SEACOM goes Live.

Dear Friends.

Thursday the 23rd of July 2009 will go down in history as the day Kenya got to commence the enjoyment of highspeed broadband internet. After years of waiting in anticipation and theorizing on the benefits of highspeed internet it is finally here. In a highly publicized and coordinated event SEACOM turned on the switch which instantaneously beamed Terabytes of bandwidth at the speed of light through highly polished and engineered strands of glass.

This was the moment that the countries on the eastern seaboard of Africa have been preparing for in more than a decade. In a single day the telecommunications paradigm has shifted dramatically. Whereas just yesterday a telephone call from Nairobi to Dar es Salaam would have first travelled to a satellite in outer space before bouncing back to Tanzania, now it will simply travel a few kilometres under the sea and arrive in a fraction of the time it took to do so before. Whereas to watch a 5minute youtube video took almost 10minutes to download now it should take just under 6seconds. Opening an internet page will be instantaneous as opposed to before when to open an e-mail account took you almost 10 minutes to access your first mail if not longer.

Beyond this however is the fact that with all this improvement in service the costs will actually go down instead of up. We are normally made to believe that when you want higher quality you should be prepared to pay more. In this case however the opposite is the reality. There is alot of debate as to whether the costs will drop by 90% or 20% – 30%. What is not in doubt is a price increase is not even considered despite the massive investment the various players and SEACOM have put into the project. Some are now wondering how will the players recoup investment?

The answer is actually to do with the concept of less price attracts greater demand. So less is more in the new economics of telecommunications. If internet access is made more affordable then many citizens will naturally want to enjoy the benefits. The more subscibers join the internet also known as uptake in technical jargon the more the firms stand to benefit. Why is this considered workable?

The answer lies in a study done by the World bank on an actual cable called SAT3 which is a fibre-optic cable along the western seaboard of Africa. This cable was a closed access system which eventhough it provided some bandwidth to the west Africans ended up being as expensive as satellite so that some countries such as Nigeria actually opted to use satellite. This is why internet speeds in Nigeria were almost as pathetic as the ones in Nairobi despite the presence of a fibre-optic cable. It has to be said though that SAT3 has only a tenth of the bandwidth that SEACOM is offering to us now i.e. SAT3 had about 120Gb/s as opposed to 1.28Tb/s for SEACOM.

Fibre-optic cables have a lifespan of between 20 – 25yrs. During that time they have to recover their investment costs and generate profit. Now if you keep prices high and no one uses your cable the bandwidth you have will be useless. Your cable will not generate any sales and return on investment will be minimal. This is why it is better to keep prices as low as possible to encourage heavy use which will then generate revenue and also hopefully create an addiction for the internet which will mean people cant do without it.

SAT3 demonstrated that artificially high price amounts to a denial of service to consumers and therefore it is like there is no cable. Hence it is in SEACOM’s interest to keep prices low. That will also have major implications for other facets of life in Africa. This will lead to monumentous change in the way Africans view information.

From a purely commercial angle m-commerce & e-commerce will take on added significance. Small and medium sized business will want to take advantage of the internet to sell their goods to the world. With cheaper access and more bandwidth they will be able to invest in content rich websites which will hopefully attract customers. Gamers will be able to upload and design games using open source software. Companies will be able to take advantage of new internet phenomena like cloud computing which could save them millions in expensive databases.

Perhaps one of the biggest changes will come when the government fully digitizes it’s services which will improve service delivery and reduce incidences of corruption. Most notable of this will be for example the ministries of justice, health, lands, education, agriculture and government procurement. It has been said 90% of the governments corruption occurs in procurement. If this aspect becomes automated and removes personal negotiations and manipulations it will be virtually impossible for corruption to occur undetected. Think of it if tenders are submitted online and payment done online and the selection is done based on mathematical scientific models it will not be possible for government officials to influence the system.

In addition our universities and institutes of higher learning will benefit tremendously from the enormous bandwidth and the greater possibilities to share and acquire access to massive amounts of information. This will mean that our academic institutions will not only be consumers but will also be able to upload valuable information into the global superhighway and therefore introduce a potentially valuable source of revenue. Searching the internet today you notice the lack of African content whether in business or cultural or literal works. This is set to change with digitization and easier access to the internet.

There are also numerous opportunities for our academics and students to participate in global projects aimed at enhancing or finding solutions to humanity’s problems through global participation on scientific projects such as wolfram alpha or medical, agricultural, meteorological, biotechnical and engineering projects.

There is also the potentially promising field of BPO [Business Process Outsourcing] which is a potential generator of employment for our youth. It may also be the conduit on which Kenya will develope other competitive and potentially more valuable IT skills. India has shown what is possible to achieve in this sector and where the future is headed. Kenya which has a relatively well educated youth has the potential to excel in this new sectors which could revolutionize Kenya’s economy.

