[kictanet] CCK: Internet Tariffs Affordability

[Alex Gakuru]

Dear Kai,

Where is this price coming from? 1M duplex 1 : 1 starts from 245 000 KSH

I believe the two Professors and one Engineer must have cross-checked these "supply-side" figures before publishing this report, but I am inclined to believe it is an industry-wide IGBOs pricing averages not just KDN's figures.

What about if we can produce 95% or more of our content in Kenya?

The gist of my argument is not content, no, it is the fact that ISPs run a 540% mark-up business according to this data (i.e. purchase 1 MB for shs 403,032.00 and sell it at shs 364, 317.00 to 6 end users at a whooping Shs 2,185 902/=). 

Many (SMEs) businesses and individuals served by these ISPs (according to me) have 30-40% markups. Most of the new outsourcing enthusiasts negative? 

Even with voice communication where content is literally 100% local, telcos make huge returns. This big problem is spread across communication sector and I would say we are now keenly following the regulator's intervention after this revelation.
 
 
 In Europe the ratio between internal and external bandwidth is 250 000 : 1 !
    
 In explaining the glaring disaprity between cost of these electronic goods and the selling price, ISPs may be inclined to accuse infrastructure providing companies in justify part of their other costs elements, though as far as I know, infrastructure bills to consumers are separate from bandwidth costs on the invoices. May be ISPs should explain.

I strongly believe rural connectivity can be achieved, as for us, we charge the same LL charges irrespective where you are!  
 
 Please note: At ICAK we are not opposed to companies making profits, but reasonably fair return on investment for quality (and after sales) services rendered, and affordable internet and communication to every one of 33 million Kenyans everywhere, urban-undeserved included.
 
Alex

"Kai U. Wulff" <kai.wulff at kdn.co.ke> wrote:        v\:* {behavior:url(#default#VML);} o\:* {behavior:url(#default#VML);} w\:* {behavior:url(#default#VML);} .shape {behavior:url(#default#VML);}                     Where is this price coming from? 1M duplex 1 : 1 starts from 245 000 KSH
   
      
---------------------------------
  
  From: kictanet-bounces+kai.wulff=kdn.co.ke at kictanet.or.ke [mailto:kictanet-bounces+kai.wulff=kdn.co.ke at kictanet.or.ke] On Behalf Of Alex Gakuru
 Sent: Monday, April 09, 2007 11:58
 To: kai.wulff at kdn.co.ke
 Subject: [kictanet] CCK: Internet Tariffs Affordability
  
   
  "Although the average price of 1 Mbps leased line bandwidth of Ksh 364,317 to the customers appears to be lower than the Ksh 403,032 that ISPs pay to the IBGO’s, data shows that for every 1 Mb/s purchased from the IBGO, the ISPs connect about 6 customers using 1 Mb/s links. That is, there is a ratio of at least 1 to 6 between bandwidth purchased and bandwidth sold." <http://www.cck.go.ke/internet_tariffs_affordability/>
 
 At these figures, rural internet cannot "make a business case" therefore there exists a serious need to re-think rural connectivity.
 
 Alex
    
    
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