Download - Julisha Final Report 1
-
8/9/2019 Julisha Final Report 1
1/83
S U R V E Y
K e n y a I C T B o a r d I C T M o n i t o r i n g a n d E v a l u a t i o n I n d i c a t o r sS t u d y
Filing Information: November 2011, IDC #undefined
: Survey
i n g # n i t " $ , % i & a
' a r t m e n t s , ( ) a ' t a ( o a d , * e s t l a n d s , + i !
t o r i a I s l a n d , - " o . 1 0 1 / 2 0 0 1 0 0 , N a i r o b
i , e n y a
e l : 3 2 4 / 2 / / / 1 5 4 4 6 4 $
F a . : 3 2 4 / 2 / / / 1 5 4 7
-
8/9/2019 Julisha Final Report 1
2/83
I D C O P I I O
Des'ite unfavorable global e!onomi! !onditions 'revailing bet8een 2009 and 200,
t)e enyan IC mar;et remained robust and 8as 'ro''ed u' by investments in
international !onne!tivity during t)at 'eriod, 8)i!) in turned s'urred a flurry of a!tivity
in investment in terrestrial net8or;s, broadband servi!es and devi!es<
)e enyan IC =ar;et is fore!ast to gro8 at a !om'ound annual gro8t) rate
>C?(@ of 14s@ to gro8 s;ills and nurture usage,enfor!ement of intelle!tual 'ro'erty and !o'yrig)t la8s >'ira!y, !ounterfeit goods, I t)eft, et!@, !reation of
industry standards and overall )armoni&ed 'oli!ies to govern develo'ment t)e se!tor<
ICT S$ills# )e gro8t) of IC 'rofessionals and t)e levels of s;ills in enya )inges largely on t)e si&e of
and number of bot) lo!al and international large organi&ations t)e level of maturity and so')isti!ation in
t)eir IC set u's and t)e gro8t) of t)e S=E segment as a ;ey !onsumer<
In)erent in t)is medley of issues are !on!erns on )o8 to retain staff t)at )ave a!uired e.tensive
e.'erien!e >after a maor 'roe!t@, 8)o may need to gro8 furt)er or use t)at e.'erien!e in anot)er
organi&ation and !annot do so in t)e lo!al mar;et and t)erefore ele!t to see; o''ortunities outside enya<
-n t)e ot)er )and, in t)e su''ly side, some mar;et 'layers t)at se!ure 8indfall o''ortunities 8)i!) t)at are
not li;ely to re!ur any time soon, 8ill tem'orarily im'ort s;ills to im'lement and manage large 'roe!ts and
8ill do so outside any frame8or; t)at ensures transfer of s;ills to lo!al 'rofessionals< )us t)e issue of
s;ills 8)en vie8ed broadly and 8)en vie8ed at )ig)er !adres, 'resents a double edged s8ord t)at reuires
a measured a''roa!) t)at fa!tors in t)e needs of t)e mar;et, gro8t) of t)e mar;et and resulting demand for
su!) s;ills<
C%anging Ecosyste"# +arious develo'ments in t)e se!tor, in!luding a unified tele!ommuni!ations
li!ensing regime, infrastru!ture develo'ments and te!)nologi!al advan!es, )ave !aused t)e lo!al IC
E!osystem to undergo some metamor')osis t)at )as gradually seen t)e lines blurred bet8een traditional
tel!os and traditional IC servi!e 'roviders< *it) voi!e servi!es nearing saturation, !ou'led 8it) lo8er
tariffs, tel!os )ave been !om'elled to ret)in; t)eir strategies a8ay from bot) voi!e servi!es and t)e mass
mar;et to8ards data servi!es and enter'rise solutions >!loud !om'uting, )osted infrastru!ture, managed
servi!es, et!@< )e overall effe!t )as been a redu!tion in t)e number of ier II tel!os in t)e mar;et, 'artly as
a result of some mergers and a!uisitions, and also by t)e gradual atro')ying of traditional ISs in t)e
mar;et<
Increased !resence o& "ultinational vendors# Numerous vendors )ave made entries into enya bet8een
2007 and 2011, and t)ose 'resent before t)at )ave drasti!ally s!aled u' t)eir o'erations bot) as a result of
t)e favorable o'erating environment and also to ta' into regional o''ortunities< o8ever, IDCGs analysis of
t)e !)annel stru!ture in enya, )as revealed t)at most vendors )ave a limited 'ool of !)annel 'artners
>distributors and +alue dded (esellers@ 8it) 8)om t)ey !an 8or; 8it) and most of t)e 'rominent !)annel
'artners are largely foreign o8ned and !an leverage of t)eir regional or international net8or;s to avail goods
and servi!es more !om'etitively t)an lo!al 'layers< IDC sees an o''ortunity in enya to )el' lo!al
!om'anies s!ale u' and 'arti!i'ate in a bigger 8ay and !reate more lo!al em'loyment in IC<
Kenya as an ICT 'u(# "en!)mar;ing data !olle!ted by IDC s)o8s t)at enya )as a mi. of indi!ators in itsfavor vis a vis some of t)e seven !ountries it 8as ben!)mar;ed against, mostly fri!an !ountries< Some
#undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
3/83
'ositive ben!)mar; items in!luded )ig)er )ouse)old internet 'enetration, )ig)er overall internet
'enetration, lo8er broadband tariffs and !om'arable business internet usage< Indeed t)e business survey
!ondu!ted as 'art of t)is study s)o8s t)at 0A of res'ondent !om'anies )ave 8ebsites 8)ile A use
email< o8ever, as stated above, t)e issue of 'rodu!ing and retaining )ig)er level IC s;ills needs a
measured a''roa!) to !om'lete t)e 'i!ture in t)e business end user environment<
Mar$et De"and# In bot) t)e business and residential segments, t)ere is relatively good u'ta;e of variousIC servi!es t)oug) !osts >of devi!es and some servi!es@, uality and a!!ess >last mile, ba!;)aul@ still )old
ba!; !iti&ens and businesses from more 8)olesome !onsum'tion of IC<
Outloo$# -verall, given t)e !onsiderable a!tions ta;en by t)e government in t)e IC se!tor over t)e last
four to five years, 8)i!) are starting to bear fruit and 8ill !ontinue to in t)e years to !ome, t)ere is still great
s!o'e to address some issues in!luding IC s;ills, a!!ess >to devi!es and servi!es@, !osts >of devi!es and
servi!es@ and generally nurture in!reased usage among bot) businesses and residents< In some instan!es,
t)e interventions re!ommended by IDC in!lude easy to e.e!ute a8areness !am'aigns 8)ile ot)ers tou!)
on e.isting 'lans by t)e se!tor regulator >niversal !!ess Fund and subsidies@ and multi sta;e)older
intervention >a!ademia, government and business in revising IC !urri!ular, !ollaborating t)roug) various
s, et!@<
H2011 IDC #undefined
-
8/9/2019 Julisha Final Report 1
4/83
T ) B * E O + C O T E T S
P
E,ecutive Su""ary -ey erforman!e Indi!ators 2010
-
8/9/2019 Julisha Final Report 1
5/83
T ) B * E O + C O T E T S 9 C o n t i n u e d
P
)PPEDI7 I I 8 Key Per&or"ance Indicators 34
)!!endi, I I I : Pro;ect Bac$ground 30roe!t "enefits
-
8/9/2019 Julisha Final Report 1
6/83
-
8/9/2019 Julisha Final Report 1
7/83
* I S T O + + I 5 U R E S
P
1 enya IC =ar;et Si&e 2010 and Fore!ast to 2014
-
8/9/2019 Julisha Final Report 1
8/83
-
8/9/2019 Julisha Final Report 1
9/83
57 S;ills ?a' nalysis
-
8/9/2019 Julisha Final Report 1
10/83
E , e c u t i v e S u " " a r y
K e y P e r f o r m a n c e I n d i c a t o r s 2 0 1 0
T ) B * E -
Ke y ICT I n d i ca to r s
Indi!ators Data
+olume of international traffi! >=b's@ 20,20
-
8/9/2019 Julisha Final Report 1
11/83
)ey in!lude t)e follo8ing
International Band.idt% : )e arrival of t)ree submarine !ables bet8een 200 and
2010 )el'ed 8ean o'erators off e.'ensive satellite !a'a!ity and allo8ed for greater
s'eeds at lo8er !osts for !onsumers< o8ever, des'ite t)is e.tra !a'a!ity, t)ere still
remain !)allenges in final a!!ess as 8ell as develo'ment of suitable 'ri!ing models
>reseller and final end user@<
Terrestrial In&rastructure )e develo'ment of t)ese !ables s'urred investment in
terrestrial segments !)ief among t)em being t)e government led National -'ti! Fiber
"a!;bone Infrastru!ture >N-F"I@ 'roe!t t)at see;s to !over all maor to8ns in
enya< Indeed one of t)e first !ables to go live, E=S >)e East fri!an =arine
System@ 8as a government led initiative in !onun!tion 8it) EGs national o'erator
Etisalat, 8)i!) later 8as o'ened to in!lude 'rivate se!tor o'erators from enya<
In total enyaGs international band8idt) )as gro8n more t)an tenfold in t8o years
from .... mb's to .... mb's<
Uni&ied *icensing Regi"e : )e introdu!tion of a unified li!ensing frame8or; t)at
sim'lifies t)e mar;et stru!ture and allo8s o'erators more latitude in terms of servi!e
offerings rat)er t)an )aving li!enses tied to te!)nology de'endent delivery< )is
frame8or; )as also allo8ed for better stratifi!ation of t)e mar;et along t)e lines of
servi!es, infrastru!ture, !ontent and a''li!ations< nder t)is ne8 regime, several
mobile o'erators a!uired IS li!enses to add to t)eir e.isting mobile and
international gate8ay li!enses and started offering mobile based internet servi!es
8)i!) )ave seen residential !onne!tions gro8ing e.'onentially over t)e last 25
years< resently nearly 0A of all !onne!tions are mobile devi!e based !onne!tions
and many used by individuals<
Cost o& Mo(ile Services and Mo(ile Ter"ination Tari&&s )e intervention by t)e
se!tor regulator, t)e Communi!ations Commission of enya >CC@ to determine
ma.imum mobile termination rates sa8 mobile voi!e tariffs 'lunge do8n8ards to )alf
t)e !osts< Indeed enya no8 )as among t)e lo8est mobile tariffs in fri!a and t)is
)as resulted in in!reased subs!ri'tions and !onsum'tion of servi!es<
Su""ary : -verall t)e above develo'ments )ave im'a!ted ;ey as'e!ts of t)e
enyan IC mar;et in!luding better !ommuni!ations infrastru!ture for enter'rises
and residents, in!reased u'ta;e of servi!es, lo8er tariffs for voi!e and data servi!es,
in!reased usage of !om'uters >given t)e value addition from affordable internet
a!!ess and in)erent !ontent@, more so')isti!ation among business and residential
users, among many ot)er 'ositive develo'ments<
o8ever, a lot more needs to be done and by establis)ing t)ese baseline
'erforman!e indi!ators, t)at in itself !an )el' determine 8)at !ourses of a!tion mig)tbe needed to stimulate t)e mar;et furt)er<
)us for t)is study a se!ond ')ase is envisaged to revie8 t)ese baseline indi!ators,
note any areas t)at )ave !)anged signifi!antly and 'er)a's attribute !ertain a!tions
