In April 2007, Microsoft revamped its Unlimited Potential emerging market strategy by announcing a bold, new initiative to reach the next one billion people with computers and low-cost software by 2015.
Microsoft's program to reach developing countries is known as "Unlimited Potential", and through this program the company aims to bring computers to the next 5 billion people by focusing on all aspects of economic and social characteristics of countries such as India, China and others. Since the inception of Unlimited Potential, Microsoft has expanded investments in emerging countries to foster social and economic growth which highlights its increasing focus on developing markets.
Aimed at developing nations, low-cost computers having Flash memory, shared computing, mobile technologies, internet-based services and customized software are the main features of Microsoft's long-term efforts.
Microsoft is offering local governments a software suite, including Office Home and Student 2007 and Windows XP Starter Edition, for US$3 per student. The company is actively partnering with NGOs, technology companies, and engaging other channels to give push to government subsidized PC-for-students programs.
Also, iCafé is the major initiative under the Unlimited Potential program. In countries such as China, India, Indonesia and the Philippines, where PC and household Internet penetration is very low, iCafés are the most important source of Internet access for a significant section of the population.
Although Microsoft's emerging market initiative shows inherent potential to be an effective social and business strategy, the close coordination with local governments, NGOs and partners to execute the programs remains a challenge in emerging markets. The slow pace of working and laid back attitude of government agencies is something which needs to be dealt carefully. Also, the rural areas in emerging countries lack with basic amenities such as electricity, water, etc. which could act as a permanent impediment to development.
On a technical side, the biggest challenge for Microsoft is to port Windows XP on a Flash-based system. This is something that Microsoft has not done in a great way and progress in this area has been very slow. Also, Vista is deemed too complex to port on a Flash-based system, due to the large number of device drivers that it supports. It will be quite interesting to watch how Microsoft handles the technical issues in the times to come.
Undoubtedly, there is a potential business opportunity in the middle and bottom of the social and economic pyramid. However, this opportunity requires new partnerships, distribution models, and customized products that are applicable, accessible, affordable, and sustainable for people in emerging countries.
While emerging nations have aggressive plans for technology adoption as a means to economic growth, they also have very limited budgets to purchase even subsidized software. As a result, some governments have encouraged the adoption of Linux which could affect the long-term unlimited potential group goals.
I am quite encouraged about the prospects of rural emerging nations in the long term and the leading indicators suggest that the average annual growth rates are accelerating in low-income economies.
Microsoft’s strategy to align its business interests with social cause to achieve win-win situation on both the fronts is highly appreciable and will have an unlimited bonus for the company down the road. The company appears to be moving in the right direction by making regular investments, and putting resources towards this direction.
By Manish Bahl
Image courtesy peiqianlong
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