Kenyans are buying more digital content than peers in many big economies around the world, despite the recent introduction of taxes on such products, highlighting the growing digital consumption in the country.
An estimated 76.5 percent of internet users in Kenya over the age of 16 now pay for a digital content every month, the fourth highest proportion in the world, behind only Norway, Mexico and Sweden, a survey by London-based consumer research firm GWI shows.
This is much higher than even larger economies like South Africa and the United States, where 73 percent and 70.2 percent of citizens respectively in that age group pay for digital content each month. The global average is 68.3 percent.
The findings are based on a survey of 1,982 Kenyan internet users done last November to provide an insight into the online shopping habits of Kenyans, especially the purchase of digital content.
Digital content includes movie or television streaming services, music streaming and downloads, mobile app purchases, mobile and computer games, online learning materials, e-books, online magazine subscriptions and dating services, among others.
This high rate defies the recent introduction of the digital services tax (DST), which was initially charged at a rate of 1.5 percent on the price of such digital products. It has since been changed to a significant economic presence (SEP) tax, levied at three percent.
Most of the other jurisdictions trampled by Kenya, including South Africa and the US, have no digital tax on such online products.
Some experts attribute the high rate of consumption of digital content in Kenya to a widely youthful population that is digitally literate and a vibrant digital economy supported by strong infrastructure.
“I think Kenyans, per se, are quite tech savvy,” noted Niral Patel, CEO of Accelera Digital Group, a digital services firm with operations in Kenya, Nigeria, South Africa and Ethiopia.
“And there’s a large youthful population that’s coming into the economy and by that, naturally they would demand that type of service because they see immediate value and gratification from there.”
“I think the consumption will not stop. It will continue to transform traditional industries and give rise to new industries and by that, it creates opportunity, which improves innovation,” he added.
Globally, movie and TV streaming tops the charts for the type of digital content that people spend money on, with about 31.5 percent of internet users paying for it, followed by music streaming at 22.5 percent.
Online dating services and magazine subscriptions are the least purchased, with only 4.4 percent and 6.1 percent of internet users paying for them respectively.
What people pay for changes with age, but the top two are similar across all age groups. Younger users are, however, paying more for mobile games, apps and learning materials, while older people are spending more on e-books, news services and magazine subscriptions.
But while Kenya tops the charts for the share of internet users paying for digital content services, the average amount spent on such services by Kenyans is among the least in the world.
Data from Statista shows that Kenyans spend an average of Sh2,015 ($15.57) a year on digital content purchases, while people from South Africa spend an average of Sh7,185 ($55.5) and Americans spend Sh123,132 ($951) on such purchases, the highest in the world.
