Introduction

We are living in the information age. That cannot be gainsaid. Today, information is the currency of the world economy, and the tools of this trade - the information communication technologies - are equivalent to the hoes, sickles and ploughs of yore. Without Information Communication Technologies (ICTs), it is impossible to play a meaningful role in the modern world. Indeed, lack of ICTs implies lack of opportunities hence poverty. An individual without access or ownership of such ICTs as mobile phones, computers, television, radio, modems, et al will find himself or herself facing insurmountable obstacles in the quest to earn a living. Such is the importance that ICTs have gained in the world of the 21st century.

It wasn't always like this. Up until the second half of the 20th century, the world pretty much depended on what has been referred to as the Old Economy. The richest individuals in the world were those who owned or controlled or worked in industry, railways, shipping, agriculture, retail industry, pharmaceuticals, military, government and religion. Such people as Henry Ford, the Rockefellers, the European royal families, the Kennedys and the famous Aristotle Onassis all made their vast fortunes from Old Economy activities. The Old Economy evolved from the previous feudal system where the owners of land became the ruling elite and the Old Economy barons were those who owned or controlled the means of production and distribution.

In the ICT driven economy, otherwise known as the New Economy, the richest people are those who own or control the flow of information. In other words, the New Economy dictates that information is not only a power by itself but power can be derived by controlling the flow of that information without necessarily owning it or conciously knowing what exactly that information is. Under the New Economic order, manifested in the use of ICTs, the power barons of today are those who own or control the channels of information. Presently, the list of the world's richest individuals is dominated by leaders of the ICT industry. Such people as Bill Gates, Ted Turner, Rupert Murdoch and Steve Jobs come to mind.

The Old Economy hasn't been completely vanquished however, and neither is it desirable to vanquish it completely. The Old Economy provides the material superstructure in which the New ICT-driven economy operates. Without roads, railways, factories, farms, motor vehicles, airplanes, governments and churches,  the New Economy would operate in complete nothingness, it would exist in a vacuum with no raison d'etre, an entity unto itself without any meaning whatsoever. The New Economy complements the Old one, the New Economy makes the Old one manageable but doesn't completely replace it. The New Economy can never replace the Old for we as civilized human beings need food, clothing, shelter, transportation, law and order: all aspects of life provided by the Old Economy throughout the ages. The New Economy makes life easier, that's all.

ICTs have provoked great excitement due to their characteristic of making life and work much convenient than it was prior to the current explosion in ICT development. Before the advent of telephones, radio, television, computers, mobile phones and Personal Digital Assistants, the world functioned slowly but with acceptable efficiency. ICTs have helped increase that efficiency. For instance, its much easer to feed sales figures into a computer then retrieve reports, say, at the end of the month displaying sales patterns and customer feedback. In the past, such reports would have had to be painstakingly done by hand but they were done nevertheless though with much more labor than is required today.

The convergence of ICT technologies is another aspect of ICT that has provoked great excitement. For instance, the convergence of the telephone, FM radio, the modem and the internet browser into one device called the third generation mobile phone. Take also the convergence of computing technology, the Internet, the music player and the television to form the modern home entertainment unit. With a single ICT device, an individual can accomplish tasks that would have required multiple devices only a decade ago. Such is the tremendous pace in the development of ICTs.

In future, when the New Economy and its associated technologies have gotten ingrained into our lifestyles, and the excitement has long worn out, then it will be possible to look at it in its rightful context: that ICTs are there to complement normal human activities and not to supplant them. That the purpose of human life, just as it was since the days of the first men and women, is essentially survival and procreation. ICTs do not exist for their own sake and humans don't exist for the purpose of feeding on endless streams of information provided by the tools of the New Economy. Human life is much more complex, much more richer in experience to be reduced to simply the utilization of manmade tools.

When that time comes, we will be grateful to the 19th century pioneers of ICTs, people like Samuel Morse, Guglielmo Marconi, Thomas Edison, John Logie Baird, Franklin Roosevelt, among others. These people had the vision of what we see today, and did not hesitate to make the faltering baby steps towards actualizing this dream. Their vision was of a society of equals, each man, woman and child, co-existing and working together for the greater good. A world of respect, dignity and freedom. This was the driving force behind the emergence of ICTs. Its up to the future generations - and the current ones - to bring that vision into fruition.

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Definition Of Terms And Concepts

The term Information Communication Technology (ICT) has transformed itself into a vogue phrase in the present information age. Anyone desirous of appearing knowledgeable and tech-savvy inserts the term randomly during the course of day to day speech and reports. The term, ICT, finds itself used interchangeably with the term IT and within the media, both are used to symbolize high level technological developments in computers and interconnectivity. Hence, in normal usage, IT refers to computers, networks, servers, the internet, mobile phones, Bluetooth, etc. IT includes technology that is designed to transmit, process or store information and hence the simple telephone qualifies as part of IT just as much as the phonograph and the telegraph of the 19th century. The term IT, so defined as any tool of handling, manipulating or storing information could extend as far as including the pen, the stylus and the book but such claims in the information age would likely be met with jeers.

