FortySouth

What is a technology cluster?
It’s a geographical concentration of related enterprising technology firms growing around a nucleus of R&D facilities (research centers, universities), suppliers, customers and risk capital providers. Some well known clusters include Silicon Valley for electronics, New York for financial services, Detroit for automakers and Bangalore for outsourcing.

Why Nairobi?

The unprecedented growth of mobile subscribers in Kenya and indeed Africa as a whole is well documented. Empirical evidence in ITU’s 2008 report on ICT indicators in Africa show that:

Growth in Africa’s mobile sector has defied all predictions. Africa remains the region with the highest annual growth rate in mobile subscribers and added no less than 65 million new subscribers during 2007. At the beginning of 2008, there were over a quarter of a billion mobile subscribers on the continent. Mobile penetration has risen from just one in 50 people at the beginning of this century to almost one third of the population today.

With growth in mobile telephony outpacing internet access and fixed line penetration, applications are being developed at a faster stride for the mobile phone. A sterling example is Mobile banking. Safaricom, a technology firm, is blazing this trail with M-Pesa. Equity bank joined the foray with their mobile banking service offering Eazzy 24/7. The City is surrounded by several internet service providers and now four mobile service providers.

Computer science, IT and Engineering Students at University of Nairobi, Strathmore University and JKUAT are actively researching and developing apps for the mobile phone, as witnessed more recently with the Google East Africa Gadget competition. MIT offers the Entrepreneurial Programming and Research on Mobiles (EPROM) program that teaches mobile phone programming in 12 African universities including UoN and Kenyatta University.

Deregulation of the telecommunications sector and adoption of streamlined licensing frameworks with policy guidance from the CCK and privatization of Telkom has in many ways leveled the playing field for other service providers and has allowed competitors entry into the market. The Permanent Secretary in the Ministry of Information Dr. Bitange Ndemo and the ICT Board have been supportive of local initiatives.

Are we there yet?
Clearly, wer’re not, but we’re on the right path. Tech start-ups are now beginning to emerge with the imminent growth in internet traffic capacity, the trend will only continue to grow because of the opportunity that technology offers to all sectors of an economy.
We’ve seen this trend before in Europe and Asia where increase in internet capacity not only led to an increase in access and penetration, but also a boom in economic growth.

Indeed, G. Paul Zachary, an NYTimes columnist pondered: is Nairobi the next Palo Alto?

Consider Wilfred Mworia, a 22-year-old engineering student and freelance code writer in Nairobi, Kenya. In the four weeks leading up to Apple’s much-anticipated release of a new iPhone on July 11, Mr. Mworia created an application for the phone that shows where events in Nairobi are happening and allows people to add details about them.

Mr. Mworia’s desire to develop an application for the iPhone is not unusual: many designers around the world are writing programs for the device. But his location posed some daunting obstacles: the iPhone doesn’t work in Nairobi, and Mr. Mworia doesn’t even own one. He wrote his program on an iPhone simulator.

“Even if I don’t have an iPhone,” Mr. Mworia says defiantly, “I can still have a world market for my work.”

With all the talent to spare and an enabling regulatory environment, Nairobi really could be positioning itself as the next technology cluster for mobile applications.
Photo credit: National Research Council Canada

According to an ITU report on Telecommunication/ICT Markets and Trends in Africa, out of 1.1 billion internet users worldwide in 2006, Africa had 44 million or 3.8%. At the same point in time, while the world had 281 million broadband subscribers, Africa registered 1 million or about 0.4%.

In Asia the numbers stood at 104 million, 89 million in Europe and 80 million in the Americas. Growth in this sector has been hampered by high tarrifs and limited computer literacy.

Mobile telephony on the other hand has seen great advances in the last decade with significant year-on-year growth in penetration with subscribers per 100 inhabitants of 22.0. In 2006, Africa’s share stood at 7.2% of the 1.1 billion mobile subscribers.

The Telecommunication market in Africa is on the up-tick with a number of undersea fibre optic cable projects underway (SEACOM, TEAMS and EASSY) and increased competition among mobile service providers.

With mobile telephony currently outpacing growth in other ICT services, could the future (short-term, at least) of ICT in Africa be in wireless?