Mobile data sparks a revolution

In the Middle East and Africa, mobile value-added services are having a powerful transformational effect on the businesses of mobile operators and the lives of their customers.

With voice-service revenues in the region forecast to record relatively little increase over the next few years, data services offer the best growth prospects.

It is clear that data services – especially access to the Internet – have had a profoundly transformative effect in the region, as the use of online social networking has played an important part in the big political developments that have occurred in the region in the past few months, notably the overthrow of governments in Egypt and Tunisia.

Egyptian operator Mobinil said in its 1Q11 results that “data appetite is exploding,” as has been demonstrated in recent months, when “social networking, particularly via mobile, has been playing a critical role in political mobilization.” Mobinil said that it plans to launch new digital applications and form new partnerships in order to take advantage of the opportunity in mobile data.

However, one should not overstate the links between mobile data and political change. Internet connectivity and social-networking services were important as facilitators and catalysts in the Egyptian and Tunisian revolutions. But a high level of connectivity does not necessarily lead to revolution. And political upheaval can take place where connectivity is low. Syria and Yemen have among the lowest rates of mobile and broadband penetration in the Middle East but have recently experienced sustained protests, though the outcome of these remain uncertain.

We’re currently building the conference agenda for this year’s North Africa Com conference which will address data across the region.  Find out more about joining the speaker panel http://nafrica.comworldseries.com/conference/Call_For_Speakers

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.

Mobile subscriptions in West & Central Africa predicted to increase 68% over next 5 years to reach 310m+

The West and Central Africa region has consistently been the fastest-growing in Africa in the past few years. Mobile subscriptions in West & Central Africa are predicted to increase another 68% over the next 5 years to reach in excess of 310m.  Over this period, the strongest subscriber growth is expected in the telecom markets of DRC, Benin, Cote d’Ivoire and Togo.   Competition for these new customers is fierce though, as operators compete with new entrants in a more crowded environment.

Unlike East Africa, where competition has been fought mainly on price, West & Central African operators in the region’s more developed markets have harnessed improved connectivity as a way of increasing customers.  They have invested in their networks to offer value added services such as mobile money transfer, which are regarded as a customer retention tool and way to increase rural coverage.  Data services, in particular mobile broadband is now offered in 7 of the region’s 24 markets.

Despite these clear developments, it’s still early days in the provision of these new services in West & Central Africa, and the companies which will succeed in seizing the best opportunities will have to move fast and be innovative. 

This June, 700+ telcos from across the region will meet at West & Central Africa Com conference and exhibition to discuss how to seize these opportunities.  Find out more at www.comworldseries.com/wcafrica

Regional Telecom Leaders Prepare to Set Strategies for Capitalising on New Networks and Services at East Africa Com Conference in Nairobi Tomorrow

Tomorrow, over 650 telecom leaders from across East Africa will gather in Nairobi at East Africa Com conference (www.comworldseries.com/eafrica).  Their agenda for the 2 days is to establish strategies, set best practice benchmarks and find innovative ways of capitalising on the new networks and services in the fiercely competitive East African market.

Subscription growth remains high in East Africa, but this is not driven by an increase in customers, rather multiple SIM usage as a result of fierce price wars amongst the operators.  This has had a negative impact on ARPU which has declined to reach just US$7.13.  New players, the imminent introduction of mobile number portability and improved connectivity has forced operators to look beyond price as a winning competitive tool. 

New opportunities for operators now lie in the provision of value added services and mobile broadband but services are still evolving and an optimum business model is still to be established.  It is for this purpose that 650 telecom leaders will meet tomorrow at East Africa Com conference, 5-6 April.  Representatives will include mobile, fixed, satellite and WiMAX operators, ISPs, MVNOs, regulators, ministers, solutions and technology providers, investors and consultants to ensure a truly 360 degree perspective of the market.  Attendees will pool their different perspectives, ideas and experiences to set strategies around convergence, broadband, LTE, value added services, telecoms Fraud and connecting rural areas. 

