[kictanet] I have seen the future of the marine cable

Wed Dec 10 13:42:45 EAT 2008

I believe the marine cable presents a far greater opportunity than a threat.
The fact that the choice of locating servers offshore/onshore exists can
only be beneficial. 

The challenge is to focus on ensuring that the trend is inwards and to our
benefit; and entails dealing with the root causes that would make a
corporation steer clear of our shores in chosing where to locate its
servers. These include price competitiveness, investment climate, simplified
regulatory frameworks, etc, when compared with other potential destinations.

Several of these areas have seen noteworthy government/private initiatives
aimed at doing away with bureaucratic red-tape and simplification of
investment procedures as well as improved connectivity and reduction of data
transfer costs.

A critical area that has been ignored is the productivity costs of doing
business in Kenya - specifically Nairobi. Even before you factor in
unreasonably high office rental and utility costs, the direct and indirect
costs of getting workers to and from work has risen in recent years to
levels that are simply alarming.

These are the actual costs of transportation and as well as the time taken
in the commute of workers to and from work. In a pilot survey carried out by
our firm on the urban commute of professional staff based within Nairobi's
CBD we established that only 58% of staff took less than an hour in their
daily commute to work. We intend in future to look at firm's outside the
CBD. 50% of those using public transport (in a 5-day working week) spent
more than US$ 40 every month on transport. A 2006 report by Sykes - a
leading South African outsourcing operator, showed that 80% of it workers
spent less than an hour commuting to work at a cost ranging from US$ 27 to
US$ 39. With escalating domestic rental rates in the areas close to
Nairobi's CBD climbing out of reach, this problem will only get worse - fast
- and only reduce worker productivity further.

It is these factors that are undermining the tremendous gains made in
reduction of infrastructure costs and ease of investment and are more likely
the factors that led to the departure of the multinational Yawe was
referring to. 

As an illustration    

-----Original Message-----
From: kictanet-bounces+pgitau=githongo.com at lists.kictanet.or.ke
[mailto:kictanet-bounces+pgitau=githongo.com at lists.kictanet.or.ke] On Behalf
Of John Walubengo
Sent: Tuesday, December 09, 2008 12:26 PM
To: pgitau at githongo.com
Cc: KICTAnet ICT Policy Discussions
Subject: Re: [kictanet] I have seen the future of the marine cable

Yawe,

I too shiver when I think about Kenya after the marine cable lands.  I see
two additional challenges: security and digital colonization.

Security: With better and reliable telco-links into and out of E.Africa,
hackers based in developed economies would find a rich-haven to launch
attacks into and from within E.Africa where security for electronic
infrastructure (e.g. government, parastatal, banking and other websites) is
often an after thought.

Digital colonization: similar to what you described as becoming one of the
"top 10 Clerical hub" of the world (no offense Kukubo and Co ;-).  But it
could be true, the submarine cable will definately leap-frog us into the
21st Century faster than we shall be able to exploit it.  And so those who
are able, will use the cable to damp their "goods" as it were. Think of it
in terms of the proliferation of TV sets before our local capacity to
produce content matured - end result? Enough 3rd rate soap operas from
Mexico, West-africa, etc became our staple diet.

And so it will be with the cable. I am not saying the cable shouldnt come, I
just think we should have plans to ride the cable at the top rather than at
the bottom of the Internet value-chain.

walu.
--- On Tue, 12/9/08, robert yawe <robertyawe at yahoo.co.uk> wrote:

> From: robert yawe <robertyawe at yahoo.co.uk>
> Subject: [kictanet] I have seen the future of the marine cable
> To: jwalu at yahoo.com
> Cc: "KICTAnet ICT Policy Discussions" <kictanet at lists.kictanet.or.ke>
> Date: Tuesday, December 9, 2008, 11:42 AM
> Today I saw the future of Kenya after the fiber land and I
> feel duty bound to share the experience.
> 
> For many years my business has provided server solutions to
> multinationals for groupware, our main selling point for
> having servers located locally was always the unreliable
> internet links.
> 
> Today one of my clients, a multinational company has moved
> their servers to Europe and are using thin client technology
> to connect the desktop user.  
> 
> I saw a similar scenario when multinationals where allowed
> VSAT terminals, as many technical activities got
> consolidated either at head office in Europe/USA or regional
> processing centers in India.  What we were left with was
> clerical and other none core activities.  With the downturn
> in the world financial markets expect more centralised
> control of corporate activites and offshoring of currently
> local functions.
> 
> I assure the advocates of BSP and call centers that they
> will achieve their objective of turning Kenya into a
> clerical hub for the rest of the world.  Which is
> historically what Kenya's role was always meant to be
> within the British Empire.  We are soon to become a nation
> of overqualified call center operated involved in an
> activity that does not provide skills transfer.
> 
> Come January I will have lost a prime revenue earner as all
> that will
> be expected from us will be blowing the computers and
> offering 1st
> level support on productivity applications and printing
> issues.  This
> will mean that I have no need to retain high skilled
> personnel.
> 
> What use is it then for us to be setting up Universities
> all over the country yet all we shall need are large armies
> of fellows with good spoken english, maybe french or chinese
> with an average IQ and basic level of education.
> 
> Am I an alarmist? I do not think so I am a realist, I am
> reengineering to meet the challenge but can someone provide
> a condusive environment.  Ndemo can we get collocation
> centers made available, the newly redressed ISPs are not
> about to add value in this direction.  Can the government
> take the lead in outsourcing its activites, we are ready to
> setup a call centre for the Government in ISIOLO or at RIAT
> in Kisumu, I dare you to give me the challenge.
> 
> Have a god filled christmas & a proserous new year
> 
>  Robert Yawe
> KAY System Technologies Ltd
> Phoenix House, 6th Floor
> P O Box 55806 Nairobi, 00200
> Kenya
> 
> 
> Tel: +254722511225, +254202010696
> 
> 
> 
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