Kenya’s 10 Biggest Technology Stories Of 2014
Happy New Year! I hope 2015 has started off on a good note for you and that you are rearing to go as much as I am. As I have done a few times in the past on my blog, I thought it would be great to capture what I saw as some of the biggest technology stories from 2014 in Kenya. This is a purely subjective list and therefore its possible I have missed a few here and there so do forgive any obvious omissions (however, do comment if there is anything else you think I could add). That being said, here is my list of the biggest technology stories in Kenya from 2014:
Safaricom’s Launch of LTE Advanced/4G In Kenya
This one in particular was really BIG for me. Kenya finally got LTE Advanced/4G via Safaricom. The service was launched in early December 2014 so it just barely made this list. The most interesting thing about Safaricom’s 4G is that it has the potential to deliver speeds of 100 Mbps which is over twice the fastest speeds one can achieve on the existing 3G service (previous top speeds of 42 Mbps).
Kenya was late to the 4G party in East Africa as Uganda and Tanzania had it over a year ago. This was due to all sorts of logistical issues including a failed consortium approach and the lack of available spectrum (which changed when Safaricom acquired spectrum licenses from the soon to be wound down Essar Kenya’s YU Network a few months).
Safaricom’s 4G network is only available in a few locations in Mombasa and Nairobi in Kenya with plans to roll-out throughout Kenya over the next couple of years or so. I personally have NOT yet managed to get Safaricom 4G working in the designated areas of Nairobi to-date with compatible devices and SIMs so still waiting to experience ‘warp speed-esque’ 4G bandwidth in Kenya.
Smart Mobile ‘Everything’ Becomes A Kenyan Thing
Everywhere I look these days it seems everyone is on a smartphone. Seriously. As in EVERYONE. Smartphones for the longest time had been the preserve of the rich and famous (pun intended) in Kenya in relative terms. These days, even the ‘Mama Mbogas’ have smartphones and are avid users of mobile bible apps and WhatsApp too.
The key drivers behind this trend as far as I can tell in 2014 were really inexpensive Android smartphones and super affordable data bundles. This has essentially liberated the myth of smartphones being for elite few and in fact according to some of the latest GFK research findings smartphone sales now exceeds feature phone sales in Kenya at close to (or more than now?) 70% of total monthly sales. This is HUGE!
I have been tracking the costs of the really inexpensive Android smartphones in Kenya and these are now as low as Kes. 4,000.00 for a basic device. This is a tipping point of sorts since some feature phones actually cost more than these entry-level Android smartphones which I find baffling. Even more interesting is that I heard it mentioned at a recent Safaricom event that they plan to launch a Kes. 2,000.00 smartphone in Kenya this year which is a mind-bending proposition from anyone’s perspective.
In a nutshell, 2014 was the year that smartphones and ‘smart mobile things’ like tablets really did go mainstream in every sense of the word. Onwards and upwards I say!
Digital (TV) Migration Finally Happens
Digital Migration for TV broadcasts in Kenya was starting to look like a pipe dream after being delayed by over a year from the first deadline. That changed last night/this morning as the deadline for analogue signals to stop broadcasting in Nairobi and its environs kicked in on the 31st December 2014. The global deadline for the switch-over from analogue to digital TV broadcasting is the 17th June 2015 so Kenya is planning to eventually complete its migration process by the 30th March 2015. This should be interesting since the country is covered up to 58% at this juncture so there will be a need to ensure full national signal coverage by the 1st April 2015 (or as close to possible).
One of the big upsides of Digital Migration is that lots of broadcast spectrum will become available for other wireless services such as 4G mobile broadband. In addition, Digital TV is able to utilize spectrum much more efficiently than Analogue TV ever could. So, in a sense, its a long overdue transition that needed to happen even if the consortia of Nation Media Group, Standard Media and Royal Media Group are still pushing for a deadline extension in the Supreme Court, once again.
Local E-Commerce Goes Mainstream In Kenya
I’m not sure when it happened exactly in 2014 but e-commerce in the Kenyan context finally went mainstream. I say this from the perspective of being a technophile who has worked in Kenya’s Internet space for almost two decades (yes, the Internet is actually that old here!).
I have always been skeptical about when the actual moment would come that a significant part of the Internet-connected population in Kenya would go online to find, buy or sell products and services via e-commerce. This clearly happened in 2014 as evidenced by the fact that the keyword ‘OLX’ was the most searched one on Google in Kenya on their annual zeitgeist list – this is without a doubt the tipping point since the general awareness of ‘local’ e-commerce ‘brands’ like Jumia, EasyTaxi, OLX, Rupu, PigiaMe, etc is well established.
I personally have done lots of purchases on many of these e-commerce services over the past couple of years and the level of convenience they offer is quite literally life changing (true story I tell you!). It does not hurt though that many of the local e-commerce players in Kenya are spending insane amounts of money online and offline to market their offerings so this is a clear driver behind their massive growth.
