climate and comms

Government authorities have a key role to play in facilitating the emergence of a digital economy.    Their mission does not only entail adopting and enforcing appropriate and effective regulations but also ensuring that existing infrastructure is leveraged for optimal utilization.   The participants in this strategic workshop will work on ways to make governments and regulators true catalysts for digitalization, with the support of all sector players. This  is the subject matter of a discussion to be held at the Africa CEO Forum in Abidjan next week.  These are my initial thoughts.  All comments welcome. In Africa we have seen the emergence of a mobile telephony market which went from zero to over a billion phones in just over two decades.   The mobile industry requires tight regulation because of the use of a scarce resource – spectrum.    The role of Government has thus, of necessity,   been important in ...

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...

As far as data centres are concerned Africa is a blank slate. London alone has more than 2 times the number of DC’s than the whole of Africa. The majority of DC’s in Africa are enterprise/Telco/Banking/Govt in-house.    Very few are carrier neutral.   There are also no Cloud DC’s to speak of. With the advent of massive capacity brought about by the deployment of multiple submarine cables Africa can now connect seamlessly to the rest of the World at seemingly unlimited bandwidths.   This increase in capacity of connectivity brings with it the benefit of lower costs which underpins a virtuous cycle of increased usage, higher demand, lower prices and so on. As the international investment community starts to wake up to the opportunities brought about by fast growing (albeit off a low base) economies, rapid urbanisation, a young growing population, there will be a steady increase in FDI in infrastructure,  agriculture as well as investment into services and...

Starting in the mid 1990’s Africa underwent a ‘mobile revolution’ whereby from a standing start of below 1% telephone penetration (tele-density) -   the Continent now boasts over 800 million mobile phones.     By skipping the so-called ‘landline’ technologies the mobile operators leapfrogged a technology generation.   These mobile networks, it can be argued, have been a major contributor to the economic upswing the Continent has experienced since the start of the new millennium.     The mobile revolution is now over as growth has moderated and penetration levels started to peak.     However, a new revolution beckons - the Internet revolution.   Africa falls behind the Rest of the World when it comes to broadband with less than 15% penetration, mainly in the cities.    During the last 5 years numerous submarine cables have been installed, connecting Africa to the Globe.   These fibre-opti...

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...