Since the term, IT, includes such an astounding range of devices whose invention has spanned hundreds of centuries of human existence, there arose the need for a much more definitive term that would readily refer to the tools of the Information Age.  From the mid 1990's came the term Information Communication Technology to restrict the term to strictly those that store, retrieve and transmit information electronically, more specifically, using digital technology.

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Importance Of ICTs in National Development

The substantially important role played, and to be played, by Information Communication Technologies on national development cannot be overemphasized enough. With the current information age, only those countries that are technologically relevant will prosper and Kenya will be no exception in this regard. Through adopting ICTs, the country can put in place the prerequisite infrastructure to attract both local and foreign direct investment that will contribute to economic growth as well as the creation of employment opportunities for the growing population.

For much of the 1990s, the United States of America (USA) experienced remarkable economic growth that had not been witnessed since the post World War 2 era. American corporations specializing in software and computers grew at a rapid pace making billions of dollars and creating a new class of the super rich exemplified by Bill Gates of Microsoft Corporation. High tech companies were sprouting up literally at every street corner. Initial Public Offerings at the New York Stock Exchange turned computer wizards into overnight millionaires catapulting them into the creme de la creme of international celebrity. Banks, investment funds, philanthropists and the US government all made a collective decision to invest in start-up companies that were innovating new standards in ICTs. Silicon Valley, the world centre of computer technologies, grew in size and relevance and what was once deregoratively referred as the home of computer addicts emerged as a major player in the international economy.

Much of that economic growth experienced by the USA in the 1990s is directly attributable to the rapid growth in demand for ICTs following the emergence of the internet which was widely popularized by the Federal government. Indeed, the US Vice President, Al Gore, coined the term, "information superhighway" as a means of demonstrating to the American public the opportunities offered by internet connectivity.

Its not only the USA that has seen the benefits of policy and monetary investment in ICTs; the emerging industrial economies such as Taiwan, China and India owe their growing financial punch to the use of ICTs. Most of the computer hardware in use across the world today comes from these three countries. Manufactures such as IBM, Hewlett Packard - Compaq, Canon, Epson among others have relocated their manufacturing operations to Asia not only because of lower labor costs but because of the conducive environment that exists in those countries for the development of ICTs. This has helped transfer skills to those countries' populations. Today, a significant portion of software developers also come from the trio and this is evident in the workforce composition of American software giants Microsoft, Adobe Systems, Sun Microsystems and Apple Inc. In 2005, a Chinese company - Lenovo - bought controlling stakes in IBM, long regarded as an icon in American engineering.

The transfer of skills and technology has had another advantage for India. For long, India's planners were faced with the ceaseless nightmare of creating enough jobs for the rapidly growing population that crossed the 1 billion mark at the beginning of the millenium. ICTs provided the answer: all that was needed was just a change in relevant policies as the telecommunications infrastructure was already in existence and investors in the ICT industry would help train the population thus improving their job prospects. This approach - a collaboration between government agencies in India and the private sector - has made India to be the global centre for back office outsourcing.

Back office work includes activities that provide support for a company's core duties of providing particular products or services. Back office work is often seen as tedious and distracting to company employees as well as pushing up costs through the hiring of non core staff. Back office activities include data entry, customer call centre operations, payroll management, customer feedback analysis and general administrative correspondence. India, largely due to its early investment in ICT policies as well as the transfer of skill to its people, has convinced corporations in Europe and the United States to outsource to itself all back office operations. The result is that a telephone subscriber in London calling the enquiries line is more than likely to have her call answered by an Indian customer service officer. Consequently, thousands of people in India have gotten jobs in call centres and this has not only improved the standards of life for these people but it has had a multiplier effect on the national economy as well out of the fact that directly employed persons are in themselves customers for consumer and luxury goods from other commercial sectors.

Apart from India, other countries that are engaged in back office outsourcing are the Phillipines and Ghana. Kenya got into the outsourcing business relatively recently and currently, two call centres exist in Nairobi. Though Kenyans are skilled in the use of ICTs, the connection infrastructure is inadequate for large scale international outsourcing operations. However, a planned fibre optical cable linking Kenya with the rest of the world through the Indian Ocean will definitely expand data bandwidth in Kenya and hence improve the country's prospects in tapping the back office outsourcing market.

The development of mobile communications, video conferencing facilities, multi-media capabilities of communications and the internet are of immense benefit in healthcare delivery. By this revolution, spatial differences between medical specialists, medical centres and patients can be eliminated. ICT permits valuable professional expertise to be made available to remote areas. Today, the doctor on call can move freely with his/her mobile phone and can easily be reached in case of emergency to give initial instructions on how to manage the patient while on the way to the hospital if necessary.

