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African Experience with Telecenters
By Peter Benjamin
peter@sn.apc.org

As Manuel Castells says: "Information technology, together with the ability to use it and adapt it, is the critical factor in generating and accessing wealth, power, and knowledge in our time. The disinformation of Africa at the dawn of the information age may be the most lasting wound inflicted on this continent by new patterns of dependency.”

In the past few years, there has been great interest in using telecenters to provide access to information and communication technologies (ICTs), with projects initiated by governments, the private sector, international donors, and community organizations. Telecenters have been seen as a means of addressing the lack of ICTs throughout Africa and of assisting in providing universal access, to both telephony and other forms of ICTs.

This article reviews various initiatives throughout Africa. Discussion on telecenters is always confused by the fact that the word covers different types of projects, and because many other terms can be used. Following work by Mike Jensen, this article looks at two types: type A microenterprise telecenters; and type B, bigger, donor-funded telecenters.

Type A: Small, Private Sector Telecenters

In several countries the past few years have seen a proliferation of small phone shops. They are run primarily by small entrepreneurs and are generally quite successful. If they weren't, they would close down. These centers started off offering basic telephone services, but several are now moving into fax and even Internet services, as the market develops.

Senegal is the African country with the largest number of telecenters: more than 9,000. The telecenters have been supported by Sonatel, the telephone company, which has supported these “telecentres privés” (private telecenters) instead of pay phones. These telecenters started in 1992, and there are now about 6,000 in Dakar—on almost every street corner—and increasingly in rural areas. Telephony is overwhelmingly the main service. However, other services are offered, especially fax and photocopying, with 1 percent of revenue coming from Internet use.

The telecenters are profitable. Operating a telecenter generates a monthly income of approximately $200 per line. It is estimated that the telecenters contribute about 0.5 percent of the gross domestic product. The Senegalese telecenters have performed very well as sustainable small businesses with support from Sonatel. There is fierce competition—especially in Dakar—and market demand is encouraging the introduction of other services slowly, such as Internet.

A different private-sector model comes from Africa Online, an Internet company that has set up 261 E-Touch centers in Kenya—mostly in Nairobi. These centers offer e-mail, Internet, fax, photocopying, printing, and telecommunication services. They give users a free e-mail address and charge for usage. Each piece of mail costs about 50 cents. Surfing the Web costs about seven shillings (nine cents) per minute. There are about 30,000 user accounts in the country, 10,000 of which are active. The E-Touch centers are reasonably successful small businesses in Kenya, but their costs put their services out of reach for most Kenyans. However, some businesses and larger nongovernmental organizations are benefiting from the centers.

Africa Online is also active in Ghana. In 1997 it launched the project Email for Everyone, which worked through communication centers—similar to the Senegalese telecentres privés. Unfortunately, after much initial enthusiasm, most of the centers closed down due to poor telephone line quality in some areas and the emergence of free e-mail services such as hotmail.com. In addition, the market was small because computer literacy was low. Africa Online also went into a joint venture with the post office to provide e-mail services. The e-mail accounts were free to users, and in three months 30,000 Ghanaians signed up. Again, after the initial enthusiasm, the active user numbers have declined, but the joint venture is still providing an effective service for many, mainly in the cities.

In South Africa, Vodacom has established 1,800 phone shops. These are metal shipping containers with usually 5-10 phone lines, costing R24,000 ($3,333) to set up. They are run as franchises and are very profitable. A few are starting to offer fax and even Internet services.

Type B: Donor-Funded Projects

Very different from the aforementioned, micro-projects are the donor-funded telecenters. The main program has involved a partnership—between the International Telecommunications Union, UNESCO, and the Canadian International Development Research Center (IDRC)—that has established major centers in Mali, Uganda, Mozambique, and South Africa. These centers tend to be much more expensive (up to $250,000) and offer a range of telephony, computing, Internet and information services. The projects stress community participation and sustainability, but to date none have proved that they can be self-sustaining after external funding. Most of these centers are supported by foreign donors, though the national programs for telecenters in South Africa and Egypt can be included in this category.

Perhaps most well known is the Nakaseke Multipurpose Community Telecenter (MCT) in Uganda. It opened in March 1999 and aims to introduce and test new technologies and applications and to demonstrate the impact of such technologies on development of rural and remote areas. A baseline survey was conducted to establish the nature of information needs of the community and the services. Sixty percent of funding came from international donors, and forty percent from national government. In 2001 a school tax of 59 cents is planned for all 8,000 school children in Nakaseke to subsidize the center.

The telecenter has eight computers, two printers, a scanner, a photocopier, a VCR/TV, a video camera, and a projector. However, frequent power cuts are a problem. In addition to phone, fax, and Internet use, there are a paper and digital library; computer training; and an interesting Indigenous Knowledge program whereby center staff are building a resource of local health and crop experience. The center has proved that ICT can be useful for development in a rural area. The center is just about covering operating costs (subsidized by the community), but there is no expectation that the center could generate enough income to replace equipment in a few years (depreciation), let alone repay the major capital investment. This center required great external support (financial and organizational) and so is unlikely to be a model that can become widespread.