by government, investors or servi!e 'roviders to su!) !)anges and !ontinually
monitor su!) develo'ments in an effort to steer t)e se!tor in t)e rig)t dire!tion<
2 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
12/83
S I T U ) T I O O V E R V I E <
I T E n v i r o n m e n t
In 2010, IC s'ending in enya stood at SB 5in subs!ribers@ and de!lining tariffs for bot) voi!e and data servi!es<
-ver t)e fore!ast 'eriod tele!om servi!es is 'roe!ted to gro8 at $
-
8/9/2019 Julisha Final Report 1
13/83
+ I 5 U R E 1
I T S p e n d in g S h a re b y t op 5 v e r t i ca s
Sour!e: IDC, 2011
)e t)ree to' ;ey se!tors !ontributing to I S'ending in 2010 8ere Communi!ations
>20in!luding insuran!e and ot)er finan!ial servi!es 12in!luding 'ubli! se!tor edu!ation 1/smart ')ones,
la'to's and tablets@ in t)e mar;et and in t)e business segment, )ave su''orted initiatives to de'loy
!)ea'er 8ide area net8or;ing >*N@ te!)nologies li;e +irtual rivate Net8or;s<
5ro.t% o& (asic IT s$ills S;ills mainly nurtured in a nas!ent "- se!tor albeit only for I enabled front
offi!e servi!es >)el' des;, !onta!t !entre, et!@ )ave )el'ed bigger mar;et 'layers ma;e t)e transition to
outsour!ing su!) servi!es and en!ouraging ne8 business 'ra!ti!es to develo' around t)is and !reating
em'loyment<
Positive govern"ent interventions 'robably one of t)e main drivers on 8)i!) ot)ers drive )as been t)evarious measures ta;en by government in terms of 'oli!y and regulation to ma;e t)e IC se!tor t)rive<
)e setting of lo8er mobile termination rates, issuan!e of unified li!enses, investment in innovation,
/ #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
14/83
!ontribution to infrastru!ture and t)e revision of t)e Communi!ations !t are ust among t)e many areas
8)ere t)e government )as )el'ed drive t)e IC mar;et<
+inancial Sector gro.t% 8 s it 8ere t)is se!tor is !onstantly among t)e to' !onsumers of I and 8it)
'eri')eral te!)nologi!al develo'ments at 'lay >eo8ing to ot)er !ivil 8or;s or vandalism@< In areas 8)ere t)ere is no 'o8er grid, t)is serves to limit t)e
u'ta;e of I and for some 'layers, running generators in!reases t)eir !ost of doing business<
Counter&eit !roducts la!; of me!)anisms to verify t)e aut)enti!ity of 'rodu!ts as 8ell as 'oor business
'ra!ti!es ma;e !ounterfeit 'rodu!ts a maor !)allenge for bot) legitimate sellers as 8ell as !onsumers 8)o
end u' 8it) sub standard 'rodu!ts< -verall it also affe!ts vendor brand euity 8)en !ounterfeit 'rodu!ts fail
and 8)ere t)e !onsumer !annot distinguis) bet8een genuine and !ounterfeit 'rodu!ts<
Relative "aturity o& t%e "ar$et resently t)e enyan mar;et is largely unso')isti!ated and t)e number
of maor enter'rise users of I are not many< )is 'resents a uniue mi. of !onditions 8)ereby t)e si&e of
I 'roe!ts done )el' limit t)e number of 'rofessionals in t)e industry and also en!ourage )ig) staff
turnover es'e!ially in I De'artments<
C%ange o& guard 8 most !ommonly !ited 'roblem in t)e industry )as to do 8it) t)e !)ange of de!ision
ma;ers and leaders)i' in various government de'artments es'e!ially 8it) regard to t)e initiation of
!ollaboration 'rogrammes and 'roe!ts< Some vendors rea!) t)e 'oint of signing an =o but are
frustrated 8)en t)ere are su!) !)anges and t)e 'roe!ts 8it)er stall or do not ta;e off at all<
Politics *it) an ele!tion looming in 2012 and no !lear indi!ation of t)e dates 8ill be a !ause for disuiet
in t)e se!tor as businesses ado't a 8ait and see stan!e and 8)ile at t)e same time t)e government )olds
H2011 IDC #undefined 4
-
8/9/2019 Julisha Final Report 1
15/83
ba!; on some IC e.'enditure in order to finan!e t)e ele!tion< t t)e 'eri')ery, ele!tioneering may disru't
'oli!y and ot)er dis!ussions in 'arliament and else8)ere<
Ta,es : a.es levied on !ertain I 'rodu!ts li;e !o'iers 8ill !urtail gro8t) for t)ese as 8ell as en!ourage
t)e 'roliferation of refurbis)ed !o'iers into t)e mar;et, 8)i!), ust li;e !ounterfeiting, may affe!t brand
euity<
Currency 8 In 2011 t)e enyan s)illing )as lost ground to maor !urren!ies, meaning )ig)er im'ort !osts
for I distributors and in turn affe!ting )o8 mu!) inventory t)ey !an a!uire and )old< S)ould t)e trend
'ersist, t)is 8ill not only affe!t t)e I Se!tor but overall ot)er se!tors t)at de'end on im'orted in'uts
>gri!ulture, =anufa!turing, et!@<
$ #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
16/83
I C T E C O S Y S T E M
)e su''ly side of t)e mar;et is 'resently dominated by a fe8 maor 'layers
>e.!luding vendors@ 8)o 'arti!i'ate in t)e bul; of IC 'roe!ts in t)e !ountry< )ese
in!lude some foreign o8ned !om'anies<
-verall, vendors 'resent in t)e !ountry are fairly satisfied 8it) t)e business
environment and are in!reasing t)eir investment and )ead!ount in anti!i'ation of
in!reased sales bot) in enya and in t)e greater Eastern fri!a region<
*it) t)e entry of ne8 vendors, it !an be e.'e!ted t)at t)e !)annel 'artners)i's 8ill
gro8 or t)e need for diverse !)annel 'artners 8ill gro8< "earing in mind t)e
!)allenges fa!ed by ier II !om'anies, as outlined later in t)is se!tion, t)is
unders!ores t)e need for a broad base of 'roviders to 8)i!) ne8 and e.isting
vendors !an )ave a!!ess<
Smaller 'layers, ier II 'layers, 8)o are ty'i!ally enyan o8ned !om'anies, need to
be su''orted and 'rovided 8it) an environment t)at !an )el' t)em gro8 and
'arti!i'ate in large deals< )ese 'layers 'resently only fo!us on 'art of t)e S=E
mar;et and t)e !onsumer mar;et and are ty'i!ally regional 'layers >'rovin!ial level@
8it)out mu!) te!)ni!al or finan!ial !a'a!ity to ta;e on !ountry 8ide or big 'roe!ts<
+ I 5 U R E /
Ch an n e an d M arke t S t r! c t! re
Sour!e: IDC, 2011
C h a n n e l A n a l y s i s - V e n d o r s a n d c h a n n e l
p e r f o r m a n c e a n d t r e n d s
IDCGs intervie8s 8it) vendors in t)e mar;et, indi!ate t)at enya )as, over t)e last
t)ree years, 'rovided a very !ondu!ive environment for business, as evin!ed by t)eir gro8t) in bot) )ead!ount and business bet8een 200 and 2011<
H2011 IDC #undefined 7
-
8/9/2019 Julisha Final Report 1
17/83
?overnment initiatives in!luding infrastru!ture develo'ment, regulatory reforms
>li!ensing frame8or;s@, investment in 'ubli! a!!ess !enters, egovernment 'roe!ts,
!ontent !reation, devi!e subsidies, )ave all )ad a very 'ositive effe!t in transforming
t)e mar;et, stimulating investment, stimulating IC u'ta;e and bolstering !onfiden!e
in t)e overall IC mar;et<
mong t)e )ig)lig)ts of feedba!; re!eived from vendors in!lude:
)ere are an estimated 2050 vendors 'resent in t)e mar;et most of 8)om rely on a small 'ool of maor
distributors and ier 1 +alue dded (esellers >+(s@ and Dealers 8)o !ombined a!!ount for t)e bul; of IC
"usiness in enya estimated at nearly 40$0A<
-n average C and rinter vendors ea!) )ave bet8een t)ree to four distributors and at least si. ot)er
'artners >dealers and systems integrators@ ea!) at different mar;et levels<
t t)e lo8er 'art of t)e 'yramid are ier 2 +(s and dealers, estimated to number more t)an 100 'layers
and 8)ose fo!us is 'art of t)e S=E segment, t)e S==E and )ome user segment< )ese are 'layers 8)o
ty'i!ally do not )ave a !ountry 8ide 'resen!e and 8ould largely be found o'erating at a 'rovin!ial level or
even a national level >8)ere S=Es )ave su!) a 'resen!e to reuire nation8ide servi!es@ but at a smaller
s!ale nonet)eless<
)ese ier 2 firms are mostly enyan o8ned !om'anies serving ot)er enyan o8ned businesses and
o!!asionally se!uring 'arts of relatively good !ontra!ts in t)e government and edu!ation segments, 8)ere
'ro!urement of goods or servi!es may reuire a lo!al 'layer<
)e ier I 'layers largely !om'rise !om'anies 8it) bot) a national and regional 'resen!e, and in most
instan!es are maority foreign o8ned !om'anies s'inning off regional offi!es in Sout) fri!a, E, India
among ot)er !ountries<
-8ing to )aving a good foot)old in t)eir 'arent regions, !ou'led 8it) a!!ess to industry best 'ra!ti!es,
fairly solid s;ills bases and a!!ess to !a'ital, su!) !om'anies )ave been able to target t)e mar;et segment
t)at in!ludes multinational !om'anies >=NCs@, large enter'rises and government, 8)ere su!) !redentials
bear )eavily on de!ision ma;ing at t)is level<
+endor !om'etition on !)annel 'artners)i's )as intensified 8it) main distributors being soug)t after by
ot)er vendors to leverage on t)eir reseller net8or;< )us multi'le brand )andling by t)e !)annels is t)e
norm even for !)annel 'artners 8)o 8ere KloyalK to !ertain vendors<
)e !)annel is maturing fast 8it) t)inning out of grey s)i'ments 8)ile traditional tel!os and t)eir !)annel
'artners are oining t)e fray in terms of C sales<
+endors are ;een on setting u' offi!es in enya to serve t)e East and Central fri!a region<
+endors 8it) a lo!al 'resen!e en)an!e t)e brand image signifi!antly as 8ell as im'rove logisti!al su''ort
and in!reased mar;eting !am'aigns<
*it) more vendors setting u' lo!ally, t)e mar;et )as seen an in!rease in bot) t)e number of !)annel
'artners<
?overnment initiatives in!luding infrastru!ture develo'ment, regulatory reforms >li!ensing frame8or;s@,
investment in 'ubli! a!!ess !enters, egovernment 'roe!ts, !ontent !reation, devi!e subsidies, )ave all )ad
a very 'ositive effe!t in transforming t)e mar;et, stimulating investment, IC u'ta;e and bolstering
!onfiden!e in t)e overall IC mar;et<
)us vendors 'resent in enya )ave registered 'ositive gro8t) over t)e last t)ree years of bet8een 14
24A in business value and 8it) some 'osting gro8t) in )ead!ount ranging bet8een 24100A
K e n y a a s a r e g i o n a l h !
