Nicaragua Reality Check: iPhone? “No.” Pedal-Powered Call Shop? “Yes.”

by Andrew Meyer on January 25, 2008

Reality checks are healthy. They help you assess the actual situation and proceed with solutions that work in the real world.

I have had my fair share of hyping mobiles phones in Africa, Google Phones in India, and developing countries skipping low-cost laptops and jumping straight to mobile.

The future is bright for low-cost tech in developing countries. It will bring the leveraging power of information and Internet to the BOP (bottom of the pyramid). But, in most developing areas it just hasn’t arrived yet.

You hear successful stories hear and there of poor students using WiFi-enabled laptops etc, but the reality is sometimes much different.

Not bad. Just different.

About a month ago, Brian Forde who runs Llamadas call shops in Nicaragua emailed me about new “business they created for BOP entrepreneurs to provide service to BOP clients.”

Pedal-powered mobile call shops!

Check the Llamadas video explaining how they work (ironically, there is an iPhone cameo at the end):

At first, I thought “What?!”

Pedal-powered mobile call shops seem so clunky and impractical.

But, than I re-read Brian’s email and single sentence really jumped out at me:

“In Nicaragua people make national and international phone calls every day in call shops using their cell phones as address books instead of cell phones, although this may seem inconvenient to some the savings is worth it to many.”

Wow. People have cell phones but they only use them as address books because they are too expensive.

It was a big reality check smack in the face, but it was definitely refreshing.

Just goes to show how far “creative capitalism” needs to go before it makes sense for some people in Nicaragua to start using their mobiles as actual phones and not just as fancy address books (See this post on Bill Gates’ call for “creative capitalism”).

Sure, mobile phones with Internet-connectivity will be great for the under $2-a-day crowd. But, in some areas of Nicaragua reality calls for practical, clunky and oddly innovative solutions like Brian’s pedal-powered mobile call shops.

For more information on the mobile call shops you can email Llamadas at info@llamadas.com.ni.

If you have an interesting, clunky or just plain practical product or service aimed at the BOP give me a holler at andrew@buzzyeah.com.

We don’t just cover the latest low-cost laptop aimed at the “Under $2 Crowd” (new BUZZYEAH category that covers products and services aimed at the two billion or so people that make under $2-a-day). We will give your own “pedal-powered mobile call shop” a shout out too.

Update: Peter Sauer leaves a very interesting comment below (he just got back from Nicaragua).

Update: Brian at Llamadas leaves in excellent comment below about the debilitating costs of slow, inefficient communication options for the under-$2-crowd.

  • Hey Andrew,

    I was in Nicaragua a few weeks ago. While I didn't see any of these, I was struck by one thing I saw related to cell phones... In one rural area we visited many people lived in 10x20 see-through shacks. These people appeared to be dirt poor, however I saw more than one person talking on their cell phones outside of their homes (I was told their phones/plans cost around the same amount we pay here). I simply couldn't (and still can't) believe that people would put money into a cell phone/plan when living in such accommodations. Very misaligned priorities if you ask me.

    -Peter
  • Peter, yeah that is really interesting. I wonder what percentage of their daily income those mobile plans make up?
  • And, what benefits they receive from having mobile plans?

    It appears that the benefits haven't helped their "see-through" shack situation but I'm still interested in why they would pay for expensive mobile plans. There have got to be some major benefits.

    Where is the micro-marketing/survey data when you need it?
  • Sam
    Interesting points. Although I've never been to Nicaragua, I have been to Central Los Angeles. A friend of mine is a teacher at a school in that area. She told me that she was astounded upon visiting some of her students' homes to find Flat Panel TVs in small crowded apartments. The children shared bedrooms and had no desks to complete their homework at, but apparently HDTV was a priority. It doesn't make sense, but the same is true of those middle class Americans facing serious credit card debt and foreclosure on their homes. Everyone seems to be in need a reality check!
  • tuftsmania
    i don't care, you can delete this if you want, but to back sam up.


    hood rich.


    nigga rich.


    reality check for REAL.
  • Hey Andrew to answer your question about mico-marketing survey data, according to Telcor the government agency in charge of telecom regulation in Nicaragua 2.1 million Nicaraguans have cell phones but only 130K have post paid cell phone plans so to assume that people in 10X20 shacks have cell phone plans would be incorrect as only 6% of the cell phone accounts are post paid plans.

