Cutting-edge corporates: Demand from the private sector drives innovation and development

Private sector consumption is widely considered the single largest growth driver in the development of ICT in sub-Saharan Africa. ICT uptake among multinationals and recently established local small and medium-sized enterprises (SMEs) alike has proceeded at a much faster rate than among federal, state and local government entities in recent years. “IT is increasingly being seen as a major business enabler,” Olabode Akinyemi, the CEO of Trading Engineers, told OBG.

While the government’s involvement in the sector has increased since the establishment of the Federal Ministry of Communication Technology (FMCT) in 2011, private corporates – particularly financial institutions, oil companies and local SMEs – are expected to continue to serve as the sector’s primary source of business for the foreseeable future.

“Demand from the government has been limited so far, which has resulted in a gap in ICT usage between the public and private sectors,” said Emmanuel Bamiyor Iwegbu, the managing director of ICT Convergence, a local technology solutions firm.

In the World Economic Forum’s “2013 Global Information Technology Report”, which ranks 144 countries on a variety of metrics, Nigeria was ranked 92nd for internet usage among the population and 124th for online government services. In terms of absorption of new technology by the business community, the country was ranked 72nd in the world.

Key growth areas in corporate ICT services include data hosting and analysis, content delivery systems, data security and emergency backup, among others.

CLOUD ON THE HORIZON: Cloud computing services, which provide remote access to software, applications and data via the internet, are in demand among local corporates. “Banks and telecoms firms are driving the growth of cloud computing,” Chuks Ulu Udensi, the country manager at Dell in Nigeria, told OBG.

Numerous “mobile money” initiatives, which enable the user to send currency digitally using a mobile handset, are underpinned by cloud computing and various other data hosting solutions. Cloud computing also allows smaller enterprises, which comprise a very large proportion of Nigeria’s business community, to cut down on their expenses.

Similarly, as retail usage increases, private firms have turned to online content as a means to maintain or attract new customers. In 2012 the country surpassed South Africa to become Africa’s second-largest source (after Egypt) of Facebook users. Nigeria is also the thirdlargest source of Twitter users on the continent. Many companies have worked to tap into this growing market of internet-savvy nationals. As of April 2013 GTB ank was the most active local firm on social media, with more than 1.1m Facebook likes and 45,000 Twitter followers. Building on its online presence, in January 2013 the bank launched an application which allows users to carry out banking services from their Facebook accounts.

INNOVATION: While the government has played an outsized role in cultivating start-ups, the private sector has been involved in several initiatives that encourage innovation. The Co-Creation Hub (CCH), a non-profit ICT incubation centre, supports local entrepreneurs in the development of social technology ventures. Since it was established in 2011 CCH members have released various ICT-based products, including a mobile application that encourages secondary school students to read. In February 2013 CCH hosted a number of events during Lagos Social Media Week, which was the first African iteration of the global Social Media Week conference. The hub benefits from partnerships with a handful of local and international corporates, including Google, Nokia, Samsung, BlackBerry and Main One.

Like the CCH, the Institute for Venture Design (IVD) aims to accelerate the rate of ICT-based innovation in Nigeria. The institute is affiliated with the Centre for Design Research at Stanford University. As well as serving as a centre for members of the ICT development community, the IVD offers a two-year fellowship programme which helps participants launch viable, innovative, market-based products or services.