Mark G Davies

Innovation & Impact

A serial entrepreneur, Mark has lived on four continents and built five successful companies – from the very first dotcoms in New York City to investment matchmaking in London, and then to business incubation & agricultural services in Ghana. Heavily influenced by his anthropology degree, he’s sought out frontier markets in tech, innovating early and helping shape the path for others. Mark lives between Lisbon and Salvador.

Entering the Queue at Africa’s No-Frills Cybercafes

Davies originally planned a philanthropic venture to provide better communications ... but as he considered the failures of other misbegotten African aid programs, Davies had a change of heart... [BOSTON GLOBE]

NAIROBI – There’s no air conditioning at Browse Internet Access, on the fourth floor of a downtown office building here, just fans and windows thrown open to the temperate air of this mile-high Kenyan city.
But that isn’t enough to disperse the warmth generated by five dozen computers, the five dozen people who use them, and a half-dozen others quietly waiting their turn. They call this stuffy, crowded place a cybercafe, although there’s not an espresso machine in sight. And those who come to Browse don’t do a lot of browsing. They’re here to communicate with family and friends they could never afford to reach by telephone. Or they come here to work.
Whatever their reason, Nairobians just keep coming. When Stephen Onyambu and his wife, Pamella, started Browse in 1998, it had just 12 computers. Today, there are 60, yet people still wait in line. “By the end of the year, God willing. . . we should have 120,” said Stephen Onyambu.
Browse has plenty of competition. A visitor will find a cybercafe on practically every block in the city center. And not just in Nairobi. The fashionable districts of Cape Town are littered with Internet cafes. Accra, in Ghana, has nearly a hundred. Nairobi-based Africa Online boasts more than 250 cafes scattered around the continent. And entrepreneurs from Africa and Europe are scrambling to open still more.
In America, the cybercafe boom died out by the late 1990s, the victim of cheap home computers and all-you-can-eat Internet access. But the cybercafe concept makes more sense in Africa, where only a fraction of the population has telephones, much less computers. For decades, people here have walked to the neighborhood call center to telephone a friend or relative abroad. Now the same concept is being applied to the Internet, and in Africa’s biggest cities, thousands are lining up to get online.
They come to places like Browse for a variety of reasons. If Josephine Ndunga, 22, a computer science student at a local college, had been a student in the United States, she’d have stayed on campus to send e-mail to her fiance in Seattle. After all, nearly every American college provides a free link to the Internet.
But due to the high cost of Internet access in Kenya, her school charges students to hook up to the Web, and Browse is cheaper. “I was introduced to it by a friend and I liked it,” she said. “There are lots of computers, so you don’t have to wait.”
A few feet away, Kevin Machine buffs up his resume. Machine, 25, is a German teacher who wants to see the world. “I’m looking for a job,” he joked. “Kosovo. Uganda. Anywhere.”
Steve Thoithi, 32, already has a job; in fact, he’s doing it at Browse. Thoithi, an economist turned Internet entrepreneur, designs Web sites for companies in Kenya, Uganda, Tanzania – whoever will hire him. Thoithi prefers logging on at a cybercafe when it’s time to go online. “I do have an account at home,” he said. “But it costs more.” Here at Browse, he pays 7 Kenyan shillings for 3 minutes – the equivalent of 9 US cents.
Still, Thoithi isn’t satisfied. He’s found a competing cafe that he likes better. “They charge a shilling a minute, and the speed is not that bad.”
Life in the slow lane
It’s no surprise that download times at Browse are nothing to boast about. Given the high cost of bandwidth in Africa, no cybercafes have the kind of high-speed connections that are found in almost all American businesses. Indeed, African cybercafes can’t even match the speeds available to the typical home user in the United States.
For instance, an American’s telephone modem can download Internet data at around 56,000 bits per second. At Browse, 60 computers share a single digital line with a top speed of 144,000 bits per second. This one connection is far slower than the cable modems, or DSL lines, found in millions of US homes. And divided by 60 users, it works out to just 2,400 bits per second – agonizingly slow for downloading Web pages.
Like so many other African businesses, the cybercafes are shackled by the massive cost of bandwidth on the continent. Because there’s no direct cable connection between Kenya and the rest of the world, all of the country’s Internet traffic relies on satellite connections, which are far more expensive than the fiber-optic links that connect the United States to Europe and Asia.