However, online fraud remains a huge concern and as such most transactions are done either via mobile money with an obvious bias to Safaricom’s dominant M-Pesa as well as Cash on Delivery (COD) – Kenyan consumers are generally NOT comfortable (yet?) punching in their credit/debit card details for e-commerce transactions. We are indeed a Mobile First (read: Mobile Money First) nation in every sense of the word!
Equity Bank’s Equitel MVNO Launches (& Rattles Safaricom)
Equity Bank’s foray into the Mobile Virtual Network Operator (MVNO) space did not go unnoticed when they announced their plans to launch Equitel, their MVNO brand. There are other MVNO’s in Kenya leveraging Airtel’s mobile network but none is being taken as seriously as Equitel which has the backing of the hugely successful Equity Bank with its close to 9 million banking customers.
Everyone is watching Equitel closely (and with bated breath I may add) since they do have the potential to actually make a dent on the dominant green giant known as Safaricom. Its common knowledge that there is bad blood between Equity Bank and Safaricom with regards to their failed joint venture from a few years ago known as ‘M-Kesho’. This is apparently the thrust behind Equity Bank launching Equitel.
However, from where I stand, its very simple. Equity Bank sees Safaricom’s M-Pesa as a major competitor for banking transactions. Indeed, in many ways, when you look at the (almost?) obscene amounts of money going in and out of the M-Pesa ‘money machine’, it makes you wonder if Safaricom is actually a mobile bank masquerading as a mobile network? Obviously this is not literally the case but if anyone has a chance of halting Safaricom’s mobile money dominance via M-Pesa, that would be Equity Bank’s Equitel.
Indeed, in the few months that Equitel has been operational its rumoured they already have 400,000+ of their banking customers signed up and growing – with zero advertising spend to-date. However, the main caveat for Equitel at this juncture is that Safaricom (indirectly?) keeps blocking their attempts to launch their ‘thin SIM’ which ‘piggybacks’ on existing mobile subscriber (i.e. competitor) SIMs so that there is no need to acquire or replace existing mobile SIMs (Its essentially a dual SIM functionality is a single SIM device).
Personally, I do not think that the Equitel thin SIM is the real game changer – the real game changer is that Equity Bank is actually an inter-connected ecosystem comprised of a myriad of financial services that can offer far more utility for customers via mobile devices than Safaricom’s M-Pesa as a standalone mobile money offering ever could. Whatever happens in 2015, we will finally see what happens when an unstoppable force meets an immovable object in the context of Equitel and Safaricom!
The Kenya Government’s eCitizen Portal & National Security Communication Network
I almost missed this one completely. The Kenya Government did two really interesting initiatives in 2014. The first was the eCitizen Portal. This one was really significant in that it enabled eGovernment services for the first time for things that Kenyans have often found to be tedious, time-consuming and sometimes corrupt.
The eCitizen portal delivers services to the citizenry such as online application and delivery for business registration, drivers licenses, immigration paperwork, marriage certificates, etc. Hitherto, many of these services required one to go in person to Government offices or the more convenient (and successful) Huduma Centres to wait in lines, etc.
Therefore, the eCitizen Portal essentially streamlines Government services delivery to the general public via a digital channel on a nationwide basis. This, people, is HUGE! I can’t wait to see how many more services will be rolled out this year and beyond as it means all many will need is an Internet connection to get their Government ‘things’ done online and not in person.
The second piece of big news from the Kenyan Government was the approval of the National Security Communication Network which was somewhat marred by lots of controversy throughout. The 4G powered Kenya National Security Communication Network harnesses the power of technology to enable law enforcement officers effectively coordinate and deploy their resources in response to threats to national security and, indeed, emergency situations requiring the interplay of competencies from the National Police Service and various disaster response teams.
The network deployment was awarded to Safaricom who will build it as a proprietary network side-by-side with their own extensive mobile network in Kenya. Some fear that the network will give the Government too much ‘Big Brother’ insight into what Kenyans are doing at any given time when its operational from sometime next year (2016). However, only time will tell how exactly the network will be used by the Kenyan Government.
The Untimely Death Of One Africa Media’s Founder Carey Eaton
In early June 2014, Carey Eaton who was the founder of One Africa Media was shot dead by thugs. Carey was a personal friend and someone I had huge admiration for from the perspective of being a seasoned Technology Entrepreneur. Carey had returned to Kenya a few years ago to establish and/or acquire e-commerce businesses that have become well established in Kenya such as BrighterMonday and Cheki.
One Africa Media was the platform he used to expand his interests to markets such as Nigeria, Ghana and South Africa. He managed to secure funding to the tune of US$ 20 Million in 2013 for this express purpose. In many ways, Kenya lost one of its best and brightest stars in technology in 2014 as that was how significant Carey’s contribution had been for the few years he operated his businesses in Africa. I can’t go into all the details but I did do a more detailed blog post on the late Carey Eaton here on this blog. Rest In Peace Carey. Still very much missed by Kenya’s nascent technology community at large.
Social Media Is Kenya’s Number One Internet Pastime.
