Joining the Mobile Era "after" Communism
|Dec 15, 2019|| 1|
This post is based on my own experience, research done while visiting Cuba, and reading from different sources.
Driving down the famous “El Malecón” boulevard in Havana, Cuba you’ll encounter a beautiful and serene bay with dozens of fishermen passing time, chatting about life and listening to music on their old radios while they focus on the catch of the day.
Daily life in Cuba is pretty simple. Outside of working for the government or tourism, there isn’t much else happening in the country to the visible eye from an economic standpoint.
However, that’s been changing as of recently.
We wouldn’t think of Cuba as a pioneer in technology and entrepreneurship, but in the past few years, Cubans have seen a significant rise in smartphone adoption and internet connectivity, led in part by more relaxed rules on censorship from the government and some investments in telecommunications infrastructure.
On my recent trip to Cuba I met Laura (redacted her name for privacy), a 29 year old psychologist who currently works at a small boutique hotel around El Malecón, where I was staying. After been shown around my accommodations, we began chatting about Cuba from her perspective. I wanted to learn what the state of things were since Fidel Castro, Cuba’s infamous leader, died in 2016.
She mentioned that Cuba was somewhat different now. People have more “freedom” – art events and music festivals are common now, and with tourism booming, opportunities have not been better. But from a professional and economic standpoint, she mentioned “studying a career at the university is not worth it, unless you’re just interested in learning and not making a living.”
Laura left her profession as a psychologist at a local hospital in order to make a better living assisting guests at the hotel. As a psychologist, she earned about $40 USD a month, just in line with the average monthly income for most Cubans. Working at the boutique hotel, however, allowed her to earn around $300 USD per month instead of that meager “government” salary. With this substantial increase in income she’s now able to sustain life at home by taking care of her aging parents. She now also has access to many things most Cubans cannot afford, better food, premium beers, and tons of burgeoning entertainment.
This story repeats itself around the Island for most Millennials and Gen Z’s. If you’re not working in tourism/hospitality, it’s very likely you’ll be amongst Cubans earning just enough to go by. The future is bleak if you don’t do something a bit different.
This is what some hope the recent opening of the internet helps change Cuba.
The Internet in Cuba
In the early 1950’s, Cuba was overthrown by a few revolutionaries whom we’ve heard and read so much about, Fidel Castro, Ché Guevara, and Camilo Cienfuegos, among others.
Since then, Cubans have had very limited access to the outside world and, for that matter, to any widespread innovation brought by the internet.
In 2013, for the first time the Cuban government approved the “opening” of the internet to a few areas in the capital city of Havana. Unfortunately, these were constrained to specific “plazas de navegación” or public squares with limited internet access points. Think of these as “cybercafés” (without the cafés) where Cubans could gather to consume vast quantities of internet content.
Back then (and still today), however, only those who could afford to buy an internet connection could access it. It worked just like a payphone. You’d pay for the time you wanted to spend browsing.
Access to different parts of the internet were also prohibited. Major international websites were intentionally blocked. The government tried pushing a few local websites, from local newspapers like Granma to email services like Nauta, which can only be accessed from within Cuba. Using the internet for the first few years wasn’t really that useful. It was a closed ecosystem.
Quickly after the introduction of the internet, smartphones began to surface. The government started selling devices, however, at obscene prices. All through the retail branches of the government-owned communications’ company, ETECSA. The high prices drew Cubans to find cheaper alternatives in the black market.
A Cuban’s monthly income is roughly between $40 - $100 USD. As a result, unless you work in the government or are married to a foreigner with a local business in Cuba, your ability to buy a smartphone is very limited.
For context, an unused 2015 Samsung Galaxy A5 retailed globally for about ~$500 USD when it came out. Four years later the same phone, sold through ETECSA as a 2017 model, costs $350 CUC which is equal to $350 USD ($1 CUC = 1 USD). It takes any Cuban at least ~9 months to afford this phone. This excludes any data package needed to access the internet.
As a way to bypass the government and its prices, smartphones have been imported from places like Panama, Venezuela, and Mexico by Cubans who’re able to travel abroad. Most imported smartphones are of Chinese brands like Oppo or Huawei. Some are lower-quality phones, like Chilean-owned Itelecom which is not even known for making phones outside of Cuba.
Still expensive for most Cubans, “illegal” imported smartphones are 20-30% cheaper than those sold by the government at the ETECSA branches. These smartphones are also guaranteed not to have been meddled with by the government which is known for practicing real life Orwellian-type control over its citizens.
Family members and tourists visiting Cuba have also left behind new technology. From old laptops, and USB drives (filled with movies, music, and news), to iPods, and other devices, these items have contributed to the flow of foreign information and digital entertainment into Cuba.
I’m not sure how many smartphones are as of today in the hands of Cubans, but from what I was able to see in the parts I visited and with a total population of close to 12 million Cubans, unless wages are increased or payment plans are established, it’ll take many years for their widespread adoption.