Browse’s Internet connection costs the company about $5,000 a month. By comparison, an American business can buy a T-1 Internet line, which is 10 times as fast as the Browse connection, for under $1,000 a month.
Internet connections are cheaper in South Africa, by far the most technologically advanced nation on the continent. But that’s had the ironic result of making cybercafes less popular there than in other African countries. Of South Africa’s 43 million people, it’s estimated that 1.5 percent, or about 650,000, have Internet access at home. That is more Internet users than the rest of Africa combined. And this group comprises South Africa’s political, intellectual, and business elite.
In other African countries, such people can be found in the cybercafes. In South Africa, they’re in the office or at home.
So it’s no surprise that South Africa’s cybercafes seem curiously devoid of Africans. “Ninety-eight percent of the visitors are international travelers,” said Ursula Brown, founder of the Cyber Java cafe in Cape Town’s Sea Point district.
Untapped demand
But elsewhere on the continent, cyber-entrepreneurs see good opportunities. Mark Davies is a Welshman who went to New York and started an Internet business, which he sold to Ticketmaster-CitySearch in 1998. His new firm, BusyInternet, is building a massive public Internet facility, in the heart of one of Africa’s most competitive Internet environments: Accra, Ghana.
Davies fell in love with Ghana when he visited the country as a teenager. He originally planned a philanthropic venture to provide better communications to people in Africa. But as he considered the failures of other misbegotten African aid programs, Davies had a change of heart.
“We decided that it was a healthier approach that the business should stand on its own two feet,” he said. “It’s very important that it has the rigor of a for-profit business.” Davies’ determination to make money on the deal has impressed Ghanaian investors, who have contributed half of the project’s $1.5 million cost.
Davies and partner Alex Rousselet hired students in Accra to measure the demand for Internet services among Accra’s two million people. They found nearly a hundred cybercafes in operation, many of them slapdash facilities with poor service, where six or eight computers share a single telephone line. Even so, their research concluded that the machines in these cafes were in use about 70 percent of the time. To Davies, that was a clear sign that there’s plenty of untapped demand for high-quality cybercafes.
So BusyInternet is converting an old bottled-gas factory in the center of town into Africa’s biggest public Internet facility. It will be open 24 hours a day, with high-speed connections and its own diesel generator to fend off Accra’s frequent blackouts.
On the ground floor, Davies plans 100 computers linked to the Internet, available by the hour. Upstairs, BusyInternet will hold computer training classes for business people, and rent office space to local startups.
If the concept works, there’s plenty of room to expand – an entire continent, in fact. For example, there’s nothing like BusyInternet in Nigeria, Africa’s most populous nation. “I personally have friends who come all the way from Lagos to Accra to surf the Net,” said Stanley Okpala, a Nigerian who helped conduct BusyInternet’s market research in Accra. That’s a 250-mile trip that takes an entire day. But Okpala says his friends have little choice. “We don’t have open cybercafes in Lagos like they do in Accra.”
Nigeria’s recent moves to deregulate its land-based and cellular telephone systems have caught the eye of BusyInternet’s Rousselet. “Because of what the government is undertaking now, Lagos is high on our list” of potential sites to expand to, he said.
The cybercafe business should become much more attractive throughout west Africa in the next year. South Africa’s SAT-3 fiber-optic cable to Europe will start service this autumn, with links to Nigeria, Ghana, Ivory Coast, and several other nations. With its vast data-carrying capacity, SAT-3 should lead to sharply lower costs for international phone calls and Internet connections. With bandwidth by far the biggest cost in running a cybercafe, SAT-3 could help spawn a new wave of public Internet services. Cafes could afford to buy faster connections; customers who now spend half an hour slowly downloading their e-mail could finish up in five minutes and spend the rest of their time truly exploring the World Wide Web.
But all this depends on whether national telephone companies and government regulators pass the savings on to consumers. Besides, SAT-3 does nothing to help east African countries like Kenya. There, the cybercafes will be saddled with costly satellite connections for years to come, even if a plan – known as Africa One – to wrap a fiber-optic undersea cable around the entire continent is launched later this year.
That means no relief from thin profit margins at places like the Onyambus’ cybercafe in downtown Nairobi. Fortunately, the ample demand for Internet access will probably let them make it up in volume.
Hiawatha Bray can be reached by e-mail at