Caz Research Paper Latest&Updated Presentation

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Communication Authority of Zambia

2008 National ICT Research Symposium

Paper presentation

Market demand for ICT in rural and peri-urban areas of Zambia

By

Godfrey Mwewa

Southern Sun Ridgeway, 22-23 October 2008

Profile • Lecturer/Coordinator of Student Services,

DDE, UNZA; Researcher/Consultant in Instructional Technology.

• Involved in design and development of digital and information technologies learning environments.

• Advocate of use of ICTs for knowledge development; infrastructure development; and application development.

• Associations: AVU-UNZA Centre; ISTE; VIRPG; GLP; NYSCATE

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Objectives of the Paper Presentation

Define ICTs in light of Ubiquitous technology. Describe peri-urban and rural areas of

Zambia. Identify platforms for ICT delivery in Zambia. Analyze the opportunities in the provision of

ICT in rural and peri-urban areas of Zambia. Propose the way forward to the challenges of

access to and provision of ICT training facilities in rural and peri-urban areas of Zambia.

Outline strategies for development of ICT infrastructure in rural and peri-urban areas.

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What is Information and Communication Technology (ICT)?

There are different definitions for Information and Communication Technology (ICT)

Refers to digitalization of information and the electronics industry – the ability to store and process all kinds of information and to communicate it over telephone lines; the invention and marketing of the personal computer (PC) which reduced the cost of computing and placed it in the hands of individuals – at work and at home; and the launch of the Internet linking computers and their users together in a global network. (Wild, 2007)


What is ICT? Contd…

The coming together of these three innovations is known as convergence. Convergence enables:

traditional computers (and other devices like personal digital assistants (PDAs),

telecommunications devices (like telephones, fax, satellite, radio, TV), and

networks (like the Internet, private data networks, satellite communications, and fixed and mobile telephone networks) to work together locally, regionally and globally to share and exchange content or information.

These technologies, taken together, are called ICTs.


Importance of ICT in National Development

Has the potential to enable citizens to participate in economic activities by sharing information on products and markets around the globe and access information on health care, education and other social services.


Types of ICT/Media

Telephone/ Fax/mobile phones ‘Telegram’ Teleconferencing Podcasting Personal Digital Assistants (PDAs) Stand alone computer Networked computers Digital Video Conferencing


Context of “Rural” and “Peri-urban” areas

Rural area: community with a village setting.

Peri-urban area: community setting of up to 20 km from town centre with undeveloped social amenities.

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RESEARCH SITES

Peri-Urban locations: 6 districts Lusaka: Chongwe, Luangwa and Mwanamainda- Kafue area Central: Katuba in Chibombo Copperbelt: Kang’onga, Ndola; Luansobe in MufuliraRural locations: 14 districts Western: Mongu & Shang’ombo North-Western: Solwezi and Chavuma Eastern: Chipata Northern: Mungwi, Nakonde and Kaputa Luapula: Samfya & Nchelenge Central: Mkushi, Serenje Copperbelt: Mpongwe & Lufwanyama

Total Research Sites: 20 districts

Expected start dates: October 31, 2008 - January 31, 2009


Criteria for research site selection

Rural or peri-urban location in a district.Communication infrastructure.Social and economic activities.


Expectations of the activity

Provide basic information on the status of ICTs in rural and peri-urban areas of the country.

Provide information to the Authority and other stakeholders for potential developmental investments in universal access projects.


Why the research should be carried out

Build research capacity within the Authority and stakeholders for sustainable development of the ICT.

Assist the Authority to improve on the key deliverables in the ICT sector.

Accelerate development of telecommunications and ICTs in disadvantaged communities in Zambia.


Macro-economic Climate

In 2007, economy recorded growth of 6.2% of real Gross Domestic Product (GDP) against a target of 7%.

Consistent growth above 5% during the past five (5) years.

GDP growth rate for the 2008 financial year projected at 7%.


ICT Sector

Has a number of market segments. Major part of GDP contribution comes from

the mobile cellular and ISP market segments. Of the two market segments, the mobile

cellular market is the highest contributor and fastest growing. (CAZ 2007 Reports)


Mobile Cellular Segment

31st December 2007, subscriber base was 2,639,026 representing a mobile access rate of 22.5 people per 100 inhabitants.

Age range- majority subscribers are engaged in education, training and form of business.


4TH QUARTER MOBILE NETWORK OPERATOR ICT INDICATORS (31/12/07)

S/N Provider Subscribers Market Share

(%)

Internet Subscribers

1. ZaiN 1,956,976 74.1 215,472

2. MTN 420,825 15.9 Nil

3. Cell Z 261,225 10 Nil

Total 2,639,026 100 215,472


VARIANCE ANALYSIS OF MOBILE NETWORK OPERATOR ICT INDICATORS

Overall increase in subscriber base by 18. 27% between 3rd and 4th quarter of 2007.

Annual addition of 49.1% to previous year. MTN recorded positive growth in market share.

Grabbed market shares of 6% and 1.2% from other two providers (due to promotion strategies and network congestions by a competitor).


Clientele in Rural and Peri-urban areas

Good number of distance learning students. Professionals, small scale farmers and traders. Social services delivery: access information on

education, health and commerce/business. All need skills to get connected through 21st

century tools in 21st century context.


Implications and Market Demand for ICT Services

Estimated mobile subscribers in Sub-Sahara Africa spend at least 20% of disposable income on phone services.

Over 70% of the people with mobile phones in Zambia subscribe to more than one service provider-about 30 % of subscribers are in rural and peri-urban areas.

