Wednesday, May 3, 2017

The Digital Divide and Context

A few things happened in the past few days that surprised me.  First, was hearing that in Detroit, just 45 miles from the University of Michigan campus where I work, 40% of the population do not have access to the Internet[1].  For the past 15+ years, I’ve been focused on the digital divide in developing countries, places like sub-Sahara Africa.  Now it is an issue in my backyard.  How can that be? The age, class, and community differences for US Internet access have narrowed over the past 15 years.[2]  Is Detroit an American anomaly?

Second, at a conference on University of Michigan and Detroit programs, an anthropologist cited that Detroit has one of the largest populations of unbanked citizens in the US, 20%, nearly twice the national average of 11%.  That’s citizens without a checking or savings account[3].  It’s a cash culture; credit and ATM cards are a foreign currency.

The third surprise came from the presentations at the conference.  Surveys and solutions were all touting digital delivery.  “Didn’t that risk losing the voice and participation of the population they most wanted,” I asked?  The “best” answer I heard, “we should distribute more phones!”  One of the professors went so far as to tell us how the computer science teams always start with repeated meetings with stakeholders asking them what they wanted.  “Technology came later,” he said.

What I came away with was a sense that the gap was a mindset gap. We really don’t get the local context.  If your frame of reference is that technology is what gets applied, that it’s the way you do things, have we really heard our audience?  For a population that is not connected, does not use banks or credit cards, I’d like to hear more about the non-technical approaches—at least until the digital divide problems are solved, and that means solving the cost and value barriers, before we suggest the next best app or web site.   Perhaps we can learn from the successes and failures in sub-Sahara Africa.  Who would have thought?

[1] Jim Kerstetter, “A Digital Divide in Detroit,” The New York Times, May 23, 2016, here:  and the companion article by Cecilia Kang, “Unemployed Detroit Residents Are Trapped by a Digital Divide,” The New York Times, May 22, 2016, here: .  The latter cites the 2013 US Census Bureau data for the figure.
[2] The Pew Research Center Report, “Americans’ Internet Access: 2000-2015,” June 26, 2015, states “For other groups, such as older adults, those with less educational attainment, and those living in lower-income households, adoption has historically been lower but rising steadily, especially in recent years. At the same time, digital gaps still persist.” Yet the racial gap is less than 10%, with 84% of all American adults using the Internet.  Here:
[3] This report supports the anthropologist's claim: Kasey Wiedrich, “New Data Reveals High Unbanked, Underbanked Rates in Localities across America,” CFED, December 3, 2015. Here:

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  1. The Digital Divide is not restricted to developing countries, but can be found in disadvantaged locations even in the developed world, as you point out. It can also be found everywhere in disadvantaged demographics, for example among old people.

    The quoted articles, though, confuse two issues. 40% of people in Detroit lack, not Internet access, but broadband access. This is an infrastructure development issue, which we have seen in many developed countries. It is still related to social exclusion as it disproportionately affects rural and poor urban communities, but it may be transitional rather than systemic. Lack of Internet access is a separate issue, affecting an unspecified, and presumably smaller,proportion of people in Detroit, although for those affected it is serious, as the articles make clear.

    It is interesting that you mention those outside the banking system in the same piece, because this points to a possible synergy which is already very important in some developing countries. A major driver of adoption of technology in East Africa and elsewhere has been mobile money. GSMA estimates that there were over half a billion registered mobile money accounts worldwide at the end of 2016, none of which as far as I can discover are in North America. Perhaps there is a market opportunity for some innovative bank?

  2. Thanks for pointing out the broadband versus Internet connection issue. Note that the broadband barrier is often the mobile apps barrier, with the notable exception of Facebook's Free Basics platform, Net Neutrality issues notwithstanding. Indeed, the reverse innovation opportunity is what I was hinting at in the next to last sentence of the post.