Broadband spurs new businesses and ideas in Kenya

When Kenyan graduate Roy Wachira, 25, set out to start his first business, he turned to the Internet, whose growth in the east African nation is spawning opportunities unthinkable even a year ago.

Mr Wachira runs a free social photography site that allows users to view special occasions or travel photos online and provides firms such as telecoms operator Safaricom with a channel to reach their targeted consumers.

The site is one of many innovations in east Africa’s biggest economy spurred by faster Internet speeds through three fibre-optic cables which link Kenya with the rest of the world.

Since the arrival of the TEAMs and SEACOM cables last year and a third one called EASSy last March, costs have fallen to as low as $22 per megabyte from $4,000 previously.

Usage has jumped to 15 gigabytes from 1.8 gigabytes eight months ago.

“It is a good time to break into online in Kenya, there is a surge in usage of Internet here,” says Mr Wachira.

Mobile data users quintupled to 1.98 million last year from 398,190 in 2008 and telecoms firms are hoping data services will drive growth as average revenues per user from mobile phone calls fall.

Sanjay Sikka, the chief executive officer of Horizon, an $8-million call centre in, Nairobi, shares Mr Wachira’s optimism.

He says Horizon was set up to take advantage of Kenya’s ambition of going head-to-head with established business process outsourcing (BPO) players such as India and Philippines.

“With the fibre optics coming, that makes everything work,” Mr Sikka said in a plush building with the capacity to house 1,200 agents fielding calls and e-mails around the clock.

Horizon’s clients include a Kenya telecoms operator and a large British-based firm, says Mr Sikka, who has worked for Accenture and India’s Genpact in a 16-year career.

Those who have ventured into the brave new world of business made possible by faster Internet, however, say challenges abound, including on the regulatory front.

“Digital laws are a big issue, our constitution is really old, it doesn’t have a lot of the stuff you require to enable people to do a lot of digital activities,” says Mr Wachira.

“Parliament needs to do something to change these laws because my generation is going to be online.”

Stephen Kiptinness, a lawyer and head of regulatory affairs for France Telecom’sTelkom Kenya, said a data protection law was long overdue.