Understanding what is Happening in ICT in Tanzania: A Supply- and Demand-side Analysis of the ICT Sector

Tanzania’s score on the World Economic Forum’s (WEF) Networked Readiness Index (NRI) was low (ranked 118 in 2012) and it continues to lag behind countries such as Uganda (107), Nigeria (104) and Kenya (81). Use is particularly poor amongst individuals and in the business sector. The 2012 RIA Informal Business ICT Survey highlights the challenges that informal businesses face in using broadband and the negative impact of high prices. However, two critical events have had an enormous effect on the Tanzanian ICT sector: the linking to the SEACOM and the Eastern Africa Submarine Cable System (EASSy) networks in 2009-10; and the launch of the National ICT Broadband Backbone (NICTBB), in two phases (2010 and 2012). Allied with the increase in competition in both the voice and data markets, Tanzanians are slowly benefitting from reduced prices. Based on a prepaid mobile voice basket, Tanzania has the third lowest prices after Kenya and South Africa. Based on a prepaid mobile broadband basket, Tanzania is also ranked third, behind Kenya and Ghana. In addition, Tanzania has successfully – though controversially – completed the digital migration process ahead of time, freeing up the 700 MHz frequency band. Tanzania can build on the gains in the broadband market by making the “digital dividend” frequencies available to broadband suppliers.