Post by Ismail AbdulAzeez on Jul 13, 2013 1:26:30 GMT 1
Despite supposed friendly policies and several calls, investigations still show that low patronage of locally assembled Information and Communications Technology (ICT) wares, especially computer and software products by government, businesses and individuals in Nigeria. ADEYEMI ADEPETUN, in the report, examines this trend. Excerpt...
GOING by various surveys, two sub-sectors of Nigeria’s Information and Communications Technology industry that have suffered and still suffering from poor patronage remain software development and computer manufacturing.
While several measures have, however, been put in place to jump-start the country’s N200 billion software sector, which seem to be yielding results, patronage for locally assembled computer products is still at its lowest ebb.
Identified as sine-qua-non to Nigeria’s drive towards a knowledge economy, the Ministry of Communications Technology; Institute of Software Practitioners of Nigeria (ISPON); Jim Ovia Foundation; LAN, Intel among others have in one way or the other made case for indigenous software development through a number of initiatives.
But for manufacturers, including Zinox, Omatek, Veda, and Brian among others, the purchase of their output has been very unimpressive; thus necessitating their divestment into other related ventures to stay afloat.
Indeed, out of the 740,000 computers acquired by Nigerians in 2012, only 148,000 were manufactured locally. This, therefore, means that 80 per cent of the personal computers bought by the citizens last year were foreign brands.
This also depicts a 20 per cent market share by all the indigenous players put together; but remarkably, half of this is controlled by a single brand.
Foreign computer brands like HP, Dell, Acer, Toshiba and Samsung, among others, are said to be controlling 80 per cent of the Nigerian computer market.
The development has been blamed partly on the insensitivity of government to support the players in the hardware computer-manufacturing sector, especially in the area of favourable policy formulation.
Specifically, stakeholders have over the years pointed accusing fingers at the government for not coming up with favourable policies that give indigenous players preferential treatment compared with their foreign brands.
Even organisations and states that are supposed to lead the campaign for patronage of local ICT wares seem to be showing preference for foreign brands.
A recent visit to Lagos e-Centre at Marina showed that only foreign computers were adopted for usage.
Last week in Lagos, at the workshop for judges on legal issues in telecommunications organised by the Nigerian Communications Commission, judges who attended were provided with HP mini laptops. The Digital Bridge Institute in Lagos has also been equipped with foreign computer brands.
Several other government establishments, even the Ministries, Departments and Agencies (MDAs) still show much preference for foreign computer brands.
Most worrisome is that manufacturers of these international brands of computers that come into the country are believed to be enjoying good operating condition in their respective countries and are therefore, well positioned to sell at relatively competitive prices.
Arguably, industry analysts have said that Nigerian computer firms have always found it hard to compete favourably with their foreign counterparts due to high cost of production incurred, occasioned by general poor state of infrastructure in the country, the unfriendly monetary policy where interest rate is at double-digit rate and above all low patronage from Nigerians, among others.
In the mid-term review of the Ministry of Communications Technology, the minister, Mrs. Omobola Johnson, disclosed that in 2012, the PC ownership penetration was 4.5 per cent, saying that by the end of 2013, the rate should be seven per cent, while it is hoped that it will hit 12 per cent by 2015.
Johnson had earlier in the year said the government would develop captive markets for local computer makers to drive demand for their products.
This, according to her, will be in partnership with five banks and five local computer makers.
But to many, if the minister’s target must be realized, more efforts are needed to drive the Nigerian brand, especially by creating a policy that will ensure patronage. They also called for duty waivers for indigenous manufactures in the country.
An industry expert, who spoke on the condition of anonymity posited that one of the reasons local computer brands had been recording poor patronage and, by extension, slow growth, was because the government had not deemed it fit to truly assist local IT firms.
“They still pay import duties, even on Completely-Knocked Down components; whereas, in other countries such as the United States and others, IT importation by local firms is duty-free,” he said.
However, in a recent media interview, the Director, Statistics and Research, Nigeria Information Technology Development Agency (NITDA), Mr. Inye Kemabonta, blamed the minimal impact of the local players on inadequate capacity, saying government was currently working towards using the Nigerian Content Development initiative in the IT sector to develop the market.
“But the private sector needs to set an agenda for government,” he added.
According to him, the country needs about three million computers yearly to serve the growing local market.
