April 10, 2013

Q&A with Nathan Eagle, CEO and co-founder, Jana

Posted by: in North America

Our latest report, “13 Mobile Trends for 2013 and Beyond,” is based on insights we gleaned from this year’s Mobile World Congress in Barcelona, as well as interviews with several experts and influencers. After his keynote address at the Congress, we spoke to Nathan Eagle, CEO and co-founder of Jana, a service that connects global brands with people in emerging markets by giving mobile airtime to consumers who take market research surveys and try out products. Eagle is also an adjunct assistant professor at Harvard, a member of MIT’s TR35 (a group of top innovators under 35) and one of Wired’s “50 people who will change the world.” During our conversation, Eagle outlined the multipurpose role of the mobile phone in emerging markets and pointed to some of the ways it’s changing health care and education.

How is the role of the mobile device evolving as more people in emerging markets get connected?

One of the striking things to note is that the mobile phone is an emerging market technology. The people living in the developing world who use mobile phones far outnumber mobile phone usage in the developed world. What’s striking is that these emerging market consumers don’t necessarily have as much other technology exposure as their developed word counterparts. And so the expectation that they place on this device is actually higher. They’re not buying into a communication device, they’re buying something that does not just make voice calls or send text messages, but they’re looking to buy something that can serve as a flashlight or an FM radio. They’re looking for something that can provide them with food prices and can be their credit card.

So what’s interesting is that the phone is a piece of technology that by its very nature is quite adept at being repurposed by consumers, especially consumers in the emerging market. It’s exciting to start seeing these consumers starting to think about the next types of utilities that a mobile phone can provide them.

What are some of the leading frontiers of mobile device innovation?

The real frontiers, at least in the short term, are the incorporation of data services that use very limited data but can offset operator bills. So over-the-top-type applications like WhatsApp, for example. Things that can save that individual mobile phone user money are just huge. We’re seeing things like airtime regulators that let you control the data use from your phone, limit it per byte. You’re seeing proxy browsers like Opera Mini making huge penetration because they basically strip out all the excess material in a standard website and give you the bare-bones data that you need to see the page. Those types of things are fascinating, and I think we’re going to see more of them, especially with the advent of these $50 Android devices. They are now getting closer to $30 Android devices that are being spewed out of China.

You can get an unlocked 3G GPS-enabled Wi-Fi touch-screen Android phone. A few years ago you could get it unlocked for about $300. Last year you could get it unlocked for $150. At the end of last year, prices went down to $50. I suspect  by the end of this year, we’ll see as low as $30. And then by next year we’ll be seeing it for under $25. What you’re going to see then is real phase transition. As you’ve got these high-end phones that have parity in terms of price point with that standard phone that we consider dumb, you’re going to see a huge number of people online for the first time. And it’s thanks to Android, because that’s what these companies in China have decided to just slap onto these gray-market handsets.

How will these consumers take advantage of the mobile phone in ways we haven’t necessarily seen in developed markets?

It comes down to this idea of putting the tool in their hand and then seeing what happens. When I’ve gone [to Indonesia] in the past, I started friending people. Suddenly I get emails saying I’ve been tagged in a photo, and then I get a couple more. What happened is the guy who you friended has tagged you and every other one of his 3,000 friends in this photograph of the things he’s selling into his local street stall. And so this is clearly not functionality that Facebook intended, but this Indonesian entrepreneur is using Facebook as a mechanism to hawk his wares online, or advertise them at least.

I think that’s really exciting. That’s a nice example of how people, when they’re given this kind of technology, are going to start immediately using it. In my mind, the use cases are going to be, first and foremost, “How can I use this to make more money?”

Mobile health care and education also seem to be big areas of opportunity. 

Those are two areas of tremendous opportunity and growth. On the mHealth side, it comes down to providing information and resources to people that don’t have resources and information. I’m always a little bit wary about mHealth apps that are used for diagnosis or diagnostics, because you generally always want to have a trained medical professional human talking about diagnostics. But when you’re just talking about just access to information and being able to at least get an idea about health-related tips or recommendations, it’s wonderful. And it will make a powerful impact, especially when it connects people in these remote areas that are resource-constrained with a trained human physician perhaps on the other side of the world.

