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World will wake to Africa

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The tech industry is constantly changing and EDWARD LAWRENCE, Director of Business Development at Workonline Communications, believes that there are huge changes in store for Africa, particularly related to the growth of the Internet.

The cutting edge nature of the tech industry means that constant change is a certainty. I do believe that the changes in store for Africa in the near future, particularly related to the development of the Internet in the region, are truly revolutionary. Here are some of the trends that I think will shape the future of the internet on the continent in the next little while.

The world is waking up to Africa

Having attended several industry related conferences across the world in recent months, in places such as Marrakech, New Zealand, California and even Hawaii, it is clear that global attitudes towards Africa as a prospective market are changing.

Generally, market entrants have been overwhelmed by the success of their expansions into Africa. Amongst these, international online giants such as Google, Microsoft, Netflix and Akamai who are peering in South Africa seem to have been very successful. This trend is set to assist in lowering the cost of Internet access for local ISPs. Instead of them having to pay to pick up content from these networks from other regions (usually Europe), they can now pick it up at internet exchanges in South Africa such NAP Africa, JINX, CINX or DINX at very low rates, or even free of charge.

South Africa’s healthy Internet exchange (IX) ecosystem is, as will hopefully be the trend with less developed markets in the region, encouraging deregulation and lowering the cost of services for end users.  With the establishment of IXs, ISPs can reduce their costs and hence invest more in expanding their networks and gaining market share. Once content networks realise that they can connect with many ISPs with many end users in a single location at reasonable costs, they are encouraged to develop in the region. As this process occurs, it usually attracts further investment in the industry, draws revenue away from the incumbents, and opens the market for innovative new entrants.

Demand will increase and must be met

As more and more people connect to the Internet across the continent, the domino effect picks up pace and demand for Internet services increases. This increase in demand is coupled with high expectations from a quality and speed perspective by newcomers to the Internet (often regardless of the actual benefit of the additional speed to the user). Interestingly, we found that people living in South African metropoles often have higher expectations than people living in Europe when it comes to the quality of an internet browsing experience through their mobile network operator.

This is because quality of Internet and connectivity is a frequent discussion point here, mainly due to the poor state this market was in not so long ago. It is used as a marketing tool, and therefore front of mind for the end consumer. Consumers have been conditioned to be unhappy if they do not have superfast Internet. The demand is not as high yet in some other African countries, or more rural areas, but it is definitely developing at a rapid and steady pace.

Women first

Another interesting trend I have noticed of late is that there are very few females in the industry in sub-Saharan Africa. In North Africa, for example, attending an IPv6 training session in Tunisia, the room was filled with women, and there were very few men present. If you go to an IPv6 training session in South Africa, however, it is a rare occurrence to see a woman in attendance. I foresee a mass entry of women into the technical side of the industry in the near future as the social barriers to entry are torn down.

We see this trend manifesting in Europe, where many organisations made up of women working together have sprung up and have now garnered a lot of strength in the European tech community. We support these movements in Europe wholeheartedly, and we are currently investigating ways to recreate this trend here and elevate women’s roles in the local market.

The full value of IPv6 to be unleashed

Everything that connects to the Internet needs an Internet protocol address, a string of numbers, to do so. Before, these addresses were in an Internet Protocol version 4 (IPv4) format, but this format didn’t allow for enough addresses and they are coming close to exhaustion.  IPv6 is the latest version of the Internet Protocol, and features a vastly expanded potential number of addresses to provide for the needs of the rapidly growing number of Internet-connected devices and services around the world. In technical terms, the existing IPv4 notation has been extended from 32 bits to 128 bits per IP address.

Workonline is in the process of setting up an advanced IPv6 workshop to be held as often as once a quarter in South Africa, to guide engineers with the deployment of IPv6 on their network, as this is a need that we have recognised within the local industry. At the moment, many engineers have had basic training or exposure to IPv6. They get their addresses assigned from their RIR, they know how it works conceptually, but then they stop. They do not actually deploy it across their access layer because they are frightened by the potential risks involved and often don’t know where to turn to get advice or share thoughts with other engineers who have successfully deployed IPv6 across various types of networks. Attending an advanced IPv6 workshop with globally recognised experts present would allow them to speak more freely and get stuck into the guts of deploying IPv6 on the whole of their networks, unleashing the benefits of this protocol.

As I write this, I’m on my way to Copenhagen to join the RIPE meeting. Workonline partnered with layer 2 Internet Exchange Point (IXP) NAPAfrica, to assist RIPE NCC to gather Internet data that will help network operators gain further visibility into the structure of the African Internet.

With 21 other RRCs at IXPs around the world, until now Africa has been the only continent without a RIPE NCC Route Collector, which means that it has largely been in the dark from the perspective of Internet measurements. The decision to host a route collector is extremely beneficial to operators in the region. The sponsorship of bandwidth for the RRC is in line with our commitment to continue developing the African Internet as a whole. Having access to this data will be beneficial to our clients and the industry, and we are excited to be part of the project.

It is important that the industry continues to look for ways to bring better Internet to the continent through strategic partnerships.

Africa News

Africa phones go flat

Africa’s mobile phone market declined 2.1% quarter on quarter in Q3 2018 according to the latest figures from IDC.

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The global technology research and consulting firm newly released Quarterly Mobile Phone Tracker shows overall shipments for the quarter totalled 52.6 million units, with feature phone shipments falling 2.7% QoQ and smartphone shipments declining 1.3% over the same period.

