Home Articles One billion smartphones by 2014. Bottom-of-the-pyramid market never looked better

One billion smartphones by 2014. Bottom-of-the-pyramid market never looked better


It’s been a while since bottom of the pyramid — famously enunciated by the late management guru C.K. Prahlad — has been perceived to be an attractive market.

In fact, the bottom of the pyramid has, probably, never looked better than in the market for mobile phones. It’s no surprise then that a startup should set its eyes on the next wave of the cellphone revolution — the expected, even inevitable, explosive growth of smartphones in the developing world.

Paloma Mobile Pty Ltd, founded less than a year ago to deliver rich apps and services optimised for low-cost smartphones in poorer global markets, won a ringing endorsement of its pursuit with a $1.5 million Series A funding led by OneVentures. Venture capital veteran Roger Allen is among the investors.

The company’s founders — Jennifer Zanich and Steve Langkamp – are seasoned entrepreneurs with experience developing mobile services for emerging markets.

Meeting a billion aspirations

“Our investment in Paloma is a great example of backing a strong team with an impressive track record in building and exiting companies,” said OneVentures partner Anne-Marie Birkill. “We are also particularly excited to be backing our first female founder with this investment.”

Paloma targets one billion new smartphone users in emerging markets by 2014. In its bid to tap that market, it is developing a cloud-based platform that delivers data-efficient smartphone applications, enabling rich-media services even on the low-end touchscreen smartphones and on low-bandwidth networks common in emerging markets.

“Creating services for these one billion consumers is one of the great opportunities of the mobile Internet,” said Paloma co-founder Zanich.

“Consumers with entry-level Android phones expect to have all of the popular smartphone services, just like on expensive iPhones and other superphones that cost more than $600,” Zanich added. “But that is not a reality for sub-$100 smartphones” — devices with small screens, limited processing power and memory, and many running on slower 2G networks.

Hence the need for a new breed of smartphone services for emerging markets, believes Paloma.

The company’s first service – “Photo Chat” – delivers photos and social features such as voice notes, in a private conversation with friends or family. Still in beta stage, Zanich says the service requires only one-tenth the download size of comparable photo apps in developed markets, enabling it to run on the cheapest Android phones and even on GPRS networks. Key to delivering such services is the cloud-based platform, which does all the hard work of media processing and storage, overcoming limitations of low-end mobile devices and bandwidth constraints.