The country attracted our attention today is Tanzania located in central East Africa. The country is bordered by Kenya and Uganda to the north, Rwanda, Burundi and the Democratic Republic of the Congo to the west, and Zambia, Malawi and Mozambique to the south. Actually, Tanzania is one of the poorest countries in the world, being deprived its natural wealth and resources and totally dependent on help from the rest of the world. The economy of the country is mostly based on agriculture, which accounts for more than half of the GDP, providing about 85% of exports, and employs approximately 80% of the workforce. Besides, mining and tourism are also among the main industry sectors. However, the country continues to suffer from underdeveloped infrastructure, including roads, railways, electricity and telecommunications. Since 2000 Tanzania’s economy has been showing solid growth rates of between 5% and 8% every year.

But, we are to study the condition of Internet and e-commerce industry in this African country.

Tanzania’s telecom sector has eventually been underdeveloped due to imperfection and poorness of the national economy.

There are two fixed-line operators in Tanzania: in TTCL (Tanzania Telecommunications Company Limited) and Zantel and seven operational mobile networks, with five additional players licensed under a new converged regulatory regime. With four major operators (Vodacom, Zain, Tigo and Zantel) the mobile market is expected to break the 50% penetration barrier during this year.

TTCL is the oldest and largest fixed line telecommunications company in Tanzania. The company comes forth from the former Tanzania Posts and Telecommunications Corporation in 1993. TTCL was wholly owned by the Government of Tanzania until the partial privatization of the company in 2001. The operator currently provides voice and data communication services to over 150,000 business and residential customers in Tanzania. The company also provides network services to other licensed telecom operators. TTCL is targeting to hold its position as the leading Fixed Network Operator in Tanzania.

In 2006 a new converged licensing regime introduced that has brought a large number of new players into the market. The liberalization of Voice over Internet Protocol telephony as well as the introduction of 3G mobile services and wireless broadband networks is boosting the Internet sector which has been hampered by the low level of development of the traditional fixed-line network.

The landing of the first fibre optic international submarine cables in the country in 2009 and 2010 was set to revolutionize the market which up to that point completely depended on expensive satellite connections. Moreover, the government has embarked on a national fibre backbone rollout to connect population centres around the country. But, unfortunately, the cost of international Internet bandwidth has so far not come down by as much and not as quickly as expected.

Thus far a number of new operators has entered the market, and most of them are successfully delivering their services. Among them there are:

• Raha.com – that that markets itself as Tanzania's leading ISP
• Africa Online Tanzania - offers the small, medium and large business with a wide range of Internet and related products and services that address the most demanding of needs.
• Afsat Communications Tanzania Ltd. – using Breezecom or Lucent equipment the company delivers Wireless Internet connection.
• MIC Africa - is the oldest wireless Telecommunications company in Tanzania
• Internet Africa - is one of Tanzania's most popular Internet Service Provider, founded in 1996
• CATS-NET – has delivered Internet connection services since 1997
• Ericonet – delivers Wireless Internet service
• Arusha Node Marie
• Benson Online
• Cybernet
• SimbaNET
• Spidersat
• Kicheko
• ZanLink

The appearance of new Internet services providers was stipulated by growing demand of Internet connection. Despite the volume of Internet users in the country has only reached 1.6%, the growth in broadband penetration has made up about 500% for the decade, as reflects www.internetworldstats.com.

Internet country code top-level domain (ccTLD) for Tanzania is .tz , administered by PSGnet.
Registrations are available at the third level beneath some second-level names, like followings:

• .co.tz - commercial
• .ac.tz - schools granting baccalaureate degrees
• .go.tz - governmental entities
• .or.tz - not-for-profit organizations
• .ne.tz - network infrastructure

Turning to e-commerce sector, we are to say that it remains underdeveloped that was reasoned by lack of development in national ICT sector.

Anyway, there is a sufficient amount of progress in the field of e-commerce and related sectors in Tanzania as well as in some other African countries.

Thus far several small companies actively pursue this field and have started small businesses that use e commerce as their basis. Importantly, Tanzania’s government has taken a keen interest in promoting and developing e-commerce markethaving started the creation of a framework whereby the outline of e commerce was laid out in simple steps. The next step is supposed to be research and analyzes and thereafter establishing the rules for framing a digital and e-commerce network that would be of practical benefit to all.

As the majority of African countries Tanzania has private sector that consists mostly of small, medium, and micro-sized enterprises and the informal sector. That’s why these businesses are widely seen as a potential engine of growth in the country’s information economy. E-commerce offers huge potential to SMEs, including potential strategic benefits such as possibilities of creating new industries, developing new content and chances to find or create employment.

Besides, the National Information and Communication Infrastructure (NICI) plans, many African countries are, including Tanzania, starting to recognize the importance of the e-commerce sector development.

Thus far Tanzania was set by NICI to accomplish the following steps on a way of e-commerce progress:

• establishing an environment conducive for e-commerce transactions and competition;
• encouraging more usage of ICT in financial services (banking, insurance, etc);
• promoting the use of ICT to enhance efficiency, effectiveness and continuity in the provision of services and basic utilities,
• especially in billing and payment systems;
• developing and deploying a nationwide e-Tourism system

Despite Tanzania has a very poor and underdeveloped economy, the good signs of progress are obvious, with the appearance of new ISPs and Internet services as well as active government participation in development of e-commerce sector.