As part of a series on Brainstorm 2002, Fortune asks if companies make money while bridging the digital divide. It discusses what CK Prahalad has to say:
Picture the world population as a pyramid. At the top (Tier 1) are the rich–people who read fortune, drive cars, take vacations, and shop for fun. Below them are the strivers, the global middle class who can meet their basic needs, know who Shakira is, and maybe even own a CD of Laundry Service. But it’s Tier 4, consisting of people making less than $2,000 a year, that most interests Prahalad, who figures that something like four billion people reside at the pyramid’s chunky base. (Other estimates put the number of people in Tier 4 as low as two billion; in any case, it’s a lot of people.)
Individually, the purchasing power of Tier 4 is limited. But together it adds up to trillions. And while the poor will no doubt have to live without lattes, their general wants and needs are familiar: securing better lives for their children, getting the best price for their labor, staying healthy, and having fun. Tap into that, Prahalad says, and there is a “Fortune at the Bottom of the Pyramid”–the title of an article he co-wrote with Stuart Hart in strategy+business magazine.
This is what we want to do with Emergic – create low-cost technology solutions for the “other 90%”.
