climate and comms

According to McKinsey shareholder returns on telecom assets are down 60% over the last 4 years in the Middle East Africa (MEA) region. ( http://www.mckinsey.com/industries/telecommunications/our-insights : Telecommunications industry at Cliffs edge).     The main culprit is stagnating growth.   MEA includes mature markets like those in the Middle East where (mobile) penetration levels are close to 150% as well as high growth markets like Ethiopia where penetration is below 50%.    It is thus not useful to undertake analyses on an aggregate basis.   The mature markets are where data revenues are starting to show signs of rapid growth –but the markets are saturated.    In many African markets – particularly in Sub-Saharan Africa [1] – the decline in ARPU (average revenue per user) is no longer offset by subscriber growth and there is soon to be a decline in revenues and profitability. In order to profit from the explosion...

The mobile operators have been the ‘unicorns’ of Africa for the last 20 years.    Consistently outperforming, not only their global peers, but also all other sectors in Africa – even resources.    Historically African MNO’s have enjoyed higher EBITDA margins than their developed market peers – but it seems the African mobile fairy tale is coming to an end as we approach the bewitching hour of midnight.   The nasty sisters of MTN’s Nigerian Cinderella have reared their ugly heads with the imposition of a punitive $5.2bn fine.     Like Apple, whose once unstoppable iPhone sales have started to slow, most African MNO’s   need to come up with something new and smart or risk marginalisation as demand slows.     The killer App in Africa to date has been voice – but this market is saturated now with   customers from the very bottom of the pyramid – and so voice ARPU’s have declined.    According...

Dambiso Moyo argues that “ limitless development assistance to African governments, has fostered dependency, encouraged corruption and ultimately perpetuated poor governance and poverty” [1] .     It is self evident that sustainable development has not taken off despite the billions in foreign aid to African Governments over the last 60 odd years since the end of the colonial era.     Having eliminated aid as being a non-starter for African development the challenge now is to find the magic formula.     What key attributes, artefacts, behaviours or mechanisms will have the highest impact?      It is a highly complex web of factors and interdependencies that will lead to a sustainable future.    Issues like improved governance, the rule of law, better education,   better health care,   greater FDI,   trade,   even climate change will all be key factors that will impact the future ...

I have been waiting for Jeremy Rifkin to get with the African program.   It was only a matter of time.   For those of you who don't know, he is the guy who wrote ‘ The Third Industrial Revolution’ ( http://thethirdindustrialrevolution.com/ ) which is the story of the convergence of the communication and energy revolutions.   In it he talks of the rapidly emerging trend of local power generation and the sharing of that power laterally across the grid analogously to WiFi sharing between adjacent WiFi networks.    This is very powerful because it obviates the need for large capital projects for power generation – which have the downsides of : long lead times, centralised monolithic infrastructure, large expensive and wasteful distribution networks - all well illustrated by the current Eskom debacle. It is not widely known that only about 15% of Africans have access to power.   Millions of African children are forced to read by the lig...

I saw an article the other day headlined   “ Why saying ‘ seven of the ten fastest growing economies are in Africa ‘ carries no real meaning” [1] (By Morten Jerven writing on africanarguments.org).    Not one to be put off by such one eyed perspectives – I thought I should read it.    Always get the ‘other ‘ perspective is what   I believe and advocate,   and so I did.    What followed was a clinical analysis of GDP’s, growth rates, inflation rates and the like, indicators, so oft leant upon by economists to underpin their arguments.   Basically a dismissing of the current African economic turnaround as being statistically misleading and so on.    But all was not bad – there was a concession at the end that   ‘ the evidence does not yet readily provide us with an answer ’.   Had it been included in the title as a rider, perhaps one would have read the article with a little less disregard for the approach of the aut...