Introduction

>> An elderly woman walks just 2 kms. from her home to get a weekly blood pressure level check despite the fact that the nearest doctor is 20 kms. away.

>> An unemployed youth in a remote village submits applications to the top 10 job opportunities across 3 different cities every day at a cost of less than 50 cents per day.

>> A farmer monitoring an unusual crop disease in his field has agricultural experts located 300 kms. away examine plant samples and give him weekly updates for 50 cents per session, without ever leaving his village.

>> Young children who have never even played a simple video game navigate their way through complex racing games and adventure simulations. 

These scenarios, among others, are played out every day in villages across the country.  Internet / gaming parlors, computer education / school tutorial centers, remote healthcare facilities, photo studios, insurance agents, agriculture consultants - a single village hosts all of these. The common access point:  A rural kiosk.

This paper is based on a study conducted over a period of one year  at 300 rural kiosks across India, talking to over 3000 customers.  For the purposes of this study, we have defined a rural kiosk as "one or more computer(s), with Internet connectivity, offering ICT-enabled services aimed at providing information access, means of communication and developmental mechanisms for the rural population."

All of the kiosks which are part of this study are run by entrepreneurs as for-profit social enterprises that are members of two leading franchises:  n-Logue Communications Pvt. Ltd. and Drishtee Dot Com. These entrepreneurs make capital investments through sources such as their own savings, bank loans, and borrowings from friends / relatives. These kiosks, therefore, have a dual mission:  marrying community social development with individual economic gain. The study has looked closely at the kiosk owner, kiosk consumer profiles, E-Services offered through the kiosk, the income potential of the kiosk and service usage patterns of the consumer. Some of the important learnings emerging from this study are:

>> Most of the kiosks currently function more like cyber-cafes / gaming booths or computer education centers. Usage of development-oriented services (E-Agriculture, etc.) is lower.

>> Despite consistently low revenues, most kiosk owners believe that, with more locally relevant content/ services, better internet connectivity and reliable technical support, a rural kiosk is a sustainable business.

>> Kiosk owners are exploring alternate revenue generation options which do not depend on services provided by an external resource – photocopying, data entry, desktop publishing.

>> Linkages with local institutions – village Panchayat, school, primary health center – could help increase content relevance as well as streamline delivery mechanism of existing services.

The primary stakeholders

The kiosk owner

In the rural space, the kiosk is essentially managed and operated by just one person - the kiosk owner, who is the primary investor, the operations manager, marketing head, teacher and trainer, and kiosk technical support resource. Some kiosk owners do employ skilled computer operators to help, but this also means a regular outflow for the person's salary, which currently is not affordable for most kiosk owners.

Most of the kiosk owners are male and are in the age group of 20 years – 35 years. As can be expected in rural India, most are from a farming background. They begin with limited computer skills and sometimes, have no prior work experience of any kind. These "social entrepreneurs" are motivated by a belief that a kiosk gives them a sustainable livelihood option, along with the opportunity to do good for their community.

The consumers

The majority of the kiosk users are people for whom the kiosk currently is a point of access to skills building and entertainment. These users are primarily students, people with private or government jobs, or educated, unemployed youth. They avail of the computer courses offered, either as a supplement to classes at school or with a hope that it would help them compete better in the job market. Several of them, particularly high school and college students, use the kiosk to complete assignments for approximately 20 - 45 cents per hour. Gaming is another very popular usage, as is searching and applying for jobs, all without traveling more than 1– 3 kms. from their homes.

The kiosk also serves as a convenient and inexpensive resource to browse for information which rural consumers otherwise would not even know where to start looking for.  Many of these users are educated – either studying in or have graduated from high school / college. They often do have prior exposure, albeit limited, to the computer and are familiar with at least word processing.

The second group of consumers is people for whom the kiosk is an information access point and facilitates communication. This group consists primarily of farmers, housewives, petty traders, and the elderly. Though some of them do use the kiosk for computer education and browsing, for most of these consumers, the kiosk gives them access to market prices, the doctor, the agriculture expert, etc. These consumers generally do not interact with the computer directly.  They rely on the kiosk owner to send a query, set up video-conferencing / chat sessions, etc.  For them, the value proposition which the kiosk offers is not the technology.  It is the window to information access without having to travel more than 3 – 5 kms. beyond their village. This pattern of usage is transactional, which means that users go to a kiosk when they have a specific need versus spending time regularly at the kiosk to use the computer – take a computer course, browse etc.  Examples of transactional usages are:

>> Remote eye examination and diagnosis via video-conferencing, at 20- 30 cents per session (a service offered by n-Logue Communications in collaboration with Aravind Eye Hospital in Tamil Nadu), brings to a village a benefit which would otherwise mean traveling for at least half a day, struggling to get an appointment with a doctor and perhaps staying overnight at one's own expense.  We estimate that cost savings are at minimum from $1 – $2 per transaction.

