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Executive SummaryAfrica remains the least connected continent in the world both from the view of the total bandwidth feeding the entire continent and from an Internet penetration perspective. While Internet uptake increased from less than 500,000 in 1995 to over 12 million in early-2004, its use remains comparatively minuscule due to the lack of telecoms infrastructures in many regions and high prices. Growth is slower than world averages and is less than half the growth rate of mobile. By early-2004, overall Internet penetration in Africa was around 1.5%, with the highest penetration recorded in Réunion (over 20%) followed by the Seychelles (around 14%). South Africa and Tunisia were next in line with between 6 and 7%. This compares with over 50% penetration in developed countries. New operators with fresh capital are needed to provide broadband connectivity to and within the continent and to serve what is becoming a very attractive telecom market opportunity for both equipment and service providers. Several African countries have experienced triple-digit growth rates in Internet usage in 2003 and 2004, including Cote d’Ivoire, Morocco, Senegal, Sudan and Tanzania.While Africa is still struggling to ensure universal availability of basic voice services, the implementation of broadband networks is still very limited but has picked up momentum during 2003 and 2004.Most fixed networks in sub-Saharan Africa have been digitised and are now undergoing modernisation. Next-generation networks will provide more bandwidth and will be more efficient and cheaper to run. New network technology will allow incumbent operators to introduce inexpensive broadband delivery mechanisms such as Asymmetrical Digital Subscriber Line (ADSL), which will be a boon to smaller businesses, most of which are currently having to cope with a dial-up line for their data communication.The number of African countries offering commercial DSL services has tripled from 5 to 15 during 2004. For the year ending March 2004, Telkom South Africa has announced an increase of 661% in the number of ADSL subscribers, albeit from a small base of 2,669, to 20,313.However, ADSL rollout is typically confined to high density areas and the technical constraints of the technology mean a large proportion of African businesses may not be able to get the service. Similarly, cable modem service is only available where there is a modern cable TV network, usually only in urban areas. In Africa, there are very few cable TV networks. |