Bill Gates recently spoke about using capitalism to help the billions of underpriviledged citizens of this planet. His idea is to effectively spread the benefits of capitalism and the huge improvements in quality of life it can provide to people who have been left out. He cites C. K. Prahalad’s The Fortune at the Bottom of the Pyramid. As an incentive to companies to look at markets outside the developed west, it is mentioned that poorest two-thirds of the world’s population has about $5 trillion in purchasing power.

Some innovative uses of cell phones in poor countries are cited. Customers are charged by the second instead of by the minute to keep costs low. Money transfer through mobile phones is also quite common. Then ofcourse, the importance of information flow is highlighted. Farmers use cell phones to find the best prices of their commodities in nearby markets. I have written about this in an earlier post as well.

Bill Gates also mentions product red. Red Branded products from a company have the same features as the standard product, but the companies donate a percentage of their profits from these products to fight AIDS. This creates added brand value for customers, who might choose such a product over a competitors standard product because of the charitable cause associated with a red-branded product.

Some interesting innovations that have come out of Microsoft Research are highlighted. Visual interfaces that enable the illiterate people to use a PC instantly, with minimal training is one. Another interesting project is one that lets an entire classroom full of students use a single computer using software that lets each student use his/her own mouse to control a specially colored cursor so that as many as 50 kids can use one computer at the same time. These projects not only help in educating the poor, it also serves in creating new markets for Microsoft.

I strongly believe that creative captilism has a lot of potential, not just for social upliftment but for companies to exploit untapped markets. Such projects, along with efforts like microcredit will definitely go a long way in helping to improve the lives of the poor.