ICT can also be used for exchange of information between different health professionals thereby improving clinical effectiveness. Medical equipment is becoming increasingly more sophisticated principally as a result of advances in ICT. These systems offer powerful tools for diagnosis and capability for simulation and modeling in the medical sphere. Surgery can be made easier and more effective by giving surgeons the ability to visualize the area of the body that will be the subject of the operation.

There are available a range of information, transaction and technology solutions that help consumers, physicians, providers and health planners navigate the complexity of the healthcare system including software solutions that facilitate medical practice generally. For example, an Electronic Health Record System can be developed and a National Network of Medical Information be established for the purpose of linking all medical centres to enable citizens to access better health services and provide a better management method for human and financial resources at the Ministry of Health (Werre, 2007).

ICTs have emerged as key components in the banking industry and are the instruments used in perking up services that make banking a better experience for customers than it used to be. The first step was in the computerization of banking activities from manual systems leading to increase in efficacy and accessibility of records. The second step was the centralization of all branches to create a seamless network through which a customer can access personal accounts from any branch in the country. Automated teller machines (ATMs) have had their functionality enhanced from mere cash dispensers to become convergent platforms that enable bank customers to deposit cash, pay utility bills and provide debit and credit card services. For instance,  Co-operative Bank of Kenya account holders can pay electricity bills through the bank's ATMs as well as using the M-Banking service to pay bills using mobile phone technology (Co-op Bank, 2007).

The information age has necessitated that corporates automate their information technology systems, not just to match the times, but also to improve efficiency in production and service delivery. There is a wide variety of choice when firms select information systems to suit their needs. Enterprise Resource Planning Systems (ERPs) such as J. D. Edwards, Oracle, SAP R/3 and Baan are available in the market. These sophisticated management technologies cover such operations as finance, asset management, management accounting, sales, distribution, materials acquisition, human resources, plant maintenance and planning for production. In the management accounting module, any expenditure being incurred is pegged to a monthly performance indicator, attached to a cost centre, thus simplifying the budgetary control process. Generally, it is easy to maintain depreciation parameters in coded registers because the required information is always available in the system.

Implementation of ERP improves the timeframe within which firms execute financial reports. With SAP technology, a financial report that would take three weeks to prepare can now be done in three days (Okello, 2003).

Education has as much been a beneficiary in the explosion in the use of ICTs which make learning manageable for teachers and friendly for students. In one private school in the vicinity of Nairobi, each student in a classroom has a computer and, using specialized software, the teacher can avail on each student's computer screen the equivalent of a blackboard to demonstrate the concepts being taught. The software gives the teacher control of the situation by enabling the remote viewing of each student's computer desktop making it unlikely that a student would be distracted by, say, computer games.

ICT development in higher education institutions in Kenya has in the recent past been driven by the popularity of the internet. The effective use of these technologies offers new ways in which the quality, effectiveness and, in particular, the flexibility of higher education can be improved. ICTs can, among other things, have the following impacts: offer new ways of delivering distance education, increase the efficiency and effectiveness of university administrative processes, offer new ways in which universities can compete on a global basis (the concept of 'virtual' universities), open the way to digital libraries and offer major improvements in institutional management and academic administration (UoN, 2002).

Many governments in both developed and developing countries have recognized and identified access to ICTs as an important strategy towards the social and economic advancement of their populations. To achieve the nationwide goal of reducing the digital divide, it is incumbent upon the government of Kenya to provide frameworks, incentives and an enabling environment that will stimulate private sector investment in low-income and high cost areas (Kirui & Muhatia, 2005).

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History Of ICT In Kenya

The first ICT to ever be used in Kenya was the telegraph.

The telegraph, a system of electronic communication consisting of patterns of signals transmitted along copper wires, was introduced into the country during the building of the Kenya - Uganda Railway from 1895 to the early 20th century. Initially, the telegraph line was put up together with the railway but eventually, the telegraph itself outpaced the railway and was able to reach the shores of Lake Victoria long before the railway line. Eventually, the telegraph was extended to Kampala while an undersea cable from Mombasa connected the British administrators with their home office in London.

After World War 1, the use of wireless telegraph gained great popularity worldwide as it greatly increased the distances through which people - and nations - could communicate without a physical medium such as a wire. In the mid 1920s, a group of white settlers working under the Cable & Wireless Company had began radio broadcasts in the Kenya Colony. Though initially tailored specifically for the white settler, Cable and Wireless marked the beginnings of the Kenya Broadcasting Corporation. Television transmission in Kenya began in 1962 though only in black and white pictures. Television broadcasts in full color within Kenya became possible from the late 1970s. Meanwhile, telephone services continued to expand in the country after the initial telegraph network had been completed. The East African Community had the overall mandate of managing telephone, telegraph, telex and radio communication services within Kenya, Uganda and Tanzania in addition to postal services, railways, harbors and power distribution. At independence, there were 48 automatic and 108 manual telephone exchanges in Kenya (GoK, 1983).

