Sluggish Connection Impact on Businesses

Ethiopia, the second most populous African nation with its 96 million population has over 7 million internet users hence the lowest internet penetration rate of 8.7% says the 2015 Ethio Telecom  Statistics. This is extremely low in comparison to Kenya with its 47.3% internet penetration rate making half of its population internet surfers.

Although average internet speed has steadily improved with time, slow connection remains a part of the improving Ethiopian telecom industry. Ethiopia is among the African countries with a monopoly in its telecom sector. This oldest telecommunication service provider in Africa, Ethio Telecom is the sole operator awaiting privatization as the country is negotiating to join the World Trade Organization.

To enhance coverage and access, the government launched several broadband initiatives since 2004 which aimed to bring the country closer to the information technology era. It has been allocating record budget for infrastructural improvements and expansion efforts to better internet technology.

For internet based companies, internet is a necessity to process the customer’s request to be able to run transactions quickly and efficiently. E-commerce is relatively new to many sub-Saharan African countries and Ethiopia is no exception to this. However, the industry has been held back by low level of access to the internet and to credit cards. Nevertheless e-commerce is gaining momentum in Ethiopia circumventing credit cards as demonstrated by the launch and expansion of international companies such as and Kaymu.

Access of more than 256 kilobytes per second (Kbps) is considered broadband. With the exception of organizations such as the African Union and the United Nations which have speedy internet connection, the rest are familiar with the dawdling connection. Most of the time, it is not just the size of the email file that presents problem, simple browsing can take up so much time.

Video conferencing on platforms such as Skype and Google+ has been one of the rapidly growing communication means for businesses. The need to remain connected at all times requires a good level of connectivity. However, limited connection is preventing this from being practical with several dropped connections. Waiting for videos to buffer, websites to load and emails to open  slows business operation and hinders international transactions. Unhurried connectivity might also leave confidential information vulnerable to theft and cyber attacks.

To a large extent, connections are considered as luxury due to pricey service costs. The  lowest monthly charges per 100 kilo bits of fixed broadband internet access is over $600. These charges do not include installation fees and modem rentals. Other mobile access also have expensive price tags and limited access.

Evidently internet access varies widely between developed and developing nations. In 2012, only 78.6% of the population in North America has access to the internet, that number drops to 39.9% in Latin America, 28.7% in Caribbean, and to just 13.5% in Africa.

To cope with the global connectivity, Ethiopia introduced structural changes that are mostly aimed at expanding and improving services. The government also made the development of access to internet one of its prime priorities. Enhanced performance in broadband speed is a result of deliberate efforts of the state to invest in fiber optic roll out. It also offered wired and wireless connections with a speed starting from 256 Kbps to 16 megabytes to businesses.

Even though expanding was good news for the country, a lot more work still needs to be done to keep up with economic growth and to fulfill the connectivity demand of investors.

By Eden Sahle

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