Transsion brands (Tecno, Infinix, and Itel) led the feature phone space in Q3 2018, with a combined unit share of 58.2%. Nokia was next in line with 11.7% share. Transsion, Samsung, and Huawei dominated the smartphone space with respective unit shares of 34.9%, 21.7%, and 10.2%. However, in value terms, Samsung led the smartphone market with 37.2% share, followed by Transsion (21.0%) and Huawei (13.0%).

There were differing fortunes in the region’s three major markets, with Nigeria suffering a heavy 11.6% QoQ decline in mobile phone shipments, while South Africa and Kenya saw respective QoQ growth of 8.5% and 7.9% in Q3 2018.

“The decline in Nigeria stemmed from a slowdown in government spending, ongoing warfare in the country’s northern states, and market uncertainty in the lead up to elections,” says George Mbuthia, a research analyst at IDC. “In South Africa, the market’s growth was spurred by the penetration of low-end devices from brands such as Mobicel, Mint, and Nokia, while the launch of entry-level smartphones helped drive growth in Kenya despite increases in taxes and fuel prices placing a significant burden on disposable income in the country.”

While feature phones remain steadfastly popular across Africa, particularly in more rural areas, consumers are increasingly being attracted by smartphone offerings from Chinese brands such as Xiaomi, Oppo, and Huawei, which are actively targeting feature-oriented customers at more economical price points.

“There is a new wave of Chinese brands aggressively pursuing growth opportunities in the region, while the more-established Huawei is also accelerating its marketing efforts and expanding its distribution budget,” says Ramazan Yavuz, a research manager at IDC. “These brands have quickly progressed along the learning curve and evolved their offerings to perfectly reflect the realities of the region by addressing the diverse pricing and feature needs of the consumer base.”

Looking ahead, IDC expects Africa’s overall mobile phone market to reach 58 million units in Q4 2018, spurred by the festive season and online consumer events such as Black Friday. The introduction of more affordable smartphones in the African market will help drive progress in this space over the coming quarters, while the share of feature phones will decline steadily as the transition to smartphones gathers momentum.

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Africa News

Mobile money to cross borders

Orange and MTN launch pan-African mobile money interoperability to scale up mobile financial services across Africa.

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Two of Africa’s largest mobile operators and mobile money providers, Orange Group and MTN Group, today announced a joint venture, Mowali (mobile wallet interoperability), to enable interoperable payments across the continent. Mowali makes it possible to send money between mobile money accounts issued by any mobile money provider, in real time and at low cost.

Mowali will immediately benefit from the reach of MTN Mobile Money and Orange Money, bringing together over 100 million mobile money accounts and mobile money operations in 22 of sub-Saharan Africa’s 46 markets. Mowali is ready to enable interoperability between digital financial service providers beyond MTN and Orange operations and markets, to support the existing 338 million mobile money accounts in Africa.

Mowali is a digital payment infrastructure that connects financial service providers and customers in one inclusive network. It functions as an industry utility, open to any mobile money provider in Africa, including banks, money transfer operators and other financial service providers.

The objective of Mowali is to increase the usage of mobile money by consumers and merchants.  Mowali enables money to circulate freely between mobile money accounts from any operators in all countries.  From the customer’s point of view, this means “I can pay or receive money anywhere from my mobile account regardless of my operator”. The system will unlock further innovation in the digital financial space within the continent. 

For Stéphane Richard, Chairman & CEO of Orange, “by providing full interoperability between platforms, Mowali will provide an important step forward that will allow mobile money to become a universal means of payment in Africa. Increasing financial inclusion through the use of digital technology is an essential element in furthering the economic development of Africa, particularly for more isolated communities. This solution embodies Orange’s ambition to be a leading player in the digital transformation of the continent. By joining forces with another of Africa’s market leaders, MTN, we aim to accelerate the pace of this transformation in a way that will change the lives of our customers by providing them with simpler, safer and more advantageous services. “

“One of MTN’s goals is to accelerate the penetration of mobile financial services in Africa, Mowali is one such vehicle that will help us achieve that objective. Furthermore, co-operation and partnerships that help us accelerate the pace of development and overcome some of the scale, scope and complexity of challenges that society faces are key. This partnership with Orange is therefore an important step in helping us play a meaningful role in supporting the United Nations’ Sustainable Development Goals related to eliminating extreme poverty and enhancing socio-economic development in the markets we operate in and beyond. Thus giving our customers access to a bright, digital future.” said Rob Shuter, Group President and CEO of MTN.

The GSMA supports the Mowali initiative as interoperability at this scale is a key accelerator for both financial inclusion and Mobile Money usability across Africa.  “Today, there are over 690 million mobile money accounts around the world. Mobile money services have become an essential, life-changing tool across Africa, providing access to safe and secure financial services but also to energy, health, education and employment opportunities. The creation of Mowali will help to further transform mobile financial services throughout the African region. It demonstrates the mobile industry’s continued leadership and commitment to driving financial inclusion and economic empowerment through industry collaboration. The GSMA is proud to support its development,” said Mats Granryd, Director General, GSMA.

“Interoperability of digital payments has been the toughest hurdle for the financial services industry to overcome, in support of financial inclusion. With Mowali, Orange and MTN deliver a solution that will enable them, and other companies, to scale digital financial services across Africa, faster, to everyone—including the poor,” said Kosta Peric, deputy director of Financial Services for the Poor, at the Bill & Melinda Gates Foundation “This is a signal that a new wave of innovation, which can help alleviate poverty and drive economic opportunity, is coming. We’re pleased to see an implementation of Mojaloop—an open source payment platform available to operators across the sector—help achieve that.”

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