Kenyans shun PCs for smartphones and tablets -- Daily Nation

Interesting statistics. Read on.

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Demand for personal computers has been declining in recent years as more Kenyans prefer smartphones and tablets leaving corporates as the key drivers for PC sales.

Data from International Data Corperation shows that growth for total PC market in Kenya in 2010 was 60.7 per cent, 25.6 per cent in 2011, 16.7 per cent in 2012 and 4.9 per cent in 2013.

"The growth is declining mainly due to consumers shifting towards smartphones and tablets," IDC said in an email statement.

IDC said around 90 per cent of the total desktop PCs have been continually used by commercial entities majority by SMEs and big firms.

Smartphones and tablets in Kenya have continued to become cheaper with the cheapest smart phones retailing at around Sh4,000 while cheap tablets are retailing at around Sh8000.

The top 3 vendors in both smartphones and feature phones in Kenya are Samsung, Techno and Nokia(not in any order), IDC said.

Tablets market in Kenya is also experiencing growth especially with the push from telco companies due to their high ARPU(Average Revenue Per User) compared to smartphones and PCs when it comes to Internet.

Telco companies like Safaricom have an ambitious plan of selling around 5000 tablets each month for the first half of 2014. Intel has partnered with Asus to provide entry level tablets in the country.

Story by CARLOS MUREITHI

"

A nation of Gamblers and an Unemployment Crisis -- Daily Nation

"A nation of Gamblers and an Unemployment Crisis

By Bitange Ndemo

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In Summary

• There are virtually no other investment returns in Kenya that beat land and this is where our problems begin.  
• Walk in the aisles of supermarkets in Africa and see sun dried tomatoes from Spain and sun dried beef from Australia when God gave us more sunshine and land than any other part of the world.
• Use of capital to purchase land for speculation undermines production and stifles entrepreneurialism. 

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In the early 1990s while in the diaspora, I purchased a half- acre piece of land in Runda for KSh700,000.  In the mid-1990s I invested in a stock portfolio amounting to KSh500,000 and a retirement fund starting at Ksh. 5,000 per month with an initial unit trust of KSh250,000. 

Nearly twenty years down the road, land without structures in Runda has appreciated more than 40 times.  The stock portfolio has barely doubled.  The unit trust is down to KSh235,000 thanks to the global financial meltdown.  In the absence of clear land tenure policies, we have become a nation of gamblers exerting pressure on land to the extent that you do not have to do anything to make money.  

There are virtually no other investment returns in Kenya that beat land and this is where our problems begin.  It creates a situation where there is no incentive for anyone to buy machinery for production when there is more return in speculating on land.  To create employment, we must invest in productive sectors and in turn create employment opportunities.  Foreigners too have noted this anomaly to the extent that some of the foreign direct investment goes into nonproductive sectors with abnormal returns.  

Worse, the first thing even youthful Kenyans invest in iskogora omogondo (buy land).  How much land does a man need?  A Russian author, Leo Tolstoy posed this question in 1886 and as Wikipedia summarizes the story, man only needs a six-by-six foot deep piece of land.

PLENTY OF LAND 

The protagonist of the story is a peasant named Pahom, who overhears his wife and sister-in-law argue over the merits of town and peasant farm life. He thinks to himself "if I had plenty of land, I shouldn't fear the Devil himself!" Unbeknownst to him, Satan is present sitting behind the stove and listening. Satan abruptly accepts his challenge and also says that he would give Pahom more land and then snatch everything from him. A short amount of time later, a landlady in the village decides to sell her estate, and the peasants of the village buy as much of that land as they can. Pahom himself purchases some land, and by working off the extra land is able to repay his debts and live a more comfortable life.

However, Pahom then becomes very possessive of his land, and this causes arguments with his neighbors. "Threats to burn his building began to be uttered." Later, he moves to a larger area of land at another Commune. Here, he can grow even more crops and amass a small fortune, but he has to grow the crops on rented land, which irritates him. Finally, after buying and selling a lot of fertile and good land, he is introduced to the Bashkirs, and is told that they are simple-minded people who own a huge amount of land. 

Pahom goes to them to take as much of their land for as low a price as he can negotiate. Their offer is very unusual: for a sum of one thousand rubles, Pahom can walk around as large an area as he wants, starting at daybreak, marking his route with a spade along the way. If he reaches his starting point by sunset that day, the entire area of land his route encloses will be his, but if he does not reach his starting point he will lose his money and receive no land. He is delighted as he believes that he can cover a great distance and has chanced upon the bargain of a lifetime. That night, Pahom experiences a surreal dream in which he sees himself lying dead by the feet of the Devil, who is laughing.

