Experts weigh in on Sproxil's technology

Reuters recently asked experts in the mobile phone industry to weigh in on Sproxil's technology. This follow-up piece on the original article gives readers some interesting feedback on our MPATM technology that powers NAFDAC's Mobile Authentication Service (MAS). The three experts, Derek Kerton (The Kerton Group), Cindy Krum (Rank Mobile) and Jacob Sharony (Mobius Consulting), provide technology consultancy services to some of the world's largest companies, including Sony, Paypal, NTT DoCoMo, SK Telecom and Northrop Grumman.

Comments from the experts include:

The best apps might not be 3D games on the iPhone, but rather simple SMS programs that make a real difference. -- Derek Kerton, The Kerton Group

“I think this technology is great, and it sounds like it can be easily adapted to verify lots of products – both high-dollar and more mainstream.” -- Cindy Krum, Rank Mobile

Cindy also notes the need for more consumer awareness on the risk of taking a fake drug:

“To see success the project will have to be embraced and evangelized off-line in mass media. People will only use this technology if they understand the risks and trust the results”

The experts had a few points that we would like to address. Here is the response we sent:

Thank you to the experts for their comments. We are excited that there is growing interest in our technology and services. I’d like to address some of the questions/concerns raised so that readers may be able to discuss our solutions in more detail.

We set out to design a service that 2 billion people in low-to-medium income countries could easily use. The service has to be as secure as first-world options, and not require a large marketing campaign to retrain 2 billion people. With this in mind, we went with SMS on the mobile phone.

We offer a service not an app – there is no download or install process required. Text messaging is already pre-installed as a GSM standard on the vast majority of GSM phones made in the last decade, including the older second-hand phones often seen in developing nations.

Relatively lower income levels in developing nations means that offering an app to download and install is not scalable – it requires a data plan, which comes with an extra charge to the user. Using barcodes (1D and 2D) could work for those users who have cameraphones with autofocus and mobile internet data plans to upload the scanned barcodes for authentication. Sadly, data plans are not common among the masses outside the developed world. These are some of the reasons that led us to design our solution around a toll-free text message number. Consumers don’t have to worry about costs any longer, and legitimate brand owners are willing to foot the bill.

In our technology design phase, we also looked at a “chip and pin” model, where two codes are entered and jointly authenticated. This could work in countries that have good electronic trade systems, such as South Africa and in some parts of India and China. However, in the cash-based societies where drug counterfeiting is a major problem, one rarely gets a receipt for purchases. Thus, there is no easy way to reliably generate a receipt with a PIN.

We focused on what is already working in these cash-based societies. The prepaid cell phone market has tripled in five years (2001 to 2006). This multi-million dollar market is growing at 80%-90% annually in Asia and Latin America – and that was in 2006, I believe it’s even more exciting now. I contend that the popularity of prepaid phones hinges on the successful prepaid airtime voucher model where consumers buy a voucher with cash (often by the street or in traffic), scratch off a panel, send a code and get airtime to make a phone call. This method has been wildly successful in cash-based societies, and we’re leveraging the success to help solve a grave problem – counterfeit medication – in these same societies. Consumers already know how to scratch and send codes, and hackers have been largely unsuccessful at making fake prepaid voucher cards. The GSM technology we leverage is a great example of “good enough” security – not overly complicated, yet secure enough to power 4 billion phones worldwide.

Awareness on counterfeits is growing. There are now some good online resources for advocacy – the Partnership for Safe Medicines comes to mind. As local enforcement efforts are increased over time, we’ve seen consumers get savvier. We invite foundations and social media houses to help raise awareness on drug quality issues, so that folks at the so-called bottom of the pyramid don’t get fake drugs in exchange for their hard-earned cash.

Prepaid stats available here