There has been quite some buzz around the internet and its potential in business lately.
Indeed, the possibilities on our socio-economic life are getting clearer in that we now have concrete figures on which to peg our progress locally and on the continent.
We now know, for instance, according to the just-released Internet Society report, Promoting the African Internet Economy, that on average internet contributes 1.1 per cent of Africa’s GDP. This is against 3.7 per cent in developed countries.
We, therefore, have a fairly good idea about what we must do better. On this, the analysis suggests the point is not that more internet directly leads to a bigger economy, but improved efficiency for an internet-enabled economy.
Lack of local content infrastructure, such as data centres, routers, servers and content delivery networks has been identified as one of the key challenges needed to drive wider and deeper internet usage in African countries.
However, the world is interconnected. We, therefore, also can’t ignore what is happening across the ocean in the United States where the battle for net neutrality is now at fever pitch. The country’s Federal Communications Commission will this month be voting to reverse net neutrality rules that could have broad ramifications for the entire internet.
Under the rules established by the Obama administration, internet service providers (ISPs) are required to provide open access to their networks for all digital content. The ISPs can’t block or slow down access to lawful content or create so-called “fast lanes” for content providers who are willing to pay extra. Doing so runs the risk of advantaging those who can afford, thus entrenching established firms while making it very hard for startups to grow.
This means that it would amount to preferential treatment dividing the internet into haves and have-nots, giving major ISPs a free hand to charge more for a “faster lane” where deep-pocketed websites can pay to have their content delivered faster to consumers. This would leave poorer websites on the “slow lane”, thus with compromised load times. Consumers would end up with limited access to the internet.
Without stringent or enforced net neutrality laws, a similar scenario is likely to play out in our situation. Therefore, the main implication of the FCC effecting changes to net neutrality for us in the region and Africa would be the example it would set for our own telcom firms – MTN, Safaricom, Tigo, Airtel, et cetera – who happen to be our main internet service providers.
So far, 3G or 4G internet is available to all on an equal footing. It all depends on the amount of data bundles you can afford. There is also broadband through direct fiber connections, which likewise, depends on the package you can afford or on what is ideal for your needs, whether for home or office use.
One can say we are okay for now, though there are those who say data bundles could still be cheaper.
As for the economy, it is recognised that net neutrality lowers the barriers to entry for small business owners, startups and entrepreneurs and other sectors by preserving the internet’s fair and level playing field.
Looking at six key sectors – education, healthcare, financial services, agriculture, retail and government – the Internet Society report quotes McKinsey estimates showing the internet can deliver productivity gains in Africa valued between $148 billion to $318 billion by 2025.
The point is therefore made how crucial it is to maintain open internet to launch businesses, create markets, advertise products and services, and reach customers and clients in the digital revolution sweeping through the continent; that, it will not only foster job growth but competition and innovation.
This is except for the current lack of local content infrastructure, whose implications are a slower internet that ends up being more expensive and thus less competitive. For instance, even to do business or offer a service to somebody in the same town as you, the situation currently in Africa is that a transaction has to be routed halfway across the world through internet exchanges in North America or Europe before being delivered to the intended recipient.
Enhancing our infrastructure must, therefore, be a matter of urgency, even as we scrutinise our internet policies to ensure the principle of a level playing field where service providers are not permitted to charge some businesses more to get faster access to consumers. It should not be allowed to distinguish access to data between different content providers.
The views expressed in this article are of the author and do not necessarily represent those of The New Times.