He stays out as late as possible, marking out land until just before the sun sets. Toward the end, he realizes he is far from the starting point and runs back as fast as he can to the waiting Bashkirs. He finally arrives at the starting point just as the sun sets. The Bashkirs cheer his good fortune, but exhausted from the run, Pahom drops dead. His servant buries him in an ordinary grave only six feet long, thus ironically answering the question posed in the title of the story.

Although Pahom wanted to use the land productively, greed could not allow him to see his dream.  Here at home, the land economy is destroying the future of a generation.  Across Africa, we are importing things we should be growing and adding value to, to enable us create jobs.    In 2011, the Food and Agricultural Organization said that the global food import bill hit $1.3 trillion of which 18 per cent ($239 billion) are imports to food deficit countries or Least Developed Countries.  Africa food imports are in excess of $40 billion with Nigeria spending $11 billion on staple food while its land lies fallow.  Gabon spends $40 million importing eggs from Europe.  Evidently, we simply acquire the taste from Europe but not the skill to rear chicken for our own egg consumption.

SUN DRIED TOMATOES

Walk in the aisles of supermarkets in Africa and see sun dried tomatoes from Spain and sun dried beef from Australia when God gave us more sunshine and land than any other part of the world.  In economics, it is argued that there are three factors of production, that is, land, labour and capital.  Philosopher John Stuart Mill added a fourth one, entrepreneurship. Other academics discarded Mill's theory and said information should be the fourth factor of production.  But what they failed to see is the underlying assumption that the interplay of the four factors will function smoothly if none of the factors will undermine the other.  As such use of capital to purchase land for speculation undermines production and stifles entrepreneurialism.  Without an entrepreneur in a free market economy, there are no jobs.

While large and fallow lands are in the hands of the rich, subsistent farming is undermining agricultural productivity through over utilization of land and excessive subdivisions.   From Google Earth, I cropped land use in Kisii and compared it with Switzerland.

Land use in Kisii. Credit: Google Earth

Whereas in Switzerland they have incorporated environmental factors into their planning, in Kisii you can see the pressure on land in farming right up to the river which in turn carries away the soil nutrients through soil erosion.  Over time the land will be depleted to the extent that we shall have undermined the livelihood of future generations.  Each homestead serves as the family cemetery complicating any future re-planning or investments as no amount will buy family burial sites.   Our preoccupation with land is our undoing.  Close to 50 per cent of court cases in the judiciary are land-related.  Most cases are tying up billions of shillings waiting to be settled when the resource could be used to create jobs.

Land use in Switzerland. Credit: Google Earth

There is much we need to learn from other countries like Switzerland and the United States of America.  The US’s obsession with real estate almost brought down the economy and memories of the crisis are still fresh.  Our obsession with land and ownership structures is worse than feudalist Europe. Feudalism was a system for structuring society around relationships derived from the holding of land in exchange for service or labour.  Urbanization defeated feudalists.  We can change with rapid urbanization that will free land for productive agricultural activity.  More than anything else we need a comprehensive land use law and stop any further land subdivision in highly productive rural land.  To speculate is to gamble with a critical factor of production.  Let us not be a nation of gamblers.

Dr Ndemo is a Senior Lecturer at the University of Nairobi, Business School, Lower Kabete Campus. He is a former Permanent Secretary, Ministry of Information and Communication. Twitter: @bantigito

"

Best is yet to come, says Facebook's Zuckerberg - Daily Nation

Interesting read about Facebook...

According to Zuckerberg, the 10 years Facebook is celebrating has given them ground and resources to make Facebook bigger and enable them solve more challenges. Read his story on the daily nation on this link...http://www.nation.co.ke/business/Tech/Best-is-yet-to-come--says-Facebook-s-Zuckerberg/-/1017288/2192798/-/10bq133/-/index.html

Sony cuts 5,000 jobs, exits PC business and tips $1 bn loss -- Daily Nation

Sony is cutting jobs and retiring employees in the PC business.

"

THURSDAY, FEBRUARY 6, 2014

Sony cuts 5,000 jobs, exits PC business and tips $1 bn loss

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In Summary

• Sony said Thursday the job cuts would save about $1.0 billion a year starting from early 2015, and announced the sale of its Vaio-brand PC division to a Japanese investment fund.
• The firm also turned down a call from US hedge fund boss Daniel Loeb to spin off 20 per cent of its entertainment arm to boost profits.

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By AFP
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Sony warned Thursday it would book a $1.08 billion annual loss as it cuts 5,000 jobs and exits the stagnant PC market this year, as the once-mighty electronics giant struggles to reinvent itself in the digital age.

The shock news comes a week after Moody's downgraded its credit rating on Sony to junk, saying the maker of Bravia televisions and PlayStation game consoles had more work to do in repairing its battered balance sheet.

Japan's embattled electronics sector, including Sharp and Panasonic, has faced serious challenges from foreign rivals such as US giant Apple and South Korea's Samsung as they were outplayed in the smartphone and low-margin television business.

