[kictanet] Day 5 - Statistics on Affordability- CCKInternetStudyReport
Eric Osiakwan
eric at afrispa.org
Fri May 11 09:37:07 EAT 2007
Kai, i dont want to belittle the business element but really it is a
chicken and egg situation, do u reduce drastically down and get more
users or ascertain more users to reduce drastically.
If there is empirical evidence of much much more traffic then i think
KDN would obvious reduce the price to take advantage of volume.
Not knowing what is on the ground i think this particular case
becomes a business and or government excercise so it would be good if
we can take this off a public forum and then get the parties working
out the mechanics.
Eric here
On 11 May 2007, at 09:47, Kai Wulff wrote:
> As mentioned, the price on fiber is a function of usage. The
> current prices
> we charge are substantially lower than anything that was there
> before and
> are moving downwards. If we had more users (maybe even the
> Government using
> it), we could reduce further ..
>
>
> ----- Original Message -----
> From: <bitange at jambo.co.ke>
> To: <kai.wulff at kdn.co.ke>
> Sent: Friday, May 11, 2007 09:08
> Subject: Re: [kictanet] Day 5 - Statistics on Affordability-
> CCKInternetStudyReport
>
>
> Florence,
> AfDB is locked into EASSy and has left other DFIs to finance
> Terrestrial
> networks. You are very right on the Government's involvement.
> This is
> the model that was followed by Sweden and as Alice noted,
> Malaysia. To be
> honest the private sector in ICT sector has not lived up to the
> expectations. Check Mombasa Nairobi Fibre link where the prices
> are still
> over the roof yet there are two players there. Does anyone need
> reason
> why we need to have more players running on the Government built
> network?
> Our private sector must embrace low prices but high volume
> concept. Think
> of the idle capacity that lay on the route yet there is business.
>
>
> Regards
>
>
>
> Bitange Ndemo.
>
>
>
>
>> Looks like we are looking to issues around the last mile for which
>> a whole
>> mesh of possibilities, actors and services must be considered,
>> planned for
>> and provided. If monopolies continue, forget lower prices and
>> affordability!
>> The governemnt is right in looking to provide the super highway
>> and so it
>> ought. And in doing so it is in its purview to take any loans from
>> any
>> development banks that it can get and at reasonably low interest
>> rates. My
>> only concern is that the AfDB is nowhere in sight or is it? With
>> such high
>> ROI on th continent from ICT investments as I am told where is the
>> AfDB
>> playing? Some one pls tell me or indeed the national dev banks?
>> Are they
>> any to speak of?
>>
>> O just for news; the Nigerian ICT community is celebrating the
>> hand over
>> of managemnt of the top level domain name .ng to nigerians!
>>
>> Cheers from hot and humid Lagos,
>> FE
>>
>>
>> ----- Original Message ----
>> From: alice <alice at apc.org>
>> To: feanywhere at yahoo.co.uk
>> Sent: Monday, 7 May, 2007 11:08:31 AM
>> Subject: Re: [kictanet] Day 5 - Statistics on Affordability-
>> CCKInternetStudyReport
>>
>>
>> Dear all
>>
>> Talking about government's engagement in infrastructure
>> development, the
>> Malaysian government, for example was one of the first to attempt to
>> replicate the Silicon Valley model in a developing country. "In its
>> attempt to move the ICT sector to attract domestic and foreign
>> private
>> investment, the Malaysian government invested in creating a world
>> class
>> physical and information infrastructure. Called the Multimedia Super
>> Corridor, this USD 40 billion initiative now serves as the
>> backbone for
>> the country's information superhighway. The network is supported by a
>> high-speed link, which connects to Japan, ASEAN, the US and
>> Europe. The
>> network is also capable of supporting extensive public, education and
>> business applications". Beyond infrastructure, the Malaysian
>> government
>> provides attractive tax incentives for world-class technology-led
>> companies to participate in the MSC initiative. And most
>> importantly, it
>> launched actions to provide a well-educated work force with relevant
>> skill levels ranging from technical to research.
>>
>> I see nothing wrong with the Kenya government investing in
>> infrastructure for public good, while private sector supporting this
>> venture by perhaps focusing on the infrastructure as well, technology
>> aspect, content, applications, skills, civil society assisting by
>> ensuring there is demand at the local/rural level, etc
>>
>> The idea here being partnerships. We do seriously need to consider
>> strategies for partnerships, which would involve leveraging the
>> creative
>> potential of the different actors, allowing them to work on the
>> basis of
>> both established as well as new roles and responsibilities. That
>> implies
>> sharing of resources and responsibilities (sharing not shifting
>> risks).
