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a leaner cairo telecomp looks at free internet one year on while the past year has been bad for the it sector globally, egypt’s enduring recession has pushed several big local players into extinction. the latest international cairo telecomp forum, now referred to merely as the “ict,” served as proof that the sector is no longer a playground for dilettantes and self-proclaimed technology officers. like at last year’s cairo telecomp, internet service providers (isps), web portals and telecom corporations vied to present the most hi-tech looking booths, some of which looked like they had descended from space especially for the occasion. taking place at the cairo international conference center from january 12 to 15, the event was held under the auspices of the ministry of communications & information technology (mcit) and sponsored by telecom egypt (te). ict 2003 was also a chance to reflect on the success of the free internet initiative, launched by mcit one year ago amid much fanfare. to talk to ict participants, the initiative has been an unqualified success. “basically, the free internet has expanded the number of users,” said amr el-husseini, the director of sales in the internet division of egynet, one of the major local isps. “we’re currently seeing about 250,000 hours [of internet use] per day. in january of last year, there were about 400,000 users, and now there are 1.2 million.” he went on to predict a user growth rate of 10 percent per month in 2003, adding that he hoped to arrive at a total growth rate of 50 percent within the coming year. free internet’s biggest problem, in el-husseini’s view, is low pc penetration in egypt. but he added that mcit’s “pc in every home” scheme – which aims to supply the market with cheaper, locally assembled pcs available to the average egyptian – “has already increased the number of users. they’ve already sold about 55,000 units.” the free internet scheme, meanwhile, has been good for the country’s infrastructure. “free internet had the effect of increasing the international bandwidth coming out of egypt dramatically,” he said. according to ahmed tolba, a senior network engineer in the isp division of raya holding, another large it company, the free internet “brought lots of benefits, mainly that the cost of going on line is that of a local call. it’s 100 percent to the benefit of the user.” however, he added, “the free internet is slow. the data rate is still slow.” seifallah monieb, a business development assistant at te data, telecom egypt’s recently launched isp, agreed. “the free internet was definitely a success – the only complaint is about speed,” he said. he added, however, that “people who are seeking more speed can opt for isdns or dsls,” referring to the bigger, more expensive broadband internet connections now available from most isps. monieb, too, was confident that internet use could only go up. he expected the amount of users to triple this year, to between 2.5 and 3 million. others mentioned the importance of the year-old initiative in terms of educating the masses about internet use. as fady rafla, a marketing and communications manager at linkdotnet, the isp that currently boasts the highest number of users, explained: “what’s important about this model is that it’s helped people cross the digital divide, helped people learn about the internet. even people who are computer illiterate are buying pcs for their kids.” rafla admitted that he had been skeptical at first. “we originally doubted it would be successful, as the free internet model failed in some other countries. but surprisingly, it did well, and the market’s growing very fast,” he said. users seem happy with the scheme. tamer azam, who lives in bashteel, imbaba, bought a pc last april because he wanted to get news from sources other than the local, state-run press. “i never would have thought about buying a computer and going on line before the free internet,” he said. “now i spend a couple hours on line every day, and for the last three months, my phone bill was only £e 30.” he added that almost all of his friends in bashteel were also looking into buying computers. his one complaint – echoing the isp administrators – was speed. “maybe sooner or later i’ll be able to get a dsl connection,” he mused. ict 2003 was capped with a live panel discussion, “the free internet initiative: a balance sheet,” which brought together representatives of the industry’s biggest players. the discussion – predictably self-congratulatory – was a roll call of impressive-sounding statistics: egypt is using seven times as much bandwidth as it was 10 months ago; the internet was accessed in 2002 by 520,000 different cairo-based phone numbers, and another 200,000 from alexandria and the governorates; and user numbers are expected to double in the year ahead. but participants also discussed the tenuous revenue-sharing agreement between te and various isps, first struck a year ago, in which te cedes 70 percent of revenue from all internet calls made via isps, retaining only 30 percent for itself. at the launch of free internet last year, te vice chairman azza torky said, in a similar panel discussion, that “when we start seeing subscriber growth, we expect to see a return on our investments.” this year, she admitted, “free internet [still] isn’t making any money for telecom egypt.” however, “te is happy to subsidize the project for the country’s greater good.” oddly enough, there was some debate over the precise number of isps currently operating in egypt. while some participants put the number between 60 and 70, others said it was actually closer to 110, if you counted “virtual” isps, which “piggyback” off of other, bigger isps. the uncertainty was telling, as the most noticeable difference at this year’s telecomp was the absence of several small and mid-sized players who fell victim over the course of last year to the bad economy. last may, for example, linkdotnet swallowed up eight egyptian websites, in addition to isp internet egypt, in one gulp, in a £e 365 million deal. another notable absence this year was that of isp nile online, which, according to one industry insider, is rumored to be considering a merger with another isp. tolba, from raya holding, summed up the general state of affairs. “before the free internet, there were many isps. but afterwards, several of these isps couldn’t survive,” he said. “they were bought or they went out of business. the sector really slowed down in 2002.” adam morrow |
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