When Kenya attained independence, all external telecommunications (telephone, telex and telegraph) were by High Frequency (HF) radio. The HF radio had the disadvantage that only limited services and traffic could be carried by this system. In an attempt to eliminate these limitations, satellite communication was introduced in 1970 with the construction of the Longonot 1 Satellite Earth Station. New services such as phototelegramme, television transmission and reception, leased circuits and data reception were launched (GoK, 1983).  Longonot Earth Station is in use to this day.

The demise of the East African Community in 1977 also marked the end of the East African Posts & Telecommunications union hence, the Kenya Posts & Telecommunications Corporation (KPTC) was formed to manage postal and telephone services in Kenya. In 1978, the government formed the Kenya External Telecommunications Company (KENEXTEL) to provide external communication services (GoK, 1983). KPTC and KENEXTEL were merged in 1982 and KPTC remained the sole organization responsible for telecommunications and postal services until the liberalization of the sector in the 1990s .

The 1990s were a period of economic, political and social liberalization in Kenya, just as in much of the world, following the end of the Cold War. Private courier services emerged to compete with the postal services of KPTC. Paging Service providers gained great popularity as the demand for telephone lines far outstripped what KPTC could supply.  However,  the paging service providers could not compete with the mobile phone providers and as of 2006 paging services had ceased to exist in Kenya.

The first mobile phone service in Kenya was launched by KPTC in the mid 1990s. Applicants had to get a licence from the Ministry of Information & Broadcasting before buying a handset from KPTC - the sole supplier. Even then, service was limited to Nairobi and the cost of a phone call was shared by both the caller and receiver. In 1999, KPTC was split off to form Telkom Kenya (telecommunications) and the Postal Corporation of Kenya. A year later, in 2000, Telkom Kenya sold 40% shares from its mobile phone division to Vodafone UK. This marked the beginnings of Safaricom which is now the leading telecommunications company in Kenya as well as grossing the highest ever profits in Kenya's corporate history. Safaricom made Kshs12 billion in 2006. Kencell Communications was licensed also in 2000 to compete with Safaricom in providing cellular phone services. Kencell later became Celtel Kenya.

With Kenya joining the internet community in 1993, Internet Service Providers (ISPs) were licenced to provide internet connectivity. Among the first were FormNet and Africaonline which began by providing basic email services through the KPTC network. Because of low transmission capacity occasioned by underinvestment in the KPTC telecommunications network, it wasn't until 1999 that internet surfing became possible at affordable costs to consumers thanks to competition among ISPs.

From Independence, only the state-owned Kenya Broadcasting Corporation was licensed to broadcast in Kenya. The first private television station, Kenya Television Network (KTN), started broadcasting in 1990. KTN was also the first to introduce 24 hour broadcasting in Kenya.

The first private radio broadcast, a partnership between KBC and investors, began in 1994. However, the first truly private radio station was Capital FM which began broadcasting in Nairobi in 1996. Capital FM revolutionized radio broadcasting with 24 hour broadcasts, pop culture and expatriate radio hosts.

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Factors That Hamper The Faster Adoption Of Information Communication Technologies (ICTs) In Kenya

POVERTY

Kenya is among countries that are still at the basic stage of building up capacity to utilize both natural and human resources that will enable the country to achieve a better standard of living for all of its citizens. The achievement of national unity, national purpose, national prosperity, equality, dignity, rights and the fulfilment of national character is not only an ongoing process in Kenya but the first steps of initiating that process have not yet been fully realized hence we are still developing towards that ultimate goal of human existence. In other words, Kenya is very much a developing country that has a shortage of practically all that is needed to maximize on the use of the technology that will effectively and equitably exploit the country's potential for the good of its citizens.

Poverty means that even those with the know-how to exploit what bounty that lies within our soils cannot make use of that know-how. For what use is know-how without the prerequisite tools? And assuming you managed to get the tools, of what use will be the final product since few will be able to sacrifice what little meals they get in order to buy your product?  In such society, the merchant of what is commonly agreed as the basics of life will prosper; the vendor of what it is that will improve the quality of life will dwell in penury. Such is the reality of life in Kenya. And that is also the common thread running behind all the reasons we shall examine to explain the pathetic state of ICTs within the Republic. Ironical is the fact that without ICTs, the dire needs of the people can never be satisfied as the global trendsetters exemplified by the already advanced nations have decreed that without ICT, no body can hope to achieve anything meaningful.

