Nigeria’s last cybercafés grimly hang on


Image: By Kokumo Goodie
Nigeria’s last cybercafés grimly hang on

By Kokumo Goodie, Lagos, Nigeria

The looming end of the cybercafé era is threatening the livelihoods of numerous entrepreneurs. We spoke to some of them.

Failing dreams

Bristling with energy and a determination to succeed, Akinbo Kayode, about 41, left the university ten years ago with high hopes of a fulfilling future. After the completion of the mandatory National Youth Service Corps, NYSC, programme, he returned to Lagos and began the search for the Golden Fleece.

He searched all the nooks and crannies of the city for a white collar job, which failed to come. Six months into the search, an idea struck him one day. “Go and open a tutorial centre,” a voice from within told him. He obeyed the voice and set up, with funds from family and friends, what is today known as Dolphin Kay Tutorial Centre in Dopemu, a sprawling low income residential area on the outskirts of metropolitan Lagos.

Akinbo Kayode

When the tutorial centre stabilised a little, Kayode used proceeds from it to diversify into what he felt was “the lucrative” business of cybercafé.

In one fell swoop, he committed about N1.5 million to the business.

When it started, he was making some money but a combination of factors colluded to stop the drum beat of celebration. Today, he is a disappointed man as his expectations are so very far from being met.

Chukwuma Aguomuo is another Lagos-based cyber café operator. When he started the business in the early 90s, it was a high-yielding venture, as an hour’s air time cost between N150 and N200. He combined the business with internet calls and made brisk business whenever it was time for the American Diversity Lottery programme.

He opened about eight branches across the city and employed staff to work for him.

Today, Aguomuo has not only closed all the branches, his major headache now is how and where he will get the one year rent he will pay his landlord in a month’s time for the warehouse that presently serves as his operational base.

“It is very sad that things have changed so rapidly for the worse. It is incredible that I don’t know where the rent for this place will come from when it is due in about two months time,” he lamented.

Deserted training centre

A mighty structure houses DS Cybercafé and Computer Training Centre in Egbeda, another Lagos suburb. Two years ago, this building was a beehive of activities as men, women, both old and young, thronged the place to browse and get computer education.

Today, the story has changed. It is virtually a deserted place with less than twenty functional computers. “Patronage has gone down tremendously. Time is about 2.00 pm, I have made less than N2000. So, the challenges are enormous as we barely manage to remain in business,” a young man who said he was not competent to speak for management explained to some time ago. The shop has since closed down completely.

Six years ago, research showed that there were fewer than three computers per 1,000 people in the country while just one out of 1,500 people had access to the internet. Going by this, the cybercafés remain the veritable platform for bridging the digital divide and allowing more Nigerians to be part of the global village.

Sadly, however, this is not the case as the cyber business has virtually gone into extinction in the country. Research shows that in 2003, the country had over 15,000 cyber cafes, with over 10,000 of them concentrated in Lagos State alone. At the twilight of 2007, this figure paled into insignificance to just about 1,002. Today, it is estimated that there are less than 700 flourishing cybercafés across the country.

Temitpoe AkindeleTemitpoe Akindele, CEO, Green Star Limited, a firm of licensed customs clearing and forwarding agents, decried the high mortality rate of cybercafés in recent times which he blamed on the economy and proliferation of smart phones.

“I am appalled by the rate at which the business has gone down in the country. it was a means of livelihood for many people in the country There used to be five in my neighbourhood but now, you have to go far to get one,” he said.

Layi Omotola of the Association of Cyber cafe and Telecentre Operators of Nigeria, ACTON, says in 2003, the country had over 15,000 cyber cafes, with over 10,000 of them in Lagos State. ”As at the end 2007, the number had dropped to 1,002, and with a recent statistics taken by us, functional cybercafés are now below 600,” he had lamented.

Facing extinction

But how did this once flourishing business come to this sorry state?

Stakeholders in the telecoms sector blame the high cost of setting up and running a cybercafé as reason for the reversal of fortune in the sector, especially the cost of acquiring bandwidth.

Research shows that for one to set up a cybercafé, one would require an average of N2.5 million for internet connectivity, N150,000 monthly subscription fee aside payment for rent, computers and other infrastructural facilities that would make the place congenial for business transaction.

An average cybercafé would need between 40 and 50 computers and other accompaniments like printers, scanners and generators. Because the bandwidth is sourced from Asia, America and Europe, it is very expensive.