enya is 8it)out doubt t)e regional )ub for most vendors 8it) a regional rea!)s'anning bet8een t)ree to si. !ountries on average for vendors< side from being a
9 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
18/83
)ub, it is also a ste''ing stone for t)ese vendors to set u' o'erations in neig)boring
!ountries but still maintaining some8)at !entrali&ed mar;eting, inventory and
su''ort fun!tions at regional levels< In)erent in t)is stru!ture are various
o''ortunities in!luding training, s;ills transfer, overall )ig)er em'loyment, te!)nology
leaders)i' and in!reased investment<
mong t)e most !ommon !ountries some vendors rea!) into in!lude from t)eir enyan )ub in!lude: ganda, an&ania, (8anda, "urundi, Et)io'ia and Sout)ern
Sudan<
In some instan!es vendor offi!es in enya )ave an even 8ider geogra')i! rea!) 8it)
some )aving subSa)aran )ubs or !ombined )ubs for East fri!a, *est fri!a and
Indian -!ean Islands<
y'i!ally t)ese regional )ubs 8ould )ave 'arent or 'rin!i'al offi!es in Sout) fri!a,
nited rab Emirates or various !ountries in Euro'e but 8it) suffi!ient autonomy in
terms of mar;eting, !)annel management and 'artners)i's<
K e y c h a l l e n g e s i n t h e s e c t o r
Purc%asing Po.er 8 In t)e 'resent environment 8)ere inflation )overs around t)e 20A mar;, t)e
!onsumer mar;et )as been negatively im'a!ted, es'e!ially in t)e lo8er e!)elons 8)ere in some !ases IC
s'ending, in!luding mobile voi!e servi!es, 8ill ta;e se!ond 'la!e to ot)er 'ressing needs< So 8)en vie8ed
as t)e long tail end of t)e mar;et, a lot less s'ending is being registered in terms of devi!e sales and
servi!es !onsum'tion<
Ta,ation 8 Des'ite 'ositive develo'ments to remove im'ort duty and value added ta. >+@ on !om'uters
and 'rinters, t)e 'resent ta.ation regime for !onsumables and !om'onents, es'e!ially amidst a rat)er
un!lear ta.ation frame8or; t)at does not al8ays 'ro'erly define various IC im'orts, affe!ts various
!)annel 'layers in!luding lo!al assemblers<
Product Perce!tion 8 )e enyan mar;et is mostly in!lined to8ards 8estern brands or brands asso!iated
8it) 8estern !ountries< For 'layers from sia and t)e =iddle East, gaining a foot)old in t)e mar;et and at
t)e same time !ommanding 'ri!es t)at are on 'ar to refle!t similar 'rodu!t uality, )as been !ited as a
maor !)allenge<
*engt%y custo"s !rocedures "ot) +endors and Distributors )ave !ited lengt)y !ustoms 'ro!edures as
a stumbling blo!; affe!ting )o8 fast t)ey are able to 'la!e 'rodu!ts on t)e mar;et, and furt)er !om'ounding
t)is issue are demurrage !osts levied by !ustoms aut)orities, 8)i!) !osts in many instan!es are 'assed on
to end user and t)erefore needlessly !ausing )ig)er 'ri!es<
Sourcing %ig%ly =uali&ied talent 8 )is issue is dealt 8it) in detail under t)e SI%%S se!tion of t)is re'ort
but suffi!e to say, for some vendors, es'e!ially t)ose 'laying in t)e enter'rise s'a!e, t)e issue of availability
and uality of IC S;ills is a !onstant 'roblem t)at in some !ases greatly affe!ts t)eir go to mar;et
strategies and sometimes ne!essitates t)e use of e.'atriates to underta;e 'roe!t im'lementation, te!)ni!alsales, su''ort and end user training<
Currency &luctuation )e re!ent de!line of t)e enya s)illing against maor !urren!ies, mainly bet8een
'ril and -!tober 2011, )as meant )ig)er enya s)illings !osts for im'orters and in many instan!es affe!ts
t)eir ability to maintain an adeuate inventory< t t)e !onsumer end, it )as meant )ig)er 'ri!es of goods<
)e !urren!y de!line )as been attributed to in!reased oil im'orts and s)ould t)is be sustained in 2012, it
8ill affe!t t)e over mar;et negatively in!luding t)e manufa!turing se!tor t)at rely on im'orts of some ra8
materials, 'utting IC !onsumers in a uandary in terms of 'rioriti&ing t)eir budgets<
5overn"ent Procure"ent : Doing business 8it) t)e government )as 8idely been !ited as a maor
!)allenge in terms of 'rotra!ted 'ro!urement la8s and sales !y!les< Im'ro'riety and la!; of trans'aren!y
are ot)er fa!tors t)at need to be addressed<
H2011 IDC #undefined
-
8/9/2019 Julisha Final Report 1
19/83
" p p o r t e # p e c t e d f r o m t h e g o v e r n m e n t
In vie8 of some of t)e !)allenges !ited above, and t)in;ing very broadly about 8)at
else !ould be done in t)e IC mar;et, t)e follo8ing 8ere among t)e interventions
vendors feel t)e government s)ould !onsider to )el' allay t)eir !olle!tive !on!erns:
Ta,ation rates : (evie8 of ta.ation regimes on a!!essories, !om'onents and !onsumables
Ta,ation categories : Edu!ation of !ustoms offi!ials on t)e different array of IC 'rodu!ts to ensure !orre!t
a''li!ation of im'ort duties 8)i!) !an also )el' s'eed u' !learing of goods<
Counter&eits )e government s)ould underta;e a8areness !am'aigns to enlig)ten end users as 8ell as
!ustoms offi!ials on )o8 to dete!t and manage !ounterfeit im'orts<
Co!yrig%t la.s 8 =ore so t)e e.e!ution of e.isting Co'yrig)t la8s< +endors feel t)at t)ere are adeuate
la8s e.'e!t t)at t)ey are not u')eld<
ICT *a(or "ar$et 8 o stave off t)e need to im'ort labor for various 'roe!ts, or to !onstantly s)i' in
e.'atriates to im'lement 'roe!ts, vendors feel t)ere is room for t)e government to !reate, nurture and t)en
'rote!t obs by strongly vetting im'orted labor and ensuring some s;ills transfer ta;es 'la!e< -ne additional
suggestion 'ertains to finding a me!)anism to establis) t)e value !)ain in IC obs >8)ere is t)e value
added and to 8)i!) 'arti!i'ants does t)is a!!rue@ to overall gauge )o8 mu!) ends u' in t)e lo!al mar;et<
Procure"ent Standards : -'ening u' 'ro!urement standards to allo8 a greater variety of soft8are and
)ard8are 'roviders to bid for government obs 8ould ease t)e !ountryLs ado'tion of te!)nology on a large
s!ale<
-verall t)e ty'e of interventions reuired of t)e government do not reuire signifi!ant
investment and !an be o'erationalised using e.isting !)annels and 8it) relative ease
of im'lementation but of !ourse bearing in mind t)e li;ely im'a!t of su!)
interventions e
-
8/9/2019 Julisha Final Report 1
20/83
mong t)e areas vendors feel t)ey !an validly 'lay a role in!lude:
Investing in s'e!ifi! IC S;ills li;e mobile a''li!ations develo'ment and setting u' innovation )ubs< Setting
u' bursaries at universities and 8it)in user and develo'er grou's
Develo'ing strategies to develo' and use more lo!al talent t)an im'orted<
Introdu!tion of 'rodu!ts relevant to t)e mar;et t)at ta;e into a!!ount t)e o'erating environment and
!)allenges e.'erien!ed by users e
-
8/9/2019 Julisha Final Report 1
21/83
R E 5 I O ) * ) D I T E R ) T I O ) *B E C ' M ) R K I 5
Overview
+arious ben!)mar;ing !riteria 8ere identified and enya 8as !om'ared to seven
ot)er !ountries 4 from t)e fri!an !ontinent >Egy't, =oro!!o, (S, Nigeria and
(8anda@ and 2 from t)e rest of t)e 8orld >;raine and )ili''ines@<
)e fa!tors !onsidered 8)ile identifying t)ese !ountries 8ere
1< o'ulation<
2< E!onomi! Indi!ators su!) as ?D<
5< Fo!us on I se!tor as an engine of e!onomi! gro8t)<
/< er!eived !om'etitiveness to enya >e
-
8/9/2019 Julisha Final Report 1
22/83
Com'aratively s'ea;ing, enya is not very far be)ind in terms of t)e number of
internet users in t)e 'o'ulation, and sur'risingly 'osting better 'enetration rates t)an
Sout) fri!a 8)i!) is 'er!eived to be more advan!ed, and only slig)tly lo8er t)an
Egy't and t)e )ili''ines<
-8ing to infrastru!tural develo'ments, enya is a)ead of neig)boring landlo!;ed
(8anda 8)i!) relies on its band8idt) bot) from satellite 'roviders and terrestrial'roviders in ganda and enya t)us 'resu''osing )ig)er band8idt) rates and
t)erefore lo8er !onsum'tion<
It !an be e.'e!ted t)at 8it) 'ositive develo'ments in t)e enyan mar;et 8)i!) are
yet to manifest fully, t)at enyaGs internet 'enetration 8ill in!rease in t)e !oming
years to be!ome even more !om'arable or e.!eed !ountries li;e =oro!!o and
;raine<
+ I 5 U R E 6
To ta I n t e rne t pen e t ra t i on vs &o! seho d I n te rn e t
P e n e t ra t i on
Sour!e: IDC, 2011
Internet 'enetration is one of t)e most !om'elling indi!ators of te!)nology ado'tion
in a nation, as it !an be safely assumed t)at on!e 'eo'le are !omfortable 8it) t)e
use of t)e internet, t)ere is a greater 'robability of ado'tion of ot)er te!)nologies< In
addition several studies indi!ate t)at t)e level of internet ado'tion on a !ountry
almost often signifies t)e e!onomi! develo'ment of t)e nation as it )el's stimulatene8 gro8t) areas< If udged on t)is 'arameter, t)e findings of t)e resear!) suggest
H2011 IDC #undefined 15
-
8/9/2019 Julisha Final Report 1
23/83
t)at t)ere is definitely a lot of room for im'roving t)e internet 'enetration rates in t)e
!ountries studied< )e reasons for a lo8 internet 'enetration rate !ould be !ost of
a!!essing t)e internet > internet affordability@ as also !ould be regulations t)at
'revent Internet servi!e 'roviders from entering a !ountry< enya , 8it) ust over 20A
internet 'enetration, stands among t)e !ountries 8it) lo8er 'enetration in
!om'arison to !ountries su!) as =oro!!o and ;raine< )oug) it is understandablet)e !osts of internet a!!ess !ould be a maor !ontributor to t)e 8ides'read u'ta;e of
internet, it !ould also be 8ort)8)ile to investigate ot)er as'e!ts su!) as regulations
governing Internet Servi!e 'roviders et!<
o furt)er validate t)e 'oint of s)ared internet !onne!tions, )ouse)old 'enetration of
internet 8as !onsidered as a 'ro'ortion of total internet 'enetration< )is matri.
revealed im'ortant fa!ts about t)e use of internet in addition to its availability< In
enya, it 8as found t)at, in !om'arison to t)e total internet 'enetration rates >8)i!)