Sony said Thursday the job cuts would save about $1.0 billion a year starting from early 2015, and announced the sale of its Vaio-brand PC division to a Japanese investment fund.

The deal with Japan Industrial Partners was reportedly worth between 40 billion yen ($400 million) and 50 billion yen. No financial details were disclosed.

Citing "drastic changes" in the computer market, Sony said it would concentrate on its lineup of smartphones and tablets and "cease planning, design and development of PC products". The firm is a small player in the global PC business.

Sony chief Kazuo Hirai said the moves were aimed at "accelerating the revitalisation and growth of our electronics business".

"But the environment surrounding electronics will get more severe and it will be hard for us to achieve the goal we set for our PC and TV businesses," he told reporters in Tokyo.

Sony said the TV business would not be profitable in the current fiscal year to March, in which it expects to lose 110 billion yen. The bulk of those losses are tied to restructuring costs.

Sony has pinpointed digital imaging, video games and mobile as the units which it hopes will lead a turnaround in its core electronics business.

Unlike Panasonic, which has abandoned consumer smartphones, Sony has seen buoyant sales of its Xperia offering and record sales for its new PlayStation 4 console.

Its entertainment arm, which includes a Hollywood studio, and a little-known insurance business also make money.

But Hirai, who has led a sweeping restructuring including asset sales that saw the $1.0 billion sale of Sony's Manhattan headquarters, has shrugged off pleas to abandon the ailing television unit. On Thursday, he said Sony would strengthen its focus on the high-end TV business.

Searching for direction

The firm also turned down a call from US hedge fund boss Daniel Loeb to spin off 20 per cent of its entertainment arm to boost profits.

Sony booked a small profit in the year to March 2013, after four years in the red, but that was largely due to asset sales and a decline in the yen which boosts exporters' profitability. The unit has tumbled by about one-quarter against the dollar over the past year.

The firm invented the iconic Walkman but has struggled in recent years as the sector faced plunging TV sales while foreign rivals surged past them in the lucrative smartphone market.

Japanese digital camera makers have also suffered as consumers increasingly rely on smartphones to snap pictures.

"It seems like Sony is still searching for direction -- things are going to be tough for a while," Mitsushige Akino, analyst at Ichiyoshi Investment Management, told AFP before the announcement.

"Japanese electronics firms have to carry out these restructurings quickly, including launching more competitive products, while the weak yen gives them breathing room."

This week, Panasonic and Sharp said earnings improved thanks to an overhaul of their businesses and the yen's decline, but weak sales of consumer gadgets held back the recovery.

The job losses at Sony's TV and computer units -- about 3.5 percent of its global workforce -- would see several hundred Vaio employees likely rehired by its new owner.

Sony added it will "explore opportunities" to transfer some employees to jobs within the company, which has about 145,800 employees, and offer others an "early retirement support programme".

"

Government awards laptop tender to Olive Telecom of India --Daily Nation

Government awards laptop tender to Olive Telecom -- India

At long last the laptops will come in March 2014.

Read the full article here:

http://www.nation.co.ke/news/Laptop-Tender-Olive-Telecommunication/-/1056/2197036/-/108eknxz/-/index.html

M-Kazi Closes Shop

M-Kazi Closes Shop

Trending stories online on Technology in Kenya indicate that M-Kazi is closing shop.

Kenya’s M-Kazi is an Unstructured Supplementary Service Data (USSD) job application service connecting job seekers to employers. The start-up had a team that included the co-founders Nancy Tingze Wang, Lino Carcoforo and Mem Maina seen in the photo below.


M-Kazi "had negotiated key contracts and service level agreements with major telecoms in Kenya, conducted in depth market research and acquired 30,000 users, leveraging grass roots marketing campaigns to generate viral customer acquisition." according to a story carried by Techmoran.

Initial discussions seemed to imply that the organization closed due to embezzlement of funds by one of the founders. However, Lino Carcoforo wrote a clarification later indicating that the startup closed for the following reasons, in his words:

"1. Billing issues with Safaricom - Having negotiated rates through craft silicon to ensure better margins on SMS and USSD, mkazi was not able to bill safaricom directly due to a lack of a tripartite agreement.

2. Lack of cash flow due to not being able to bill

3. Discrepancy between mkazi system sms sent and safaricom delivery reports.

4. Failure to close subsequent funding as a result of not showing adequate growth in user acquisition -again, directly tied to lack of marketing spend."

Indeed, M-Kazi stood a chance to succeed in a place where m-everything seems to succeed. With millions of job-seekers on the market fueled by availability of mobile phones.

This means BrighterMonday and a host of other smaller similar ventures will continue to dominate the market.

Tracing the roots of M-PESA -- CIO

There is a book out there that traces the roots of M-PESA. Read on on this article found in CIO Magazine.

