The Impacts of Broadband Internet on the Value Chain of the Tourism Sector in Kenya

Abstract

The tourism sector is regarded as the second largest source of foreign exchange revenue in Kenya. Kenya has witnessed revolutionary development of ICTs, especially the recent development in internet with the arrival of the undersea fibre bandwidth in East Africa in 2009/2010. This development has led to many players in the tourism sector in Kenya adopting different ICT platforms to derive positive strategic and operational management and marketing benefits. Specifically, big and medium players have used these platforms to fight off competition and maintain market share, while informal and small players have used the same platforms to make entry into the sector. At the same time, customers are using the ICT platforms to by-pass the middle players and access services directly from the destination holiday providers. The net effect has been increased competition as well asboth positive and negativeimpacts for most of the players. However, there are challenges that prevent the deepening of the more positive impacts. The key ones were found tobethe high cost of developing and maintaining the ICT platforms, relatively unaffordable broadband Internet, lack of adequate human resource skills, lack of affordable online payment platforms and poor quality of broadband connectivity. We provide appropriate policy recommendations to address these challenges.