tou!)ed 25A@, only 2A of t)e )ouse)olds )ad internet a!!ess< )is s)o8s t)at
internet u'ta;e is most 'revalent at t)e business, edu!ation and government levels
and not so mu!) in )ouse)olds<
enya )as a )ig)er internet 'enetration vis a vis Sout) fri!a but mainly bolstered bymobile internet !onne!tions t)oug) 8it) a lo8er 'ro'ortion of )ouse)olds !onne!ted
o8ing to a de!lining fi.ed net8or; and 'oor develo'ment of DS% based servi!es<
enya !om'ares mu!) better t)an bot) Nigeria and (8anda on bot) !ounts<
Egy't )as a mu!) )ig)er overall and )ouse)old internet 'enetration 8it) a )uge ga'
of almost 24 'er!entage 'oints at )ouse)old level<
1/ #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
24/83
+ I 5 U R E 3
I n t e rn e t ' se rs v s ( Con n e c t i on s as a # o $ P op ! a t i on
Sour!e: IDC, 2011
In !ountries 8it) )istori!ally more develo'ed fi.ed line net8or;s and t)erefore a
!onsiderable user base, t)e total number of !onne!tions vis a vis t)e number of
users are evenly s'read<
In !ountries li;e enya, Nigeria and =oro!!o, t)ere are lo8er numbers of
!onne!tions but )ig)er number of users indi!ating most !onne!tions are s)ared
!onne!tions and largely !om'rise business !onne!tions >in!luding 'ubli!ly a!!essible
!onne!tions li;e !yber !afes, edu!ation institutions@< lso, a good number of t)e
!onne!tions in t)ese !ountries are mobile !onne!tions<
H2011 IDC #undefined 14
-
8/9/2019 Julisha Final Report 1
25/83
+ I 5 U R E 0
To ta I n t e rne t Pen e t ra t i o n )s ( Prop o r t i on o $ &o!seh o ds
* i th a co+p ! te r
Sour!e: IDC, 2011
Furt)er investigation 8as !arried out in t)is manner to identify if t)e internet
'enetration at a )ouse)old level 8as o8ing to t)e la!; of suitable infrastru!ture<
a;ing into a!!ount t)e number of !om'uters 'er 100 'o'ulations, it 8as found t)at
enya ran;ed among t)e bottom t)ree among t)e !ountries studied< *)ile (S )ad
9
-
8/9/2019 Julisha Final Report 1
26/83
It s)ould be noted t)at Nigeria as a manufa!turer of Cs >ino. brand@ t)at are
lo!ally affordable, a!!ounts for mu!) )ig)er C 'enetration at )ouse)old levels but
negligible )ouse)old internet 'enetration given infrastru!ture issues >submarine
!ables arrived 8ay after t)ey did in East fri!a@
+ I 5 U R E >
,! s in e ss I n te rn e t ' sag e
Sour!e: IDC, 2011
=oving on from )ouse)olds to businesses, and using a *EF indi!ator t)at measures
t)e e.tent of business use, it 8as found t)at enyan businesses use internet to a
large e.tent and is !om'arable to one of t)e more develo'ed business nations in
fri!a namely (e'ubli! of Sout) fri!a< )is is an im'ortant determinant in t)e future
of enya as an outsour!ing )ub as t)is indi!ator is a silent endorsement of t)e fa!t
t)at enyan businesses )ave reasonably robust te!)nology su''ort<
-verall all t)at may be needed in t)is segment is greater so')isti!ation and dire!tion
to8ards more solid online 'resen!e over and above 8ebsites and use of email to
ele!troni! trading< ?iven t)at mobile te!)nology is very 'ervasive, t)is 'latform
offers t)e most ideal 8ay for businesses to engage more 8it) t)eir !onsumers<
H2011 IDC #undefined 17
-
8/9/2019 Julisha Final Report 1
27/83
+ I 5 U R E ?
,road b an d -cce ss Ta r i. s /
Kenya
S-
igeria
*anda
'kraine
Phiipines
3gypt
Morocco
0(00 20(00 40(00 0(00 60(00 100(00 120(00
(road!and Access Tari)s
Internet -ccess Tari. / ,roadband
Sour!e: IDC, 2011
!om'arison of internet a!!ess rates in t)e region and internationally, s)o8s t)at
enya features among t)e to' 5 most e.'ensive !ountries for internet a!!ess but it
s)ould be borne in mind t)at t)ese are among t)e !ountries t)at only re!ently
re!eived lo8er !ost band8idt) via submarine !ables<
Nonet)eless t)is is an im'ortant fa!tor t)at needs to be addressed to a!)ieve t)e
level of internet 'enetration t)e !ountry desires< Internet affordability and 'enetrationmove )and in )and and suitable regulations on internet 'ri!ing and monitoring t)e
a!tivities of internet servi!e 'roviders !ould )el' move t)ings in t)e rig)t dire!tion<
Des'ite additional !a'a!ity, !ost of broadband is still a fa!tor for business vis a vis
ot)er !ountries<
Nigeria )as re!ently got a lot of international band8idt) but !onstrained some8)at by
t)e la!; of a 8ell develo'ed national ba!;bone, last mile a!!ess and ele!tri!ity
!)allenges<
%andlo!;ed (8anda largely relies on band8idt) from o'erators in neig)boring
!ountries<
OTE# )e full list of ben!)mar;ing indi!ators, in tabular format, !an be found under ''endi. I
I C T S $ i l l s ) n a l y s i s
I C T " % i l l s & v e r v i e *
)e 'resent su''ly of s;ills does not meet business reuirements in various 8ays
in!luding t)e !urren!y of t)e !ourses taug)t as 8ell as t)e need for business s'e!ifi!
training >soft s;ills@<
)ere is little visibility, at t)e a!ademi! level, on t)e demand for s'e!ifi! s;ills,
suggesting t)at greater and !loser !ollaboration is needed bet8een edu!ation
19 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
28/83
institutions, businesses and government to determine t)e e.a!t mi. of s;ills needed
in t)e mar;et<
resently some s;ills ga's are tem'orarily met via e.'at labor t)oug) it does not
al8ays translate into s;ills transfer to lo!als< )us 8)en 'roe!ts are !om'leted, a
void is left in t)e mar;et<
I T E m p l o y m e n t + i g h l i g h t s
IDC estimates t)e total I em'loyment in 2010 8as a''ro.imately 27,000 I 'rofessionals
-
8/9/2019 Julisha Final Report 1
29/83
+ I 5 U R E - -
7e +an d P re d i c t i on b y P ro $e s s i on a s
Sour!e: IDC, 2011
Nearly 10,000 I 'rofessionals are e.'e!ted to oin t)e I mar;et bet8een 2011 and
2015 8it) t)e biggest demand being for I su''ort 'rofessionals follo8ed by soft8are
develo'ers and 'roe!t managers<
)ese gro8t) rates )el' de'i!t t)e !urrent ma;e u' of t)e I mar;et 8)ere
e.'ansion in I set u' is ta;ing 'la!e >and t)erefore needs more su''ort for more
users@, ne8 'roe!ts being im'lemented >'roe!t management@ and e.isting systems
needing !ustomi&ation or en)an!ement >develo'ment@< *it) su!) !)ara!teristi!s, it
!an be e.'e!ted t)at t)e tide 8ill turn in t)e ne.t !ou'le of years 8it) more em')asis
in areas li;e IC !onsulting and administration but de'endent on different se!tors
and )o8 mu!) IC su''orts t)eir business needs<
20 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
30/83
+ I 5 U R E - 1
7e +an d 8-v a i ab i i t y M a t r i 9 b y I T P ro $e s s i on s
Sour!e: IDC, 2011
"earing in mind t)e e.'ressed demand, 'resent fo!us needs to be 'la!ed on I
'rofessions t)at are bot) immediately in )ig) demand and )ard to a!uire by
businesses and vendors<
)e diagram above 'lots t)ese different 'rofessions based on 8)at end users and
vendors )ave indi!ated in terms of ease of filling su!) 'ositions vis a vis demand for
t)ese 'ositions<
)erefore greater fo!us s)ould be 'la!ed on I roe!t =angers, Consultants
''li!ation Systems nalysts and Soft8are Develo'ers, being t)e 'rofessions in
)ig)est demand and )ard to fill<
*)ile t)ere is diffi!ulty in filling 'ositions 8it) Systems Engineers, t)e demand is not
very )ig) 'resently t)us some t)oug)t s)ould be s'ared to in!lude 'lans for su!)
'ositions<
-verall a !lose tab s)ould be ;e't on 'ositions t)at are in lo8 demand and 'resently
easily filled in order to tra!; develo'ments in I set u' a!ross t)e board<
H2011 IDC #undefined 21
-
8/9/2019 Julisha Final Report 1
31/83
+ I 5 U R E - /
7e +an d P re d i c t i on b y I T S k i s
Sour!e: IDC, 2011
8ay from broad !ategories of I 'rofessionals and loo;ing at s'e!ifi! s;ills t)at
t)ese 'rofessionals )old, t)e survey indi!ates t)at t)e greatest demand 8ill be for I
roe!t =anagement S;ills >15$A@ and Soft8are develo'ment s;ills >154A@<
gain t)is is indi!ative of 'ositions arti!ulated earlier i
-
8/9/2019 Julisha Final Report 1
32/83
global integration< )is 8ill !om'el t)e mar;et to a!uire and avail t)e reuired s;ills sets needed for su!)
