One of the most effective ways to reduce poverty in developing countries is to extend the reach of the Internet. Over the last 20 years, the online world has created millions of jobs and billions of dollars of economic activity. Entire new sectors have emerged, such as e-commerce, social media, and data analytics. In developing countries, the Internet is even more powerful than it is elsewhere. It can connect people who have known only subsistence to the modern economy, and provide them with opportunities for social and economic advancement. Yet most people in developing countries, some 56 percent of the world’s population, still do not use the Internet.
Why has progress been so slow? There is a temptation for policy makers to blame protectionism, especially when the telecommunications sector is involved. From this perspective, some decision makers are constraining Internet development because they fear it will invite foreign competitors, who will compete unfairly with local Internet service providers or telecom operators. These are important issues, but they do not sufficiently explain why so many people aren’t online.
We dug deeper to understand the factors that keep more than 4 billion people unconnected. Using the Internet is daunting for many people in developing countries for three main reasons: Access is too expensive; the Internet lacks content that is relevant to them; and the Internet is too unfamiliar. The consequences are that many people can’t easily connect, they give up trying too soon, or they don’t attempt to connect in the first place because they cannot appreciate how it might help them.
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