Kemabonta said, “740,000 personal computers were consumed in Nigeria in 2012. Only 20 per cent are from Nigerian manufacturers. We still don’t have enough for the local market.
“One of the easiest ways to encourage local use of computers is to urge schools to build laboratories that will be equipped with computers. This, to a large extent, is regulatory. We need to develop our demand framework to absorb the supplies.”
He advised local manufacturers to consider the idea of building a common plant for their operations, saying currently, most of the computer plants in the country were running very high overhead costs.
According to him, building a common plant will go a long way in cutting the huge cost elements that the local manufacturers have to contend with.
Nigeria, no doubt, holds a great attraction for computer manufacturers, whether local or international. This is mainly on account of its vast market potential.
While international computer manufacturers are raking in millions of naira from computer sales, their local counterparts have been operating on the periphery of the market.
They have blamed the citizens’ seeming disregard for locally assembled computers and the failure of the government to stimulate sustainable demand for local PCs for their woes.
During her visit to Omatek Computer factory in Lagos last week, the Minister of Finance and Coordinating Minister of the Economy, Mrs. Ngozi Okonjo-Iweala, thrilled by the level of investments she saw, said Nigerians must patronise indigenous operators.
Okonjo-Iweala, just like when former President Olusegun Obasanjo visited same factory some months back, described the Chief Executive Officer of Omatek Ventures, Mrs. Florence Seriki, as a foremost entrepreneur, who has succeeded where others failed.
According to her, Nigeria’s market is challenging, especially with various infrastructure bottlenecks, stressing that the culture of service maintenance is not strong in the country.
The minister who said Nigeria cannot develop if citizens will not patronise locally made goods, stressed that the Ministry of Communications Technology was set up by the government to develop and increase the potential of ICT growth in the country.
By and large, another critical challenge that may continue to fuel apathy for locally assembled ICT products, especially PCs in the country is their quality and durability. Several complaints have greeted usage of these products.
According to the Managing Director of Digital Acess Foundation for Technology Development, Mr. Mike Oseji, most of the local products don’t last compare to their foreign brands.
“I think the challenge they have is around quality. If the products are rugged, durable like foreign brands, they will be patronised”, Oseji stated.
Source: www.ngrguardiannews.com/index.php?option=com_content&view=article&id=126575:angst-over-low-patronage-of-indigenous-ict-wares&catid=55:compulife&Itemid=391
GOING by various surveys, two sub-sectors of Nigeria’s Information and Communications Technology industry that have suffered and still suffering from poor patronage remain software development and computer manufacturing.
While several measures have, however, been put in place to jump-start the country’s N200 billion software sector, which seem to be yielding results, patronage for locally assembled computer products is still at its lowest ebb.
Identified as sine-qua-non to Nigeria’s drive towards a knowledge economy, the Ministry of Communications Technology; Institute of Software Practitioners of Nigeria (ISPON); Jim Ovia Foundation; LAN, Intel among others have in one way or the other made case for indigenous software development through a number of initiatives.
But for manufacturers, including Zinox, Omatek, Veda, and Brian among others, the purchase of their output has been very unimpressive; thus necessitating their divestment into other related ventures to stay afloat.
Indeed, out of the 740,000 computers acquired by Nigerians in 2012, only 148,000 were manufactured locally. This, therefore, means that 80 per cent of the personal computers bought by the citizens last year were foreign brands.
This also depicts a 20 per cent market share by all the indigenous players put together; but remarkably, half of this is controlled by a single brand.
Foreign computer brands like HP, Dell, Acer, Toshiba and Samsung, among others, are said to be controlling 80 per cent of the Nigerian computer market.
The development has been blamed partly on the insensitivity of government to support the players in the hardware computer-manufacturing sector, especially in the area of favourable policy formulation.
Specifically, stakeholders have over the years pointed accusing fingers at the government for not coming up with favourable policies that give indigenous players preferential treatment compared with their foreign brands.
Even organisations and states that are supposed to lead the campaign for patronage of local ICT wares seem to be showing preference for foreign brands.
A recent visit to Lagos e-Centre at Marina showed that only foreign computers were adopted for usage.
Last week in Lagos, at the workshop for judges on legal issues in telecommunications organised by the Nigerian Communications Commission, judges who attended were provided with HP mini laptops. The Digital Bridge Institute in Lagos has also been equipped with foreign computer brands.