>> For this to happen there is need to ensure that there is sufficient
>> mutual respect and trust between partners to enable them to work
>> together.
>>
>> (The above comments are is entirely personal and do not reflect any
>> position of the organisations I am affiliated with)
>> alice
>>
>>
>>
>>
>>
>> Kai U. Wulff wrote:
>>> Well,
>>>
>>> If you tender the capacity you require in Garissa, we will quote
>>> a price
>>> and
>>> commit a deployment of fiber.
>>>
>>> Kai
>>>
>>> -----Original Message-----
>>> 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
>>> bitange at jambo.co.ke
>>> Sent: Monday, May 07, 2007 18:10
>>> To: kai.wulff at kdn.co.ke
>>> Subject: Re: [kictanet] Day 5 - Statistics on Affordability-
>>> CCKInternetStudyReport
>>>
>>> Dear All,
>>> Please do not be misled. The Government will never compete with
>>> anybody.
>>> All that is being done is to develop a platform where big and
>>> small can
>>> reasonably compete. I think Kai is confusing Telkom projects and
>>> Government infrastructure projects. If the private sector indeed
>>> wanted
>>> to do infrastructure projects they will have done so but most
>>> private
>>> sector have to have a business case first. I wonder why Kai did
>>> not do
>>> the Garisa route first before heading to Uganda. Please
>>> understand that
>>> Government has the obligation to provide infrastructure.
>>>
>>>
>>> Regards
>>>
>>>
>>> Bitange Ndemo.
>>>
>>>
>>>
>>>
>>>
>>>
>>>> My point is:
>>>>
>>>> Yu have limited room for infrastructure since the cost is
>>>> constant and
>>>> only
>>>> increased usage can drop the price. The Government should NOT be a
>>>> competitor but a price sensitive user!
>>>>
>>>> You will have enough people now competing for the business of the
>>>> Government
>>>> and the private users .. That forces prices down. Having a state
>>>> owned
>>>> cable
>>>> or a state owned Telkom is in my opinion not the way forward.
>>>>
>>>> Rgds
>>>>
>>>> Kai
>>>>
>>>>
>>>> -----Original Message-----
>>>> 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
>>>> Wainaina Mungai
>>>> Sent: Saturday, May 05, 2007 10:35
>>>> To: kai.wulff at kdn.co.ke
>>>> Subject: Re: [kictanet] Day 5 - Statistics on Affordability-
>>>> CCKInternetStudyReport
>>>>
>>>> Kai said;
>>>>
>>>>> The problem is when you create the demand and then some World Bank
>>>>> money
>>>>> starts to compete before you can recover the cost..
>>>>> ...The private sector needs the Government as a user there as
>>>>> well as
>>>>> the
>>>>> private companies and consumers. [Only then will the prices drop!]
>>>>>
>>>> Pricing
>>>> I would like to assume that competition from government is as
>>>> good as
>>>> competition from other market players. The beauty of competition
>>>> is in
>>>> the
>>>> way it forces the private sector to put a smile on the face of
>>>> every
>>>> consumer ;-) so as to guarantee revenue. I am convinced that a
>>>> significant
>>>> drop in prices results only from fierce competition and some
>>>> degree of
>>>> regulation. TESPOK and others fought for years to introduce
>>>> competition
>>>> which resulted in the current lower prices of internet and
>>>> telephony
>>>> services.
>>>>
>>>>
>>>> The recent intervention of CCK on the pricing of mobile services
>>>> is a
>>>> case
>>>> that proves that price controls may become necessary to protect
>>>> consumers.
>>>> For internet services, we need many 'small scale' providers whose
>>>> products
>>>> and pricing would be more market-driven and responsive to
>>>> fluctuations
>>>> in
>>>> consumer needs.
>>>>
>>>> For instance, an internet user paying KShs. 6,000 per month for
>>>> DSL per
>>>> month is actually incurring 14 cents per minute for a 30-day month.
