The Internet Industry in Namibia

by Nahum Garelick

Workshop on National Information and Communication Infrastrcuture (NICI) for Namibia

11-13 may 1998

1. OVERVIEW

Internet: Tool to cater for virtual 2-way point to point communication.

Started in Namibia early mid 90's as Namibian Internet Foundation-Namidev Interest but not an effective organization to launch the Internet as a major communication tool.

Commercial services started in early 1996. People and companies were skeptical if it could work. Took 6-8 month to catch on.

OPTIONS: Dial-up, leased Line

5 ISP's in total have been set up. Only 3 currently exist operational. Although the expansion potential is there, the costs and economies of scale will limit the players in the market place.

An estimate of users of 4500-500 dial-up users are on line and 35 Leased-line clients throughout Namibia.

Current Internet Regulatory measures are not present in Namibia.

There is a domain registrar appointed by the INTERNIC overseas. This was done in the Namidev days. The status quo remains today. Although at times problems are experienced, this person is doing the service voluntarily. A non partisan IP qualified person is required to perform this task.. This function is vital for the control of IP addresses operating with the "na" domain.

Concern from Telecom Namibian the initial stages of setting up the Industry were voiced an to the potential loss of revenue by people using the Internet vis a vis telephone revenue.

However, an increase in digicon connectivity and requests for additional lines as well as usage of phone lines does balance this out.

Nampost also reflected concern due to e-mail replacing their services to a certain extent. However, Nampost must look to alternate measures, possibly to become a point for internet access to stay abreast with technology.

ISP control in SA. Who owns the bandwidth.

To site the SA example where SA Telcom entered the Internet arena and started competing with the Private sector, a strong lobby developed from the SA ISP assn and took up the issue. This was because all clients needing lines for internet usage using SAIX, the SA Telcom service were getting preference in availability of lines to their facilities.

Telcom felt that they are not only the official telcom provider based on the current legislation but also felt that they must also provide the bandwidth as well. The ISP's will then provide the access to this bandwidth.

A strong lobby was set up by the SA Internet Industry to not support the Telcom initiative.

The issue was then taken up by SATRA and they ruled that this practice was nor fair SATRA has ruled that the ISP's will continue as they have been.

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2. STATUS

All Namibian ISP's get their bandwidth from RSA via telecom Satellite and /or landline.

Although this cost was high, it is still cheaper to bring in the link from SA than directly from overseas.

The cost per 64Kbps to Namibia made the margins very difficult to stay competitive with SA and what seemed to be the market price that people were willing to pay (Satellite)

Fibre link made this more competitive and as a result, ISP's can offer more bandwidth to allow more acceptable speeds of data transfer for the same rates.

Due to cost constraints, the ability to provide Internet services across Namibia is somewhat restricted. The limitation of skilled people to maintain these points around the country also restricts its effectively.

All connectivity is dependent on telecom infrastructure be it for dial-up, leased line or backbone connectivity. Due to regulatory policy that only Telecom Namibia and MTC may carry cross-border traffic.

Certain areas even in urban areas have poor quality links and thus have difficulty logging onto the system. This is due to the fact that Telecom only guarantee only 9600Kbps, The ISPs offer 33600Kbps connectivity.

The general understanding of computers, operating systems and software is often the biggest problem for people to connect to the Internet.

Market Segmentation

Due to the inherent cost of requirement computers and networks and telephone as well as availability of Telecom and power infrastructure, the market is restricted to urban, upper income, literate users.

This excludes that vast rural population as well as schools and learning centers. Although the Internet Interface is user friendly. If anyone is not familiar with using a computer, or not literate, the Internet will remain an illusion at this stage.

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3.CURRENT TRENDS

Namibia 2^nd largest Internet usage in the region next to SA. Reflects the International nature of Namibian communication.

Tremendous increase in interest and connectivity over the past 6-8 months.

Reasons:

1. Push from Head Offices in SA and International
2. Technology in Namibia in now better understood
3. Cost of Computers/Technology dropping
4. Cost of data transfer
5. Web Extranet, Intranet and Internet marketing
6. Management realizing the potential and becoming computer literate. Speed of data availability and reduced communication costs. Not only an IT role to use and promote computers but push from top down
7. Availability of new Telecom infrastructure becoming more accessible
8. Control of communication from own desk. Not dependant on going to Post Office/ Freighting of documents Eliminate unpredictable deadlines

Web Marketing has been embraced by the Tourism Industry in Namibia. Direct Reservations and confirmation via e-mail.

Competition has got to the stage where the Namibian companies can no longer hold up to the economies of scales of the large computer and communications giants. This follows the trend seen in SA, and the rest of the world, with the take over of smaller companies to create communication giants ready to compete with the telcoms in those countries. Concern of alliances with Telecom is also an issue here.

This scale of operation will not happen here, but the giants have started moving in and will compel the local companies to re-evaluate their positions. This is inevitable in this industry sector.

However with this trend comes expertise and technology that will be available here sooner than otherwise would be possible.

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4. PERCEPTION/PRESSURES

Aspiration to get every one on line is valid and noble but the constrains of socio-economic factors will inhibit this at this stage. I can't see agency, Govt., NGO or private sector that can carry this load alone at this stage.

The Internet is instant

One is patched into a global network and is thus subject to delays and breakdowns at the remote sites. The delays do not happen only in Namibia. Often Namibia Telecom and the ISP's are blamed for this.

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5. POTENTIAL

Marketing on the web for Namibia and its companies

Security on the Internet

Commercial services will become available

Voice and teleconferencing over the Internet

Supported Infrastructure around Namibia

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