The dynamics of entrepreneurship in ICT: case of mobile phones downstream services in Kenya

The research paper explores the extent to which mobile phones downstream services, defined here as those provided using the existing connectivity, are generating opportunities for entrepreneurship development in Kenya. After identifying the services of mobile payphones, money transfer and phone repair, the paper analyses the micro-enterprises providing them and their contribution to income and employment creation. It shows that majority of the enterprises providing the services are survivalists and they are characterised by minimal barriers to entry and therefore stiff competition. Those in growth-oriented category are characterised by barriers to entry and specialisation. These enterprises have made a notable contribution to the concerned households and the economy in form of employment opportunities, income generation and linkage with other sectors. They directly supported over 25,000 households in addition to the extra staff employed in them. Across the board the incomes of the operators improved after engaging in the enterprises. The enterprises also created opportunities for women, youth, people with disabilities and those with low or no education. To the economy, payphones have contributed to increasing the mobile phones coverage to 75% of the country; money transfer services have provided cheaper financial transactions and means of sending emergency funds; while repair services have enabled low income earners to remain connected even when they could not afford to buy new phones. The paper therefore concludes that mobile phones downstream services have generated entrepreneurial opportunities to many as well as contributing positively to the goal of fighting poverty.