Papua New Guinea, a place that seems so far away and so very out of touch from what we here in the western world would consider normal. So why is Jamaican cell phone company Digicel trying to develop a cell phone network in a place where we see more face painting than we do t-shirts? The answer is that this small and potentially profitable market has yet to be transformed by instant mobile communications, and Digicel wants to be the first to get it’s hands in it.
According to the Economist (September 4th print issue), Digicel has found itself fighting for every user on its home territory of Jamaica. Add that to the fact that most rich and densely populated areas throughout the world are already crowded with multiple mobile companies and you have a critical dilemma facing every CEO – how and where to grow? Well the answer that Digicel and other operators have discovered is to bring the technology and service model to the far reaches of the planet and in the case of Digicel, that means the remote parts of mountainous Papua New Guinea.
Digicel is facing an up hill battle of not only setting up a network in Papua, but finding the right price range for users to buy cell phones. Statistics are weak, so they had to do their own census on where to decide to put towers. The current model has them selling phones for around $15, which is a great price, but since most Papuan’s make around $1,000 a year it may be tough to get folks to justify mobile service as a got-to-have.
I really appreciate what Digicel is doing. They are trying to reach the farthest flung parts of the earth and have them connect with the rest of the world. It’s a very enticing prospect, no doubt. But with a majority of the population of the island still nomadic and somewhat primitive infrastructures of roads and security, it can be very difficult to figure out where to put cell towers, especially in a place that has such rough terrain as New Guinea.
There are good trends that favor Digicel in this venture, according to the Economist, “the global market for mobile phones is booming: subscriptions more than doubled to 4.6 billion in the five years to 2009”. The precedent for economic development that occurs because of the availability of real-time information about crops, weather, family members in far-off places and even phone rentals has been well-established.
