Google VP says Africa not a profitable market yet

Africa's low internet penetration occasioned by the dearth of fixed line infrastructure as well as the absence of relevant local content has continued to hamper Google Africa's financial contribution to the company's overall bottom line, Nelson Mattos, vice president, engineering, Europe, Middle East and Africa (EMEA), Google Incorporated has said.

This, he pointed out could change in years to come with the number of submarine cables scheduled to berth on the continent, and the significant investment made by the company in the area of local content development, infrastructure and technology solutions designed strategically to deal with the challenges of the African continent.

Mattos who made these observations while speaking to news men in Lagos observed that Africa has 14 percent of the world's population but only a meagre two percent of that massive population is on the internet.

He added adding that Google's mission for Africa is to make the internet an integral part of everyday life. He further revealed that presently Googles African operations is a cost centre not a revenue generator.

"In comparison with the larger markets of the world, Africa today is not a market at all with the low internet penetration that we have in this continent, it is minuscule. "So, this is why we are not approaching this from the perspective of the size of the market. This continent first needs to be developed. You need to invest significantly on the long run.

Only when internet penetration is extremely significant, then can we start thinking about how to position and modify the market to increase revenue generation", the Google VP added.

In addressing the continent's infrastructural challenges as it relates to internet access, Nyimbi Odero, Google West Africa's Lead noted that issues of content development should be looked into if the continent intends to improve its internet penetration as the internet is irrelevant to most Africans today.

"So, when you go unto the internet you don't really see anything about us. As a consequence, if we as a continent can increase the level of relevance of the internet, people would be driven to go towards internet.

"At a second level, there are major infrastructural problems. You heard earlier that it costs at least ten times as much to get compatible bandwidth here than in Europe or America. So, we need to begin to address some of those infrastructural challenges particularly latency and cost. A third factor is that people don't have devices. If you look at GDP (Gross Domestic Product) per capita and the cost of your standard laptop, it is almost impossible to acquire one. So, it is important to begin to make devices more accessible and affordable.

And that's another barrier to actually increasing penetration in the continent", he posited. Odero also stated that the company is addressing latency issues by developing technological solutions that improve the quality of access available on the continent. In the area of content development, he said that there is a massive asymmetry with the way Africans use the internet.

"It has so far been a 'read-only' basis to it, we are trying to transform that and address that lop-sidedness through things like maps, local business listings whereby instead of going to find out about businesses, you can put your own business on line", Odero concluded.