Kinoti's Blog

I have been reading and following up with a lot of interest about the coming of Broadband to East Africa and more specifically to Kenya and have wondered to myself if Kenyans are really ready for this major initiative that will impact their lives or it is just a lot of brouhaha that will ultimately amount to nothing of significance to the general populace of Kenya.  I lean towards the latter but we need to have better information which to is not synced at the moment.

Broadband internet connectivity is coming to the East African region which has a population of 120 million.  In less than 10 years 30 percent of this population has changed their communication and media consumption due to mobile technology.  The first wave of communication revolution in the region can be attributed to the mobile industry in Africa. The next phase is the laying of fiber optic to provide broadband to the people of this region.  It is hoped with greater access to digital technology by way of mobile devices and access to cheaper bandwidth the way information is consumed is going to follow patterns currently being seen in the more developed countries.

There are three major initiatives to open up the region The 3 major initiatives are 1. EASSY (East Africa Submarine Cable System) 2. TEAMS (The East African Marine System) and 3. SEACOM.  These 3 initiatives are investing a total of about 1 billion US dollars to lay the cable infrastructure. that will bring cheaper bandwidth by end of June 2009. This obviously portends that there will be a plethora of opportunities and the most obvious is eCommerce will become a reality. Companies will need to know how to engage in eCommerce in a new and fast changing environment.

This whole process could not have been possible without an enabling environment and with that I mean without the support of the regional governments.  This project in my opinion has fallen under the Ministry of Information and Communication and Technology in Kenya. There are various stakeholders under this aegis but at the end of the day the buck stops with the governments for spearheading this initiative.

The advantages are many for having broadband access.  The most significant is that that there will be cheaper bandwidth and this will help in increasing internet penetration.  It is hoped that with cheaper bandwidth and faster communication commerce in the region will be taken to new heights.  The region is also full of young and vibrant population who will be eager to embrace the new technologies available.

The disadvantages are also many in that for the average East African the fuss of getting faster internet access may not alter their day to day lives especially for the majority who are illiterate and having broadband speeds has nothing to do with putting a meal on their table.  Then there is the issue of power outages this is something that is perennial in the region to be connected you have to have constant supply of power.  With constant interruptions of power supplies how will people be able to function in a true eCommerce environment where online access is suppose to operate in a 24/7/365 time period.

However my biggest achilles heel has to be with the communication of when broadband is going to arrive in the region.  I have read many contradictory reports where the media has reported that we are ready to launch broadband however there have been other reports where the leaders in the sector have come out clearly and said the region is not ready for broadband.  For more information you can reference http://bit.ly/iQZo5  My take on this whole miscommunication has to do with a culture of poor communication the governments of the day for one reason or the other lack a clear cut communication strategy on the progress of the launch.  We are completely reliant on different media sources but I feel a huge initiative such as this should be communicated clearly and succinctly so that interested stakeholders can make informed decisions on future investments.  In a digital world we don’t have to be physically present to make informed decisions. Another issue that comes up is lack of factual information on the terrestrial cabling.  We know for sure undersea cable has landed in Mombasa (coastal town of Kenya) but what is the status of the terrestrial cabling? Do we have real data or information to support that it is complete and it will be smooth sailing come end of June.  We wait with bated breath.

The opportunities that lie ahead are enormous.  Access to broadband has the capability of boosting the region into an economic hub in the region.  If harnessed well the region can progress economically and as we know with the free flow of information the masses can make informed decision that will alleviate their current economic and political situation.

The threat in the new environment to me is the controls placed by the government the recently enacted communications bill in my opinion does not auger well for an enabling eCommerce environment. Other external threat obviously is security. In nations where broadband is available the biggest threat to eCommerce are cyber crimes such as phishing and pharming scams where internet users can be vulnerable to internet hackers and sleuths.  There is also the threat of cyber terrorism in the recent past the internet has been used to coordinate and execute some of the most heinous terrorist activities.  When this is all set and done do the stakeholders in the region have experts who can advise and deal with these threats or is there going to be a wait and see approach.  My suggestion is that the time to make a move is now.

My humble assessment and recommendation for the region are the governments in the region should come up with a comprehensive business plan.  In the plan there should be a clear time table on the many project required.  The region should also tap the wealth of talent available there are many East Africans living in the diaspora who have a clear understanding of what the region is going to go through.  However there is no clear strategy on tapping this valuable talent.  The US government recently tendered consultancy services to go study the impact of having faster broadband in the East African region.  The goal is for the consultants to go in make assessments and then come back with a comprehensive report that will be fed to the private sector on what is needed in terms of products and services.  Surely the regional governments can be better coordinated and ensure we are not economically colonized it is a real threat that if we don’t get our act together the region shall be overran by international companies and the real benefits will not trickle down to the local citizen.  Once the plan has been put in place the next step is to value the cost of doing business.  This is obviously a heavy investment as pointed out earlier this is an investment of almost 1 billion dollars.  In modern day commerce we must realize the Return On Investment  (ROI).  With an investment of almost 1 billion dollars what is the ROI? What targets have we set to achieve and what is the time-line for achieving those targets?  Do we have professionals who can be deployed so that that this huge investment will not go to waste and end up like other white elephant projects in the region.
 
It is crucial that once broadband is implemented we have metrics to measure the success of this humongous project.  With metrics we can be able to control the huge projects outlined so there is a laser focus and a lack of wastage of resources. However with a disjointed approach there are bound to be threats in terms of shady deals associated with the culture of corruption and impunity.  This could ultimately lead to the sabotage of the whole broadband initiative.   In conclusion I remain hopeful that after the launch of the mobile telephony the launch of broadband in the region will usher in the second communication revolution in the region.  If managed well the region will prosper if not it will be another missed opportunity for the East African region.