The 2 days of discussions will be led by a panel of 45+ speakers representing leaders of the region’s most dynamic operators, from pan-regional investors (Pan-regional players Orange France-Telecom and Airtel Africa, represented by Vice President Michel Barré and Group Director of Networks Bayan Moadjem respectively), incumbent operators (such as Telkom Kenya and their CEO Mikhail Ghossein), competitive mobile operators (with CxOs from Safaricom, Vivacell Southern Sudan, Zantel Tanzania, Airtel Kenya, amongst others), the self proclaimed original triple play provider in Africa, Wananchi (represented by Group CEO Richard Bell, and Kenya’s Country Manager Peter Reinartz), alternative service providers (Jamii Telecom, Roke Telkom Uganda) and more.

For more information on East Africa Com and to attend please visit www.comworldseries.com/eafrica

Where will VAS innovation come from in Africa's market?

Until recently most of the efforts on the part of telecoms operators and their partners in Africa have been focused on building and improving networks, first to deliver services to the growing customer base, and then to enable them to access new services including internet access.
Now that most of the population is connected and that submarine cables and new satellites are improving international connectivity and capacity, operators can turn their focus to how to best serve their customers and increase their revenues. Innovation in value-added services services is key to improve customer choice (and spending) and to differentiate from competitors. Until now, mobile money has been the great African-pioneered service, with sucessful offers such as Safaricom and Vodacom's M-Pesa, Zain's Zap and Orange Money. These are perfect for the African market, in that the offers are easy to use, fulfill a need that is specific to low-income segments, and improve customer loyalty.
But what is next? For the more advanced markets or segments, operators can look at mobile content or social networking, but they face the issue of sharing the customer's loyalty (and spending) with third parties. Targeting a different category of subscribers, telcos can look at services for specific sectors such as education, health or corporate verticals such as the oil and gas industry; the continent's major operators are busy targeting the potentially lucrative enterprise market by developing specific divisions such as MTN Business or Orange Business Services. But what about the 'ordinary' consumers, the generally low-income users who cannot spend much on new services? Operators need to be innovative in order to deliver attractive services that fit their lifestyles, while keeping their costs low to achieve reasonable margins. Airtel Africa, with its experience from India, may bring interesting ideas to the African markets, but its model may not be straightforward to transpose.
All those topics will form a recurrent theme in Com World Series events this year, with sessions covering VAS in all conferences, a special keynote on 'Serving the Customers' at AfricaCom as well as a co-located event on Entreprise ICT, and a new event dedicated to Value-Added Services in Africa to be held in Johannesburg in July.

Kenyan Operators Unlikely to Meet Deadline to Launch Mobile Number Portability

Operator price wars in East Africa have blighted operators’ efforts to ensure quality of service, meet customers’ expectations and retain their loyalty.  As consumers buy up multiple SIM cards to take advantage of the best deals, subscription rates have been artificially increased 19% year-on-year whilst ARPU has declined to a mere 12% to reach just US$7.13 at the end of 2010. 
 
All of this is set to change with the impending introduction of Mobile Number Portability in East Africa.  It’s well accepted that consumers elsewhere are loyal to their mobile number, not their operator, so for the first time East African consumers will benefit.  It is likely the consumer will now look to network quality and value added service offerings when choosing their service provider, triggering fresh competition between the operators on quality, and away from the dirty price wars.  As the artificial buffer of multiple SIM cards is knocked back, Safaricom - as the dominant incumbent so far - is expected to be the biggest loser, and competition will heat up further.

But there has been disappointing news in local press reports this week, that mobile operators in Kenya may not be ready for the adoption of the Mobile Number Portability which is scheduled to take effect from 1 April 2011. The four operators are yet to start test-runs on the switch platform dubbed, the ‘All Call Query System’ and insist that they need at least four weeks to perform the tests. The industry regulator, CCK has reiterated that the deadline for the switch-over will not be extended.  For the sake of the consumer, we hope this doesn’t end in deadlock.