The factors behind the pitiable progress in ICT development in Kenya have been adduced to include poor infrastructure, lack of priority, illiteracy and so forth all of which are united in their root within the poverty factor. Can a poor country put up enough power lines and telephone cables when half its children cannot go to school hence becoming functionally illiterate? Can the illiterate get jobs, and can they spare the pittance they earn from manual labor to invest in ICT? Suppose they saw the importance of ICTs, how would they communicate with them anyway?

The booming mobile phone industry in Kenya could be used as a pointer that ICTs are well and truly entrenched in Kenya just as much as the cyber cafés at every street corner, the commercial colleges in every building and the growing mountains of computer junk. However, these are observances made mostly in the urban areas and their surrounding suburbs and bear little resemblance to the dearth in ICTs being experienced as a reality by the rural population who form 80% of the population in the country (Kirui & Muhatia, 2005)

Development in Kenya is not uniform. There exist wide regional inequalities with regard to health care, education, income and other indicators [such as ICTs]. Kenya is among the 10 low income countries with great inequality and these differences in living standards are greatly pronounced between rural and urban areas (IEA, 2002). The existence of ICTs in urban areas therefore does not imply their availability to everyone that needs them; instead these ICTs are accessible to those that are nearest to them.

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POOR INFRASTRUCTURE

ICT represents not only communications technology and information systems but it also represents infrastructure required to enable these aspects to be applied (Mogusu, 2003).

Any technology needs supporting societal pillars in order to thrive. Such pillars could be intangible, such as knowledge and an entrepreneurial culture that encourages innovation and is thus open to creativity as opposed to condemning it. The pillars that support technology could be physical in the familiar sense of paved roads, overhead power lines, ad infinitum. The tangible and intangible pillars cannot exist without each other for they play complimentary roles that help each to exist.

The intangible gives rise to the tangible. The intangible consisting of visions, dreams and ideas are nurtured in an open, entrepreneurial society but crushed in a closed, conservative society where they will unlikely see the light of day.  In the second society, innovation is frowned upon and innovation transplanted from alien domains will wither for lack of nourishment or else the nourishment supply will have to continue from the source of such innovation. The first society, the one that is open and entrepreneurial will see endless innovative techniques. Where innovation is transplanted by external domains, then it will find local nourishment and will prosper and multiply, making the first society wealthier, happier and better able to maximize on local natural and human resources.

Having computers in the rural area, for instance, can serve as a great catalyst for education in ICTs. Just observing computers in use at an office, school or commercial bureau is enough to get people interested in knowing how they work and how to use them for personal gain (Okong'o & Ombiro, 2002). However, computers are very delicate pieces of electronic engineering that require careful handling during transportation and glancing at the state of Kenyan roads can lead to a conclution that computers, among other ICTs, in transit are likely to arrive at their final destination in a state of disrepair.

Still on computers as a case study of infrastructural deficiencies negating the use of ICTs in Kenya, a computer that manages to survive its journey on the rough roads is unlikely to connect to the internet due to a shortage in telephone lines within the country and which affects both rural and urban areas. And those in the rural areas fortunate enough to afford computers [and other ICTs] might not be able to switch the machines on for electricity is absent in most of rural Kenya (Mulama, 2007).

Kenya is finding it very difficult to balance competing economic priorities with very constrained financial resources due to weak industrial and agricultural bases that would ideally have provided such funds. The government has in the past been necessitated by prevailing socio-economic and political circumstances to obtain funds from foreign financial institutions as a form of relief. The ensuing debt servicing environment makes it even more challenging to offer such services as infrastructure rehabilitation (Okong'o & Ombiro, 2002). The result is crumbling roads, power and water shortages, crowded schools with overworked teachers and shabby hospitals with no drugs. More relevant for ICTs is not just inadequate "brown" power but also unreliable telephone connections that are a necessity for ICTs. The highly successful mobile phone companies, Safaricom and Celtel, do offer internet connection services through the mobile phone networks but the rates are generally prohibitive and thus uneconomical for general use.

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INADEQUATE / INAPPROPRIATE POLICY

In May 2002, United States Ambassador to Kenya, Johnnie Carson, had this to say on Kenya's ICT policy at the time:

"... Kenya has been slow in accepting the importance of the telecommunications revolution and has delayed opening up the telecommunications sector as well as recognising the profound importance that modern communication plays in strengthening its economy ... the CCK [Communications Commission of Kenya] is dilly-dallying in liberalising the sector ... Kenya's economy is growing very slowly because of an inadequate telecommunications system and the absence of more open and liberal telecommunications and IT environment. The only people holding back this enormous potential are the CCK and the Ministry concerned ..." (Oyuke, 2002).

