Displaying items by tag: Africa
UAE telecom operator Etisalat’s former Nigerian operation, rebranded as 9mobile, will be purchased for $500 million by investment firm Teleology Holdings. An auction was held for the troubled operator, which became a new brand in the Nigerian telecom market in mid-2017 after Etisalat pulled out of the country.
The auction for 9mobile was supervised by Barclays Africa, which picked the highest bidder after four companies were shortlisted. Pan-African telecoms group Smile made a bid for $300 million and is said to be the reserve bidder. Nigerian operator Globacom also made a bid for an undisclosed amount, as did Helios Investment Partners.
Both Teleology Holdings and Smile have thirty days to prove they have the financial resources to pay for 9mobile. It was reported that Airtel Nigeria pulled out of the auction to purchase the operator because “too many things are hidden about the health of 9mobile”.
One area of concern is that two weeks ago, a Lagos high court in Nigeria ordered the board of 9mobile’s parent company, Emerging Markets Telecommunications Service (EMTS), to disband, after a judge claimed it had been established without authority.
The court's decision was made after Spectrum Wireless Communication, a company that invested $35 million in EMTS in 2009, claimed the board's approval was not in line with its interests and called for its contributions to the operator to be recognized. Now, United Capital Trustees, which is handling the sale of 9mobile, is appealing the court order.
The sale of 9mobile was entrusted to United Capital Trustees after it defaulted on repayments of a $1.2 billion load that was given to it by multiple banks. The Central Bank of Nigeria and the Nigerian Communications Commission (NCC) supported the EMTS board, and had received bids from five parties for the sale of 9mobile.
The sale of 9mobile was extended in early January 2018 by the NCC to January 16 after the original closing date passed with no final decision. Reports speculated that the decision would be further delayed after a Spectrum Wireless Communication solicitor said anyone "who transacts business for the purpose of sale or acquisition of EMTS or 9mobile does so at his own risk."
9mobile became a new brand in the Nigerian telecom market in mid-2017 after its previous owner, Etisalat, and an investment fund, defaulted on a $1.2 billion loan. The operator, formerly known as Etisalat Nigeria, was saved by regulators. 9mobile is currently the fourth largest operator in Nigeria.
According to the latest regional appendix to the upcoming Ericsson Mobility Report, the first 5G subscriptions in the Middle East and North Africa region are expected during the period 2020 to 2022, reaching around 17 million subscriptions by 2023.
The Middle East and Africa (MEA) region, which encompasses more than 70 countries, faces extreme market variations in terms of Information and Communication Technology (ICT) maturity, but Ericsson’s Mobility Report nonetheless predicts a region-wide growth in mobile subscriptions from 1.590 million to 2.030 million by the year 2023. Further, the MEA region will witness a nearly five-fold increase in LTE subscriptions, from 190 million to 860 million, in the same timeframe.
Rafiah Ibrahim, Head of Ericsson Middle East and Africa, said: “Total mobile traffic for the region is forecasted to grow by around 49 percent annually between 2017 and 2023. This rapid growth is seeing operators increasingly exploring methods of optimizing their networks with more capacity and coverage. We are supporting operators across the region throughout the different phases of the network evolution enabling best performing networks and differentiated customer experience.”
The MEA region has a young and growing population with a median age of 21 years which, combined with its improving economy and favorable policies, creates potential for continued growth in the uptake of telecom and ICT services.
Particularly in the Middle East and North Africa (MENA), which has higher penetration rates of smartphones, mobile traffic, and mobile data traffic compared to Sub-Saharan Africa, operators will be faced with an increasing demand for faster network capability (lower latency and higher data throughput speeds) to deliver better application coverage for more consumers in the coming years.
Across the MEA region, smartphone subscriptions are expected to increase from 670 million to 1.510 million in the next five years, resulting in data traffic per active smartphone multiplying nearly six times over, from 2.2 GB/month to 12 GB/month.
Today, mobile data traffic in the region represents 83 percent of total mobile traffic, and is expected to increase to 98 percent by 2023, bringing it more in line with the global average. This will require operators to come up with efficient strategies differentiated by exceptional user experiences and optimal network performance.
The Mobility Report’s analysis of these factors considered the different strategies operators employ to approach these demands and found that the greatest challenge they face is employing available tools to maximize network utilization without negatively impacting the user experience. Moving forward, operators will need to find the “sweet spot” between the two, where a good user experience is delivered while still allowing significant volumes of traffic through the network.
On the road to 5G and IoT
The Mobility Report also revealed that the Internet of Things (IoT) is facilitating the digital transformation of industries and providing mobile operators in the MEA with opportunities to explore new revenue streams.
Cellular IoT subscriptions in the region are expected to grow from 35 million to 159 million between 2017 and 2023, at a compound annual growth rate (CAGR) of around 30 percent. This will enable operators to explore new digitalization opportunities as the world becomes more connected and industries experience an ICT-driven transformation.