I am trying to gauge the level of new media usage in sales and marketing in East Africa and would appreciate if organizations based in East Africa could fill out this short survey and/or forward it to those decision makers or influencers who manage their sales and marketing function in their respective organization.

Survey Link:

http://bit.ly/rrnkP

For any questions e-mail: info@kinconsult.com

Thanks in advance!

Let me be categorical that I harbor ambtions to set up shop in East Africa however it is not a great time in Kenya.  The leadership in our country has completely failed us.  The media bill that was recently passed by the members of the parliament and the signing into law of the bill by Mwai Kibaki is such a backward and outdated way of thinking that I am at a loss and pained that we have gone back to the draconian days of the one party system under Moi.  The coalition goverment to me is not delivering anything a bloated cabinet of 40 ministers has delivered little to the people of Kenya. All we hear is empty rhetoric and no deliverables. It must be so frustrating to be a citizen in Kenya.

I just read another article that has left me to conclude those in leadership positions in Kenya do not want Kenya to progress we have a few people who have personal interest at heart and they have failed to put country first. I personally went to Kenya to offer concrete solutions on how to market and stimulate tourism through new media and guess what the same officials that I reached out to are now embroiled in corruption scandals.  It is no wonder that Kenyans in the diaspora are discouraged to go back and give back to their country. It is indeed sad my hope lies in that new president of USA Barrack Obama will be tough on Kenya in that the leaders must toe the line and end this vicious cycle of corruption and nepotism.  We have solutions to offer unfortunatley with geriatrics in power there is such little motivation but we shall press on the winds of change are blowing.

I have attached the full article that has really disappointed me:

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Tourism officials in Sh64 million scandal


By Standard Team

Dated 01/08/09

A tour company used President Kibaki’s trip to the Masai Mara last August to defraud taxpayers of millions of shillings.

The one-day trip to the tourist resort to promote tourism following post-election slump cost taxpayers Sh20 million although all the President did was have lunch, and fly back to Nairobi.

But Presidential Press Service Director Isaiah Kabira said: "Presidential trips are never funded by parastatals. The President visited (Masai) Mara for a few hours and flew back to Nairobi without spending even a night."

 
 
He went on: "Let nobody drag the President’s name into their mess. They must account for their deeds and carry their own cross."

Another trip to the Mara for permanent secretaries in October 2007 cost taxpayers Sh8.9 million, paid to a tour company associated with a Kenya Tourist Board (KTB) member.

Incidentally, the trip was funded by Kenya Association of Tour Operators (KATO) to the tune of Sh800,000.

Months earlier, KTB paid Sh35 million to a single-sourced company for outdoor advertising although Government auditors could not find evidence of any work undertaken.

As a consequence, the Treasury has suspended Sh12 billion-rescue package to revamp tourism, which has been on the decline since December 27, 2007 when post-election violence erupted and more than 1,500 people were killed.

A Sh1 billion marketing campaign had been instituted by KTB to counter bad press that saw tourist arrivals dwindle, and which could now form the basis of further investigation.

This morning, the KTB board sits to decide on the fate Managing Director Ong’ong’a Achieng, who was interdicted last month to pave the way for investigation.

Some of the claims relate to Sh35 million payment to Prime Outdoor Network in January and March last year, which was contracted without competitive bidding, contrary to the Public Procurement and Disposal Act. Direct payments were also made to Maniago Safaris by the Catering and Tourism Development Levy Trustees on the instructions of KTB without going through the approved channels, according to a letter from KTB Chairman Jake Grieves-Cook.

Irregular payments

According to correspondence The Standard has obtained, Achieng was interdicted on December 1, last year, and given two weeks to explain the irregular payments, some of which were raised by the ministry’s National Audit Office and the Efficiency Monitoring Office.

Achieng responded on December 9 in a letter to Grieves-Cook and copied to Tourism Minister Najib Balala and Permanent Secretary Rebecca Nabutola.

Achieng explained that he selected Prime Outdoor, among other reasons, because certain provisions in the Public Procurement and Disposal Act allowed for that.

The exemptions are: "If only one person can supply the goods, no reasonable alternative exists or there is an urgency for goods or services, as long as the purpose is not to avoid competition."

Achieng further wrote: "It cannot be gainsaid that the circumstances of January 2008 fit all the four sections." He defended the trip as "very beneficial to the industry" although no explanation was offered for double payment as KATO had paid Sh800,000 for the same trip.

The Efficiency Monitoring Unit (EMU), the Inspector General Corporations and Tourism ministry’s external auditors uncovered the fraud, while KTB held a meeting on December 10 to review the charges.

The meeting was chaired by Grieves-Cook and attended by nine KTB directors and representatives from the Treasury, Office of the President and Inspector of State Corporations, among others.

Conflict of interest

At the meeting, it was concluded that the services and payments in question "did not go through the approved procedures", that there was undeclared conflict of interest by a board member and that "Prime Outdoor had not carried out any form of advertisement on behalf of KTB for which it had been paid Sh35 million".

Maniago declined to comment yesterday, while Achieng’s phone went unanswered. He had declined to comment when contacted by The Standard on the telephone, saying he would make himself available for an interview. He did not.

Prime Outdoor representatives also declined to comment.

Neither the Tourism minister nor the PS or KTB chairman could be reached for comment.

Kenya Anti-Corruption Commission Public Relations Manager Nicholas Simani said they had not received any complaints from KTB.

Prime Outdoor is listed at the Registrar of Companies as having been formed on December 22, 2000, with Ignatius Obonyo Odhiambo and Francis Raudo as directors.

Maniago Safaris’ file could not be traced at the Registrar of Companies but its website indicates that it was incorporated in 1998 after a buyout of Abercrombie & Kent. Its managing director is Mr Duncan Muriuki, who also sits on KTB board.