im'lementations lo!ally<
Increase in ICT !layers : -ver t)e last ten years, t)ere )as been signifi!ant gro8t) in t)e number of
!om'anies o'erating in t)e IC se!tor, in!luding tel!os, )ard8are and soft8are 'roviders< )is e.'onential
gro8t) )as fuelled t)e need for more lo!ally ualified staff< In addition, a number of !om'anies are starting
to invest in I servi!es 8)i!) !alls for lo!ally available staff to be on )and<
Inhi!itors
I"!orted *a(or 8 )e im'ortation of s;illed IC %abor by some 'layers, 8it)out !ommensurate met)ods
to ensure t)e transfer of s;ills to lo!al I 'rofessionals, es'e!ially for t)e im'lementation maor 'roe!ts,
only serves 'resent needs but leaves a void in t)e mar;et< *it) a''ro'riate intervention, su!) im'orted
s;illed labor !an be leveraged to im'art s;ills and en)an!e t)e 'rofile of lo!al I 'rofessionals<
I"!orted *a(or Co"!etition : vailability of lo8er !ost im'orted IC labor >eand also bearing in mind t)at large 'roe!ts are fe8 and far bet8een@, t)ere is emerging a trend 8)ereby
s;illed I resour!es migrate from !om'any to !om'any >vendor or business@ see;ing outlets 8)ere t)ey !an
utili&e t)eir s;ills and gain e!onomi!ally< o a large e.tent t)is is a !ause for disuiet among em'loyers t)at
try to 'la!e a 'remium on loyalty<
I T " % i l l s a p A n a l y s i s . r a m e * o r %
H2011 IDC #undefined 25
-
8/9/2019 Julisha Final Report 1
33/83
+ I 5 U R E - 4
I T S k i s : ap -n a y s i s Fra+e * ork
Sour!e: IDC, 2011
K e y m a r % e t h i g h l i g h t s
)ere is relatively de!ent s;ills availability in t)e mar;et and of good !aliber< o8ever, t)ere are issues to
do 8it) et)i!s on bot) t)e 'art of em'loyees >greener 'asture see;ers@ and industry 'layers >)ead )unting
staff trained by !om'etitors< )us t)e 'ool is small and most 'layers ;ee' dra8ing t)e same 'eo'le out of t)e same 'ool
)ere is a limited su''ly of good s;ills !ou'led 8it) reuisite e.'erien!e a!ross )ard8are and soft8are
ty'es<
Et)i!s is 8anting loyalty to em'loyers bot) 8it)in t)e su''ly side and demand side is la!;ing t)us I
'rofessionals largely tend to be migratory and green 'asture see;ers<
)ere is little international e.'osure t)ose 8it) advan!ed s;ills leave t)e mar;et and t)e enyan mar;et
!annot really attra!t e.'erien!ed 'rofessionals o8ing to t)e Kglass !eilingK in I >bearing in mind t)e overall
maturity levels in t)e mar;et<
)ere is a limited su''ly of good s;ills !ou'led 8it) reuisite e.'erien!e<
Et)i!s is 8anting loyalty to em'loyers bot) 8it)in t)e su''ly side and demand side is la!;ing t)us I
'rofessionals largely tend to be migratory and green 'asture see;ers<
)ere is little international e.'osure t)ose 8it) advan!ed s;ills leave t)e mar;et and t)e enyan mar;et
!annot really attra!t e.'erien!ed 'rofessionals o8ing to t)e Kglass !eilingK in I >bearing in mind t)e overall
maturity levels in t)e mar;et<
=ost university students readily dabble 8it) a''li!ation develo'ment using mainly o'en sour!e soft8are
and do )ave !onsiderable s;ills in t)at regard but !ome into a mar;et 'la!e 8)ere t)e u'ta;e of o'en
sour!e o'erating systems and a''li!ations are not very 'ervasive< <
& t l o o %
Seeing t)at various fa!tors are at 'lay in determining t)e s;ills base in enya,in!luding t)e o''ortunities 'resented by businesses to )el' nurture s;ills, t)e number
2/ #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
34/83
and si&e of 'roe!ts, t)e !y!li! nature of I 'roe!ts, a deli!ate balan!e needs to be
attained in order to address s)ortages 8)ile at t)e same time !reating more
em'loyment and en!ouraging more so')isti!ation in IC ado'tion<
mong t)e ;ey areas e.'ressed by vendors, businesses and a!ademi! institutions,
to address t)is issue in!lude:
Integrating I studies early in t)e edu!ational !urri!ulum to attra!t more interest and t)erefore talent to t)e
se!tor and demystify t)e industry<
Engaging in 'artners)i's 8it) )ig)er edu!ation fa!ilities 8it) greater involvement by t)e government and
!ontinually vet and in!entivi&e 'arti!i'ants in t)e edu!ation se!tor to in!lude more te!)ni!al s;ills in t)eir
!urri!ulum<
?iven enyaLs rising status as a budding innovation )ub in t)e region, develo'ing an enabling environment
for t)e se!tor 8ill be !riti!al to its su!!ess<
In!reasing globali&ation 8ill also 'us) !ountries li;e enya to lean more )eavily on I to 'arti!i'ate on t)e
same e!onomi! field as it !om'etitors<
=ainstreaming of basi! IC training at a large s!ale ebusiness@ IC te!)ni!al s;ills >business@ and general IC
end user s;ills >residential@ among many ot)er areas<
ote# In t)is se!tion IDC 8ill not !over IC s;ills as t)e feedba!; is treated
se'arately under a different se!tion< )us t)e follo8ing are )ig)lig)ts of feedba!;
obtained from t)e residential and business survey results<
/ e s i d e n t i a l
In t)is 'art of t)e survey, a total of 740 residents a!ross five to8ns >Nairobi, isumu,
Na;uru, =ombasa and Nyeri@ 8ere 'olled at a )ouse)old level 8it) feedba!;
soli!ited on various IC related issues< (es'ondents ranged from t)e age of 14 to
over /4 years and 8ere dra8n from t)ree main so!ial !lasses<
?iven t)e sele!tion of urban areas for t)e survey, t)e u'ta;e and usage of IC, t)e
level of s;ills >end user@ demonstrated and overall usage of IC 8as relatively )ig) as
outlined in t)e )ig)lig)ts belo8<
H2011 IDC #undefined 24
-
8/9/2019 Julisha Final Report 1
35/83
+ I 5 U R E - 6
e asons $ o r n o t h av in g an i n te rn e t con n e c t i on
Sour!e: IDC, 2011
Feedba!; re!eived from end users 'olled, on t)eir reasons for not )aving an
internet !onne!tion at )ome 8ere mainly asso!iated 8it) t)e !ost of devi!es
>!om'uters@ and t)e !ost of servi!es< o8ever, it s)ould be noted t)at a good
number also indi!ated t)at t)ey already a!!ess t)e internet at 8or; or 'ubli!ly
s)ared !onne!tions 8)i!) to a !ertain e.tent im'lies t)at residents 8)o )ave
a!!ess at 8or; may not ne!essarily be 'rom'ted to a!uire or invest in
!onne!tions at )ome, es'e!ially 8)ere !ost and level of use are fa!tors<
15A of t)e res'ondents !ited la!; of internet infrastru!ture as t)e reason for not
)aving a !onne!tion 8)i!) )el's !onfirm earlier assertions t)at last mile a!!ess
is a maor issue t)at needs to be addressed<
)e main issues t)at 8ere immediately a''arent, 8)i!) !ould be ustifiably
inferred to a''ly to rural 'o'ulations, )ad to do 8it) !ost of devi!es and servi!es,
and in many !ases, to a!!ess to servi!es and uality of servi!es< -n t)at note,
given t)at a!!ess and !ost are already issues in urban areas, it goes 8it)out
saying t)at t)ese are also very real issues in rural areas, more so on !ost of
devi!es and servi!es<
not)er as'e!t t)at may also be safely assumed to in)ibit u'ta;e in rural areas
)as to do 8it) litera!y >ust above 10A indi!ated t)at t)ey do not ;no8 )o8 to
use t)e internet@, a8areness and relative need of servi!es< *)ile t)ere may beneed for !ertain servi!es in urban areas, t)e same !annot be said for rural areas
8)ere !ulture, e!onomi! a!tivities and ability 'lay a maor role in IC
!onsum'tion<
+ighlights on ,etail ing PC Internet $o !ile Phone sage
=obile usage among res'ondents >A@ 'revails over internet >7A@ and C >$A@ usage
Internet and C usage is )eavily !on!entrated among young res'ondents >es'e!ially t)e 142/ yrs@ and
males
=ain reasons for not using a C or internet are !ommon and !orres'ond mostly to t)e inability to buy t)em
or not ;no8ing about t)eir fun!tions
sing C and internet at 'ubli! 'la!es is a 'rominent feature , e.'laining more t)e 8ea; internet a!!ess
from )omes
2$ #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
36/83
9A of res'ondents use C mainly at 'ubli! internet fa!ilities >at varying freuen!ies 'er 8ee;@< -n t)e
ot)er )and, t)eir internet usage is mostly done t)roug) mobile at varying freuen!ies 'er 8ee; >94A@
Qoung res'ondents >142/ yrs@ tend more to use C for entertainment >77A@ and edu!ational >47A@
reasons 8)ile older res'ondents >es'e!ially 543 yrs@ s'e!ify most of t)eir C time for 'ersonal >7$A@ and
8or; obligations >4A@
Internet and mobile usage is !entered over basi! tas;s, 8it) t)e advan!ed features still not uite 8ell
e.'lored
)e main 'ur'oses for using t)e internet are !ommuni!ation via email or so!ial net8or;ing >9$A@ o''osed
by a lo8 'referen!e for doing online voi!e or video !alls
*)ile 7A of res'ondents use mobiles mostly for t)e normal !alling and te.ting, internetbased fun!tions
li;e 8eb bro8sing, !)atting et!< are dominated by young residents >142/ yrs@
ime s'ent on C and internet )ave similar distribution among different age grou's and is a resultant of t)e
general 'ur'oses t)at t)ese age grou's use C or internet:
(es'ondents >145/ yrs@ allo!ate most of t)eir C6internet time for 'ersonal or edu!ation reasons
(es'ondents >543 yrs@ are )eavily !onsumed by 8or; obligations 8)ile using C or internet
-n average, 12 )rs 'er 8ee; are s'ent using a C and6or internet
=ales tend to s'end 2te.t 'ro!essing, 8or;ing 8it) s'read s)eets,
et!email !ommuni!ation, sear!) engines, et!
-
8/9/2019 Julisha Final Report 1
37/83
Confirming earlier feedba!; about !ost of devi!es, la'to's and des;to's )ave mu!)
lo8er usage in t)e mar;et,
)ere is gro8ing usage of smart ')ones in enya, 'artly attributable to initiatives by
eui'ment vendors and mobile o'erators to avail lo8 !ost or subsidi&ed devi!es into
t)e mar;et< C)ief among t)ese are ndroid based ')ones from re'utable C)inese
manufa!turers< IDC in its resear!) on mobile )andsets sees a gro8t) of ..A >F !)e!; 8it) Simon "a;er@ in t)is mar;et segment<
+ I 5 U R E - 0
P r i+ary p ! rp ose $ o r ! s i n g a P C
Sour!e: IDC, 2011
(es'onses on 'rimary usage of !om'uters !onfirms t)at !om'uters )ave more or less be!ome very !ommoditi&ed items 8it) 'ersonal use !ited as t)e biggest use,
follo8ed by entertainment >still 'ersonal usage te!)ni!ally s'ea;ing@ and
!ommuni!ation<
Rust over 54A !ited use of t)eir !om'uters for 8or; 8)i!) largely !om'rises of t)e
self em'loyed or tele8or;ing demogra')i! of t)e survey<
It s)ould also be noted t)at nearly /4A !ited t)e use of !om'uters for edu!ation,
8)i!) in itself unders!ores t)e im'ortan!e of !om'uters as a medium to a!uire
edu!ation and learning materials< *)en loo;ing at !ontent later, 8e 8ill see t)at
edu!ation still 'lays a !ru!ial role and !an get a better understanding of t)is issue<
29 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
38/83
+ I 5 U R E - >
S e rv i ce s ac t i v e y ! se d on a +ob i e d e v i ce
Sour!e: IDC, 2011
Confirming IDCGs mar;et si&ing on tele!ommuni!ations servi!es e.'enditure,
feedba!; from residents s)o8s t)at t)e biggest use of mobile devi!es, at nearly
100A is for voi!e servi!es follo8ed by te.ting at about t)e same level and at a mu!)lo8er usage level, a!!ess to so!ial media and 8eb sites, mainly by t)e younger
'o'ulation<
IDC believes t)at s)ould more lo!ally develo'ed !ontent be availed for mobile,
s'e!ifi!ally for so!ial net8or;ing, 8ebsites and entertainment, 'lus )ig)er band8idt)
s'eeds be availed, a greater a''etite !an be reali&ed< resently su!) !onsum'tion is
via !om'uters and mainly at s)ared a!!ess 'oints or 8or; 'la!es<
H2011 IDC #undefined 2
-
8/9/2019 Julisha Final Report 1
39/83
+ I 5 U R E - ?
Con ; d e n ce i n 's in g a P C
Sour!e: IDC, 2011
"y and large, and t)in;ing of basi! end user s;ills, residents 8)o use !om'uters are
!onfident users of Cs and only !iting diffi!ulties 8it) infreuent uses su!) as
'roblem solving and 8riting 'rogrammes< )is in itself, more so 8)en loo;ing at te.t
'ro!essing, !reating 'resentations, et! s)o8s t)at t)e use base is already fertile for
develo'ment of lo!al !ontent and t)at t)e missing lin; to en)an!e or later reali&e t)is
8ould lie in !onne!tivity<
-ut of all t)e res'ondents, only 51A )ave never used a !om'uter and t)e maority
'ossesses fairly solid basi! !om'uter usage s;ills<
50 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
40/83
+ I 5 U R E 1 2
Con ; d e n ce i n ' s in g th e I n te rn e t
Sour!e: IDC, 2011
Com'ared to online s;ills >ii
-
8/9/2019 Julisha Final Report 1
41/83
+ I 5 U R E 1 -
es idents < =n ine P resence
Do you Have a Personal Website or Blog?