The remarks, made in the final months of Daniel arap Moi's authoritarian presidency, expressed the views of many in the ICT sector who were getting impatient with the government's apparent lack of concern with exploiting ICTs in national development. At the time, Telkom Kenya - the country's sole provider of terrestrial telephone lines, international connectivity and internet backbone - was enjoying a five-year monopoly imposed after the breakup of the Kenya Posts & Telecommunications Corporation (KPTC) into Telkom and Postal Corporation of Kenya in 1999. It had been felt, perhaps rightly, that Telkom which had operated like a state bureaucracy needed some protection from competition before it could fully commercialize its services. However, the five year monopoly that ended in 2004 did not provide any reprieve and, if anything, Telkom maintained its old habits of inefficiency, corruption, lethargy and high tarrifs to pay its bloated workforce. Hence the American ambassador's voicing of frustration.

The first policy touching on the communication sector in Kenya was the Kenya Communications Act of 1998 which serves as the policy framework for the sector (Kirui & Muhatia, 2005) and a basis for the Kenya Communications Regulations of 2001 that guides the Communications Commission of Kenya. In 2006, the ICT Bill 2006 was published with a view to replacing the Communications Act of 1998. The common denominator weaving through the two policies is a sense of paternalism by the government that seeks to drive the development of ICTs in Kenya mainly through the Ministry of Information & Broadcasting and implemented by the CCK. The role of the private sector, market trends and appropriateness of technology is utterly ignored in a manner smacking of either elitism, vested interests or conceivably both.

Upon the liberalization of the mobile phone industry in the year 2000, the government - through the CCK - set out to address a concern that competition and private sector participation will exclude rural and high-cost areas from service provision. In a bid to address this concern, major operators had some sort of universal service obligations stipulated in their licences. In some cases, however, these obligations proved to be inadequate as they were not based on service demand and appropriate technology diffusion. Anecdotal evidence shows that because of low appropriate technology diffusion, Kencell's (now Celtel) payphones are largely unutilized. On the other side of the coin, the two mobile service providers - Safaricom and Celtel - had rollout obligations that have been surpassed. By December 2003, Celtel had connected 600,000 subscribers compared to the obligation requirement of 345, 354 supposed to have been achieved by that time.

Safaricom did not have a payphone obligation but chose to undertake a community payphone service - Simu ya Jamii - which allows community entrepreneurs to purchase airtime at a discounted rate and to resell phone services to consumers at commercial rates and in small units. This model of manned community phones turned out to be very attractive to young unemployed persons because the cost of entry is very low while the returns have been very high and in some instances, compare well to wage employment. (Kirui & Muhatia, 2005).

An attempt to increase teledensity and develop rural infrastructure by granting regional licenses has not been very successful. In 2000, three regional telephone companies won bids to operate in selected urban and rural areas. Telair Telecommunications (K) Ltd was approved to operate in Central, Coast, Nyanza, South Rift and Western regions. Safitel was to operate in Eastern and North Rift while Bell-Western Ltd was supposed to operate in North Eastern Province. The three companies were expected to roll out a total of 297,324 telephone lines in the seven provinces with Nairobi exclusively for Telkom Kenya. They were also to build fixed and wireless networks to match the size of Telkom Kenya networks in other provinces within three years. None of the companies had began operations by 2007, a fact that may be attributed to: concerns over terms of interconnection, profitability of the business after getting locked out of Nairobi, the collapse of the world's capital market for new telecommunications ventures and the rapid expansion of cellular networks into areas allocated to these companies (Kirui & Muhatia, 2005).

Similarly, the entry of a third mobile phone operator to compete with Safaricom and Celtel has been bogged down in the courts over licensing issues and shareholding requirements. Econet Wireless of Zimbabwe won the bid to become Kenya's third mobile phone operator but has been unable to begin operations due to varied interpretations of its licence. The CCK says that Econet has failed to fulfil its obligations, Econet states that CCK gave it a license to operate GSM services but not a working frequency, rendering the license nothing more than the paper it is printed on. At the same time, Econet is facing court wrangles with local shareholders arising from a legal requirement that at least 30% of shareholding must be Kenyan. This condition has driven foreign investors in the ICT sector to partner with local cow-boy capitalists in the country. As the disputes rage, Econet has on several times obtained court orders stopping the CCK from licencing other potential mobile phone operators.

A licence awarded to Dubai based Vtel Consortium to become the second national telecommunications operator after Telkom Kenya was cancelled as wrangling with local partners stopped it from meeting its commitments, forcing the CCK to invite the next highest ranked bidder, Reliance Ltd, to apply (Wangui, 2007). However, Reliance sought a review of the licence's obligations, something that CCK found unacceptable. The process was scrapped in March 2007. Even if the process of seeking a second national operator had been successful,  existing mobile phone providers - Safaricom and Celtel - had questioned why the second national operator licence had rights to have both fixed line and cellular services and yet licences issued previously were for only one type of service. Also, the second national operator would have had a licence to operate internet backbone, among other services that the mobile phone companies were not allowed to operate.