In fact, 5G-enabled industry digitalization revenues for MEA are predicted to at USD 242 billion between 2016 and 2026 – meaning ICT players must adopt and integrate digital technologies into specific industries to generate new revenues.
5G will be an important technology in growing industrial digitalization, and despite IoT being in its infancy in much of the region, there are still examples of how it has already helped improve the livelihood of MEA communities and industries.
These include smart agriculture initiatives in Turkey and Africa, remote monitoring of oil wells and temporary networks in case of disasters in Saudi Arabia, and Narrowband-IoT (NB-IoT) being used to address utilities and smart meters in South Africa. Technologies like 5G and IoT will serve the region’s diverse operator needs by opening up new revenue streams as a result of industry digitization, improving standards of livings in countries across MEA.
Perhaps the most striking and indicative finding of this latest Ericsson Mobility Report for MEA is the fact that, despite being amongst the fewest, LTE connections will show the highest growth rate at 46 percent annually over the next five years.
The report also forecasts that total mobile traffic will continue to rise in both the Middle East and North East Africa, at a compound annual growth rate of 48 percent, driven by higher mobile data traffic and increased penetration of smartphones in the region.
As a result, operators will be faced with increasing demand for faster network capability (low latency and higher data throughput speeds) to deliver better application to enable widespread uptake of the 5G and IoT technologies of the future.
In the face of such widespread technological advancement, operators, governments, and industries are investigating what new opportunities these technologies will bring as the Networked Society comes increasingly closer to reality.
As more devices, sensors, and appliances connect to each other and to the internet, security and sustainability continue to be strengthened and optimized, paving the way for a truly connected world. The resulting technologies will empower people, transform industries, and enable the smart city solutions that will reshape the future in the Middle East and Africa.
Vodacom, the South African subsidiary of UK-based Vodafone, has signed a MoU with Nokia under which the companies will trial Nokia 5G technology to accelerate the launch of the new technology and enable Vodacom to drive digitalization for the benefit of businesses and individuals in South Africa.
“We have defined a technology path that allows operators to transition to 5G at their own pace. Working with Vodacom, we can help it identify how 5G can support growth in the country and the steps it should take in its own transition to best meet individual subscriber and enterprise needs,” said Rajen Naidoo, head of Vodacom South Africa Customer Team at Nokia.
Nokia has a 5G portfolio that will allow operators to gain an early-to-market advantage in the delivery of ultra-fast mobile broadband services that leverage multi-Gigabit speeds and ultra-low latency. Nokia will leverage expertise from its Bell Labs Consulting arm to work with Vodacom and identify where, when and how to evolve its network to 5G.
Working with Vodacom in a series of workshops and trials, Nokia will share its latest 5G innovations including massive MIMO Adaptive Antennas, AirScale Radio Access, AirGile Cloud-native Core, Multi-Access Edge Computing, and end-to-end Mobile Anyhaul transport networks to test how they can be used to meet ever-changing demand in the country.
“As the leading mobile network provider in South Africa, with the best 3G and 4G networks, it was crucial for us to partner a formidable player such as Nokia as we're gearing ourselves for the next generation of wireless networks, 5G,” said Andries Delport, Vodacom Group Chief Technology Officer. “This collaboration comes at a time when we have a firm mandate from the Vodacom Board to propel Vodacom Group to become a leading digital company.”
Initially the companies will focus on the delivery of Ultra-HD and virtual reality video services, leveraging the enhanced mobile broadband and ultra-low latency capabilities of 5G. Vodacom and Nokia will also collaborate to understand how 5G can drive continued economic growth in vertical industries important to South Africa including manufacturing, mining, healthcare, media, energy and transportation.
“It is my firm belief that the adoption of 5G will help us to deliver against some of the digital technologies in areas such as big data analytics, artificial intelligence, virtual and augmented reality, autonomous vehicles and the Internet of Things,” Delport added. “Quite crucially, Africa is in the middle of a mobile connectivity boom, and as such, 5G will help us to deliver faster internet speeds to our almost 70 million customers across the Group."
The acquisition of 9mobile, formerly Etisalat Nigeria, looks to be competitive, as 16 firms have submitted their interest to bid for the operator. Etisalat Group was forced to pull out of Nigeria this year after its firm couldn’t come to an agreement with its lenders to restructure $1.2 billion debt after missed payments. Following Etisalat’s exit, the Nigerian firm announced it had rebranded as 9mobile and said it is open to discussions with new investors.
The 16 companies to express their interest in purchasing the Nigerian operator include South Africa’s MTN, India’s Bharti Airtel, and Nigeria’s ntel, which in 2015 acquired the assets of the defunct NITEL and MTel through the federal government’s privatization program. Africacell, a holding company with cellular communications companies in DRC, Gambia, Uganda and Sierra Leone, also submitted its interest in purchasing 9mobile, according to a report by ThisDay.