East African operator leaders will be meeting in Nairobi, 5-6 April to discuss implementation of new networks and services across the region at East Africa Com conference.  Find out more online www.comworldseries.com/eafrica   

West Africa region sees Africa's major operators compete for growth opportunities

As for most of African telecommunications market, the West Africa region seems to be entering a new phase of its growth. Until recently it was characterised by low ARPU, low penetration, and countries with a high number of operators for a relatively small population. However, since the arrival of new international connections (new submarine cables and satellite links) and some dynamic initiatives from ECOWAS's main regulators, the region has now become a ground for Africa's major operator groups to compete.
Among the region's international strategic investors are France’s Orange, South Africa’s MTN, India’s Airtel, Etisalat (owners of Atlantique Telecom)and Expresso Telecom of the UAE, who all have significant footprints in the region. All these commpanies have expressed their interest in growing their presence in the region and increase their positions within their existing markets, where data and other value-added services such as mobile money offer considerable growth opportunities.
Thses groups will all be present at West & Central Africa Com, the region's annual event which will take place in Dakar, Senegal on 15th and 16th June. They will be represented by senior executives with a wealth of experience in those promising markets: Bernard Ghillebaert (Head of West Africa & Asia, Orange Group), Tiemoko Coulibaly (CEO, Francophone Africa Region, Airtel Africa), Ahmad Farroukh (Acting VP for the WECA region, MTN Group), Juan Jose De La Torre Chamy (Group Strategy & Planning Director,Etisalat Group), and Saiful Alam (CCO, Expresso Telecoms Group)
and more.
They will join 700+ telecommunications professionals from the region and beyond to discuss how to seize the changing opportunities in this region's dynamic market. With mobile subscriptions forecasted by Informa Telecoms & Media to increase by 68% over the next 5 years, and mobile broadband launches enabling the growth of mobile data services, this region is definitely the place to be for international investors.

Airtel Africa & East African Operators Ensure against Fraud and Revenue Loss in Telecoms Business

Risk of fraud & revenue loss in telecoms continues to be a major priority for big businesses in East Africa.  Whilst the region’s telecommunications industry has seen a quantum leap in the past decade – with markets like Kenya, Tanzania and Uganda being some of the most competitive & lucrative in the whole continent – there remains this shadowy side of telecoms in Africa. 

Operators often compete at a cut-throat level when it comes to pricing, OPEX, CAPEX, distribution models, etc.  But service providers like Airtel realise that there is money to be saved by committing to fraud and risk avoidance as well.

In Nairobi on the 6^th April, the Kenyatta International Conference Centre will provide a hub and platform for learning, debating and networking around this important issue of Fraud.  In particular, 2 exclusive Master Classes will take place.  The first to be run by Airtel Africa’s Group Revenue Assurance & Fraud Manager, Hawas Garba Matta.  The second by an international expert – Patrick Gitau of Globacom Nigeria.  The whole session will be opened and chaired by Ade Banjoko, Chair of the GSM Africa Fraud Forum.

Topics and discussions in these classes will include:

• effectively integrating risk, fraud & revenue assurance into your corporate strategy
• telecoms enterprise risk management
• optimizing end-to-end fraud & revenue assurance strategies
• implementing risk based fraud & revenue assurance framework with essential “from the top policy”
• bridging the GAPs by assessing & monitoring product life-cycle processes to identify the sources of fraud & revenue loss
• focus on optimised fraud detection through real-time capabilities
• how to tackle telecom fraud typologies in East Africa - bad debt management, process flows and inefficiencies, and capacity deficiencies problems in your network
• how to get value from RAMS and FMS
• vendor valuation criteria and considerations, and working closely with suppliers to minimise revenue leakages

“The market has responded very positively to this brand new feature to East Africa Com conference and exhibition,” says Emily Cottam, Senior Conference Producer, East Africa Com “Fraud is a topic that East African operators can’t afford to overlook if they are to remain profitable in this increasingly competitive market.  These master classes are a one-stop-shop for operators looking to understand and implement effective fraud prevention strategies.”

