Two years of Seacom in Kenya

Marking two years since the Seacom cable brought its high-speed service to Kenya, our correspondent Caroline Kimutai takes a look at what changes it has brought about.

On July 23rd 2011, Seacom (the undersea cable linking Kenya and the United Arab Emirates), will mark two years since it launched in Kenya. In the last five years, Kenya’ s ICT sector has seen enormous transformation and growth – providing business and employment opportunities.

According to World Bank’ s Information and Communication for Development Report 2009, every 10% increase in high-speed internet connections in developing countries (results) in an increase of 1.3% in economic growth. For Kenya, this has translated in many economic gains as the price of internet connectivity becomes affordable to more people who can use it to communicate and conduct commerce.

Seacom says the impact of high capacity bandwidth and solutions will dramatically shift the way Kenya learns, conduct business, and bridge the knowledge gap in the country and across the region enabling communities to unleash their creative potential and seamlessly integrate into the information driven global economy.

Investments made

In the 2001/2 financial budget presented on June 8, by Uhuru Kenyatta Kenya’ s Minister of Finance, the Government allocated KSh44.2 billion with priority areas given to research and innovations, information and communication service, and data management. With more opportunities in the ICT sector, Kenya is gradually positioning itself as the technology hub of East Africa. Already, the country is investing USD60 million in the National Optic Fibre Backbone Infrastructure.  

Only two years ago, the average cost of internet connectivity was about USD3,000 per Mb on satellite services; the go-to-market launch prices on Seacom was USD500 per Mb – a reduction of 83%. This was followed by massive price reduction in internet connectivity prices that dropped by as much as 67%. Within three days of Seacom launching, Kenya reported an increase in internet speeds; within 14 days Safaricom reported a 200% increase in data traffic, and international bandwidth supply increased by 700%.

Growth of internet users

According to the Communication Commission of Kenya (CCK), in the first quarter of 2011, Kenya had 8.6 million registered internet users – these figures have continued to grow yearly. This growth can be attributed to the fibre optic cable that has lowered costs and improved connection speeds significantly.

This has led to a growth in the number of internet users in the country.

A recent audience research establishment survey conducted by research company Synovate in the first quarter of 2011 showed an increase in internet usage. With a base population of 22 million (people aged 15 years and older), 16% of the people had used the internet in the past four weeks, compared to 9% in 2007. 13% had used the internet in the past seven days.   

The internet is a leading employment creator in the country as youth use it to market goods and services; entrepreneurs are using social sites like Facebook to showcase their products and market them to local and international markets.

For Small and Medium Enterprises, there is a growing need to outsource IT services like managed premises for data hosting and network security, software services like payroll, Enterprise Resource Planning, Human Resource, Customer Relationship Management among others.

Benefits so far

Kenya has benefited in many ways from the fibre optic cable. Students in institutions of higher learning can now easily access research materials (E-resources and E-books); the emergence of the iHub concept has seen the creation of ICT experts, software developers and exposures to global ICT markets; and a developing E-Commerce society.   

Shift to mobile

This year, mobile broadband is expected to be worth USD3.6 billion. The audience survey by Synovate found that 87% of the people had made a call using the mobile phone in the past seven days. The survey also found that a majority access the internet on their mobile phone.  No doubt, the mobile phone shall continue to dominate the provision of internet service.

In mobile telephony, focus will now shift to data services with numerous innovations taking place on the mobile platform for example digital TV.  Businesses are at the forefront of this revolution; an example is the convergence with mobile technology – it is possible to bank using a mobile phone, pay utility bills, and conduct transactions – all at a click of a button.

Future opportunities as a result of high capacity bandwidth will revolve around; content management, cloud computing, managed services, business process outsourcing, E-Government, E-Commerce, E-Learning, and E-Health.  

Carole Kimutai is an online writer based in Nairobi, Kenya.
Twitter: @CaroleKimutai

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