Poor policy formulation, high equipment cost hinders PC Penetration

• Country has 3.3 million functional computers
• Telcos, OEMs seek to perk up penetration rate

Ben Uzor Jr

The computer hardware market has remained underdeveloped due to poor policy formulation and implementation on the part of government as well as the attendant high cost of equipment acquisition in Nigeria, analysts told Business Day at the weekend. According to the analysts, inspite of the growing number of Original Equipment Manufacturers (OEMs) and resellers, along with the significant growth recorded in the telecommunications industry after the sector was successfully deregulated in 2001; there are only 3.5 million functional Personal Computer (PC) systems in the country.

In the estimations of the analysts, there are a total of 10.5 million PCs in offices, hospitals, homes and schools across the country. Business Day further gathered that only 34 percent of the total is in functioning condition, which leads to the conclusion that PCs are still uncommon in a country of 140 million people. Besides, it is imperative to stress that dependable statistics of PCs in Nigeria are difficult to get hold of because a good number organisation do not have proper documented inventories and also because of the apparent unwillingness of many to release information they consider vital.

Moreover, reliable statistics from the International Telecommunications Union (ITU) reveal that PC penetration remains very low at 7 per 1, 000 Nigerians. Analysts are optimistic that the PC market has the prospects of growing exponentially in no distant time. According to them, it will be sustained by increasing awareness levels in the population, especially the youth, spurred by education, the internet and deliberate initiatives from stakeholders. Johnson Obioma, a telecom analyst told Business Day, that the fundamental barrier to increased PC penetration was the high cost of buying equipment.

According to him, most indigenous OEMs offer affordable computing equipments, but are hindered by the prevailing high cost of doing business in Nigeria which to a large extent impacts on the quality of their equipments when compared to other foreign brands. He called on government to as a matter of exigency introduce zero tax policies for local computers manufacturers as well as an exemption on duties on the import of computers parts and accessories. With regards to price reduction, some telcos and PC manufacturers have entered into strategic alliances to offer affordable laptops to Nigerians.

Only recently, Globacom and HP introduced an innovative offering that enables Nigerians to own top-end internet-equipped netbooks. Under the special bundling offer, customers can get Glo 3G powered HP netbook for N34, 000. MTN followed suite by introducing its Internet Netbook Bundle which offers 20 percent of the purchase price of the Netbook back after 12 consecutive months of subscription to internet service from MTN. Though operators believe that the trend is very positive for the market, analysts do not think that PC penetration will suddenly shoot up on account of Telco’s resourcefulness.

Over the years, the federal government has introduced numerous PC acquisition schemes with little or no impact on PC penetration in the country. One of such initiatives was the Computer for All Nigeria Initiative (CANi), a government-private sector collaboration designed to increase computer penetration in Nigeria. The CANi scheme suffered numerous setbacks, one of which came from government agencies which still prefer to patronise foreign brands like HP, Toshiba, and Dell even when local brands like Zinox, Omatek, and Brian computers have proven just as good.

Leo Stan Ekeh, chairman, Zinox Technologies, strongly believes that governments at all levels must support indigenous computer manufacturers through policy and preferential patronage. This, he added, was if government intends to make significant headway regarding increasing the number of Nigerians who have access to PCs. “The endorsement of Zinox Computers in 2002 by the Federal Executive Council of Nigeria under President Olusegun Obasanjo…may not have created patronage but it achieved fascination for the Zinox brand. “Governments must do more than pronouncements, they must buy into the numerous marketing schemes designed to move the products to end users.

The indigenous manufacturers/assemblers must carry the governments along on these schemes. In the same vein, Tunji Balogun, chief executive officer, Brian Computers, urged to the federal government to improve their participation in the computer hardware market by making requisite funds available for indigenous OEMs. “If OEMs are empowered, it will do two things. It will reduce the cost of ownership of systems and make things easier for people to buy because we can do installmental payment over a period of time. But we cannot do that without government empowerment by talking to the banks on our behalf or empowering the banks for them to empower we local OEMs”, he added.

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