Mobile no threat to Internet cafes

By Damaria Senne for Nokia
Johannesburg, 10 Apr 2008

The ability of low-income people to access e-mail through their mobile phones will not hurt the growth of SA`s Internet caf'e market, says mobile phone giant Nokia.

Earlier this month, Nokia announced a range of four entry-level handsets which will allow users to access their Web-based e-mail accounts from their mobile phones.

Anand Narang, Nokia`s director of entry category marketing, says users of the Nokia 5000, 2680, 7070 and 1680 will be able to configure the phones to receive mail from their e-mail providers.

He says the phones will provide e-mail connectivity for people who cannot afford PC-based Internet.

The phones will also popularise e-mail among communities, driving them to Internet cafes to access additional Internet services.

Experienced e-mail users will also set up e-mail connections for family members to facilitate easier communication between them and this, in turn, will increase the number of people who grow comfortable with using digital media, he says.

Benefits

World Wide Worx MD Arthur Goldstuck notes that access to e-mail through a mobile phone reduces the time and money users spend to go to an Internet cafe.

However, it does not replace the need to go to an Internet cafe to access broader Internet services, he says. SA still has a need for Internet cafes, especially in townships and rural areas, he adds.

Universal Service and Access Agency (USAASA) CEO James Theledi says mobile e-mail and Internet cafes complement the work of USAASA, enabling connectivity for the poor.

Government has tasked USAASA with rehabilitating/creating 174 telecentres and setting up 244 cyber labs in schools during the 2008/9 financial year. USAASA also supports initiatives by operators to expand their infrastructure to under-serviced areas.

Nokia Siemens Network also sees a need to build public Internet facilities in remote areas. The company recently said it would boost its Village Connection solution so it provided Internet services in addition to voice and data services.

The original model provided only voice and data solutions and was trialled in a number of emerging markets, including India and Tanzania, said Rauno Granath, head of new growth markets. Plans are also in motion for a South African trial.

Challenges

Goldstuck says Internet cafes face big financial challenges as owners` business margins are low, yet the best local locations are expensive.

And, while Vodacom, MTN and Cell C have successfully rolled out community services, iBurst`s experience also highlights the challenges new players face in raising money to roll out infrastructure in under-serviced areas.

In 2006, iBurst CEO Thami Mtshali announced an initiative to build about 20 000 Internet cafes by 2010. The project failed to take off due to its inability to get funding from a number of development institutions, including the Department of Trade and Industry and Umsobomvu Youth Fund.