There has never been any doubt that social media as a ‘thing’ is huge with consumers in Kenya. Just how BIG a ‘thing’ social media is became even more apparent in 2014 when I took sometime to secure data on the most popular platforms in Kenya. Facebook is by far the largest with approximately 4.2 million registered users. YouTube comes second with approximately 3 million users (not registered necessarily) every month. Linkedin and Twitter have in the region of 1 million registered users each. Its hard to tell how big Instagram is at this stage so my closest guess would be over 1 million largely ‘millenial’ registered users.
Using online services like SimilarWeb and Alexa to check out website rankings, as well as Distimo to check out mobile app rankings, social media can be confirmed to be where Kenyans spend the most time ‘hanging out’ online. Using the numbers shared above, and factoring in overlaps, I would say we are looking at 5 to 6 million users on social media in the country which is therefore a penetration of around 15% – not bad! Brands have taken notice of this consumer trend in Kenya and are advertising via Facebook and Twitter in hoards to reach them. I am not sure how well this is working but for sure social media is a Kenyan thing!
Local Mobile Apps Start Thriving
I am particularly happy to note that in 2014 local mobile apps started getting some of the action that had previously been the preserve of global mobile apps. There had been a stark contrast between the most popular local and global mobile apps with social media and mobile messaging apps leading the trend.
A few years ago, one of the key drivers behind this trend is that the local mobile apps just weren’t as good? Many seemed to be a solution looking for a problem instead of the other way around. This was unsustainable since the combined Apple App Store Google Play have over 2.5 million apps between them – getting noticed in such an avalanche of mobile apps is increasingly hard – as in, really really hard.
Therefore, its refreshing to see well designed and built mobile apps with a solid business model for the Kenyan consumer making waves. For me, local mobile apps that come to mind in this space include Sendy, EasyTaxi, Safaricom Nation Mobile App, Business Daily Mobile App, OLX Kenya Mobile App, HelloFood, etc.
I actually use these mobile apps on a regular basis as they serve my needs from a very local perspective, even if some are actually local versions of International mobile apps. This is what is needed to drive the uptake of mobile apps – the contextual relevance. This is what I saw Kenyan mobile app developers start working towards this past year.
BRCK Is Kenya’s First ‘Internet of Things’ Offering
The BRCK (pronounced BRICK) is the very first ‘Internet of Things’ device that I am aware of to come out of Kenya. The BRCK was conceived in Kenya by the same team behind Ushahidi, the crisis information system that grew its roots from the 2007 post-election violence in Kenya. BRCK is a basically a super robust mobile WIFI hotspot and power bank that leverages mobile networks and other wireless connectivity services for connecting you to the Internet.
The BRCK was specifically designed to operate in urban or ‘hard core’ rural environments in Africa. Naturally, and I paraphrase from their website, ‘if it works in Africa it will work anywhere’. The BRCK is basically designed as a massive powerbank with WIFI connectivity built in, a global 3G SIM, and extensibility for more bits and bobs as required.
The really cool thing is that the BRCK was designed in Kenya but is actually manufactured in the US. One thing I know is that the roll-out of the product took longer than planned but its finally here and definitely makes sense for use in Kenya or beyond where Internet connectivity and reliable electricity is hard to come by.
It’s also worth mentioning that some big players have started to take note and work with local app developers. A good example is Safaricom’s acquisition of the Android app M-Ledger. This is big because serious app developers (and these are few)can now begin to cash in and create more with the knowledge that the market for serious and disruptive apps exists.
@ben thanks for the heads up. I think the m-ledger story warrants a blog post of its own 🙂
I think online crowdfunding platforms was a big plus for start-ups with most noteable players being 254 Fund Me, Babandu a Nailab partnership with 1% Club, and M-Changa a sms based platform, as alternative sources for raising capital for start-ups. One of the biggest crowdfunding success stories in Kenya is the BRCK kickstarter campaign.
@tobias indeed. The BRCK kickstarter campaign was a watershed moment for online crowdfunding in Kenya. The other more local platforms were also quite impressive! Hopefully we will see much more happening in this space in 2015.
We have surely seen a lot of E-commerce development in Kenya which have very innovative ideas and will propel this country to the world map. BRCK is one of the greatest idea and innovation for 2014. This will help to propel innovation and provision of internet even in the remote areas.
The other idea developed is the introduction of a loyalty card in partnership with local banks and Visa. Customers will access discounts and offers from various establishments and pay via pre-paid card. They will receive points which are redeemable later in any establishments.
This has been done by an online company http://www.two4one.co.ke in partnership with others like Jovago.com and Travelstart.com. It is expected to revive the tourism and hospitality industry which has been negatively affected due to over dependance from the foreign tourist.
Establishments will be offered a profile to market themselves and update their deals, offers and giveaways.
I came across this http://www.tendersure.co.ke (www.qedtendersure.com)during one of the procurement processes. I was a bidder and we got to use this system, called Tendersure, in the bidding process last month for CfC Stanbic Bank.
Having seen and used other e-procurement solutions in the market, this Tendersure comes out on top.
Probably the next big thing in e-procurement.