CIO East Africa (Nairobi)

19 February 2013

Kenya: Results of Second Julisha National ICT Survey Published

The Kenya ICT Board has launched results of the second National ICT Survey, known as Julisha II. The survey looked at various ICT indicators in 10 kenyan towns, up from 5 towns in the inaugural survey whose results were announced last year.

Conducted by IDC, the survey interviewed 750 respondents all over the country. The launch was held Tuesday morning at The Intercontinental, and was attended by Kenya's Permanent Secretary in the Ministry of Information and Communication - Bitange Ndemo, ICT Board CEO - Paul Kukubo and IDC regional manager - Francis Hook.

Key indicators show that the volume of International Internet traffic went up 162% from 20,209 Megabits per second in 2010 to 52,938 Mbps in 2011.

International Internet bandwidth per 10,000 people was 7.7 Mbps up from 4.2 Mbps in 2010. Internet subscription stood at 6,152,687 up 30 percent from 4,716,977.

The pricing of Internet largely remained constant at $22 (KSh. 2,000) for 512 Kilobits per second of connectivity through both years while that of fixed broadband went down 4.8 percent to stand at $37.90 (KSh. 3,300) down from $39.80 (KSh. 3,500).

Of 540 users surveyed on the lack of an Internet connection at home, 63 percent blamed the lack of a PC, while 35 percent said they couldn't afford an Internet subscription. 33 percent saw no need of a home Internet connection while 23 percent cited lack of infrastructure in the neighbourhood. 11 percent said they did not know how to use the Internet.

Computers per 100 inhabitants are up 14% to 2.7 from 2.4 computers in 2010. 8 percent of households had computers up from 6 percent.

Total fixed lines went down 26 percent to stand at 283,546 from 380,748.

The number of .co.ke domains went up 35% over the year to 24,322 from 18,000.

When it came to use of egovernment services, one of the three key pillars in the National ICT Master Plan 2017 (http://www.cio.co.ke/news/main-stories/kenya-launches-national-ict-master-plan-2017,-aims-to-connect-all ), 34 percent of respondents were not aware of any such services, down from 47 percent of respondents in the Julisha I survey. Those aware of such services but who still hadn't used them or any other online service stood at 36 percent. Respondents aware of such services but who hadn't used them but used other online services stood at 16 percent. Those aware and who had used egovernmnet services over the two years stood constant at 14 percent.

Respondents listed some of the government services they would like to access online as registration of National IDs at 12 percent, online admission into secondary schools and public universities at 9 percent, job application, voting and payment of land rates among others.

The Business Process Outsourcing sector, provided 13,100 jobs up 4.8 percent from 12,500 jobs in 2010. The number of BPO seats stood at 5,696 up 13.9 percent from 5,000. At the time of establishment of the Kenya ICT Board in 2007, the country was marketing itself as a BPO destination and the board was tasked with the mandate to market and help the country achieve top status in the BPO industry. The Board had set a target of 15,000 BPO jobs by 2012. So far, the country fails to rank among the top 50 outsourcing destinations, where Egypt, Ghana and Senegal are ranked above the country (http://www.cio.co.ke/news/main-stories/kenya-not-among-top-50-outsourcing-destinations ).

In the education sector, 65 institutions were now connected to the Kenya Education Network (KENET) up from 60 with number of connected campuses at 78 from 74. 29 of these universities have a broadband connection up from 15. This saw 250,000 students now connected from 176,000 students, though number of PCs per 100 students dropped to 5 from 6.

IT spending per person went up 32.1 percent to stand at $24.4(KSh. 2,100) from $18.5(KSh. 1,600). IDC expects ICT market spending to grow at a compound annual growth rate of 9.1 percent between 2011 and 2016, which will see spend go from just above $ 1000 million (Ksh. 87.35 billion) to $ 1,596 million (KSh. 139 billion) in 2016. Hardware spend which currently contributes to 81 percent of overall IT spending will reduce to 76 percent while Services will go up from 10 percent to 16 percent and software up from 7.8 percent to 9.2 percent.

Consumers account for the largest IT spending by sector, at 28.4 percent, followed by the communications sector (media and telecommunication firms) which account for 24 percent. Government accounts for 8 per cent, banking 7.9 percent while process manufacturing 6.3 percent.

The country has between 20 to 30 vendors (with direct links to multinationals) and an equivalent number of resellers. Tier 1 value added resellers - firms dealing with enterprises and less with small and medium enterprises number between 30 and 40, while Tier 2 value added resellers who deal mainly with SMEs number between 80 and 120.

The survey revealed that of the local firms that had invested in neighbouring countries, 24 percent had invested in Uganda, 20 percent in the larger Tanzanian market and 14 percent in the equally large Ethiopian market. 16 percent had established in Rwanda, 6 percent in South Sudan and 4 percent in Burundi.

Challenges faced by businesses included limited and expensive financing, long sales cycles especially with government, inconsistent importation regulation and tariffs, lack of enough skilled people and theft and piracy.

The report also benchmarks Kenya against seven other countries including South Africa, Nigeria, Rwanda, Ukraine, Philippines, Egypt and Morocco. Kenya beats South Africa and Rwanda in Internet usage and is closely behind Egypt. Ndemo says when he was appointed as permanent secretary in 2006, his goal was to beat the two countries which were being mentioned as ICT power houses on the continent.

In a comparison of broadband tariffs, Kenya is only cheaper than Rwanda, and Nigeria which has the highest tariffs of the seven. The National ICT Master Plan 2017 has a pillar that focuses on ensuring all Kenyans are on the Internet by 2017. A consortium of private telecom players is currently working on establishing a shared 4G LTE network for which the government will provide spectrum. Kenya is also trialing the use of white spaces for broadband. The two moves are expected to bring down the cost of connectivity in the country while increasing the number of people having access to broadband.

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