The report said industry sources confirmed that the 16 companies had complied with the deadline for the submission of Expressions of Interest (EoIs) at Barclays’ office in Lagos. The CEO of 9mobile, Boye Olusanya, said he is focused on getting the company back on track to make profit. 9mobile has about a 13 percent share in Nigeria’s mobile market, according to GSMA Intelligence, behind MTN, Glo Mobile and Airtel.
The main challenge facing telecom operators in Africa is competition and regulatory stability, according to Mr. Abdellatif Bouziani, CEO of telecom provider Smart East Africa Group serving Tanzania, Uganda and Burundi. Speaking to Telecom Review, Mr. Bouziani said governments in Africa have sold too many operating licenses which have forced prices down, but operating costs remain the same.
Competition is high in the African telecom market, said Mr. Bouziani. With governments selling up to 6-7 telecom operating licenses, operators are forced to lower their prices, but operating costs remain the same, so they must cut spending to survive. But by reducing spending, operators aren’t able to experience growth. When there’s less cash going into countries, big players suffer, and smaller players suffer even more, he said.
Governments in Africa are the big winners in the equation, Mr. Bouziani explained, because they generate revenue from selling the licenses and collecting taxes and fines from the operators. But that puts pressure on emerging players like Smart East Africa which began operating four years ago. Big operators are suffering because they have big costs, and smaller operators are suffering because they cannot grow.
“We have to do business differently now,” Mr. Bouziani told Telecom Review. “We cannot do it the same way we did 5-10 years ago.” Voice is no longer primary, he explained, therefore the industry needs to get closer to the OTT (over-the-top) players to benefit more from them utilizing operators’ networks. Operators need to be a part of the change rather than taking a back seat and watching it happen, he said.
Smart East Africa launched in Tanzania, Uganda and Burundi in 2014 under Industrial Promotion Services (IPS) Kenya, which in turn is part of the Aga Khan Fund for Economic Development (AKFED). The operator was launched in the three markets to drive innovation in the market and focus more on the youth segment, Mr. Bouziani said.
AKFED is the sole for-profit agency of the Aga Khan Development Network (AKDN) and works in partnership with international organizations and governments to stimulate the private sectors of developing economies, with the aim of generating capital for investment into long-lasting and sustainable development initiatives.
The organization is essentially a development and investment agency, Mr. Bouziani explained. AKDN holds a 51 percent stake in Smart East Africa while Timeturns, the previous owner of Smart, owns a 49 percent stake.
To stand out in the market, the company implemented an “innovation-friendly” environment to foster knowledge and new ideas. Mr. Bouziani said: “We have to take into account how much telecoms has changed with the introduction of OTT, increasing data usage and value added services. We must ask ourselves: how can we play around with all these things to come up with a business model that allows us to survive in this non-conventional industry?”
In 2014, Smart announced plans to invest US$300 million over the course of five years to expand its telecoms networks and services. The company faces stiff competition, with 17 rival operators combined across Tanzania, Uganda and Burundi. The company offers free roaming across the three countries.
Chinese smartphone vendor Huawei Technologies has altered its strategic approach in Kenya in a bid to boost sales of its handsets. It has restructured the price of some of its devices and is now showcasing smartphones that are retailing at between $100-200. It is hoping that a sharp increase in sales will boost its market share in Kenya.
Huawei is currently positioned as number three in relation to market share in the African nation which has been described as a fast-growing local smart devices market. Huawei is trailing South Korean conglomerate Samsung Electronics and Tecno which is owned by Hong Kong’s Transition Holdings.
Huawei’s manager in Kenya, Derek Du said it entered the smartphone market by introducing three smart phones, but it didn’t focus on products retailing for under $200 and that costed the company long-term. In an effort to increase its market share in that segment from 4% to 15% it will overall its entire strategic approach.
Kenya’s telecommunications incumbent Safaricom enjoys a 72% market share (around 28m users) and they reported that there is now 13 million smartphones on its network, which is a significant jump from 10 million last year.
Kenya consumers have finally parted with their well-worn standard phones in favor of relatively cheap devices that offer them faster internet speed and access to applications such as WhatsApp, online banking and taxi-hailing services. According to Du, Huawei has switched its strategic focus after it became evidently clear that the average Kenyan consumer is price sensitive.
Du added: “The new focus on the lower end of the market has come about because the Kenyan consumer is price-sensitive. The $100-200 is the key part we can play. If we can bring it up, it means we will also bring up the whole market share.”
He believes that change will enable Huawei to boost its overall market share to around 25-30%, from the current 14% it has been rooted on for the last two years. Research has revealed that the average Kenyan worker earns an annual wage of $1,200, which subsequently means that most people can’t afford expensive smartphones.