An independent internet group in Britain made a startling revelation in its research. According to the research, internet service providers, ISPs, in Africa lose over $400 million annually for pairing of local traffic in exchange and international bandwidth provision. This colossal loss is incurred because most African countries do not have internet exchange point, IXP, where ISPs can interconnect and share local traffic.

Rising costs

Kayode said he paid N450,000 to DPC to acquire its modem alone and another N30,000 monthly subscription fee. “How much you pay as subscription is a function of the number of computers you intend to use. I use only 10 computers and paid N450,000 and N30,000 monthly subscription fee,” he had said.

He says the virtual collapse of public power supply from the Power Holding Company of Nigeria, PHCN, constant harassment and extortion from security men, emergence of globall service for mobile communication, GSM, and private telephone operators, PTOs, offering internet service in their respective bouquets have considerably contributed to the near-moribund state the business is in the country.

While the cost of air time has gone down drastically from between N150 and N200 per hour to N100 and N80 per hour, administrative cost continued to maintain a steady rise.

Rent is reviewed annually while the pump price of petrol underwent iniquitous tinkling for more than a dozen times in the last eight years of former President Olusegun Obasanjo administration.

Today, automotive gas oil, AGO, or diesel goes for N150 per litre and above in the Lagos area while petrol has moved from N70 per litre to N97 courtesy of President Jonathan Goodluck’s New Year gift to Nigerians that voted him massively in anticipation of change.

Of all the challenges faced by operators of cybercafés, that of fake and substandard generators pose a daunting one. Since the beginning of this year, management of DS Cybercafe said PHCN has not supplied power for an hour.Disused generators

Yet bills must come in at the end of the month. So, the firm, like others, makes do with generators. For his 40 kva generator, which runs on diesel, he spends N9,000 while the other two that use petrol would accommodate about 15 litres costing N1,800 which will last for only six hours before a refill. The problem now is that the generators pack up no sooner had they been purchased.  “I bought that generator for N80,000, used it for only one month and it packed up,” he lamented. Kayode has about five condemned generators which he said he bought and used for only three months.

Even when the generators work, there are always fluctuations in the signal of ISPs. Thus, for one week, the signal strength may be as low as 25%. When this happens as it so often does, it is double jeopardy as they could neither make money nor recoup the lost down time.

Dr Jacob Nwachukwu, executive chairman, Corporate Medicals, physician and stress consultant, took the issue of downtime with no compensation up with regulator of the telecoms sector, the Nigerian Communications Commission, NCC. He complained bitterly about the pains he had to go through, regularly changing ISPs who do not care a hoot about down time.

Ernest Ndukwe, former executive vice chairman of the NCC, affirmed that indeed, subscribers are entitled to compensation for down time, adding that such issues should regularly be brought to the attention of the NCC. But how many of the operators know this and will take the pains to fight the battle? Many of them claimed they are ignorant about their right to compensation.

Embarrassing raids

The sudden surge in cyber crime in the country has not helped matters. Kayode Afolalu, managing director of Brand Definitions, a brands and communication outfit located at the famous Computer Village, Ikeja, says the level of cyber crime in the country has made the law enforcement agents to see anybody browsing in a cyber café as a fraudster.Kayode Afolalu

And contrary to the legal dictum of being presumed innocent until proven otherwise by a regular and competent court of law, you are presumed guilty and subjected to all manners of humiliation by barely literate but perpetually inebriated policemen. This, he says, is evident in the manner the cafes were constantly being raided by police, and patrons arrested, notwithstanding their innocence.

This embarrassing situation as well as other forms of disturbances encountered in cyber cafés, he said, are enough to discourage people from patronising them, and in turn make provisions for alternative. “If you are unlucky to be arrested at a cybercafé or attacked by armed gangs who may not only dispossess you of your cash and valuables, but your dear life, would you take the gamble of going there again? Afolalu asks. “So, people just buy the dongle, stay at home with their desk top or laptop to do whatever they wanted to do.”

The situation has even been made easy with original equipment manufacturers, OEMs, giving away free bandwidth of about 200 MB to sell their products. So also are GSM operators, who in an attempt to outdo one another, offer 100 per cent data in return for data purchased.

But it is also an incontrovertible fact that some cybercafés were real haven for young cyber criminals. By special arrangements, these criminals used to pay their way to have overnight access to the cafes where they send scam mails.

But an operator denied this and said those with criminal intentions now do it within the confines of their bedrooms. While this brings more money to operators, it brings international opprobrium to the nation.

E-commerce  transactions have remained low in Africa because of internet fraud.  Nigeria, sadly, is a giant in this regard as she is ranked the “riskiest” for e-commerce by on-line merchants across the globe because the country accounts for about 4.81% of global internet fraud.