The country's internet service provision market is fully liberalized with about 80 licensed internet service providers (ISPs). Unfortunately, only less than half of these ISPs are operating. Internet services are mainly consumed in major cities in the country with Nairobi having about 80% of the one million users in the country. This state of affairs cannot be blamed on operators alone but also on the ICT infrastructure in the country (notice how issues such as infrastructure, poverty and illiteracy are interlinked). Most rural areas are very far from the nearest internet points of presence and this makes the cost of accessing the internet prohibitive.

The government has been viewing the awarding of telecommunications licences as a form of fiscal revenue. The auction approach favored by the government is a market-oriented and objective method for awarding licences and is a very transparent process. However, high auction prices raise challenges for policy makers. The high prices paid for licences make it more difficult for the winning bidders to fund network rollout and service development. As a result of this, choices and decisions about the services to be rendered may be driven by short-term goals of quickest possible recovery of up-front licence fees, instead of long-term focus on overall growth of the industry.

Operators might be tempted to pass on to customers as much as possible of the up-front licence costs, resulting in retail prices higher than desired. Auctioning of licences has raised substantial revenue for the government though a lot can be debated upon this method concerning the efficiency, competitive impact and social implications of this form of licensing. It ought to be a policy objective to accelerate infrastructure deployment and a licence should be allocated subject to a range of deployment conditions and not just the price tag. Futhermore, because of convergence, in future the telecommunications network assets will only be worth a fraction of their present value.

In order to reduce the upfront financial burden on operators, a royalty based payment scheme could be adopted. For example, the regulator can devise a scheme with the payment based initially on a small percentage, for example, 10% of the network turnover but spreading over several years, say, five years. Such a royalty based approach was used in Hong Kong. According to their regulations, the initial reserve price would be 5% of network turnover, with an annual minimum payment of US$6.4 million for the first five years. The minimum payment would then rise from the sixth year over the remaining time as agreed upon.

In countries where licences are awarded on merit and not just on ability to pay upfront fees, services start much sooner. Such countries include Finland, Sweden, Japan and Korea. Japan allocated all its 3G licences to the three incumbent operators; NTT DoCoMo, IDO and Japan Telecom. None of these operators paid any upfront charges. They were only required to pay radio usage fees of approximately US$5 per subscriber per year, thus accelerating market growth. The move turned out to be of great significance since operators are able to use their finances to roll out infrastructure and to market their services (Wangui, 2007).

Studies have found a dynamic relationship between mobile phone communications and economic growth. Mobile phones have had just as much of a revolutionary impact on the developing world as roads, railways and ports. Mobile phone services are increasing social cohesion and unleashing the entrepreneurial spirit that stimulates trade and creates jobs. Were taxes on mobile phones to be cut, private enterprise and government would all benefit. Currently, for every Kshs100 of airtime sold, the government takes Kshs26, which is thought as being too high.  A cut in mobile services taxes would lead to a reduction in tariffs, which would then boost usage of mobile services. Greater usage of mobile phones improves communication between businesses and their customers, fuelling economic development and lifting tax receipts from across the wider economy, says one study titled "Taxation and the Growth of Mobile in East Africa" (Oyuke, 2007).

Indeed, there is evidence that cutting down on taxes will increase the usage of ICTs. At the beginning of the Millenium, an average new computer would cost Kshs100,000 and above. Sales were slow as only corporates could afford to spend that kind of money on a single computer. Small businesses and cybercafés turned to the second hand computer market to satisfy their needs for computing technology. Later on, computer shops began assembling whole computers from spare parts hence the advent of the "clone" computer. Second hand and clone computers were cheaper than brand new computers. The average price of a new clone computer was about Kshs50,000. The disadvantage of this type of computer was frequent breakdowns and a short life span.

Between 2003 and 2005, the government gradually reduced import duties on computers and accessories with a view to making them affordable. By 2007, computers and accessories were zero rated. Today, a brand new computer from reknowned manufacturers such as Dell, Hewlett-Packard Compaq and IBM costs an average of Kshs50,000. The market for clone computers has virtually been eliminated as many small businesses find it economical to invest Kshs50,000 on an established brand with after-sales service rather than spend Kshs24,000 on a lower quality computer. In addition, the price of second hand brand name computers retired from the corporate sector has dropped to Kshs15,000 making them affordable to the average home. A high quality laserjet printer now costs Kshs13,000 while a small inkjet can be obtained for about Kshs5,000.

The result of reducing taxes on computers has been a noticeable increase in acquisitions by homes. Reducing taxes has enabled businesses to buy reliable products from established suppliers thus improving productivity and cutting costs in the medium term. Such benefits can be replicated in other ICTs such as mobile phones, internet connectivity, radio and television if a conducive taxation structure were to be conceived and implemented.