>>>> This
>>>> is
>>>> a great deal for any 24 hour user who may even make money
>>>> through such
>>>> access to the internet. The same user would be said to incur 28
>>>> cents
>>>> per
>>>> minute if s/he were to use the link for an average 12 hours per
>>>> day at
>>>> the
>>>> same monthly rate. There may be a catch here but there is a high
>>>> probability
>>>> that more businesses can survive on such low rates and pass such
>>>> rates
>>>> down
>>>> to rural consumer.
>>>>
>>>>
>>>>
>>>> ---
>>>> Wainaina Mungai
>>>> http://www.madeinkenya.org
>>>>
>>>> SUSTAINABLE DEVELOPMENT is development that meets the needs of the
>>>> present
>>>> without compromising the ability of future generations to meet
>>>> their
>>>> own
>>>> needs.
>>>>
>>>>
>>>>
>>>>> 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
>>>>> Rebecca Wanjiku
>>>>> SENT: Friday, May 04, 2007 10:23
>>>>> TO: kai.wulff at kdn.co.ke
>>>>> SUBJECT: [kictanet] Day 5 - Statistics on Affordability -
>>>>> CCKInternetStudyReport
>>>>>
>>>>>
>>>>> thanks Kai for the response,
>>>>> we need many people responding to this issue,
>>>>>
>>>>> in my opinion, the government should find a way of using the
>>>>> WB money
>>>>> through the private sector, so that the private sector does
>>>>> not see
>>>>> as
>>>>> if
>>>>> the government is competing and killing the profit margin,
>>>>>
>>>>> in this regard, the government could come up with some MOU
>>>>> with the
>>>>> private sector so that some of the money invested is
>>>>> government's and
>>>>>
>>>> some
>>>>
>>>>> PS.
>>>>> that way, part of the profits will be ploughed back (it will be
>>>>> mandatory)
>>>>>
>>>>> i remember during the OFC workshop, Kai shared how IFC funded a
>>>>> private
>>>>> secotor consortium to carry out some survey at USD 300k and a
>>>>> similar
>>>>> survey carried out by govts was valued at USD 3m
>>>>>
>>>>> maybe this can help reduce costs and provide a way for govt
>>>>> and PS to
>>>>> work together and deliver quality market services, develop the
>>>>> content
>>>>>
>>>> and
>>>>
>>>>> all..
>>>>>
>>>>> its just an opinion, its not absolute,
>>>>>
>>>>> lets hear as many voices as possible,
>>>>> it is at these forums/discussions that great ideas come up,
>>>>>
>>>>> regards
>>>>>
>>>>> _KAI WULFF <KAI.WULFF at KDN.CO.KE>_ wrote:
>>>>>
>>>>> Hello,
>>>>>
>>>>> we leave it to the ISPs to create the demand. We were hoping that
>>>>> with
>>>>> our
>>>>> rural initiatives, like connecting schools and showing them
>>>>> how to
>>>>> educate
>>>>> the parents (and make money with this) will increase the
>>>>> demand on a
>>>>> natural
>>>>> way.
>>>>>
>>>>> What we have seen wit some Rural BTS, it takes about 12 month
>>>>> until
>>>>> it
>>>>> is
>>>>>
>>>>> break even ...
>>>>>
>>>>> The problem is when you create the demand and then some World
>>>>> Bank
>>>>> money
>>>>> starts to compete before you can recover the cost. It is my
>>>>> strong
>>>>> believe
>>>>> that wherever a device can be operated, there WILL be a
>>>>> market. The
>>>>> private
>>>>> sector needs the Government as a user there as well as the
>>>>> private
>>>>> companies
>>>>> and consumers. Only then will the prices drop! We still focus too
>>>>> much
>>>>> on
>>>>>
>>>>> the INTERNET, what most people need for a start is LOCAL
>>>>> information
>>>>> and
>>>>> communication .. so I would say: 90% local IP traffic and 10%
>>>>> international
>>>>> ..
>>>>>
>>>>> Kai
>>>>>
>>>>>
>>>>> ----- Original Message -----
>>>>> From: "Joan Walumbe"
>>>>> To:
>>>>> Sent: Thursday, May 03, 2007 10:26
>>>>> Subject: Re: [kictanet] Day 5 - Statistics on Affordability -
>>>>> CCKInternetStudy Report
>>>>>
>>>>>
>>>>>> Walu,
>>>>>>
>>>>>> I agree with you that affordablity is a factor especially for
>>>>>> rural
>>>>>> communities when it comes to access to the internet. But I think
>>>>> that
>>>>> lack
>>>>>> of awareness is an even bigger factor. It's fine for the urban
>>>>>> folk
>>>>> (who
>>>>>> already recognise the benefits to the internet etc.) taking a
>>>>>> short
>>>>> break
>>>>>> in
>>>>>> shags to have the internet access when back home, but it there is
>>>>> no
>>>>>> demand
>>>>>> for the internet among the residents what is the point?