>> Availability of insurance policies at the kiosk (offered by both n-Logue Communications and Drishtee, in collaboration with ICICI Bank), not only gives the community a convenient service, but at a more basic level, increases their awareness about financial risk management options.

How sustainable are these kiosks?

Like any business, the rural kiosk also requires time to show profits and build a customer base. However, most kiosks do not show very high levels of consistent profitability and even those that do seem to hit ceiling levels fairly fast. Stagnation or steep drop in revenue are seen within six months to a year of operations. Yet, kiosk owners maintain their faith in the business.  Over a period of a year, 50%+ of the kiosk owners in our study have added equipment at their own cost.  This includes one or more of the following:  An additional computer, a CD-writer, a printer. Most of those who have not done so yet, plan to at least add another computer within six months to a year. Other preferred additions are a scanner and a photocopier.

Kiosk owners also put in effort to drive customer traffic. They feel that the kiosk provides opportunity to the village, particularly the children and youth, by offering education services and exposure to new technologies and they would definitely be able to increase usage over a period of time. Kiosks are generally open 8 -10 hours a day, and the owners spend a fair amount of time talking to the villagers about the services offered - addressing Gram Sabha meetings, visiting the village school, going house to house, etc.

Today, the most effective way to spread information in a village is word-of-mouth.  It is low cost, allows personal interaction and does not require the audience to be literate. The kiosk owner uses this informal channel effectively, not just to build awareness about the services which the kiosk offers, but also to get a buy-in from the decision-makers. For example:

>> A kiosk owner increased customer traffic for a Spoken English course by visiting the homes of girls who had completed formal education and by speaking with their parents about the course.

>> Several kiosk owners began getting a regular stream of students for online mathematics and science tutorials once they demonstrated the application to teachers at the local school and involved them in the teaching sessions at the kiosk.

Kiosk owners believe that they can increase their current monthly income by at least $22 – 44, if only they had higher Internet speeds, more technical support and more new services. They anticipate growth in the following areas:

>> Services such as games, browsing, and computer education:  These would still primarily target existing regular users, getting them to spend more time at the kiosk, but essentially using the same set of services. 

>> Photocopying, data entry, photography, etc:  These would target a different set of users – owners of small businesses, the village Panchayat office, etc., for whom the kiosk would essentially provide business center services which would otherwise be available only in nearby towns. For example, digital photography is emerging as a high-potential service, with most government schemes, school / college admissions, examination hall tickets, etc.  requiring photographs of the applicant.

All of the above indicate that the kiosk business has potential to become sustainable, particularly in the context that the current services address the needs of less than 10% of the village population. Provided that additional relevant services are created, the potential to impact the village community from a socio and economic standpoint is substantial.

Augmenting the current service / business model

In terms of rural ICT bridging the digital divide, most services provided by rural kiosks today do not address the needs of the illiterate mother–to–be or the retired government clerk trying to find out why he hasn't received his monthly pension amount. The kiosk owners do not anticipate high revenue flow from development services such as, E-Agriculture, E-Health, etc. 

The reason is fundamental - the business model cannot be built around the poorer section of the community or around services where the usage might be result to a visit at the kiosk once in six months to access a land record or an emergency consultation with a doctor. This already low usage is further limited by social and cultural norms.  For example, most rural users are currently not very comfortable getting a blood pressure reading without some accompanying comforting conversation with a doctor. Similarly, an adult literacy program would probably be welcomed by the village women.  However, her ability to attend these classes many times depends on the gender of the kiosk owner, the kiosk location, the class timings, and her husband's or father's consent.  Furthermore, charging even a small amount for basic, yet vital health services could prove to be difficult, and may result in erosion of goodwill within the community.  Therefore, a delicate balance needs to be created between economic sustainability and social gain.

In this context, it is interesting to consider whether some of the development services would penetrate better if offered through the village office, primary health center, etc., with the kiosk functioning as a facilitator. For example, information on pre-natal care could be made available at the kiosk, but instead of the kiosk owner attempting to market the service, the primary health center could organize awareness sessions at the kiosk.