Since the election in 2003 of the National Rainbow Coalition (NARC) led by President Mwai Kibaki, the government has made positive steps in liberalizing the ICT sector. As a way to realize affordable and reliable access to communication services in the country, more players were licenced to compete with Telkom Kenya in various markets. One major development of the new regulatory regime has been to allow cellular operators to have their own international gateways. More operators are being licenced to provide internet backbone and gateways, broadcast signal distribution and commercial Very Small Aperture Terminal (VSAT) services. In addition, some operators, including the Public Data Network Operators (PDNOs) will be allowed to carry any form of multimedia traffic such as Voice Over Internet (VOIP). And in order to extend their reach and benefit to customers, PDNOs have been allowed to establish international gateways for data communication services (Kirui & Muhatia, 2005).

The CCK has also announced that it is reviewing the clause that requires foreign companies investing in the communications industry to have at least 30% shareholding. This has been resulting  to inability by local shareholders to raise capital and infighting among themselves, followed by a litany of crippling court cases (Wangui, 2007).

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EDUCATION

Kenya's semblance of a well endowed ICT sector stands on a bubble because it lacks a dependable and long-term source of manpower and infrastructure sustainability. The country has an ICT deficient education system that will not be able to meet the sustained demands of ICT development and integration. Countries such as Korea and Japan that have well endowed ICT sectors are complimented by performing, structured and technologically-oriented education systems (Olocho, 2007).

The strength of any manpower source is the kind of education and training that is provided within the paradigm of its education curriculum. The current education curriculum in Kenya provides for limited preparation of students for the world of work. It is limited in scope and at the same time, the syllabus is not contextualized to the ICT needs of the country. The relatively few schools that have an ICT program limit the number of candidates who can take up the subject considering it as a specialty whereas this is an essential subject just as would be the compulsory subjects such as mathematics and languages. Its also on an incorrect premise that Kenya has considered ICT as a secondary school subject when it is supposed to be introduced right from the early learning years.

There should be a policy of mainstreaming ICT into all the subjects offered in schools. For instance, an ICT component in geography (GIS), history (e-books), maths (binary), commerce (e-commerce) and so on (Olocho, 2007). This will help inculcate into students an ICT culture from a very early age making the use of ICTs a way of life both in a personal sense and for career advancement.

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BIBLIOGRAPHY

1). Werre, Patrick (2007). “Benefits of ICT to healthcare system” Daily Nation, March 8, 2007. ICT Survey P. IV

2). Co-operative Bank of Kenya Ltd (Co-op Bank) (2007). “Co-op Bank in major drive to improve services” Daily Nation, March 8, 2007. ICT Survey P. V

3). Okello, Bob (2003) “Bamburi reaps from software.” The East African Standard, April 29, 2003. IT Survey P. 15

4). University of Nairobi (UoN) (2002). “University excels in ICT training” The East African Standard, April 30, 2002 IT Survey P. 11

5). Kirui Sammy & Muhatia Godfrey (2005). Universal Access: The Kenyan Experience. In: Etta, Florence E. & Elder Laurent (Eds). At the Crossroads: ICT Policy making in East Africa. Nairobi. East African Educational Publishers & International Development Research Centre - IDRC
ISBN: 9966-25-439-0
ISBN: 1-55250-219-8 (IDRC e-book)

6). Government of Kenya (GoK) (1983). KENYA: Official Handbook
Nairobi. Government of Kenya

7). The Communications Commission of Kenya. (2007) http://www.cck.go.ke

8). Institute of Economic Affairs (IEA) (2002). The Little Fact Book. Nairobi. The Institute of Economic Affairs, Kenya. ISBN: 9966-9985-6-X

9). Mogusu, Tom (2003) “Time running out for an ICT policy.” The East African Standard, April 29, 2003. IT Survey P. 25

10). Okong'o Peter & Ombiro Evans (2002). “Unlocking Kenya's IT potential” The East African Standard, April 30, 2002 IT Survey P. 16-17

11). Mulama Joyce (2007). "On the way to getting wired". Inter Press Service News Agency, March 1, 2007.
http://www.ipsnews.net/africa/nota.asp?idnews=29302

12).  Oyuke John (2002) “UK backs CCK over Telecoms reforms.” The Financial Standard, May 21, 2002. P. 2

13).  _________   (2007) “Mobile tax debate intensifies as Budget Day approaches.” The Sunday Standard, May 21, 2002.  Bizbytes P. 4

15).  Wangui Pauline (2007) “Kenya: Time to change licencing procedures for Telecoms” The East African Standard, February 4, 2007. Posted to the web February 5, 2007 http://www.eastandard.net

16). Olocho, Sande F (2007). “Key impediment to ICT growth in Kenya” Daily Nation, March 8, 2007.  ICT Survey P. IX

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*Portions of this term paper created and edited using open source software: AbiWord word processor running on Puppy Linux ver 2.15 operating system.