>>>>>>
>>>>>> So does KDN enter a market and then hope to create demand or is
>>>>> their
>>>>> a
>>>>>> market that demands the service or is it a little of both?
>>>>>>
>>>>>> I understand that Kai would not be venturing into the rural areas
>>>>> if
>>>>> it
>>>>>
>>>>>> did
>>>>>> not make any financial sense. Can anyone provide some
>>>>> info/statistics
>>>>> on
>>>>>> demand for internet access in rural areas?
>>>>>>
>>>>>> Joan Walumbe
>>>>>>
>>>>>> ----- Original Message -----
>>>>>> From: "John Walubengo"
>>>>>> To:
>>>>>> Sent: Thursday, May 03, 2007 9:01 AM
>>>>>> Subject: [kictanet] Day 5 - Statistics on Affordability - CCK
>>>>>> InternetStudy
>>>>>> Report
>>>>>>
>>>>>>
>>>>>> Day 5- Statistics on Affordability.
>>>>>>
>>>>>> I acknowledge an interesting thread filtering in on Trust
>>>>> relationships
>>>>>
>>>>>> b/w
>>>>>> IGOs/ISPs...feel free to continue contributing on that as well as
>>>>> on
>>>>>> today's theme on affordability (multi-tasking
>>>>>> encouraged by internet technologies ...)
>>>>>>
>>>>>> and just to pick up from Kai's projection of KDN fiber hitting
>>>>> Bungoma
>>>>> in
>>>>>> early August 2007. This would be quite a welcome and timely
>>>>> development,
>>>>>> but at what cost to the consumer? To what extend will the
>>>>> (internet)
>>>>>> services be affordable to the rural/average communities?
>>>>>>
>>>>>> Affordability is a subjective term gven that what is considered
>>>>> cheap
>>>>> by
>>>>>> the
>>>>>> Bill Gates of this world is probably not so for the average
>>>>>> Kenyan
>>>>> on
>>>>> the
>>>>>> street. In trying to get an objective measurement for
>>>>> affordability,
>>>>> the
>>>>>> Report pegged it on the national average incomes. In other words,
>>>>> if
>>>>> the
>>>>>> monthly average income in Kenya is around 100USD and if the
>>>>>> average
>>>>>> monthly
>>>>>> cost for internet access is also around 100USD then obviously the
>>>>> average
>>>>>> Kenyan will not bother with accessing the Internet - it just
>>>>> becomes
>>>>> way
>>>>>> beyond their means or too expensive or not affordable.
>>>>>>
>>>>>> The report indicated that access through the more convenient
>>>>> Internet
>>>>>> Dial-up/Desktop services costed over 200% the average incomes
>>>>>> (too
>>>>>> expensive), while the same access through mobile phones was
>>>>>> costing
>>>>> just
>>>>>> 8%
>>>>>> of the average incomes (quite affordable). What needs to be
>>>>>> done in
>>>>>> order
>>>>>> to make Internet Services more afforable to Kenyans?
>>>>>>
>>>>>> 1 day deliberation on this one.
>>>>>>
>>>>>> walu.
>>>>>>
>>>>>>
>>>>>>
>>>>>>
>>>>>>
>>>>>> _______________________________________________
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>>>>>
>>>>>
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>>>
>>>>> Rebecca Wanjiku,
>>>>> journalist,
>>>>> p.o box 33515,
>>>>> Nairobi.00600
>>>>> Kenya.
>>>>>
>>>>> Tel. 254 720 318 925
>>>>>
>>>>> blog:http://beckyit.blogspot.com/
>>>>>
>>>>>
>>>>> --------------------
>>>>>
>>>>>
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>>>>> Check out [LINK:
>>>>>
>>>>>
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>>> new_cars.html;_ylc=X
>>>
>>>> 3oDMTE1YW1jcXJ2BF9TAzk3MTA3MDc2BHNlYwNtYWlsdGFncwRzbGsDbmV3LWNhcnM-
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>>>>
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Eric M.K Osiakwan
Executive Secretary
AfrISPA (www.afrispa.org)
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