Where will profitability come from next for African operators?

Following years of network deployments, fast growth, improvements in international satellite and cable links, Africa’s telecommunications markets are facing new challenges: how to make the most of the improved access to continue growing revenues in a market where subscription growth is slowing down?
On the one hand, operators are looking at reducing their costs in order to maximise profitability on their existing revenues. While they are still investing in their networks (particularly for mobile broadband), they needs to be more efficient. All major operators on the continent have attempted to deploy low-cost operations and outsourcing strategies but it may be Bharti Airtel’s expertise of the low-cost model that will make a difference in how operations are run optimally in Africa. In addition, the increasingly popular tower sharing model may be the key for operators to reach the under-served (and so far not profitable) rural areas.
On the other hand, companies are looking to creating new revenue sources. Improved networks, innovative models and wider access to better devices mean operators can develop innovative services to generate additional revenues from their customers or from new segments. Value-added services such as content, social networking or mobile money are attracting the attention of operators. Those services can prove profitable, but they mean having to partner with third companies to provide the content or the access to the customers; ‘OTT’ service providers such as Google and Facebook can offer either opportunities or challenges for operators who don’t want to become ‘dumb pipes’. In terms of customer segments, vertical enterprise markets may bring the best opportunities. Major operators have created special divisions within their companies to target these customers, such as Orange Business Services or more recently MTN Business. With dedicated teams, they will be better able to serve the needs of segments such as the public sector (health, education, government), oil, gas and mining, or the financial sectors. However in this field too, they will have to work with partners (such as network equipment vendors or cloud computing providers) to deliver services that answer the needs of the enterprises.
All these issues and more will be addressed at the AfricaCom event which will be held for the 14th time this year in Cape Town on 9th and 10th November. The conference programme is currently being written, with new sessions and features to bring the latest trends to the audience: special focus sessions on customer focus, mobile broadband, convergence, VAS, social networking, rural telecoms, cost management, and more. In addition, the congress will include 2 new co-located events: Enterprise ICT (covering ICT strategies and services for enterprises in Africa), and AfricaCast (addressing the trends and opportunities for the African broadcasting industry). So, now is a chance to have your say on the key topics to include in the programme and companies to invite to speak.