April, 2008

October, 2009

I took the first photo. That was in April 2008 in an informal telecenter visit. The second one appeared in a Sinhala blog recently.

Mangedara Nenasala telecenter at Thulhiriya (less than 2 km from MAS Holdings) is one of the hundreds of defunct Nenasala telecenters. During better times it provided services such as utility bill payments and computer training. Now it remains closed since the operator, who was never paid for his services, left for better opportunities.

The findings of the telecenter operator survey done by LIRNEasia at a workshop organised by Sarvodaya in October 2008 will be useful to understand why Nenasalas fail. (Sample was not representative, but large enough to get a general idea about the telecenter operations in Sri Lanka.)

Do telecenters in Sri Lanka make money? Yes. They report an average monthly income of Rs. 22,119. (=USD 201) This is associated with a relatively large standard deviation of Rs. 21,714 (= USD 197) indicating a variation within a wide range. This means a large number of telecenters are running at a loss.

Providing Internet services ranked only third among telecenter income components (16%). The key sources of income are education and training (43%) and providing fax, photocopy and printing series (21%). They also make money from VoIP (4.5%), utility bill payments (2.5%) telephone calls (2.5%) selling other goods (2%) and VCD/DVD rentals (1%).

Do telecenters make a profit? Yes, but perhaps may not in real terms. They record a monthly average profit of Rs. 6,735 (=USD 61) with a large standard deviation of Rs. 9,504 (=USD 86). This indicates the loss incurred by some of them. This is again without considering the cost of the communication link. (The monthly average cost of a 2 Mbps business broadband connection is USD 46 in Colombo. This might be slightly high in rural areas.)

Telecenters operators are rewarded in different ways. Only 33% are salaried. 22% receive a share of profits. 13% receive an allowanced based on performance. 32% receive no personal income.

Here are the summarised results from the telecenter operator survey done by LIRNEasia at the weCan workshop in October 2008. Sample was not representative, but large enough to get a general idea about the telecenter operations in Sri Lanka.

Out of a total of 147 operators surveyed, the bulk, 101 were from Nenasalas, the 500 odd telecenter network created under the World Bank funded e-Sri Lanka programme. 10 were from Sarvodaya multi-purpose telecenters and 6 from others (eg. public libraries) 30 have not specified the type of the telecenter.

Do telecenters in Sri Lanka make money? Yes. They report an average monthly income of Rs. 22,119. (=USD 201) This is associated with a relatively large standard deviation of Rs. 21,714 (= USD 197) indicating a variation within a wide range. Not a surprise since some telecenters are running at a loss (presumably temporarily) and few reporting a monthly income of over Rs. 100,000 (= USD 900).

However, providing Internet services ranked only third among telecenter income components (16%). The key sources of income are education and training (43%) and providing fax, photocopy and printing series (21%). They also make money from VoIP (4.5%), bill payments (2.5%) telephone calls (2.5%) selling other goods (2%) and VCD/DVD rentals (1%).

Asked for the preferred income profile, the results were not too different. They still want 33% income from training, 21% from fax photocopy and print services and 17% from Internet services. Is this an indication of being more realistic or less ambitious? You decide.

Average monthly expenditure of a telecenter is Rs. 15,837. (USD 144) This may not reflect the real costs as the Internet charges for Nenasalas are borne by ICT Agency from the money comes from e-Sri Lanka programme. Salaries is the highest cost component (39%). Then comes electricity (25%). About 10% each for telephone and rent.

On average basis a telecenter has 5 PCs and employs four staff members – two permanent, two temporary. Correlation between the income and the permanent staff strength was 0.56; the income and the number of PCs, 0.62.

Do telecenters make a profit? Yes, but perhaps may not in real terms. They record a monthly average profit of Rs. 6,735 (=USD 61) with a large standard deviation of Rs. 9,504 (=USD 86). This indicates the loss incurred by some of them. This is again without considering the cost of the communication link. (The monthly average cost of a 2 Mbps business broadband connection is USD 46 in Colombo. This might be slightly high in rural areas.)

Telecenters operators are rewarded in different ways. Only 33% are salaried. 22% receive a share of profits. 13% receive an allowanced based on performance. 32% receive no personal income. How they prefer to be rewarded? 51% wants a monthly salary; 26% a share of profits and 18% a performance based allowance. Doesn’t sound too entrepreneurial but in Sri Lanka culture job security plays an important role.