Intel bullish on Africa

By Leon Engelbrecht for Intel
Johannesburg, 28 Mar 2008

Global chip giant Intel is bullish on Africa and its prospects on the Mother Continent. But Intel executive VP Sean Maloney warns the high cost of broadband will trip up growth unless addressed.

"We subscribe to an Africa-optimist position with the rationale that commodities will be short in the next 10 to 15 years," Maloney told ITWeb in an exclusive interview.

"In that context, where you have reason to believe there will be significant growth in economic strength... in part on oil and gas... and a large young population, then that's the kind of combustible mixture that led to the growth of the Chinese and Indian economies.

"It is a tremendous growth opportunity for us and we have to grow our presence in Africa," the Intel world number two says.

"The anxiety is around spectrum and broadband. That is a fairly deep anxiety.

"I have the same anxiety about India and parts of Latin America. Spectrum issues are even worse than building a highway... if you screw up the number of lanes, at enormous expense you can go back and add a lane or two. With spectrum you can't do that.

"So it is very important for SA and the region that decisions about spectrum made now are made in the context that you have to get the whole population online. Now, that means there are certain regulatory and commercial consequences. To be frank, the cost of broadband in the region is high enough, that unless it changes, that it will be an impediment to growth."

Taking the lead

"The role-model countries on broadband have been [South] Korea and Japan. For the best part of 15 years they have been leading the world on educating their populations on IT and they [have] made the decision to open up their spectrum." Networks capitalising on this are now being built out.

In Latin America, leading countries are now doing the same, Maloney says. "You have countries there now looking at significant spectrum allocations." He notes that Colombia and Peru "are taking fairly positive positions".

However, he is concerned about India. "The position in India is you have several hundred million people who speak English to some reasonable extent, which means they can immediately enter the global knowledge labour pool: but they can only do that if they have broadband." It appears there are significant constraints in that regard, he adds.

By contrast, in China "there is a policy for teaching all children English and computer literacy". Maloney avers "they have a much more active policy on Internet access, so it depends country to country".