Emerging ICT Business Opportunities in Kenya.
The following is an article I wrote that was published in the September 2009 edition of the Kenya Institute of Management’s (KIM) Magazine, Management, as a special feature:
By all considerations, 2009 has been a remarkable year for Information and Communications Technologies (ICT) in Kenya. The first game changer of the was the controversial signing of the Kenya ICT Bill into Law earlier this year. This action received a lot of negative publicity from the Media fraternity due to some of the negative measures it presented. However, from an ICT perspective, there we’re several important and highly beneficial breakthroughs in the same. Nevertheless, these breakthroughs are yet to be fully realized due to the challenges faced in actually operationalizing them.
The first major development in the ICT Bill is that it accommodates the possibility of E-Commerce in Kenya. More specifically, the Bill provides Kenyan Banks with the legal framework to start offering E-Commerce services in Kenya. E-Commerce is a key aspect of Kenya achieving its full socioeconomic potential and will enable companies, small and large, to market and sell their services via the Internet, in Kenya and beyond. The second major aspect of the ICT Bill is that of email being legally binding for electronic communications and transactions, meaning that it is now admissible in court. And, lastly, the Bill provides for electronic signatures which can be used to digitally sign documents and transactions. This will enable all sorts of possibilities such as customers signing up for services online with out necessarily having to sign hard copy documents. All of these developments will basically create an electronic business environment in Kenya which has lagged so far behind the rest of the world for the better part of a decade. Globally, E-Commerce represents a massive market that is worth trillions of dollars across a broad range of sectors and industries – the ICT Bill enables Kenya to become a part of this opportunity.
The second ICT game changer for business of the year has been the landing of both SEACOM and TEAMS high speed under sea cables. In the month of July 2009, SEACOM went live in several African Countries including Kenya. Already, we can see that our Internet connectivity has at least doubled in speed even if the costs have remained largely unchanged at both the retail and business consumer levels. Going forward, when the TEAMS cable goes live later this year, and the EASSY cable goes live next year, Kenya will have an abundance of high speed internet connectivity to theÂ rest of the world. It is already being speculated that Internet costs will drop by as much as 70% in due course. In a nutshell, it means that the Internet will become a highly commoditized utility throughout Kenya. This presents a number of obvious and not so obvious opportunities from a business perspective.
The first industry that is expected to benefit from the high speed cables most is that of Business Process Outsourcing (BPO). Global BPO is a multi-billion dollar industry that is largely dominated by countries such as India, The Philippines and China. Hithero, Kenya has been unable to compete effectively due to the high costs and low quality of satellite-based communications, even though Kenya has a large population of highly educated graduates who could be absorbed into this Industry. However, the low costs of communications that the high speed cables will create will level the playing field for businesses operating in BPO. This is an essential development especially for call centers, data transcription and other BPO businesses that require fast and high quality communication linkages.
The high speed cables will also create opportunities for those businesses and individuals who want to enter Knowledge Process Outsourcing (KPO). KPO is different from BPO as it represents high level services that outsourced such as accounting, legal services, medicine, data analysis, software programming, web site design, architecture, engineering, etc all that can be offered virtually to a global client base. This means that rather than looking for jobs or customers in Kenya alone, businesses and individuals will be able to market and deliver their offerings to a global customer-base, online. This is possible due the fact that large data uploads and downloads will be cost-effective and efficient as a result of the high speed cables. It also means that teleconferencing and video conferencing with customers globally at near-free costs will be a reality, enabling a Kenyan service provider to interact with customers online, as if they we’re in the same room.
From an organizational perspective, the high speed cables mean that businesses will no longer have to fly staff to expensive conferences, workshops or seminars since they can â€œvirtuallyâ€ attend the same through the Internet. The cost savings of this possibility alone are mind boggling, especially in this day and age where organizations have to think about operating at an optimal level and maintaining a â€œgreenâ€ approach to their business processes, with a minimal carbon footprint.
Another transformational aspect of the high speed cables will be in the area of service delivery from a public and private sector perspective. It will become possible to cost-effectively deliver services to a mass market through the Internet. It will be easy to facilitate the development and distribution of lots of content to a market that will be largely online. Business models that have operated up to this point effectively will be disrupted by the advent of high speed Internet access, anywhere and everywhere.
Lastly, from a consumer perspective, the very idea of content consumption and distribution will change. The idea of streaming real-time radio or tv on a mobile phone will result in a whole new range of media business possibilities. The non-stop high-speed Internet access will create all sorts of consumer content choices and preferences. The masses will be become a truly one-to-one marketplace for brands across the board. The consumer we know today will indeed look quite different in the days to come. The consumer will also become a major part of content development and distribution. It will definitely not be business as usual.