These are exciting times for Africa as internet coverage spreads across the continent. All kinds of innovative businesses, ideas, connections and opportunities are being developed. However, the news is not all positive and there are many challenges still to be solved.
Talking about “the internet” in the context of “Africa” may seem broad. It may even seem obvious that its spread involves both opportunities and challenges, but it is an important enough tech development to warrant a deeper analysis.
Luckily, Dalberg Global Development (in partnership with Google) has recently published a report on the impact of the internet in Africa. And in Kampala last Friday Mairead Cahill presented the company’s findings on the good, bad and unfulfilled potential of the internet in Africa.
The best news is that access to the internet in Africa is increasing. The Dalberg report found that mobile phone take up in Africa has now reached 63%. This coupled with the high quality fibres being fitted in countries such as Kenya means that more people have access to the internet, and better quality internet.
Although actual internet access is still only at 20% it is increasing all the time.
There are currently over 60 social media platforms in Africa. The report analyses how these are being converted in economic and social values. It found that the internet enabled solutions in cost savings (e.g. Healthcare worker training), improved earning potential, and increased access to financial services.
As Mairead said:
The third wave of innovation is being realised through customized solutions.
There is lots of space for innovation.
Although internet access is improving all the time, 80% of the population in Africa have no access. This represents a major challenge. Less than 10% of businesses in Africa are online.
The largest problem that Dalberg found is that pilot internet projects are not scaling. It found that there are lots of pilots but these do not lead to mature growing businesses. Mairead placed the blame for this on investors who are keen to fund exciting new pilots but offer no support for growing a business. She called on the internet hubs to offer more concrete advice in this area.
There is much unfulfilled potential in Africa. Currently, only 13% of Ugandans are online. Dalberg argues that core infrastructure is key to the future of the internet in Africa. Mairead broke this down into both the “physical” infrastructure and “softer” infrastructure. An example of softer infrastructure she gave was enabling a business environment. Continuous investment in infrastructure is critical. In particular, a big problem holding back internet use in Africa is access to electricity. This represents a simple but essential problem.
Access to internet in Africa is not just about broadband connections but also governmental structure.
Addressing the challenges:
The talk ended with three recommendations for Africa:
1. Access. Continue to invest in infrastructure by looking for opportunities to align incentives between public and private sectors.
2. Impact. Look towards payment platforms to unlock the next wave of African online consumers and translate virtual connections into meaningful economic value.
3. Ecosystem. Further invest in understanding the policy environment and what drives or inhibits innovation.