Growth in internet access still driving down African business costs

Michuki Mwangi senior development manager for Internet Society Africa. (Supplied)
Michuki Mwangi senior development manager for Internet Society Africa. (Supplied)

More job opportunities can be created if people have the ability to monetise the content they create online, says Michuki Mwangi, an Internet Society (ISOC) senior development manager for Africa.

And informal businesses in Africa are increasingly using the internet to support their operations.

Mwangi spoke to Fin24 on the sidelines of the 9th African Peering and Interconnection Forum held in Cape Town last week.

The forum allows for engagements on ways to improve network connections, lower the cost of connectivity and increase the number of users, among other things.

Mwangi recalled how he bought a cellphone from a business in Kenya, which strictly operated online. The business could offer Mwangi the phone at a discounted rate because so many of the costs associated with a traditional business were cut out. For example, the business relied on an online catalogue to promote phones, as opposed to needing store space to put phones on display.

"This is where the region is moving on to. We’re identifying ways to use the internet to do business, and keeping operations at low cost," he explained.

Cost of internet access

Mwangi said that as the regulatory environments were changing, there was more space for investment in internet infrastructure. The subsequent increase in user awareness drives demand, while more competition drives down prices.

Companies like Microsoft and Amazon Web Services have also launched cloud servers locally, which businesses can use for their operations, added Ben Roberts, chief technical officer of Liquid Telecom. By making use of these servers, businesses do not have to carry the cost of running their own servers. 

Roberts added that the continent was becoming more intra-connected, including an increase in broadband networks spanning East and West Africa.

Liquid telecom, meanwhile, recently announced it would build a fibre network from Cape to Cairo.

* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER

ZAR/USD
16.81
(-0.26)
ZAR/GBP
21.34
(-0.12)
ZAR/EUR
19.02
(-0.13)
ZAR/AUD
11.73
(-0.21)
ZAR/JPY
0.15
(+0.60)
Gold
1681.70
(+0.13)
Silver
17.39
(+0.17)
Platinum
815.55
(+0.35)
Brent Crude
41.90
(+5.78)
Palladium
1949.00
(+0.59)
All Share
54722.38
(+2.85)
Top 40
50199.80
(+2.79)
Financial 15
11467.53
(+4.66)
Industrial 25
74264.52
(+2.52)
Resource 10
49969.31
(+2.29)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
I'm not really directly affected
19% - 196 votes
I am taking a hit, but should be able to recover in the next year
26% - 268 votes
My finances have been devastated
29% - 295 votes
It's still too early to know what the full effect will be
26% - 260 votes
Vote