Tablets from the Developing World
WHY YOU SHOULD CARE
The $38 made-in-India tablet is coming your way.
Pooja Bhatia is an OZY editor and writer. She has written for The Wall Street Journal, The New York Times and the Economist, and was once the mango-eating champion of Port-au-Prince.
Paging all tablet shoppers: The market for your beloved flat-screen devices, so far dominated by companies in the United States and South Korea, is about to go global. Soon it may be time to look further afield — way further afield — for your electronic goodies.
Since 2012, tablet manufacturers have sprung up in these three developing nations, as well as others that are not exactly known for their tech manufacturing prowess. What’s more, the developing-country manufacturers could give the Samsungs, Apples and Acers of the world a run for their touchscreens. After less than a year and a half in business, India’s Aakash has already sold more than a million units. Congo’s VMK announced plans to sell 100,000 Way-C tablets this year. Haiti’s Sûrtab opened several months ahead of schedule. It’s currently selling wholesale only — its first shipment of 600 tablets went to Kenya.
“It’s been overwhelming,” says Suneet Singh Tuli, CEO of Aakash’s manufacturer, Datawind. When the company began commercial sales, Tuli hoped to place 50,000 units per year. People guffawed, but, says Tuli, Datawind is now selling close to 50,000 every two weeks.
The developing-world tablets’ first selling point is their price tag. Sometimes subsidized by the government and usually underwritten by cheaper-than-China labor, tablets assembled in developing countries are generally less expensive than the ones you’ll find at Best Buy. Later this year, customers in the United States will be able to order online an entry-level version of the Aakash for $37.99. Sûrtab plans to go commercial before the Christmas holidays, and although it hasn’t set its exact retail prices, it expects them to cost around $175 for a 3G version and $110, at most, for a Wi-Fi version. Samsung tablets cost about twice as much; Apple iPads, even more.
We’d love to carry them in many of the big U.S. retailers with ‘Made in Haiti’ as the big thing behind them.
The second selling point is national pride. “We’d love to carry them in many of the big U.S. retailers with ‘Made in Haiti’ as the big thing behind them,” says Maarten Boute, CEO of Sûrtab. Boute, a Belgian-born businessman who formerly led the Haiti operation of telecom giant Digicel, sees the Haitian diaspora as a big potential market. Like Haitian coffee or mangoes, two burgeoning export markets, “We’d have Haitian tablets — with the whole social responsibility thing behind it.”
The “homegrown” aspect of these tablets appeals to national pride too. In Ghana, the minister of communications urged Ghanaians “not to look towards the east and the west for their tablets but to look within” to the domestically made Uhuru tablet, according to news reports. The 27-year-old designer of Congo’s Way-C, Verone Mankou, has been called the “Steve Jobs of Africa.” Billed as Africa’s first domestic tablet, the Way-C sells for $300 and is said to be comparable to the iPad. The company says it plans to expand to other countries in West Africa as well as Belgium, France and India.
Such prices may yet be too high for the tablets to have mass appeal in developing world markets, cautions analyst Matt Shakhovskoy of Dalberg Global Development Advisors. “Until the price of tablets comes down so far that they become affordable for everyone easily, they’ll remain much more a niche, upper-class market geared around entertainment,” he predicts.
Still, governments in the developing world salivate over the chance to build up a technology manufacturing sector. Tech manufacturing generally has higher margins, more growth potential and better-paying jobs than sectors like garment assembly. As of now, the vast majority of components for tablets are made in China. Factories elsewhere merely assemble the product.
Don’t look toward the east or west for your tablets but within, urged a Ghanaian minister.
Tablets, however, may provide an opening for other countries to get in on the component game. India has incentives and subsidies for local chip manufacturers, says Tuli, and there’s been an overall push for the government to capture some of the benefits of component manufacture. “It’s a global trend,” he says. “You can’t just have one country be the manufacturing country for the whole world — it needs to spread. Not just for generating local manufacturing but also for creating a whole ecosystem around it.”
Building up that sector will be a challenge, especially in terms of infrastructure. To start with, electronics factories must be completely free of dust — not so easy in a place like Port-au-Prince. Sûrtab workers say their relatives have a hard time believing tablets can even be made in Haiti, according to Boute. ”People don’t believe they’re doing what they say they’re doing.”
Come December, when Boute expects Sûrtab to be available via retail, they finally might.