Sour!e: IDC, 2011
-nly /A of residents dis!losed t)ey )ave a 'ersonal 8ebsite or blog and may sim'ly
refle!t 'ersonal 'referen!es and 'er)a's also de'endent on t)eir ty'e of o!!u'ation<
It !annot be inferred t)at lo8 online 'resen!e by !iti&ens is o8ing to lo8 !onfiden!e
in internet related s;ills<
)e 'revious figure !onfirms t)is, 8it) a good number of res'ondents 8it) fairly )ig)
levels of !onfiden!e in !reating 8ebsites, 'osting to dis!ussions grou's among
ot)ers<
o8ever, t)is is still an o''ortunity to engage 8it) residents at different levels on t)e
!reation of relevant lo!al !ontent, not ne!essarily 'ersonal 8ebsites or blogs, but
ot)er !ontent t)at may be relevant to t)eir immediate !ommunity e
-
8/9/2019 Julisha Final Report 1
42/83
-
8/9/2019 Julisha Final Report 1
43/83
mobile o'erators allo8ing su!) 'ayments to be made via t)eir mobile money
'latforms and !ou'led 8it) some a8areness !reation about t)is servi!e, online
!ommer!e !an only be marginally en)an!ed for !ertain demogra')i!s in!lined to do
so but 8it)out mu!) information about )o8 it 8or;s< s it 8ere !redit !ard users for
offline transa!tions are fe8 o8ing to e!onomi! reasons< )us for online 'ayments,
only a marginal in!rease !an be effe!ted 8it) interventions li;e using mobileo'erators mobile money 'latforms<
+ I 5 U R E 1 /
F inanc ia T ransac t ions on the In te rne t and Mob i e
Sour!e: IDC, 2011
?iven t)at mobile devi!es are most 8ides'read, it is )ardly sur'rising t)at most
transa!tions are made via t)is devi!e<
)e feedba!; suggests t)at bot) a!!essibility to mobile devi!es, as 8ell as t)e
relative ease of use of su!) mobile servi!es, !ontributes largely to t)e )ig) levels of
usage< t t)e ba!;dro' of t)is is a !iti&enry t)at )ave been isolated from traditional
ban;ing servi!es and t)erefore !annot migrate to traditional online internet
transa!tions ba!;ed by formal ban;ing systems<
)us innovations in mobile transa!tions )ave sur'assed internet transa!tions o8ing
to myriad reasons, !)ief among t)em being t)e ba!;ground 8it) traditional ban;ing
and a!!ess to mobile devi!es and servi!es<
o )el' in!rease more internet transa!tions 8ill reuire more 'ayment 'latforms to be
a!!essible for e.isting users, aside from !redit !ards 8)ose usage in enya is mu!)lo8er t)an t)e number of internet users< =obile 'ayment 'latforms, interfa!ed 8it)
5/ #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
44/83
internet ban;ing !ould 'rovide t)e missing lin; to 'romote internet transa!tions< )e
re!ent servi!e laun!) by irtel is a good e.am'le<
+ I 5 U R E 1 4
S a t i s $ ac t i on * i th I n te rn e t S e rv i ce s
Sour!e: IDC, 2011
*)en 'olled about satisfa!tion 8it) internet servi!es, a good number of res'ondents
8ere satisfied 8it) t)eir overall internet servi!e as 8ell as t)e su''ort t)ey re!eive<
Issues of s'eed 8ere among t)e areas 8)ere residents 8ere not satisfied and )ardly
sur'rising t)e issue of value for money 8)ere at least 20A indi!ated dissatisfa!tion<
+ I 5 U R E 1 6
-* aren e ss o $ on i n e g ov e rn +e n t se rv i ce s
Sour!e: IDC, 2011
H2011 IDC #undefined 54
-
8/9/2019 Julisha Final Report 1
45/83
*)ereas 45A of t)e res'ondents 8ere a8are of t)e egovernment servi!es offered
on 25A< Indi!ated t)ey )ave used t)ese servi!es<
s indi!ated else8)ere in t)e resear!), lo8 usage may be as a result of !on!erns
relating to !onstant availability, se!urity !on!erns and generally trying to !ontend 8it)
a bureau!rati! !ulture 8)ere t)e most effe!tive transa!tions are offline )o8ever
tedious<
+ I 5 U R E 1 3
=n i n e g ov e rn +e n t se rv i ce s ! se d
Sour!e: IDC, 2011
-ut of t)e 25A of egovernment servi!es users, t)e maority soug)t to obtain
e.amination results online, follo8ed by a''li!ations for 'ubli! servi!e obs<
5$ #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
46/83
+ I 5 U R E 1 0
,ar r i e r s t o ICT ! sag e
Sour!e: IDC, 2011
!!ess to !om'uters, t)e )ig) !osts of !om'uters and unaffordable internet a!!ess
are t)e t)ree main barriers to IC usage in enya and 8)ile t)is is a serious
!)allenge, it also 'resents an o''ortunity to in!rease 'enetration t)roug) various
means in!luding asset finan!ing, !ost subsidies and toll free dial u' rates for remote
and rural areas<
It s)ould be 8ort) noting t)at t)e level of !om'li!ation to te!)nology as 8ell as t)e
la!; of s;ills are not maor in)ibitors as issues of !ost, again !onfirming t)at t)e IC
litera!y levels among residents is adeuate to allo8 t)em to !onsume more and
move to t)e ne.t level<
mong t)e least !ited barriers in!lude la!; of lo!al !ontent, se!urity !on!erns andla!; of trust of IC<
/esidents' "rvey +ighlights
!uiring IC s;ills in enya is signifi!antly affe!ted by t)e overall so!ial status of )ouse)olds and
res'ondents
)e unavailability of C and internet at )omes due mainly to t)eir )ig) !ost and t)e inability of res'ondents
to 'ur!)ase t)em emerges as t)e main barrier against IC ;no8ledge
not)er barrier is t)e absen!e of internet infrastru!ture in some neig)bors 8)i!) is 'ro)ibiting t)ose 8)o
are finan!ially !a'able >SC% "@ form enoying t)is servi!e
H2011 IDC #undefined 57
-
8/9/2019 Julisha Final Report 1
47/83
)is is leading to t)e fa!t t)at most internet a!!ess is done via mobile or from 'la!es outside )ome 8)ere
res'ondents are satisfied by its !ost, s'eed and reliability
sage of C, internet and mobiles is generally limited to basi! features
)e same main barriers >!ost and unavailability of C and internet@ t)at are redu!ing t)e use of internet and
C are also 'reventing res'ondents from ta;ing IC training !ourses
*it) t)ese fa!tors 'ressing, only 1$A of res'ondents )ave been trained on IC s;ills in t)e last year
(es'ondents are aiming to in!rease t)eir general basi! s;ills for using mobiles, C and internet< )ey
refle!t less desire to learn advan!ed features
59 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
48/83
( s i n e s s
In t)e business survey, a total of 149 res'ondent organi&ations from five to8ns
>Nairobi, isumu, Na;uru, =ombasa and Eldoret@ 8ere 'olled on various as'e!ts,
in!luding IC s;ills< (es'ondents 8ere s'read 'ro'ortionately de'ending on t)eir
se!tors s)are of IC s'end and in!luded government de'artments and agen!ies<
-verall IC usage in business is fairly )ig) t)oug) some issues remain and 8)i!) if
addressed !an result in )eig)tened levels of usage<
+ I 5 U R E 1 >
,! s in e ss =n i n e P re se n ce
Sour!e: IDC, 2011
)ere is !onsiderable usage of 8ebsites among businesses in enya and a goodnumber are leveraging on ot)er online 'resen!e in!luding online adverts, e
ne8sletters and 'resen!e on so!ial net8or;ing !ites<
In t)is regard, t)e enya business !ommunity !an be !onsidered to be at 'ar 8it)
develo'ed !ountries 8it) all t)at remains being t)e level of 'resen!e in terms of
online trading6transa!tions 8)i!) is one as'e!t t)at t)is survey did not e.'ressly
measure but 8)i!), given ot)er areas !ited as !on!erns, mig)t be 'reventing more
enyan businesses from ado'ting a more 8)olesome online 'resen!e< C)ief among
t)e !on!erns !ited else8)ere in!lude se!urity<
H2011 IDC #undefined 5
-
8/9/2019 Julisha Final Report 1
49/83
+ I 5 U R E 1 ?
I n t e rn e t Con n e c t i on " ,! s in e ss I n te rn e t S p e e d s %
Sour!e: IDC, 2011
?iven re!ent develo'ments in availing )ig) s'eed band8idt), a good number of
organi&ations )ave !onne!tion s'eeds )ig)er t)an 1=b's but also de'endent on t)e
number of end users t)at t)ey need to 'rovide a!!ess to<
%oo;ing at t)e maturity of t)e mar;et, 8)i!) s)ould be denoted by t)e ty'es of
s'eeds, less t)an 20A )ad s'eeds less t)an 412;b's and only 1A 8ere not
!onne!ted<
-verall, a!!ess among business stands at A 8)i!) is a very 'ositive indi!ator for
organi&ations in enya<
+ I 5 U R E / 2
Con s t ra i n t s $ o r I n te rn e t ' sag e
Sour!e: IDC, 2011
+arious reasons 8ere !ited as !onstraints in terms of internet usage, !)ief among
t)em being availability and !overage 8)i!) )el's restate t)e issue of last mile
/0 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
50/83
a!!ess< -t)er ;ey !onstraints in!lude 'ri!ing and uality of servi!e bot) illustrative
of a dis!erning nature of organi&ations<
ItGs 8ort) noting t)at only less t)an $A indi!ated t)at t)e internet is not relevant or
ne!essary to t)eir business<
+ I 5 U R E / -
To ta n!+b er o $ $ ! t i+e e+poy e es t ha t h ave access t o
o r ! se sh a re d 8 d e d i ca te d P C
Sour!e: IDC, 2011
In terms of !om'uter usage at organi&ation level, in t)e =edium segment >100/@
em'loyees, a greater number of staff )ad a!!ess to !om'uters 8it) at least 40A of
t)em )aving bet8een 100/ em'loyees 8)i!) is t)e segment si&e )aving
a!!ess to a C< )is unders!ores t)e im'ortan!e of t)e S=E segment in enya
8)i!) is largely made u' of !om'anies t)at are servi!es oriented and t)erefore invest
!onsiderably in !om'uting<
Inversely, t)e maority of t)e bigger organi&ations )ave a lo8er 'ro'ortion of staff t)at
use IC and most of t)ese organi&ations are in se!tors t)at are not e.'ressly IC
de'endent for a maority of users and in!lude agri!ulture, mining and some
government bodies<
Online Government Services
)ere is fairly good a8areness on government servi!es offered online t)oug) 8it)
lo8er levels of usage< systemati! and !onsultative a''roa!) !ould ado'ted to
sensiti&e users on servi!es available as 8ell as a!t on feedba!; on t)e ;ind of
servi!es needed<
mong !iti&ens, 8)ile t)ere are lo8 levels of !onne!tivity, for t)ose t)at )ave
!onne!tivity, t)ere is fair ;no8ledge of t)e ty'e of government servi!es offered and
some usage of servi!es<
)ere is 'resently demand for various online servi!es li;e driving li!ense a''li!ation,
birt) !ertifi!ate a''li!ation, et!<
H2011 IDC #undefined /1
-
8/9/2019 Julisha Final Report 1
51/83
mong !iti&ens, t)e mobile devi!e is t)e most !ommon met)od of a!!essing t)e
internet and s)ould more government servi!es be issued for mobile 'latforms, a
greater u'ta;e !an be a!)ieved<
+ I 5 U R E / 1
' sag e o $ e / g ov e rn +e n t se rv i ce s
Sour!e: IDC, 2011
)ere is more a8areness of servi!es li;e !ustoms, business li!ense registry and
re'orting !orru'tion online, but !om'aratively usage of t)ese servi!es is rat)er lo8
and ust li;e 8it) t)e residential segment, issues relating to !ulture, bureau!ra!y and
ease of doing business are 'robable reasons for lo8 usage among t)e business
!ommunity<
o a !ertain e.tent, t)e a8areness and usage of t)ese servi!es is !ontingent on t)e
a8areness !am'aigns underta;en by t)e 'roviders of t)e various servi!es< enya
(evenue ut)ority is most notable in t)is regard and t)e results !onfirm t)is< )eir
annual !am'aigns to en!ourage ta. 'ayers and im'orters to utili&e t)eir online
servi!es is indi!ated 'ositively )ere<
-verall s)ould t)ere be similar levels of 'ubli!ity about ot)er government servi!es,t)ere !ould be greater ado'tion<
/2 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
52/83
-
8/9/2019 Julisha Final Report 1
53/83
In total t)e !ombined I and ele!oms mar;et 8ill gro8 at a C?( of 9
-
8/9/2019 Julisha Final Report 1
54/83
. o r e c a s t T a ! l e s
ICT Spen%in&
H2011 IDC #undefined /4
-
8/9/2019 Julisha Final Report 1
55/83
-
8/9/2019 Julisha Final Report 1
56/83
T ) B * E 1
To ta ICT Spend ing "'SM% by Techno ogy 2010>201?
