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Opened with much fanfare, IBM lab in Kenya looks for concrete results

Opened with much fanfare, IBM lab in Kenya looks for concrete results

The government pays the company $2 million a year, but so far benefits appear to be indirect

H.E. the President of Kenya, Hon. Uhuru Kenyatta (left) and Dr. Kamal Bhattacharya, Director IBM Research - Africa (right) at the opening of IBM's First Africa Research Laboratory, November 8, 2013.

H.E. the President of Kenya, Hon. Uhuru Kenyatta (left) and Dr. Kamal Bhattacharya, Director IBM Research - Africa (right) at the opening of IBM's First Africa Research Laboratory, November 8, 2013.

In 2013, Kenyan President Uhuru Kenyatta launched an IBM research lab in Nairobi with expectations that it would help develop and launch applications for both the government and private sector. Two years later, though, the lab is struggling to identify specific, viable projects that it that has researched and developed.

The situation has raised questions, especially because under the contract signed with the ICT Authority, the government contributes US$2 million annually toward running the lab.

IBM officials say the lab has raised Kenya's tech and business profile.

"IBM has not only delivered on, but exceeded its initial commitments to the Kenyan government." said Kamal Bhattacharya, vice president of IBM Research, Africa. "Together with the Kenyan ICT Authority, IBM is making a significant investment into the future of science and technology in Kenya and to reinforcing Kenya's global reputation as a leader in innovation."

The ICT Authority said the $2 million investment has paid off, with the universities being the major beneficiaries of the lab. There are currently 15 interns at the lab. In addition, IBM's presence itself has helped lead other international companies into the country, say ICT Authority officials.

"The presence IBM lab in Kenya has acted as a boost of confidence to other international companies interested in investing in Kenya; Mastercard has already announced that it will be setting up a lab in Kenya," said Victor Kyalo, CEO of Kenya's ICT Authority.

When asked about successful collaboration, Kyalo pointed to a study launched in October last year, on the ease of doing business in Kenya. The research is being done in collaboration with IBM and Strathmore University, and is seeking to identify ways the government can reform processes and attract more businesses to the country.

The study is placing students at key government departments to collect data on how processes can improve. For instance, at the government department that registers corporations doing business in the country, the students are supposed to help come up with ways to speed up the process.

Although the report is not yet out, it is expected that it essentially will list the same problems that World Bank report on ease of doing business has reported over the years. Currently, World Bank ranks Kenya number 136 out of 189 countries on the ease of doing business.

Kyalo deflects criticism that professionals who have experienced the process might be in a better position to advise the government.

"Getting fresh graduates to critique the process is the best because they have fresh eyes and will help point out the direction they think Kenya should be heading, they are the generation used to more digital processes," said Kyalo.

Nevertheless, even though IBM and government officials have talked about some initiatives that are in progress, and have suggested indirect benefits of the IBM lab, they have not been able to show off concrete projects that have been brought to fruition.

"In the last two years, all the lab has done is showcase the facilities, there is no single project that has gone to testing, that we can say this is work in progress; we are happy to just show the media around," said a source, who did not want to be quoted by name due to the risk of losing future  opportunities.

"In other public-private partnerships I have been involved in, by the end of the first year, there are usually some progress that the public can test, or some research that benefits the public -- here we are just happy with the facilities and just making statements, the government has not made any demands or kept us accountable," the source said.

The ICT Authority's Kyalo acknowledges that IBM has not delved deeply into how a research lab can interact, to the benefit of all involved, with the start-up scene and growing companies. In the second phase of the five year contract that starts in September, however, IBM and the government will explore whether the private sector can benefit from the lab, he said.

Some industry players say IBM can help.

"Yes, IBM research has a role to play in the growth of the local tech sector; there's a huge gap for data that just requires someone with the necessary budget to sort it out," said Phares Kariuki, CEO of Angani, a cloud provider. "For instance, there's no central body that has been authoritatively tracking the evolution of connectivity in Kenya, how many people have fiber to the home, and of those, what's the average income level of the house hold."

This type of data would make investments in tech easier for investors because it would give them an accurate picture of technology consumption in Kenya, Kariuki said.

On its part, IBM says it wants to work with local companies. IBM considers itself the only multinational technology company that has committed significant investment to high-end engineering skills in Africa and it expects to start showing results in another 12 to 18 months.

"Engaging with the local business ecosystem is a crucial part of the strategy of IBM Research Africa; we work with partners as part of our research of new solutions and services as well as our go to market strategy," said IBM's Bhattacharya.

IBM says it has started working with Kenyan startups like Echo Mobile, which was involved in a campaign to provide information on Ebola in Sierra Leone last year. There is no data on the effect it had on the campaign, however.

Currently, IBM is working with Gear Box, a hardware startup that plans to build smart water tanks to be deployed in both urban and rural areas. The tanks are designed to give warnings on pump failure, energy consumption and coordination of water delivery services.

A major issue that has stymied participation of private companies in IBM projects, however, is the intellectual property requirement. For startups, the amount of paperwork presented by IBM to cover intellectual property issues is too much and requires investment in legal counsel, which the young companies may not have.

"According to the contract, if the IP originated with the government, then it belongs to the government, if it was IBM that came up with the idea, partnered, tested it and it works, then it belongs to IBM, for the private sector, they are supposed to negotiate separately with IBM," Kyalo said.

For private companies, IBM requires that all IP developed at the lab belongs to it, whether developed jointly or not. Asked whether this is calculated to deter local companies from participating, Bhattacharya said: "We are currently exploring a number of models that best suit the African landscape."

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