From my own academic background, we’re trying to put together large-scale studies in places like Africa. We’re getting people to fill out surveys on a regular basis and trying to get a better sense for what behaviors are indicative of potentially the onset of chronic diseases like heart disease or cancer. These types of things are going to be a massive problem in places like China and Africa. They aren’t necessarily on as many people’s radars as they should be, but it is one of the problems of the future for these emerging markets. The mobile phone is at least helping us get a head start into tackling it.

Can you provide an example of mHealth in action?

[A science paper we put out] shows how we’re using mobile operator data to gain an understanding of where the high-risk regions for malaria are and ultimately to better allocate malaria eradication resources across Kenya. So it was using mobiles for health and doing it from a public health perspective rather than from an individual perspective. The fact that a large fraction of the population virtually everywhere carries around one of these devices lets global health professionals build much better models of disease dissemination and ultimately can really help in eradication efforts.

And what opportunities does the mobile phone present for education?

What we need is curriculum. I’m thinking about a mechanism where you can actually start in a viable way pushing materials and helping students learn. And it’s not going to be the phone in isolation in the short term, but it’s going to be leveraging the phone, perhaps, in the classroom in a more organized manner.

As these Android devices become increasingly ubiquitous, you can start having a technology that can ultimately be almost self-contained and provide an educational experience to a student where the student doesn’t need any other resources besides, essentially, electricity. We’re nowhere near there yet, but that is a vision we’re pursuing. And I believe it will happen at some point.

Jana has established partnerships with various brands. What are these programs, and how do they work?

Companies like the Procter & Gambles of the world or companies like Microsoft—across virtually every category—know that their future revenues and earnings growth is coming from these emerging markets. So there’s a real gold rush right now. They are trying to get market share, trying to get mindshare. Once a consumer enters the laundry detergent category, you want your brand of laundry detergent to be the very first brand they try. They enter the social networking category of consumer, and you want your network to be the first one they sign up for.

And it’s so frothy right now that these brands are spending huge amounts of money trying to advertise and also trying to learn about these consumers. What we are offering is trying to solve that problem. We’re helping them gain better insight into these consumers and then, once they understand the consumers, help them promote their products and potentially promote tryouts. And that tryout could be “Try our laundry detergent” or “Let us show you what Twitter is.”

Insight comes from incentivizing people to fill out surveys about what they think about laundry detergent, giving people 10 rupees off their first box of laundry detergent. Or incentivizing people to go out and try to download this app and see what you think of it.

How do these consumers feel about mobile marketing?  Are they allowing or embracing ads that come to them via such an intimate platform?

It depends on what we’re talking about by advertising. If you’re talking about providing them with opportunities to earn money, I haven’t found any population of people who are not embracing those opportunities. It’s important to make a real distinction between the types of things we are doing: We’re providing people with things they want as opposed to spamming people on the phone. So we never send any senseless messages. We have a platform that, if the consumer wants to, they can log in and then see a smorgasbord of opportunity. I don’t see that as invasive.

You could think of us as maybe a website you go to explicitly if you want to download a coupon or take the survey and earn a little bit of money. And so we haven’t seen frustration with that. The real frustration we see is, “Why aren’t there more things I can do to make money?” That’s why they create an account. That is why they keep coming back to our website. When we don’t have enough client projects for them, that’s where frustration happens.

How do you see this evolving?

My hope is that as we continue to grow, the base of users will learn more and more about the types of things they want and use that information to better meet their needs. And to be able to tell clients what these consumers, on an intimate level, are looking for.

Do you envision Jana evolving into an m-commerce platform?

For the moment, we never debit, we only credit accounts. We can only make the amount of airtime in someone’s account go up, not down. There are other platforms out there that allow people to buy things, but we explicitly designed our platform so that it does one thing and one thing only: It gives you money.

We’re not giving people extra minutes or extra data, we’re paying people now in over 70 [local] currencies. We go to that person and say, “I can give you 10 rupees in cash or I can put 10 rupees on your phone.” They view those two things as exactly equal. So I think we’re giving them five free minutes or 20 free text messages. Ten rupees is 20 cents.

The average person in one of these emerging market countries buys their airtime almost every day. You’re constantly being reminded, “I’ve got to buy another 25 cents’ worth so I can call my family out of the country.” This is part of a daily routine of literally billions of people. And so that’s why our model is so powerful, and potentially so foreign to people in the West.

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