Each household has an average of five (5) phones. ZMK 170 billion a year to take electricity to rural areas.


Market Forecast Mobile market for 2008 quite positive for Zambia

provided macro-economic fundamentals remain stable.

Value added services alone minus good network accessibility are not enough to retain subscribers.

Despite high pricing complaints by clients, gradual increase to subscriber base indicates demand for ICT services in all parts of Zambia.


Challenges in the Mobile Network Sector

Mobile Network Coverage Coverage for districts situated in rural and a majority

peri-urban areas restricted to district centres and not outlying areas (Katuba, Luansobe, Mwanamainda, Mungwi).

Lack of viable economic activities in some areas Terrain- salute ZaiN for 100% country network

coverage (MTN 67 out of 72 districts): e.g. clients in Kanona have to find a point away from village.

Absence of infrastructure sharing agreement


Fixed Line Network (FLN)

Globally, 60 % decrease in FLN service demand.

In Zambia, 1.75% decline in the number of subscribers as at 31st December 2007 due to various reasons.

Subscribers migrated to mobile for better ICT services.


Internet Service Providers

The ISP market only segment continued to exhibit health competition.

13 licensed operators: 6 in business of providing internet services; 7 either in internet equipment hardware supply or installation.

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S/N ISP Internet AccessTotal

Subscribers Market Share

Dial Up Broadband

1. AFRICONNECT 0 1450 1450 8.8%

2. ZAMNET 4659 1318 5977 36.3%

3. ZAMTEL 6146 610 6756 41.2%

4. COPPERNET 655 586 1241 7.5%

5. UUNET 372 178 550 3.3%

6. MICROLINK 92 398 490 2.9%

TOTAL 11,924 4,540 16,464 100%

Internet Subscriber base


Internet Service Providers

No dominant firm in the ISP market as at end of 2007/8: market shares, Zamnet and Zamtel market leaders.

31st December 2007 and 31st March 2008, number of internet subscribers had 2.2% decrease due to rise in private networks for faster and efficient transfer of large volume of data by corporate entities.

Internet penetration rate in Zambia has continued to be 1%.


Emerging Technologies and Internet Service Market Demand

Future of the Internet is in ‘your hand’. Emerging technologies: Global System for

Mobile communication (GSM) and Worldwide Interoperability for Microwave Access (WiMAX) increasing access to the Internet via mobile phones and wireless data over long distances.


Expectations in the ISP Market

WiMAX: “Nomadic connectivity”, will provide broadband access to places where it has been economically unviable.

Time has come: predicted that the Internet is to be dominated by handheld devices as opposed to traditional computers.


WAY FORWARD IN THE DEVELOPMENT AND PROVISION OF ICT SERVICES IN RURAL AND PERI- URBAN AREAS

1. Mobile Internet Vehicles: Mauritius’ Cyber Caravan

Project Model

Mobile Internet Vehicle


Way forward Cont’d

2. Computer Kiosks (South African model- ‘hole in the wall’).

3. Partnerships with institutions of learning to develop knowledge, skill, values and ownership of programmes: UNZA, private ICT service providers


Strategies for ICT Infrastructure Development

Collaboration with other ministries such as MoE, MSVT, MAAC, MLG and MCSS; and private institutions to establish user-supported ICT Learning Centres (‘Mufulira College of Education model’)

Reduced or zero-rated tax on ICT equipment such as VSAT for organizations investing in rural and peri-urban areas.

Positive discrimination Provide grants to universities for research in ICTs

e.g. 5G technologies, nanotech and engineering that have the potential to overcome issues of speed and/or terrain/distance


CONCLUSION

There is high market demand for ICT in ruraland peri-urban areas in Zambia. No moreprocrastination- writings on the wall are clear: “ time of formulating of strategies forimplementation of the national ICT policy is now”.

LET’S DISCUSS!!!

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References • BBC, “World Debate” TV programme on January

13, 2008.

• BBC, “Marketplace Middle East” TV programme on July 2008.

• Bennett, M. “Internet Connectivity in Zambia: Opportunities and Challenges.” A paper presented at the e-Brain Forum Monthly Meeting at Lusaka Hotel on Thursday, June 26, 2008.

• Communications Authority of Zambia. (2008). 2007 Annual Report. Lusaka: CAZ

• Communications Authority of Zambia. (2008). 2007 ICT Economic Indicators. Lusaka: CAZ


References Contd …

Brownstone IT: Vehicle mounted mobile satellite internet access terminal. (From PRESS RELEASE by Brownstone IT - East Sussex, UK 14th March 2005). Retrieved on September 5, 2008 from http://www.satsig.net/brownstone-mobile.htm.

Commonwealth of Learning ( June 2008). The Future of the Internet is in your hand. Connections: Learning for Development, 13 (2), 16.

Communications Authority of Zambia (2008). Analysis Report the Market Entry of a Fourth Mobile Cellular Operator in Zambia. Lusaka: CAZ.

Executive Issues for September 2008 Volume 3 (Online publication)


References Contd…

Farrell, G and SHafika, I. (2007). Survey of ICT and Education in Africa: A Summary Report, Based on 53 Country Surveys. Washington, DC: inforDev / World Bank.

Mulozi, D. “Internet Connectivity in Zambia: Opportunities and Challenges.” A paper presented at the e-Brain Forum Monthly Meeting at Lusaka Hotel on Thursday, June 26, 2008.

(“The Post Newspaper”, September 5, 2008) Wild, K. (28th November 2007). What is ICT? From

http://www.itrainonline.org