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Tracing the roots of M-PESA 

By Lilian Mutegi

February 05, 2014

With 18.2 million customers and currently contributing up to 43% of Kenya’s GDP, M-PESA has been seen as a disruptive innovation that threatens incumbent businesses as well as sparking new businesses and entrepreneurship.

This has seen two researchers - Nicholas P.Sullivan, a Senior Fellow at the Centre for Emerging Market Enterprises and Tony K. Omwansa, a lecturer at the university of Nairobi – come together to trace the roots of M-Pesa from 2003 up to date in a book that was launched yesterday at the Michael Joseph Centre.

The book tittled “Money Real Quick-The story of M-PESA” is the first that documents the profound impact that Safaricom’s mobile money transfer services M-PESA has had on the lives of users in Kenya.

According to the book, M-PESA platform moves Kshs 77.3 billion a month in peer to peer transactions. A further Kshs 9.9 billion is moved in person to business transactions while person to business transactions account for Kshs 7.6 billion a month.

Using case studies, the book chronicles the evolution of M-PESA from its original concept as a micro finance tool to a complex financial transactions platform that is leading Kenya’s cash-lite agenda. The book features the accounts of those who worked on the service and how it grew to become the most successful mobile money solution in the world.

The 192-volume has 9 chapters beginning with the Introduction, The Innovation, Human Network, Banks Disrupted, Impact at the Base of the Pyramid, Inching towards “Financial Inclusion”, Swahili Silicon Valley, Change is Not Easy, Kenya on Stage and the final chapter - Cash is the Enemy.

It is a journalistic narrative-driven story about the birth and development of M-Pesa and its impact on the lives of Kenyans. A secondary mandate is also to show the ubiquity of mobile money that allows the potential for financial innovation in developing countries especially those at the base of the pyramid.

At some point in the book, the authors mention Kibera, the largest slum in Kenya. “Even in Kibera slum, on the outskirts of Nairobi, where over 250,000 people live cheek by jowl in highly unsanitary conditions and makeshift housing is a beehive of M-Pesa activity. There are very few bank branches but M-Pesa agents line in the dirt streets: People queue up to fill their phones with e-money or even collect cash. Savings group once a high touch face to face phenomenon much like money lending, have in many cases adopted M-Pesa as a means of mobilizing lump sums to lend amongst themselves,” state the authors.

The book was initiated by Wiebe Boer, former director Rockerfeller Donation in 2010 and took 4 years to complete using funds provided by the same foundation. It is published by Guardian Books.

“Money Real Quick-The Story of M-Pesa”, will be available to the public via Amazon. It can also be bought from local bookshops at a price of €9.99 which is equivalent to  Kshs. 1,165.63.

"

CCTV to replace traffic police in Nairobi from March 2014 -- CIO

We are soon to see no police at the roundabouts and Nairobi roads  as has been the case over the years following the installation of CCTV cameras on traffic lights that will monitor and control traffic.

Read this article found in CIO magazine.

"CCTV to replace traffic police in Nairobi from March 2014 

by Kamau Mbote
February 05, 2014 

CCTV cameras were installed by Chinese firm Ms Nanjing Les Information Technology at a cost of Kshs 430 million.



Nairobi roads and roundabouts will no longer be manned by traffic police as has been the case over the years following the installation of CCTV cameras on traffic lights that will monitor and control traffic.

The plan that is set to rollout starting March 1, 2014 is the result of months of upgrades of traffic lights and installation of CCTV to monitor major roads in Nairobi.

According to Nairobi governor Dr Evans Kidero, the machines are more than capable of controlling traffic meaning the police can be redeployed to handle security.

“Where there is electronic traffic control system there is no need to add human’s intervention,” he said.

The governor who was speaking after receiving recommendations from a committee tasked with decongesting Nairobi also noted that a number of cameras installed along University Way in the past few weeks had already been destroyed by rioting students.

As a result the governor says the University of Nairobi now has to pay for repairs worth 5 million shillings.

“We are going to claim repairs of the university way from the University of Nairobi and the ones from Nyayo stadium from the contractor who interfered with the cables,” he added.

The current CCTV cameras were installed by Chinese firm Ms Nanjing Les Information Technology at a cost of 430 million shillings part of an initiative to install CCTV cameras in major cities in the country at a cost of 8.5 billion shillings.

In phase 1 51 cameras were to be installed to help curb insecurity and in traffic management and would cover Kirinyaga Road, Gikomba, Kenyatta National Hospital, Machakos Country Bus Station, Muthurwa Market among others areas.

Plans are also in place to have building owners install CCTV cameras that will be linked with the city’s backbone.

The committee also says plans are under to decongest Nairobi ensuring that people don’t dump vehicles in Nairobi that has led to fewer parking available."