In 2005 alone, the Federal Bureau of Investigation, FBI, a US security outfit and the Economic and Financial Crimes Commission, EFCC,  carried out a joint operation that led to the seizure of goods worth N319 million in the Lagos area alone while the EFCC made seizure of over USD1 billion in laundered money.

Faint hope

One operator, who spoke on condition of anonymity, said the migration to electronic platforms by examination bodies like the Joint Admission and Matriculation Board, JAMB, the body that conducts University Matriculation Examination, UME, the West African School Certificate Examination, WASCE, the General Certificate of Education, GCE, NECO and recruitment into the armed forces and other places of employment, operators make seasonal gains.

“We see business during registration for examinations because even if they can do the registration with their handsets, they cannot print. So we make money from printing and registering them online for examination,” he said.

Even with this avalanche of challenges, all hope is not lost as stakeholders called on government to do the right things by fixing the comatose power sector and domesticating satellite so that signals would no longer be routed from Europe and other Asian countries.

Share the News

Get Daily Newsletter

Search News

comments powered by Disqus


FNB, PayPal bring global eCommerce to Botswana

Ogone Madisa-Kgwarae First National Bank (FNB) has announced it will be extending the partnership between FNB and PayPal to offer the PayPal Withdraw Service, previously available only in South Africa, in Botswana. Read More

Survey: businesses have less than two years to make digital inroads

Progress has announced the results of its recent global survey: "Are Businesses Really Digitally Transforming or Living in Digital Denial?"  Read More

Gartner: profit opportunities exist for PC vendors

The worldwide PC market registered one of its lowest quarterly growth rates in the first quarter 2016, but Gartner, Inc. said several profit opportunities exist for PC vendors. Read More

MTN Business makes headway to be an ICT Partner of Choice

MTN Business, the enterprise business unit of MTN SA, plans to focus on three key areas in a bid to become the ICT partner of choice, namely, getting the basics right, accelerating growth and diversifying its revenue streams. Read More

MTN Ghana celebrates 20 years of operations in Ghana

MTN Ghana has unveiled its 20th Anniversary logo at a grand ceremony held at the iconic MTN House in Accra to officially mark the 20 years of operations in the country.  Read More

Copy Cat bets on innovation to grow market share

Kenyan technology company Copy Cat Group is implementing a new transformational strategy to increase its market share in the ICT market.  Read More

Infrastructure investments highlight bright spots for SSA economic diversification

The commodity super cycle may have ended, but there are certainly bright spots for investors across sub-Saharan Africa, IHS has told the World Economic Forum on Africa. Read More

Africa’s CEOs look to innovation and technology to stimulate growth

CEOs in Africa are ramping up their efforts to innovate and find new ways to do business on the continent, according to PwC’s Africa Business Agenda released at the 26th World Economic Forum on Africa in Kigali. Read More

4th Africa Business Forum to be staged in Ethiopia

Registration is open for the 4th Africa Business Forum to be held on Wednesday, June 1st, 2016 at the Sheraton Hotel, Addis Ababa, Ethiopia, East Africa. Read More

Airtel divests telecoms tower assets in DRC to Helios Towers Africa

Bharti Airtel International and Helios Towers Africa have announced an agreement for the divestment of approximately 950 telecoms towers in the DRC from Airtel to Helois Towers Africa.  Read More


Sage EnterpriseSAP AfricaTrust PayVMWareSamsung ElectronicsMitsumi DistributionPhoenix DistributionMTN BusinessSchneider ElectricMultichoiceMicrosoft 4AfrikaNetworks UnlimitedArbor Networks


Government should encourage youths in ICT earlyGovernment should encourage youths in ICT early

Youths should be given more encouragement to develop their ICT skills, an 11-year-old app developer told Kokumo Goodie.


IBM Opens First Cloud Data Centre in South AfricaIBM Opens First Cloud Data Centre in South Africa

IBM is opening a new IBM Cloud Data Centre in Johannesburg, South Africa. The new cloud center is the result of a close collaboration with Gijima and Vodacom and is designed to support cloud adoption and customer demand across the continent.  


Resolving the data centre disconnect

The disconnect between virtualised applications and physical storage is costing businesses time and money.   

Separating the attack that matters from the noise

It has almost become the norm for a business to be compromised by a security attack. The emphasis today is thus more on how a business responds ...

MTN Business partners SMEasy to give entrepreneurs access to easy accounting solutions

MTN Business, in partnership with online accounting tool SMEasy, today announced the launch of an agile, fit for purpose business management and easy accounting solution for small ...