Datawind squeezes costs out of bandwidth for developing markets

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$80 for a tablet with a year of mobile Internet service included is a powerful selling proposition, particularly in the developing markets that Datawind is targeting. The Canadian company showed its newest tablet – priced at $38 with WiFi connectivity only – at the Showstoppers event at the CTIA show in Las Vegas last month.

Datawind has solved two tough problems: making a cheap and functional tablet and bundling it with even cheaper mobile service in a useful way.

The 7-inch tablet runs Android on a 1.3 GHz dual core processor that costs $3.50. Other components are comparable, resulting in a device that has twice the processing power and memory as the first iPad, according to the company. Plans are to keep squeezing out costs, with a projected price point of $20 next year.

The real secret sauce, though, is a custom-built browser that connects to Datawind’s servers, which compress the bandwidth used down to a relative trickle and also serve out ads that help subsidise data connections in developing countries. That’s what allows the company to include a year’s worth of data service for $42 more. “We do the heavy lifting on the back end”, said Suneet Tuli, Datawind’s CEO.

There are obvious trade offs in performance, but users aren’t restricted to Datawind’s network. Other browsers run fine, and can be used when more robust or inexpensive connectivity is available.

Africa and India – where Tuli says they’ve been the top selling manufacturer since last year – are Datawind’s primary markets, although it also sells products in the developed world too.c

About Steve Blum

Steve Blum is president of Tellus Venture Associates, a management, planning and business development consultancy for municipal and community broadband initiatives. He is a 30-year industry veteran and an expert in developing new broadband infrastructure and services, including wireless, fiber optic and satellite systems. His career includes playing key roles in the launch and growth of DirecTv in the U.S., as well as other satellite broadcasting platforms around the world. For the past ten years, he has helped build municipal wireless and fiber optic broadband systems. His client list includes many California cities, such as San Leandro, Palo Alto, Oakland, Los Angeles, Lompoc and Folsom. He’s a member of the executive team for the Central Coast Broadband Consortium and has worked with other regional consortia in California. Steve is the author of seven books on the Internet and satellite broadcasting and is a frequent contributor to professional journals and industry events. He holds an A.B. in History from the University of California, Berkeley, an M.A. in East Asia Studies from the University of Washington, and an M.B.A. from the University of St. Thomas. He is a triathlete and multiple Ironman finisher, and is currently ranked in the top 100 of the Challenge Triathlon world rankings, out of more than 30,000 athletes.