Last year on December, the government allowed citizens for the first time to purchase 3G-speed mobile data plans to access the internet “from anywhere in Cuba”, as they stated on their propaganda.
This meant so many things for Cubans. For starters, that they would no longer be constrained to the “plazas de navegación”. They could now have internet access while on the go.
You may be reading this and thinking, “well interesting but 3G is devastatingly slow and old technology”. Indeed, but imagine going from being physically constrained to a public square to now being able to access the internet from your phone anywhere you want. Information and communication at your fingertips.
In more advanced countries we surely take it for granted. But speed and connectivity are exactly what allow us to move fast on daily basis and innovate at the speed we are.
Tech companies around the world also face challenges when developing apps and tools for countries where speed is slow and connectivity is limited. Facebook, for example, developed “Facebook Lite”, a lightweight app with only the core features of the main app, in order to give access to citizens in places where data is expensive and limited. The lite app works on phones with low memory and allows frictionless access to Facebook’s different tools.
The lack of private and public investment in technological and communication infrastructure has definitely left Cuba behind other countries. Nonetheless, the move to sell smartphones and mobile data plans is a good start.
This sounds like they’re making good progress, because they are, but there’s a huge caveat in all of this – it’s still extremely expensive for the average Cuban to buy data plans.
Data plans cost either $7 USD for 600MB or $10 USD for 1GB of….3G speeds! If you’re in the normal income level for a Cuban, this means that 600MB of data will cost you roughly 18% of your income while the majority of the world pays less than 4 - 5% of their income for 4G mobile data plans.
As they say, necessity is the Mother of Invention and Cubans have data needs. As a result of expensive data plans, instead of downloading apps straight from an online app store, Cubans share apps and content through bluetooth or apps like Zapya. This allows them to save on data. In just a few days an app can go from a few smartphones in Havana to the rest of Cuba. Early adopters work as distribution nodes.
A New Cuba
Regardless of the slow adoption, limited connectivity, expensive hardware, and cost-prohibitive data plans, a new digital Cuba seems to be emerging. While speaking with Laura, my hostess at the hotel, she mentioned that Cuba will be different in the next decade. The government is finally paying attention to younger generations.
Now, it’s very common to see groups of teenagers participating in state-funded events that push development of technology and art programs. Independent groups are also forming around these events and many others far from the capital-city are creating their own. Software developers are starting to build formidable apps to solve some of Cuba’s challenges and groups of non-developers are doubling down on music and the arts.
As Cuban entrepreneurs get better informed, get curious, and thirsty for more they’re starting to get online and find opportunities.
An interesting fact about Cuba is that education is quite good. If you want to learn, you can go learn just about anything from various languages to medicine, engineering, and math. As a result of word of mouth and tourists chatting with the locals, Cubans have discovered about different websites they can use to export their education. For instance, Laura (my hostess at the hotel) knows Spanish, English, French, and Italian, all learnt at school in Cuba. She recently began earning additional income as well by working as a translator for different agencies in France which pay anything between $1-5 USD per page. All of it because of the internet.
Others are beginning to replicate marketplaces and concepts they’ve seen online. As an example, a new Uber-like app was recently launched called Bajanda. In Havana most people rely on public buses and taxis to move from place to place, thus the city is packed with old classical taxis (that double as tourist cars) and the newer state-sponsored taxis using Russian-made Ladas’.
The group behind Bajanda was able to connect the dots between supply and demand, and launched their Android-first version of the app connecting taxi drivers with users looking for transportation.
According to an old article I found, the app has had some success and indeed when you open the app in Cuba (I used Laura’s Samsung phone) you could see the cars driving around. To my surprise, the team recently got in touch with me through twitter and mentioned they now have over 11.5K downloads from the app store with “a decent fleet of drivers all around the city”. This might not be telling of its reach since most people transfer apps in Cuba by way of bluetooth to avoid burning data, however it tells you that they are seeing positive traction of the app.
Social media cannot be ignored either. Just like in every part of the world, influencers have overtaken Cuban’s social media networks. From Facebook and Instagram, to now TikTok, hundreds of Cubans have gained popularity (link to article in Spanish) through different mediums. They’re taking advantage of a digital layer that is very hard to shut down.
I saw how important self-expression and individuality was amongst younger Cubans and have no doubt that social media will cause major impact in the coming years as a powerful tool against censorship.
Aside from their (very important) political issues, Cuba is making progress as fast as its system allows it to. A new generation of entrepreneurs is not waiting to happen, it’s happening. With groups forming and demanding cheaper and faster internet and with increased interest from companies and entrepreneurs from around the world, I’m hopeful that a new tech-driven society will bring back Cuba to its glory days.
I’ll finish up with this quote from Ernest Hemingway who spent valuable time in Cuba and was influenced by its uniqueness.
“Now is no time to think of what you do not have. Think of what you can do with what there is.” – Ernest Hemingway
Well said, Ernest.