2010 2011 2012 2015 201/ 2014 C?(
-t)er * 50
-
8/9/2019 Julisha Final Report 1
57/83
T ) B * E /
To ta ICT Spend ing "'SM% by )e r t i ca Marke ts 2010>201?
2010 2011 2012 2015 201/ 2014
gri!ulture, Constru!tion, and =ining 21
-
8/9/2019 Julisha Final Report 1
58/83
T ) B * E 4
To ta ICT S p e n d in g " ' S M % b y ,! s in e ss S i ze 2010> 201?
2010 2011 2012 2015 201/ 2014
110 22
-
8/9/2019 Julisha Final Report 1
59/83
K e y . o r e c a s t A s s m p t i o n s
T ) B * E 6
Ke y F o re cas t -s s! +p t i on s $ o r t h e Ke n y a ICT M arke t 2012> 2015@
=ar;et For!e IDC ssum'tion Im'a!t
!!elerator6
In)ibitor6
Neutral
Certainty of
ssum'tion
Macroecono"ics
oliti!al Stability Ele!tions e.'e!ted in 2012 8ill
stymie government s'ending in
t)e latter )alf of 2012<
rogress 8it) e.isting and
'lanned IC investment and
s)ared servi!es may grind to a
)alt during t)is 'eriod<
↓
E!onomy Curren!y stabili&ation !an bee.'e!ted to s)ore u' im'orts of
goods, in!luding oil, and overall
)el' alleviate inflation and
resulting effe!ts on !onsumers
>s'ending 'o8er and 'ri!e of
goods@<
Im'roved ability to maintainim'orted inventory by !)annel
'artners< %o8er s)s !ost of
goods !an be 'assed on to
!onsumers
%abor IC S;ills 8ill remains a serious
!)allenge
)e survey s)o8s t)ere are
ga's in demand and small 8ins
!an only be made in terms of
soft s;ills and a8areness
among under graduates about
t)e dire!tion t)ey s)ould ta;e to
be able to fit in t)e mar;et<
Mar$et
C%aracteristics
Inflation Inflation 8ill affe!t !onsumer
IC S'ending
Des'ite t)e fa!t t)at
!ommuni!ations servi!es
!om'rise a !onsiderable
'ortion of )ouse)old s'end,
in!reased !osts of food,
trans'ort, ele!tri!ity and ot)ers,
8ill eat into overall budgets and
diminis) 'riorities for non
essential IC s'end among t)elo8er !adres of t)e !iti&enry<
↓
(egional
Integration
-ngoing initiatives to develo'
t)e East fri!an Community
-ngoing develo'ments among
t)e East fri!an Community
!ountries 8ill )el' IC furt)er
along t)e road in terms of f ree
movement of goods and
servi!es< enya !an 'lay a
'ivotal role in t)is, es'e!ially in
t)e 'rovision of s;ills and IC
related servi!es<
+erti!al Fo!us In!reased so')isti!ation amongS=Es 8ill graduate t)em to t)e
ne.t level of a''li!ations
resently S=Es, 8)i!) formt)e bul; of businesses in
enya, and 8)o are largely in
40 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
60/83
T ) B * E 6
Ke y F o re cas t -s s! +p t i on s $ o r t h e Ke n y a ICT M arke t 2012> 2015@
=ar;et For!e IDC ssum'tion Im'a!t
!!elerator6
In)ibitor6Neutral
Certainty of ssum'tion
servi!es related industries,
)ave !onsiderable IC usage
>even in terms of end users@
and 8ill soon be ri'e to ado't
more so')isti!ated IC
a''li!ations<
Tec%nology
%E6/? Net8or;s ?overnment 'lans for a s)ared
/? net8or;
ro'osed roll out of s)ared /?
net8or; may not )ave asignifi!ant effe!t on t)e
!onsum'tion of data servi!es
but 8ill )el' o'erators address
UoS and ot)er 'rovisioning
issues
Cloud Com'uting Cloud Servi!es 8ill start to ta;e
root
?iven t)e !)anges in t)e
!)annel, more so 8it) tel!os
entering t)e enter'rise IC
Servi!es s'a!e and modeling
most offering around a !loud
model, businesses 8ill )ave
greater !onfiden!e 8or;ing 8it)
tel!os on t)eir !loud strategies
Mar$et
Ecosyste"s
C)annel )ere 8ill be distribution
!)annel !)allenges as vendors
see; to )ave uniue !)annels<
)e limited 'ool of distributors
and ier I +(s 8ill !om'ound
t)e ability of vendors to enter
mar;ets more !om'etitively
(esidential =ore lo8 !ost smart ')ones
8ill be a!uired in t)e mar;et<
Smart ')one usage 8ill
en!ourage in!reased data
servi!es !onsum'tion in t)e
residential segment
"usiness "usinesses 8ill gradually
leverage t)e mobile 'latform to
rea!) !onsumers<
?radual efforts by businesses
to de'loy enter'rise mobility
and mobile a''li!ations 8ill
also foster more online trade
and intera!tion 8it) !onsumers
%egend: very lo8, lo8, moderate, )ig), very
)ig)
Sour!e: IDC, 2011
H2011 IDC #undefined 41
-
8/9/2019 Julisha Final Report 1
61/83
E S S E T I ) * 5 U I D ) C E
A c t i o n s t o C o n s i d e r
Pro"otion o& locally o.ned distri(utors : )ere need to be efforts to gro8 t)e
distributors)i' 'ool in t)e mar;et, 'ossibly 8it) lo!al and regionally o8ned 'layers to
offer greater diversity to any vendors t)at feel t)e need to )ave 'rodu!t and servi!e
e.!lusivity< s it 8ere, t)e do&en or so distributors already )andle 'rodu!ts of
various vendors 8)o are sim'ly ;een to leverage t)eir mar;et rea!), but s)ould
alternate 'layers oin t)e mar;et, t)e distribution !)annel !an undergo some
transformations< In!entives for su!) 'layers may go a long 8ay in fostering greater
lo!al 'arti!i'ation<
+oster Innovation# )e 'resent initiatives to in!ubate S=Es in IC and 'rovide seed
funding for startu's is yet to be measured but IDC believes t)at t)ese initiatives 8ill
!ertainly )el' foster innovation es'e!ially in t)e younger 'o'ulation and more !ould
be done by 8ay of a8areness !reation as to )o8 young 'eo'le !an start 'arti!i'ating
in a ;no8ledge e!onomy<
)us a multi fa!eted a''roa!), involving in!ubation, sensiti&ation on te!)nology
trends and o''ortunities, !ou'led 8it) relevant syllabi t)at 'rovide t)e ste''ing
stones to attaining t)is, 8ill go a long 8ay in 'roviding a solid foundation for
innovation<
5ro.t% o& Tier 1 !layers# *)ile in!ubation initiatives may foster u' starts to ma;e
an entry into t)e mar;et as IC 'layers, 'er)a's t)e im'a!t may be greater s)ould
ier 2 'layers be suitably engaged to )el' t)em undergo !onsolidation by t)em
a!uiring smaller 'layers, in!reasing t)eir resour!e and s;ills base as 8ell as t)eir
geogra')i! 'resen!e<
)us given t)e limited 'ool of 'layers from 8)i!) large enter'rises, multinational
!om'anies and government !an dra8 from in terms of e.'ertise, resour!es and
e.'erien!e, t)ere is need to nurture more lo!al 'layers to !om'ete effe!tively 8it)
more establis)ed 'layers t)at !urrently dominate t)e mar;et< Su!) measures 8ill
bot) )el' !reate em'loyment and nurture reuisite s;ills<
)us some fo!us s)ould also be dire!ted to8ards e.isting ier 2 'layers, more so
enyan o8ned IC !om'anies, to allo8 t)em greater a!!ess to business
o''ortunities in large enter'rises, government and multinational !om'anies< s it
stands, t)eir limited resour!es, ability to retain s;illed staff and limited geogra')i!