What’s more, these master classes form just one segment of the East Africa Com 2011 conference & exhibition, now in its 7^th year.

For more information about East Africa Com, and the Fraud & Revenue Assurance master classes visit www.comworldseries.com/eafrica or contact Emily Cottam on emily.cottam@informa.com or call on +44 (0)207 017 5610

Data services compensate for slowdown in mobile growth in Turkey

The total number of mobile subscriptions in Turkey declined by more than 2 million to 61.5 million in the 12 months to June 2010.  Caused by combination of economic downturn, decline in multi-sim ownership and the introduction of lower termination rates and number portability. 

All 3 Turkish operators have launched lower cost, flat-rate voice and data services which have triggered a 74% surge in usage.   As a result, 3G now accounts for more than 1 in 10 mobile subscriptions in Turkey.

This week, Turkish group Turkcell has reported a 0.8% year-on-year revenues increase in 2010, breaking the TRY9 billion (US$5.62 billion) mark for the first time. Revenues were mainly boosted by the uptake of their data services. However, the different regulatory decisions such as decreasing mobile termination rates in its domestic market had a negative impact on EBIDTA, which decreased by 1% to TRY2.95 billion, bringing the margin down 0.6pp to 32.7%. The group ended the year with 60.4 million subs, a yearly decrease of 3.7%, as a result of fewer customers in Turkey from the decline in multiple-SIM ownership and prepaid cards, and in Ukraine as a result of change in subscriber definition.

Turkish and Eurasian operators will present on their strategies for capitalising on this data potential at Eurasia Com conference in Istanbul next month www.comworldseries.com/eurasia

Director General of the Communications Commission in Kenya confirmed for East Africa Com

Whilst the multitudes gathered for Mobile World Congress in Barcelona, there was - it could be said - a very low representation from emerging markets, and in particular from Africa. 

However, anyone interested in doing business in the lucrative African markets can rest assured that all of the leading lights of the East African telecoms industry will be in attendance at East Africa Com, Nairobi, 5-6 April 2011.

Last week the Director General of the Communications Commission in Kenya, Mr Charles J. K. Njoroge, confirmed he will give a speech on Wednesday 6^th April.  This is the 7^th annual East Africa Com conference and exhibition, and yet again there is unparalleled regional industry support.

See you there! www.comworldseries.com/eafrica

About Mr. Charles J.K. Njoroge

Mr. Charles J.K. Njoroge is the Director - General and CEO of the Communications Commission of Kenya (CCK).  He was appointed to the position in July 2008. He was recently recognized as an Elder of the Burning Spear (EBS) by the President of Kenya.

Until his appointment, Mr. Njoroge, an Economist, was the Director in charge of Competition, Tariffs and Market Analysis.  In that position, he was responsible for economic regulation, which entails policy formulation; competition and market analysis; price regulation which includes tariffs and interconnection issues; universal access and funding and statistics.

Mr. Njoroge joined CCK on 1999 at its inception.  He previously worked for the defunct Kenya Posts and Telecommunications Corporation as a Senior Telecommunications Economist.  His experience in the sector spans over 25 years.

Mr. Njoroge has spearheaded a number of seminal studies at CCK.  These include the Universal Access study which gave birth to the CCK’s Universal Access strategy in 2005, and set the foundation for the country’s international (TEAMs) and national (FONN) fibre optic connectivity.  He coordinated the carrying out of the Telecommunications Network Cost Study that saw the reduction of retail and interconnect rates for mobile telecommunications charges in the country.  He also oversaw the carrying out of an Internet Market study, which among others identified factors hindering the development of the Internet subsector in Kenya.  In addition he was instrumental in the set up of KENIC, the ccTLD, the KENET project and other initiatives such as the digitization of secondary education among others.

Mr. Njoroge holds an MA in Development Economics from Dalhousie University, Canada, a BA in Economics from the University of Nairobi, Kenya, and a Postgraduate Certificate in Telecommunications Regulation from University of Westminster, UK.  He holds a number of certificates from some of the leading training institutions from the US in the area of ICT Regulation and Management.