Interview: Intel eyes African expansion, WiMax launch

JOHANNESBURG (Reuters) - The world's biggest chip maker, Intel, is expanding to Nigeria and Kenya to beef up its African business and hopes WiMax wireless technology will be launched commercially on the continent this year.

Intel's head of sub-Saharan Africa, Jacques van Schalkwyk, said on Tuesday the firm would open a Nigerian office this year to boost its presence in West Africa and aimed to establish another in Kenya for East Africa in the first half of 2006.

The US company is testing WiMax -- which is similar to WiFi but operates over longer distances -- across the world and Schalkwyk said he hoped products using the technology would go live in either South Africa or Nigeria this year.

"Africa has a great opportunity to leapfrog (traditional technologies) and WiMax can play a key role," he told Reuters in an interview.

Industry analysts say wireless technologies are crucial for the rollout of phones and the internet in the world's poorest continent, where infrastructure between far-flung communities is patchy, and cellphone use is already booming.

But Schalkwyk also said education rather than technology was the real key to getting more PCs into African homes and increasing computer literacy on a continent where many people have never made a phone call, let alone surfed the web.

"If you ask people what the benefits of technology are, more than 70 percent of the population won't really have an answer -- computer literacy is still very low," he said.

"We strongly believe that technology is not going to be the big driver -- the big driver is education. Affordability is a reality but we need to show people the benefit."

No-frills computer?

Schalkwyk said Intel was looking at developing a no-frills PC aimed at Africa and other emerging markets, but this was not definite and the risks were high.

"We are doing market research regarding an entry level product," he said. "But if you are enabling the market for the first time and then you give people an inferior technology...it could put them off altogether."

Schalkwyk declined to give company forecasts, but said he expected total sales of handheld devices in the region to show double-digit annual growth in the next few years, while PC sales should grow by 16 to 20 percent annually.

Intel's business on the continent, where it is the market leader, is import-based, with products developed at the company's recently-opened Middle East and Africa base in Cairo.

The company was not worried by the explosion of mobile phone technology, which some analysts say could overtake computers as a way to access the Internet, as third-generation services launch and prices fall.

"I don't see it as a threat. I see it as an enabler of technology," said Schalkwyk "It will make people hungry for more."