Finally before I let you guys living in Kenya go I would like to suggest you do a historical experiment to test your current internet speed before switching to the fibre-optic cable. To do this go to speedtest.net and choose a city of the world say Washington DC or Amsterdam and test your current speed before switching to SEACOM or TEAMS. Do the test 3 times and divide the result by 3 to get an average speed. Keep those results in safe place and then when you effect the change do the test again and see the difference. You will also be able to compare your speed with other places in the world. The site tests your download, upload and ping speeds. So you should have 3 different speeds to test for. If you have already switched, it will be interesting to see how you compare to Europe which currently has the highest speeds eventhough South Korea enjoys some of the highest as a country.

African Submarine Fibre - Optic Cables

In conclusion the completion of this project is the first among almost a dozen initiatives to build fibre around Africa. In Kenya which is a mobile technology phenomenon technologies such as WiMAX and the deployment of 3G & 4G networks will lead to a richer mobile experience. Africa is truly transforming as the number of undersea cables under construction means that West Africa may end up with almost 7 cables the largest of which is the proposed WACS with a whopping 3.84Tb/s while East Africa may see upto 4 cables. This may truly turn out to be the beginning of the age of Africa. Africa, Kenya Yes We can.

JellyFish.

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15 Responses so far »

  1. 1

    Good post, I’m worried about the cartels that will form to keep prices high, but hopefully consumer demand and competition will force the prices to come down.

    • 2

      jellyfishcoolman said,

      Hi KenyanChristian.

      I am also hoping that cartels dont form around this cables. However I am reasonably optimistic that even if such a cartel were to form it wouldn’t last long not to mention it is not likely. Thanks for your comment and welcome to my blog.

  2. 3

    […] Jellyfish, who dismisses pricing concerns by noting that such an increase in speed and quality of service […]

  3. 4

    […] Jellyfish, who dismisses pricing concerns by noting that such an increase in speed and quality of service […]

  4. 5

    Techmasai said,

    this is an incredible post, like your take on the impacts and what this will mean for the Kenyan community

    • 6

      jellyfishcoolman said,

      Hi Techmasai.

      First let me officially welcome U to my blog. I have been following your site & would like to take this opportunity to thank you for the mentions. I look forward to a good collaboration on matters beneficial to Kenyans and Africans in general. Once again thanks and welcome.

  5. 7

    John Karanja said,

    I think Safaricom will help keep these other ISP’s in check just as they have done in the recent past by providing internet through the mobile phones.

  6. 8

    kenyantykoon said,

    this is good work. Your features are always well researched and up to date.

    At first i was skeptical that this project wouldnt have been completed without a lot of politics and corruption. am surprised actually. I hope the integration will go on without a hitch

    http://kenyantykoon.wordpress.com/

  7. 9

    jellyfishcoolman said,

    Hi Kenyantykoon.

    Thanks for the kind words. I am glad that you are so honest about your feelings before. This goes to show that if we keep the faith and pursue our goals diligently and avoid the negativity we can achieve alot. The terrestrial rollout will proceed becoz it is in the interest of the ISP’s and the consumer to begin enjoying highspeed broadband. Though prices may not immediately drop they will in due time becoz they must otherwise the people who invested in this cables will not recover their costs.

  8. 10

    shikomsa said,

    Three words. Comprehensive comprehensive comprehensive. Any grey areas I had about the new life that is coming have effectively been cleared. Gratitude to you is in order here.

    • 11

      jellyfishcoolman said,

      Hi Shikomsa.

      Welcome officially to my blog. I have visited ur blog when u were talking of the research involving ants & traffic which I found intriguing. Thanks for the compliment & keep coming back. I am hopeful things will get better in Kenya. We must press on and hope for the best. Once again thanks and welcome.

  9. 12

    kachwanya said,

    It is Africa time. For start, when the other two cables are completed, the combined bandwidth available for use will be overwhelming, and a fact that will require more than creativity. But i believe there is nothing to worry about, just look at the use of mobile phones, nobody can complain that mobile phones are under utilized in Africa. I think the cables and the internet will be the same.

    The cost of accessing internet will probably remain the same for sometime, a fact that i think is not well justified. The truth here is Seacom have invested a lot of money on the project, the same for Teams and Easssy but according to Seacom website, they have clearly indicated that their initial price of the bandwidth to ISPs is roughly 90% cheaper and actually they expect it go down with time. Eassy actually accused their rivals of exploiting the customers through high prices, meaning they will charge lower than that. Now if there are people who are justified to charge the same or higher at the moment are Seacom and the other two cables. Then come in the ISPs, i mean if they getting the bandwidth cheaper why can’t they simply pass down the same benefit to the consumers. Why are they talking of the prices reducing by roughly 20 to 30 % over time . I agree there are cost involved, and some of them have actually invested substantial amount in preparation to connecting to the fiber optic, but that is still lame excuse. They can recoup their investment if they allow many people to access the net and that will only happen if the cost of doing so is affordable to the common citizens.

    By the way this is a great insight on the benefits or what it means to be connected to the internet super-highway.

  10. 14

    […] Blogger know as Jellyfish gives a full overview about SEACOM and how it can be implemented in East Africa. If you are an investor i recommend this article.[Read about SEACOM] […]

  11. 15

    Tee said,

    Thank you for such valuable information.But I will also like to know the disadvantages of the seacom cable and how it can be improved.
    Thank you.


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