Taking this idea further, in villages with population below 2000 (where kiosk viability becomes even less due to lower available market volume), the kiosks could just be a computer in one local institution, with a focus on addressing some specific local needs. For example, placing a computer in the local school and using it primarily for extra tutorials for a nominal fee would, in the long-term generate a better return on investment than setting up a full-fledged kiosk. This would also mean training one or more teachers adequately, which would extend the potential of the computer further to improve teaching skills. This facility could even be run as an entrepreneurship - an individual could pay for the computer and even function as a teacher, while the school provided the space and paid for electricity, maintenance, etc.

The appeal of these models lies in the fact that they offer the opportunity to use ICT to enhance existing rural development service delivery mechanisms. There is, however a flip side.  The local institution (the school, primary health center, etc.) should exist in the village, in the first place. Secondly, it should be reasonably functional, with some qualified staff available. Fulfilling both of these conditions is itself often a challenge in the rural landscape.  Thus, until adequate resources are provided at schools and primary health centers, availability of such services at will continue be inconsistent and infrequent.  

Even within user groups interested in using the kiosk, it becomes difficult to expand the consumer base over time because:

>> There is a lack of local language content and interface.
>> End-to-end services need to be provided. The farmer definitely needs to know accurate market prices, but he also needs to know soil quality, water table levels, alternate cropping options, etc. While the kiosk does not address these needs today, large scale domain experts / companies will need to provide locally relevant, updated content in order to reach scale. 

Could the kiosk deepen existing divides?

Currently, the most used services are games, browsing and computer education. Though this is a good business driver for the kiosk, the long-term implications on the village economic and social structure could be negative if these services continue to be the only significant uses of a kiosk. 

Computer education provides additional skill sets that help to open the door to opportunity, and is therefore a popular service that has been adopted by the village community to collectively drive towards socio-economic development. That said, a focus on computer education alone without considering capacity-building needs for jobs which do not require computer usage creates an imbalance. That is, currently the education offerings at a kiosk are mostly limited to computer education, but in order to drive real socio-economic change, the kiosks must add additional focus on vocational training, school-based education, among others. 

Increasing consumption of games and browsing means increase in revenue for the kiosk owner; however the flip side is that community earnings and savings are not being spent on services that provide returns such as increased income or job opportunities. 

A related issue here is that kiosks themselves do not currently provide any means of employment (beyond the odd computer operator), nor do they currently act as a source of information which enables people to improve their livelihood. That said, several organizations are trying to create opportunities for employment within a village.  For example, Microsoft and Drishtee Dot Com have taken a step in this direction. The two companies have been working on trials to determine more efficient methods of connecting rural artisans with regional and global marketplaces. With support from Microsoft, Drishtee has created a portal  DrishteeHAAT. This E-Commerce website not only facilitates marketing and selling products made in rural areas, but also collects feedback and specific design requests.  Requests from customers are collected by the kiosk owner, who uses a TabletPC to demonstrate and explain the feedback from buyers and customers, communicate design requests to artisans, as well as, help them create concept designs.

Conclusion

The rural kiosk has definitely had a positive impact on some sections of the village community.  ICT-enabled services in the rural space can be scalable and sustainable.  However in the long-term, the kiosk model in its current form could cause financial distress for the kiosk owner as well as increase socio-economic divides in the village if:

>> The needs of a wider user community are not addressed. This needs to be achieved without compromising sustainability. Enhancing the local relevance of service content and making the scope more comprehensive is a required approach. In addition, it would also be interesting to consider locally suitable variations of the current model.

>> Appropriate support mechanisms are not put in place for the kiosk owner. This requires greater involvement by resources such as connectivity providers, financial institutions, domain experts, the private sector, etc. The kiosk owner should focus more on customer needs assessment, business development, customer relationship management, and linkage-building at the local level. Larger issues such as service / application development, infrastructure management, etc. should be owned by external entities. 

Moving forward, the rural kiosk needs to expand its offerings from Internet access, games and computer education and become a "rural knowledge center" that enables a village community to address social, economic and educational needs through information and expertise linkages, which would otherwise not be accessible or affordable.

Acknowledgements

The team which worked on the survey data and contributed findings for this paper:

1. Suneet Sethi, Microsoft Corporation
2. Sangamitra Ramachander, n-Logue Communications Pvt. Ltd.
3. Arvindd Narayanan, Drishtee Dot Com