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4. The computer service industry

Nigeria imports virtually 100 per cent of all its IT equipment, and a diversity of firms exist to supply, service, and maintain the imported equipment. There are however problems associated with poor vendor performance and the high cost of computing equipment. Local manufacturing is under discussion.

Computer Companies

There are over 200 registered companies in Nigeria offering a broad range of computer-related services. Most of them were set up between 1977 and 1982 to take advantage of the indigenization decree and the then prevailing economic boom. Table 3.12 lists some of the more notable ones.

A partial survey conducted in 1986, involving 47 computer companies, showed that 88 per cent of these were vendors; 79 per cent were consultants; 70 per cent offered training services; 68 per cent had maintenance facilities; while 45 per cent offered bureau services.⁴ There is a lot of overlapping as many firms offered three or more services.

As is to be expected, the companies vary widely with respect to available capital, experience, and technical expertise, and the quality of maintenance and after-sales service provided. The weakest link in the chain is in the area of a reliable maintenance service to reduce the incidence of down-time in installations. Even where service facilities exist, replacement parts may not be readily available. The quantity and range of spares carried are not enough, and waiting times for imported spare parts are usually very long. The problem is aggravated by a proliferation in the different makes of imported computers - especially micros - available in the market. User complaints about vendors are more often than not associated with the great difference between claimed and actual maintenance capability. But, as one speaker at a recent symposium and workshop said, "the area of operation of fraudulent vendors is becoming narrower than before"; the speaker went on to predict that in time these vendors would disappear. ¹²

Table 3.12. Some major computer firms in Nigeria

Source: Ref. 4.

On the whole the companies are doing a creditable job, in spite of their numerous handicaps, in supplying the growing need for computer equipment and services in Nigeria. The next few years will see a vast improvement, as suppliers take advantage of the liberalization of foreign exchange and the increased volume of business expected from growing computer usage. Already a new development has started with the setting up by NCR of a Rework Centre at Lagos for the refurbishing of ageing equipment.

The Cost of Computers

Without doubt, the single most important factor contributing positively to the growing popularity of computerization in Nigerian industry is the availability of the microcomputer, which has greatly reduced the cost of owning and operating a computing facility. At prevailing prices, anyone wishing to install a minicomputer in Nigeria will have to be looking for a sum of about N1 million, with perhaps a similar outlay in the cost of supporting facilities including software. On the other hand, a network of micros that can handle the data-processing needs of most medium-sized companies will be available at about one-tenth of this amount. Sources in the trade suggest that total mainframe and mini sales in Nigeria are running at about 30 units or less per annum.

Unfortunately, micros are still highly priced in Nigeria relative to their international prices. Although one frequently reads about falling prices in the international press, the prices of the same goods in Nigeria seem to be always on the increase. This discouraging situation is explained partly by the low and ever-falling dollar parity of the Naira, and partly by the high mark-ups that have always been a feature of the Nigerian hardware market.

One approach to finding a solution to the problem of the high cost of the micro is the development of computer manufacturing in Nigeria. This issue is dealt with below.

A Home Computer Industry

Nigeria is developing a local computer manufacturing capability for several reasons. These include the high cost of imported equipment, the need to standardize on hardware (and software), and the question of maintenance.¹³ Assessing these arguments, Pryce expressed the view that "the evidence points overwhelmingly to the local production of a clone of the IBM PC - a machine-type (rather than an individual machine) with a vast store of cheap software, with ample power for 95% of Nigerian computing applications for the next 5 to 10 years, and capable of being periodically up-graded in memory and speed by exploiting US and Japanese advances in chip technology. " ¹³

One computer firm claims to be assembling the Modellor version of the IBM PC. But experience of the motor car assembly industry in Nigeria suggests that the nation should, from the start, look beyond mere assembly of computing equipment. The Nigerian government seems to have taken a stand on the issue. Dr. Chu Okongwu, the Minister of Finance, was quoted as telling a computer workshop at Owerri in Imo State that "the government is looking forward to the day when a 100% indigenous [computer manufacturing] company will be built and maintained in Nigeria.''⁸

A development that can be expected in the near future is the appearance of software houses producing application software for local needs. Many of the experts at the symposium reported on by Pryce believe that all requirements for indigenous production of quality software are already met.¹³ A commercial software venture can only be viable in Nigeria if it is preceded by a degree of standardization of microcomputer types, and, possibly, local manufacture. It may also be useful to consider the Iraqi model, where an information processing centre under the Ministry of Industry undertakes the development of software relevant to the needs of Iraq and distributes them at low cost to government-owned industries, all of which use standardized equipment.¹⁴

5. Telecommunications

The Telephone Network

An efficient telecommunication service is an important requirement in the development of computer-based technologies in any country. In Nigeria, responsibility for the public telecommunication service is vested in Nigeria Telecommunications Ltd. (NITEL) (a new limited liability company created in 1985, in succession to the now defunct Post and Telegraphs Department, to run the telecommunication service on a commercial basis). The network has several limitations including inadequate trunk facilities, low grade of service, frequent system breakdown, and a long waiting list for new connections.

NITEL is aware of the need to improve the quality and range of its services. As President Babangida himself has said: "today, the telecommunication network is unreliable and inadequate to meet the demands in the country. In order to improve this situation, a programme of expansion and modernization of the network is being planned."¹⁵

To date, the Nigerian telephone network uses electro-mechanical equipment. Current estimates are that there are 205,000 connected telephone sets in the country, giving a density of 2 telephones per 1,000 persons, which is among the lowest in the world. (The comparative figure for the United States is 500 per 1,000 persons, and Ghana has 7 telephones per 1,000 persons. )

In an effort to evolve a coherent telecommunications policy, two national symposia have been held.^16.17 Despite much debate, a decision has yet to be made on the introduction of digital switching and transmission systems, although a Minister of Communications once said: "the conclusion of the various submissions overwhelmingly pointed to the fact that Nigeria has to go digital."¹⁸

Data Communications

The Nigerian corporate computer user is beginning to demand facilities for wide area computer networks as well as data communications. Examples are the banking industry, NITEL, NEPA, WAEC, and the military. At present, the demand is judged insufficient to warrant the establishment by NITEL of a data communication service using the existing voice facilities,¹⁹ although availability can also induce greater demand. Dial-up facilities and leased data lines are in use in the Lagos area, but, as pointed out by Denloye,¹⁹ an operator of a leased line "is left pretty much on his own to attach whatever equipment he chooses to the line. He can expect no help from NITEL in determining the quality of the line he leases, and has to ensure correct operation himself."

The oil industry has taken a lead in establishing their own data network with or without the involvement of NITEL. Shell has installed an X-25 packet switched data network between Lagos, Port Harcourt, and Warri using trunk lines leased from NITEL. On the other hand, the NNPC has recently completed a private telecommunication network said to be the largest in Africa.²⁰ The all-digital network incorporates 875 km of optical fibre cables, and will come under the Integrated Data Services Company, one of the 12 new subsidiary limited liability companies established by the NNPC in 1988 as part of its new commercialization programme. The NNPC installation is an interesting development since it is a chink in the armour of monopoly invested in NITEL.

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