rea!), serve to limit )o8 mu!) t)ey !an gro8 as businesses and em'loyers<
ier 2 !om'anies, by virtue of not being foreign maority o8ned, if nurtured 8ell and)el'ed to be!ome more robust 'layers, !an ma;e good !andidates for foreign dire!t
investment by multinational =NCs and ot)er global IC investors t)at see; to gro8
t)eir mar;ets by investing in or 'artially a!uiring lo!al !om'anies in order to enter
t)e mar;et and !om'ete favorably 8it) ier 1 !om'anies<
Protection o& local ;o(s# In t)e survey t)at IDC !ondu!ted, more so to do 8it) t)e
issue of IC s;ills and ga's, a !ommon t)read running t)roug) most dis!ussions
relates to a some8)at rela.ed and unregulated stan!e to8ards foreign 8or;ers,
more so 8)en t)e reuired s;ills are lo!ally available already< Su!) )as been !ited
often as a reason t)at some 'ositions are not a!!essible to enyans leading
sometimes to brain drain 8)en enyans see; better o''ortunities in neig)boring
!ountries or fart)er beyond<
42 #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
62/83
S;ills transfer: *)ile in reality t)ere may be various 'ositions and s;ills t)at are not
easily available lo!ally, for t)ose instan!es 8)ere foreign 8or;ers arrive in enya to
underta;e various IC tas;s, t)ere is need to monitor 8)et)er a!tual s;ills transfer
ta;es 'la!e 8)ile at t)e same time ensuring a favorable environment for IC
investors and end users t)at reuire su!) servi!es<
*ast "ile access and =uality o& service# From t)e results of t)e business andresidential survey, as 8ell as intera!tions 8it) vendors, even t)oug) so mu!) )as
been done to develo' IC infrastru!ture via international !onne!tivity, national
ba!;bones, 'ubli! a!!ess !enters, t)e issue of reliable and affordable last mile
a!!ess 8ill !ontinue to in)ibit t)e 'ro'agation and usage of IC<
H2011 IDC #undefined 45
-
8/9/2019 Julisha Final Report 1
63/83
" m m a r y / e c o m m e n d a t i o n s
T ) B * E 3
e co++e n d at i on s
=a!ro rea Details !tion "road (e!ommendations
I S;ills In!rease out'ut of
number of s;illed staff
Fo!us • 8areness 'rogrammes at edu!ation institutions
on:
• business needs vis a vis !ourses ta;en
• ty'e of s;ills in )ig) demand for t)e ne.t 54 years
• !urrent =IV(E of s;ills needed
• attra!t more 'eo'le >es'e!ially yout) and females@
via 'romotional !am'aigns
• In!lude middle lo8er tiers of edu!ational
institutions to get !onne!ted
I S;ills En)an!e uality of
s;ills
Fo!us • "ridging 'rogrammes to involve a!ademia,
graduates and IC "usiness leaders
• Curri!ulum refres) and 'lan to do t)is regularly
• In!lusion of basi! soft s;ills !ourses as 'art of t)e
!urri!ulum
• Establis)ment of Industry Standards, !!reditation
and Et)i!s body
• S'e!iali&ed funding for IC !ourses
• artner 8it) training6IC !om'anies and ensure
training availability
I S;ills rote!t lo!al obs
stem brain drain
Consider • =e!)anism to balan!e t)e need for e.'at labor vs
s;ills transfer value
• In!entivi&e Dias'ora to reverse brain drain
• =ore atta!)ment 'rograms and interns)i's 8it)
te!)nology !om'anies to learn and a''ly
(esidential
sage
in!rease e
government servi!es
a8areness
Fo!us • 8areness 'rogrammes on servi!es !urrently
offered and follo8 u' on suggested online
government servi!es
(esidential
sage
in!rease e
government servi!es
usage
Fo!us • %everage mobile o'erators to u'date !iti&ens on
government servi!es vis S=S >subsidi&ed !ost for
government for bul; S=S@<
• De'loy relevant SSD driven servi!es for !iti&ens
(esidential
sage
IC do'tion Consider • Content soli!it feedba!; on !ontent of interest,
es'e!ially from nonusers
• a8areness on ot)er !ontent and servi!es >business
servi!es, online trade, et!@
• Content revie8 feedba!; on !ontent most used
and s)are 8it) benefi!iaries of digital !ontent funds
to ta;e a!tion6innovate6res'ond
• Close !ollaboration 8it) media to 'ursue t)einternet as a !)annel for delivery<
4/ #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
64/83
T ) B * E 3
e co++e n d at i on s
=a!ro rea Details !tion "road (e!ommendations
• ddress !osts See ma!ro item C-S belo8
• !!ess see ma!ro item INF(S(C(E and
C-S belo8
(esidential
sage
Cost of
servi!es6Devi!es
Fo!us • rioriti&ed subsidies of 'ubli! a!!ess !enters after
evaluation
• rovide infrastru!ture su''ort and servi!es
subsidies
• (eanimate lo!al assembly initiatives t)roug)
vendor and 8it) 'oliti!al 8ill
"usinesssage
egovernmentservi!es a8areness
Fo!us • 8areness !reation on e.isting !ontent andservi!es
• %everage on )ig) internet ado'tion to intera!t 8it)
businesses more via a various databases >e
-
8/9/2019 Julisha Final Report 1
65/83
T ) B * E 3
e co++e n d at i on s
=a!ro rea Details !tion "road (e!ommendations
• Collaborate 8it) CC to sensiti&e o'erators on SF
Infrastru!ture "a!;bone6"a!;)aul
remote areas
• Develo' a frame8or; under 8)i!) s !an be
started and de'art from t)e 'resent s!enario 8)ere
s are !overtly !ommer!ially oriented, ad )o!,
bereft of synergies and leveraging value<
• Consider 8ireless6satellite te!)nology elements in
national infrastru!ture 'lans for e!onomi!ally
unviable areas to mi. 8it) *iFi and ot)er
te!)nologies for last mile a!!ess
Infrastru!ture o8er • -ffer subsidies >and re8ard s!)emes@ to o'erators
8it) rene8able energy fo!us or innovation t)ataddress 'o8er issues
Cost Internet Servi!es Consider • Furt)er subsidi&e 'ubli! a!!ess areas, se!ondary
s!)ools
Cost C Costs Consider • (evive lo!al assembly initiatives >eSmart6*@
Consider • artners)i's 8it) vendors of lo8 !ost devi!es, ta'
into lo!al a''li!ation !ommunity
Sour!e: IDC
T ) B * E 0
-c t i on s b y M ac ro - re as
Intervention Ty!e Macro areas addressed
Finan!ial Infrastru!ture S;ills (esidential C)annel Cost
rivate ubli! artners)i's Infrastru!ture S;ills (esidential Cost
(egulation Infrastru!ture "usiness (esidential C)annel
8areness S;ills "usiness (esidential
Content S;ills "usiness (esidential
Curri!ulum reform S;ills
Sour!e: IDC
4$ #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
66/83
* E ) R M O R E
/ e l a t e d / e s e a r c h
H2011 IDC #undefined 47
-
8/9/2019 Julisha Final Report 1
67/83
) P P E D I 7 I 8 I T E R ) T I O ) * B E C ' M ) R K I 5
T ) B * E >
, e n c h + a r k in g
enya (S Nigeria (8anda ;raine )ili''ines Egy't =oro!!o
International Internet "and8idt) =b6se! 'er 10000 'o'ulation /
-
8/9/2019 Julisha Final Report 1
68/83
T ) B * E >
, e n c h + a r k in g
enya (S Nigeria (8anda ;raine )ili''ines Egy't =oro!!o
?overnment Su!!ess in IC romotion *EF Indi!ator /
-
8/9/2019 Julisha Final Report 1
69/83
) P P E D I 7 I I 8 K E Y P E R + O R M ) C E I D I C ) TO R S
T ) B * E ?
Ke y P e r $o r+an ce I n d i ca to r s
Des!ri'tion Indi!ator
+olume of international traffi! >=b's@ 20,20'er 100 in)abitants@ 0'er 100 in)abitants@ 0-ut of a 17 >best@ s!ale@ 2
-
8/9/2019 Julisha Final Report 1
70/83
T ) B * E ?
Ke y P e r $o r+an ce I n d i ca to r s
Des!ri'tion Indi!ator
Is enfor!ement in enya 8it) regards to intelle!tual 'ro'erty and ele!troni!
transa!tions adeuateW
4A of -rgani&ations Disagree
-rgani&ation is !omfortable 8it) transa!ting online for business 'ur'oses from t)e
'oint of vie8 of 'riva!y and data 'rote!tion
$4A of -rgani&ations gree
Number of o'erators buying !a'a!ity at t)e landing station or Number of o'erators
8it) a!!ess to t)e landing station
11 maor o'erators ot)ers
?lobal Net8or;ed (eadiness Inde. 2011 (an;ing 91 >out of 15@
ri!e of Internet !!ess for 412 b's SB 22
Fi.ed broadband Internet a!!ess tariff >B 'er mont)@ SB 5best@ s!ale@ /
-
8/9/2019 Julisha Final Report 1
71/83
T ) B * E ?
Ke y P e r $o r+an ce I n d i ca to r s
Des!ri'tion Indi!ator
?overnment Su!!ess in IC romotion /best@ 0
-
8/9/2019 Julisha Final Report 1
72/83
) P P E D I 7 I I I : P R O A E C T B ) C K 5 R O U D
*it) an aim to im'rove servi!e delivery, trans'aren!y and effi!ien!y, t)e 'roe!t
8is)es to !ondu!t a t8o ')ased survey >an initial ')ase I and a follo8u' by ')ase II,
one year later@ as 'er t)e s!o'e of t)e servi!es belo8, as 'art of t)e overall
monitoring and evaluation 'lan to:
Establis) data based information for assessing euity of IC a!!ess, 'enetration and usage
Establis) t)e baseline data for t)e =E IC indi!ators tra!;ed by t)e IC"
Identify t)e !urrent si&e of enyan IC mar;et for 200, bro;en do8n by subsegment su!) as
C6Servers6Storage6Soft8are6Servi!es6ele!om Servi!es
nderstand t)e gro8t) trends of t)e IC mar;et and t)e role of enya as a )ub of IC in t)e region
nderstand t)e role of %o!al enyan I !om'anies in t)e gro8t) of IC in t)e !ountry and ;ey !)allenges
to8ards t)eir develo'ment
Identify !riteria to !reate a ben!)mar; for t)e develo'ment of IC in enya in !om'arison to surroundingregion
nderstand t)e !urrent and 'lanned usage of various IC te!)nologies in !riti!al industry se!tors
nderstand t)e !urrent su''ly, usage and future demand of different ty'es of I s;ills by organi&ations in
enya and
naly&e t)e !urrent fulfillment strategy em'loyed by organi&ations in enya of t)eir I s;ill needs,
evaluation of t)e su''ly of I s;ills in t)e !ountry and t)ereby t)e e.'e!ted ga' in t)e !oming years<
'ro(ect )ene*ts
)e 'roe!t deliverables 8ill engender a range of benefits su''orting t)e 'rimary and
se!ondary 'roe!t obe!tives< )e maor benefits !an be summari&ed as:
H2011 IDC #undefined $5
-
8/9/2019 Julisha Final Report 1
73/83
T ) B * E - 2
P ro A e c t ,e n e ; t s
%evel "enefit
"enefits to t)e I Industry nderstanding t)e !urrent usage and 'enetration of t)e I 8it)in enya
Identifying lu!rative I industry o''ortunities for enya and develo'ing a strategy to
in!rease ado'tion of 'rogressive I te!)nologies 8it)in t)e !ountry
Contributing to develo'ment of information so!iety in s'e!ifi! and enya as a )ub for
IC in general<
"enefits for enya IC "oard nderstanding t)e !urrent state 8it) regards to IC barometers and gro8t) trends
nderstanding maor !)allenges and o''ortunities for t)ese areas
nderstanding enyaGs 'osition 8it) regards to its 'eer !ountries
?aining o8ners)i' of ;ey I to'i! areas and s'ear)eading t)e im'lementation of
initiatives in t)ese areas in !onun!tion 8it) ?overnment em'o8ered and 'rivate
se!tor asso!iations
nderstanding t)e !urrent availability of IC s;ills and t)e ga's
(einfor!ement of enya IC "oardGs t)oug)t leaders)i' and !ustodian role
"enefits for ot)er I sta;e)olders nderstanding t)e state of I 8it)in enya
nderstanding t)e ;ey !)allenges of IC in enya and analy&e )o8 to develo' enya
as t)e IC ub in t)e region
Creation of 'rogrammes >based on t)e results of t)e study done by IDC@ to augment
t)e lo!al enyan IC industry and t)e IC s;ills available<
Sour!e: IDC
'ro(ect +ow
IDC 'ro'oses a stru!tured resear!)based !onsulting engagement to address enya
IC "oardGs s'e!ifi! reuirements< s 'er IDCLs inter'retation of t)e (F, 8e
'ro'ose t)e follo8ing flo8 for t)is engagement:
Stage 1: roe!t i!; -ff
Stage 2: Creation of In!e'tion re'ort
Stage 5: Inde't) =ar;et nalysis and (esear!)
Stage /: nalysis of results and !reation of t)e final re'ort
Stage 4: IC "oard (esults *or;s)o'
Stage $: )ase I 'roe!t revie8 and )ase II finali&ation<
'ro(ect O,tp,ts
)e maor out'uts of t)e roe!t 8ill be t)e follo8ing: In!e'tion re'ort
$/ #undefined H2011 IDC
-
8/9/2019 Julisha Final Report 1
74/83
IC E!osystem re'ort
"en!)mar;ing table
I table
I s;ills re'ort
Final re'orts
Delivery 8or;s)o'
H2011 IDC #undefined $4
-
8/9/2019 Julisha Final Report 1
75/83
-
8/9/2019 Julisha Final Report 1
76/83
+ I 5 U R E / 6
M e th od o og y