is still a few years down the line in emerging markets. Today’s innovators aren’t forgetting the benefits and capabilities of SMS and feature phones.

M-farm to launch price information mobile apps in June” by John Kieti on iHub blog
M-farm, a Nairobi-based startup, will launch its new mobile application for agricultural commodity pricing information on the first day of Pivot East. The introduction of the app coincides with an overall upgrade of the mobile solution, including a new SMS short code, to promote market transparency and increased trading in the Kenyan agricultural industry. M-farm’s CEO Ms. Jamila Abass is one of the first African entrepreneurs to be accepted into the Unreasonable Institute.

New Apps for the Bottom Billion” by David Talbot on MIT Technology Review
A new technology from University of Toronto and Microsoft allows low-end phones to receive pictures via SMS as bitmapped text messages. The researchers are looking to use this technology in Bangalore to provide jobs to crowdsource the digitization of handwritten documents. Users can receive an image of the handwritten text in the bitmapped text message, and transcribe in an SMS reply. This is a good example of a simple technology that enhances SMS for the billions of users without smartphones.

Sage Pastel to launch mobile payslip app in Kenya” by David Herbling on Business Daily Africa
In the country where mobile money has been the most successful, it makes sense that there should be an app that allows users to access their payslip or paycheck on a mobile phone. Sage Pastel is a global business management firm with offices in Nairobi currently rolling out SMS-based solutions with plans for smartphone apps in the future. In addition to viewing payslips, the app will also offer push notifications to alert users when their paycheck is ready to view.

Feature Phones are Key to Mobile Payments Adoption” by Ilan Oosting on Mobile Payments Today
The success of the mobile payments industry has paved the way for additional innovations in the industry. Illan Oosting points out that the “latest mobile technology” isn’t always what the market needs. Globally, only 12% of mobile subscribers are smartphone users. Currently, SMS solutions and feature phones remain the best way to access the user base that benefits the most from mobile payments. Slowly, the smartphone market will grow, but “feature phones hold the most clout” today: sometimes the simplest technology is what works best. Our portfolio company SlimTrader also commented on this article: “Smart money isn’t on smartphones.”

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