Several other government establishments, even the Ministries, Departments and Agencies (MDAs) still show much preference for foreign computer brands.
Most worrisome is that manufacturers of these international brands of computers that come into the country are believed to be enjoying good operating condition in their respective countries and are therefore, well positioned to sell at relatively competitive prices.
Arguably, industry analysts have said that Nigerian computer firms have always found it hard to compete favourably with their foreign counterparts due to high cost of production incurred, occasioned by general poor state of infrastructure in the country, the unfriendly monetary policy where interest rate is at double-digit rate and above all low patronage from Nigerians, among others.
In the mid-term review of the Ministry of Communications Technology, the minister, Mrs. Omobola Johnson, disclosed that in 2012, the PC ownership penetration was 4.5 per cent, saying that by the end of 2013, the rate should be seven per cent, while it is hoped that it will hit 12 per cent by 2015.
Johnson had earlier in the year said the government would develop captive markets for local computer makers to drive demand for their products.
This, according to her, will be in partnership with five banks and five local computer makers.
But to many, if the minister’s target must be realized, more efforts are needed to drive the Nigerian brand, especially by creating a policy that will ensure patronage. They also called for duty waivers for indigenous manufactures in the country.
An industry expert, who spoke on the condition of anonymity posited that one of the reasons local computer brands had been recording poor patronage and, by extension, slow growth, was because the government had not deemed it fit to truly assist local IT firms.
“They still pay import duties, even on Completely-Knocked Down components; whereas, in other countries such as the United States and others, IT importation by local firms is duty-free,” he said.
However, in a recent media interview, the Director, Statistics and Research, Nigeria Information Technology Development Agency (NITDA), Mr. Inye Kemabonta, blamed the minimal impact of the local players on inadequate capacity, saying government was currently working towards using the Nigerian Content Development initiative in the IT sector to develop the market.
“But the private sector needs to set an agenda for government,” he added.
According to him, the country needs about three million computers yearly to serve the growing local market.
Kemabonta said, “740,000 personal computers were consumed in Nigeria in 2012. Only 20 per cent are from Nigerian manufacturers. We still don’t have enough for the local market.
“One of the easiest ways to encourage local use of computers is to urge schools to build laboratories that will be equipped with computers. This, to a large extent, is regulatory. We need to develop our demand framework to absorb the supplies.”
He advised local manufacturers to consider the idea of building a common plant for their operations, saying currently, most of the computer plants in the country were running very high overhead costs.
According to him, building a common plant will go a long way in cutting the huge cost elements that the local manufacturers have to contend with.
Nigeria, no doubt, holds a great attraction for computer manufacturers, whether local or international. This is mainly on account of its vast market potential.
While international computer manufacturers are raking in millions of naira from computer sales, their local counterparts have been operating on the periphery of the market.
They have blamed the citizens’ seeming disregard for locally assembled computers and the failure of the government to stimulate sustainable demand for local PCs for their woes.
During her visit to Omatek Computer factory in Lagos last week, the Minister of Finance and Coordinating Minister of the Economy, Mrs. Ngozi Okonjo-Iweala, thrilled by the level of investments she saw, said Nigerians must patronise indigenous operators.
Okonjo-Iweala, just like when former President Olusegun Obasanjo visited same factory some months back, described the Chief Executive Officer of Omatek Ventures, Mrs. Florence Seriki, as a foremost entrepreneur, who has succeeded where others failed.
According to her, Nigeria’s market is challenging, especially with various infrastructure bottlenecks, stressing that the culture of service maintenance is not strong in the country.
The minister who said Nigeria cannot develop if citizens will not patronise locally made goods, stressed that the Ministry of Communications Technology was set up by the government to develop and increase the potential of ICT growth in the country.
By and large, another critical challenge that may continue to fuel apathy for locally assembled ICT products, especially PCs in the country is their quality and durability. Several complaints have greeted usage of these products.
According to the Managing Director of Digital Acess Foundation for Technology Development, Mr. Mike Oseji, most of the local products don’t last compare to their foreign brands.
“I think the challenge they have is around quality. If the products are rugged, durable like foreign brands, they will be patronised”, Oseji stated.
Source: www.ngrguardiannews.com/index.php?option=com_content&view=article&id=126575:angst-over-low-patronage-of-indigenous-ict-wares&catid=55:compulife&Itemid=391