    You can check out more stats at:
    http://www.telcor.gob.ni/Desplegar.asp?PAG_ID=47

    I also disagree with Peter's comment about how people who live in 10X20 shacks have misaligned priorities by spending money on cell phone minutes. Communication is very important to the poorest of people who are mostly day laborers, if they can make a phone call to resolve a problem that saves them from traveling by bus for several hours and missing a days wage in addition to the cost of transportation they save, then the cost of the phone call is worth it.

    To put communication in rural areas in perspective for your readers sending hand written notes sent via bus or calling a radio station to have them broadcast a message to someone in an area without cell phone or landlines is still a popular and effective way used to communicate with people in rural areas.

    By the way for more information and photos of Llamadas Pedaleadas you can check out our site at http://www.llamadaspedaleadas.com
  • Brian, thanks for great comment. I totally agree with you about inefficient communication killing micro-businesses (and anyone for that matter).

    The opportunity costs of riding a bus or train to the city or a distant village to get something or talk to someone is horrendously debilitating to the under-$2-per-day crowd.

    One of the biggest examples would be banks. It's hard to find a conventional brick-and-mortar bank in rural areas. So, if you are a smart villager and want to put your small earnings in savings you have to take a whole day off work to get to the bank.

    This brings us back to your point of good communication (phones) bringing benefit to the bottom-of-the-pyramid crowd.

    Let's hope that telecom companies find innovative ways to put beneficial mobiles (preferably w/ internet connectivity) into the hands of the under-$2 crowd with payment plans that make sense for their extremely small and volatile daily wages.
  • I live in Nicaragua, and the creativity of Nicaraguans never ceases to amaze me.

    As for seeing people talking outside of tin shacks talking on their cellphones, there is an easy answer. Most people use their phones only to receive calls. Often, they will call me and ask me to call them back, or just call long enought for the caller id to show up on the phone. Nicaragua's landline phone system is improving, but there are hundreds of towns where there are no lines available, I lived in Ciudad Dario in northern Nicaragua, and there were people there who had been waiting 5 years to get a phone line for their house.

    For many Nicaraguans, their cellphone is their only way to be reached.
  • Victoria
    hi this conversation is very interesting to me because i was just in nicaragua in february to help build a school house in a community named Los Encuentros.. my spanish is horrible but the people i met and i had a strong connnection even though we barley understood eachother.. so when i headed back to the states i left them my phone number and have been getting random phone calls from different numbers each time. most of the time i cant understand alot of what their saying but its still nice to hear their voice everyonce in a while.. but the calls have been becoming more rare and id really like to speak with them even just to say hi.... some body please help me how can i do this???
  • Victoria, that's really cool that you were building a school house in Nicaragua. Did you notice that Nicaraguans in the area had cell phones? It sounds like it might be hard to get a hold of the friends you made over there unless they get a cell phone w/ a permanent number and a decent international incoming rate plan (so you can call them at your cost).
  • Bill, thanks for the great comment.

    I really think that mobiles with affordable data and call plans (Internet) are going to make a huge impact in rural developing areas.

    It seems like the most innovative companies like Google understand that mobile is the next big thing and are all trying to figure it out. They also understand that a lot of people in the global market don't have access to the Internet and mobile technology and they want to change that.

    This can only be good news for Nicaraguans living out in rural towns.
  • Erick Rizo
    Great Idea Mr Brian Congratulations 4 the pedals powered call shop
  • Nice video and great news.
    Thanks.
  • The locales of Nicaragua would rather invest their money for other necessities than for a trend like the iPhone. Just like the pedaled phone call booths that they launched.
  • Nica
    I will add a little information about cell phones in Nicaragua to put things in perspective.

    Cell phone minutes in Nicaragua are all prepaid. Minutes are literally sold everywhere in public.

    People load their cellphones when they can. Sometimes as little as $1 at a time. They use minutes sparingly. If they have the chance to save 50 cents, they will. If that means ducking into a cyber cafe to make a cheaper international call, they will. Possibly their phone does not have any minutes left on it. This is common, the phones can still receive calls even if there are no minutes. Rather than pay the relatively exhorbident cost of cell phone international calling, they might opt to have that 30 minute call to the cousin in Colombia in a cyber.

    There is no concept of cell phone service on or off or a monthly bill.

    And there are Genuine Apple iPhones in Nicaragua. They buy them modified from China. The phones have been modified to hold dual sim cards. This way they can have two numbers and can buy minutes from both the major vendors, Claro and Movistar. I guess they just use them as cell phones and PDAs, no Internet access or iPhone specific features.

    Hope this information is interesting to someone.
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