In Mozambique two pilot telecenters were established in 1999 in Manhiça and Namaacha (both in Maputo province), funded by the IDRC. They each have four computers, an Internet hub and modem, two printers, backup equipment, a public phone, a fax/phone, an external card-phone, a photocopier, an overhead projector, a whiteboard, a TV with video, a radio and a binder. Current operating costs are just being met by operating income, except the phone bill. Initial conclusions are that long-term economic sustainability depends on the existence of a critical mass of users and the adoption of computer-related services. Over reliance on phone and photocopy services for income means vulnerability to inevitable future competition and that the major telecenter investment is not justified. Technical support, backup, and continuous staff training are essential, especially for encouraging the developmental and information services, and good communications channels with local authorities and community leaders as well as maximum transparency and information regarding the project are important to success.

In South Africa 63 telecenters have been established by the Universal Service Agency. These cost about R200,000, and most have four computers, four phone lines, a printer, a copier and a TV. Most are in rural areas. Only a few are economically sustainable, mostly through running computer-training courses. There have been many technical, financial, and managerial problems.

Conclusion

These two models show different lessons. The small business centers have been very successful in some countries, and they require a supportive environment consisting of a legal system, taxes and helpful telephone operator. Some are starting to move beyond telephony into ICT services but only when there is an economic demand; local content creation is unlikely. They increase access to the Internet and ICTs, but primarily only for those who can afford rates that are out of reach of the majority of the population. The majority of the centers are in the main cities such as Dakar and Nairobi. There usually is no explicit commitment to wider developmental goals.

The larger, funded telecenters show that ICTs can be useful in development when there are sufficient local involvement, support, training, and finance. However, none of them have shown a model that is sustainable. The more realistic projects, such as in Mozambique, have business plans that show that the centers will take at least four years to be self-sustaining—and only then with the capital written off.

At best, these centers cover operating costs—sometimes not including phone bills or salaries. No major funded telecenter has been able to set aside money for depreciation of equipment, let alone generate money to repay the initial capital. Many of these sites are offering useful services in their communities, though most are so young that their impact is more anecdotal than demonstrable. In most cases there have been greater technical problems than anticipated: power problems, computer crashes, theft, and lightning strikes. Many of the externally funded telecenters have been very top-down projects, certainly with participation, but within the guidelines of the external funders.

While there is now experience in the usefulness of ICTs in development, none of the existing, funded telecenters could be rolled out in any large-scale way. So far, they do not present a model that is useful for universal access as opposed to individual projects.

Some lessons can be drawn:

• Centers are managed better when the owners have a stake in them. In some projects, donated equipment is lying around unused. The entrepreneurial instinct is a strong force in making a center effective.
• There is a great demand for telephony. ICT use can be built, but it takes time, training, and local adaptation.
• Simple business models are more likely to be successful than complicated ones. The idea of a multipurpose telecenter is ambitious. Without extensive training and support, many of the wider aims of telecenters are difficult to accomplish.
• Computers by themselves are not an information service. Few centers use information technology systems to provide information for local use.

The small telecenters have shown there is a greater demand for telephony than had been thought, and a market is growing for ICTs. The larger centers have shown that ICTs can be of use in rural areas, but currently are not economically sustainable. Purely market-driven initiatives are likely to increase the digital divide within Africa, and we do not yet have a model for sustaining community access centers that can provide access for the majority.

Externally funded projects will never, by themselves, change the reality for the majority in developing countries. There just isn't the money, even if there was no problem with the dependency this would create. So efforts should go toward models that can be reproduced, but acknowledging that there are different ways this can happen.

• Straight commercial: Companies like Africa Online and others may move into this market if they believe it is lucrative. Many more areas can be reached economically than previously thought.
• Subsidized: Long-term international funding is not beneficial, but there is a case for local public funding for some projects, as with schools, clinics, and—in some countries—libraries. However, rarely should the funding be 100 percent (all the economic lessons of entrepreneurship should be used). However, this route is uncertain because most African governments have very tight finances, and in many areas the state is tending to withdraw, including from education, health, and public libraries.
• Step-up migration: Perhaps the way with the greatest potential to bring access to ICTs throughout Africa is to support smaller businesses and community organizations that develop new services themselves. If they are offering telephony, they can be the support to offer fax, or secretarial, or computer, or even Internet services.

These three methods of extending the rollout of ICTs require different kinds of research and support: The first requires economic return information to persuade investment. The second requires evidence of wider social impact sufficient to encourage public funding. And the third requires experience to minimize local risk and make the migration easier. These three are not exclusive categories; a range of external commercial funding, public funding, and smaller entrepreneurial activity can work together.

In particular, there is less work on the step-up migration. Support through guides for the thousands of microentrepreneurs tells about why and how to offer fax, messaging, Internet and information services; microloans (as carried out in Bangladesh by Grameen) for faxes and computers; low-cost training courses; computer recycling for small businesses; e-commerce tool kits; networks; and newsletters.

It would be useful if the focus on telecenters in Africa shifted from individual projects to developing a national system that would support a range of private, public, and small-scale initiatives to bring ICT within the reach of the majority in this continent. This would include regulatory structure, business support and training, public-information and content-creation networks, access to loans, and technical assistance. We now know there is a market for telephony and we have some evidence that ICTs can be useful in development, but we do not have a sustainable model that can be rolled out successfully throughout the continent. The emphasis should now be on supporting many different initiatives while learning from them and sharing the experience. Big top-down projects have only limited use.

As ITU secretary-general Pekka Tarjanne has said: The truth is that most Africans will not gain access to telecommunications without African initiatives, taken by individuals. The individual who sublets his or her phone line or sets up a phone shop or telecenter does more to close the development gap than the great corporations and businesses of the world.''