Internet cafe owners face increasing competition

24/06/2007

Falling revenues from internet cafes are causing some managers to consider leaving the business. Others seek to bolster their incomes by offering additional services.

By Sarah Touahri for Magharebia in Rabat -- 24/06/07

[Sarah Touahri] In order to compete, Internet cafes are offering additional services

Internet cafe revenues have been in steady decline in Morocco. There are currently approximately 11,500 Internet cafes in the country, and demand for new cafes is falling year on year. While 4,200 cafes were established in 2005, only 3,500 opened doors in 2006. For many operators, the business is no longer the profitable enterprise it used to be. Although some owners are giving up, others are turning to innovative solutions.

Many Internet cafe owners complain about the loss of revenue they have suffered over the past three years. Competition is stiff and in one district of Rabat, it is possible to find several cafes side by side. To the dismay of cafe owners and managers, the competition has brought about a huge drop in rates.

The price of a one-hour session has fallen from 20 dirhams in 1998 to between 3 and 4 dirhams today. "In the past, [home] subscriptions were very costly, and Internet cafes were few and far between. My cafe used to attract many customers from other districts. Some of them would have to wait quite a while for a terminal to become available. But recently things have changed; other places have sprung up in the same district," Rachid Semmouhi, who manages an Internet cafe in Kenitra, told Magharebia.

Nora Bachtioui, who supports her family of six with her Internet cafe was concerned when revenues began to fall. "We had to find a solution to our drop in earnings. From 400 Dirhams per day, income had fallen to 150, or even 100 Dirhams," she told Magharebia.

Many Internet cafes have shut their doors in the face of rising competition. Semmouhi said that his manager was seriously thinking of shutting down shop after nine years in the business.

Others have found new tricks to increase revenue and ensure their continued survival. Many internet cafes print documents, make photocopies and offer training and typing services. Others provide faxing centres, repair computer equipment, or even deal in GSM handsets. Many internet cafes also offer phone centres and traditional cafe services.

Hakim Taji, who operates an Internet cafe in Temara, agrees that Internet cafe owners have had to adapt to changing conditions. Taji holds a degree in IT and offers à la carte training on basic software programs. "In that way, I’ve been able to steady the ship. I give about six hours of training per program, for an average of 200 or 300 Dirhams. My customers are happy, and I’m hoping to open a phone centre," he said.

Sami Banani, who teaches economics, explained that Internet cafes could still survive in Morocco, particularly in working-class districts where computers are still priced beyond the reach of most and many cannot afford an Internet subscription.