Huawei’s previous approach centered on their mid-range smartphones were it enjoys a 30% market share. Huawei has enjoyed a successful twelve months globally, and the Chinese conglomerate, based in Shenzhen, is now seen as a real threat to the smartphone monopoly which is dominated by Samsung and Apple.
Huawei’s African boss said that the Kenyan economy was enjoying a resurgent comeback after a difficult number of years, and is in a stable position. This makes it an attractable market for investors, and du has reiterated its commitment to growing its business in Kenya.
Ericsson and Qualcomm Technologies have successfully completed a lab trial for a Cat-M1 solution with MTN South Africa in support of MTN’s Internet of Things (IoT) ambitions.
This is the first Cat-M1 test implementation of its kind on the African continent and represents the first stage of a wider scope of test activity. The Cat-M1 trial uses IoT devices integrated with a Qualcomm MDM9206 global multimode LTE IoT modem and the Ericsson Massive IoT Radio Access Network product.
The successful test will ensure MTN continues to lead in technological IoT advancements and will prepare MTN for a new wave of solutions that can be implemented in the future. MTN South Africa will continue trialing devices and applications for Cat-M1 in its Test Bed lab.
Cellular IoT technologies, such as Cat-M1 and their evolution into 5G, set a solid foundation for massive IoT by reducing complexity, lowering power consumption, expanding coverage, and increasing device density.
Cat-M1 enables advanced IoT applications by providing hundreds of kilobits per second in throughput, mobility, and VoLTE support. Examples of typical Cat-M1 IoT applications include smartwatches or fitness bands with integrated voice communications services, pet tracking devices, point of sale terminals, vending machines and vehicle tracking with emergency calling support.
“Cat-M1 provides key advantages of low-cost devices, long battery life, extended coverage and supports a wide range of use cases,” said Giovanni Chiarelli, CTIO, MTN South Africa. “The successful trial, in conjunction with Ericsson and Qualcomm Technologies, proves that both companies have the ability to support new IoT services and technologies for MTN.”
Chiarelli added, “The initial use of this technology has been for tracking and reporting use cases that have benefited both consumer and business customers. At MTN we are providing the platform for these and future applications to enhance people’s lives.”
Rafiah Ibrahim, President, Ericsson Middle East and Africa, said, “Today, the majority of telco IoT revenue comes from machine-to-machine connectivity, but in the next five years, this will change to revenue from platforms, applications and services. This trial ensures MTN South Africa will capture new revenue streams and deliver the best experience to its customers.”
South Africa-based telecommunications company Vodacom said in a statement that it will give all customers affected by a recent billing systems error a 500MB bundle for free, over and above the airtime and data refunds processed by the company.
The system error, which impacted certain prepaid and top up customers, was caused by a configuration change on Vodacom’s prepaid and top up billing system. Vodacom swiftly isolated the problem and rolled the process back. The company worked to ensure that all affected customers were refunded in full.
“The error clearly caused inconvenience to our customers and we’ve worked very hard since we picked it up to make it right and refund all our affected customers,” said Shameel Joosub, Chief Executive Officer of Vodacom Group.
But the company wanted to “go a step further” to apologize and thank its customers for their understanding, Joosub explained, thus deciding to give each affected customer a free 500MB bundle which they can use over three days.
“An error of this kind has never happened before and we’ve taken steps to ensure it never recurs,” Joosub said. “We’d like to assure all our customers that this was simply an error caused during a configuration change and nothing more than that. We hope our customers will appreciate the gesture, and our apology.”
Vodacom, majority owned by Vodafone (69.75% holding), is one of Africa’s main communications organizations. The company’s mobile network operates in Tanzania, the Democratic Republic of the Congo, Mozambique, Lesotho and Kenya, covering a population of over 260 million people.
Vodacom recently announced that its proposed R35 billion (around US$2.6 billion) acquisition of an effective 35% stake in Kenya’s main telecommunications company Safaricom has been finalized. All regulatory approvals and conditions precedent in both Kenya and South Africa have now been met.
The United Nations (UN) Environment Program, an agency that coordinates the UN’s environment activities, recently signed a Memorandum of Understanding (MoU) with Safaricom, Kenya’s largest telecommunications provider, aimed at heightening the implementation of Sustainable Development Goals (SDGs), which focus on protecting and conserving the environment.
UN Environment has urged Kenya’s private sector to collaborate with them in implementation of the SDGs that will help curb climate change. The 17 SDGs cover areas such as climate change, economic inequality, innovation, sustainable consumption, peace and justice, among other priorities. The goals are interconnected – often the key to success on one will involve tackling issues more commonly associated with another.
Currently, UN Environment is working closely with the private sector through various initiatives, such as the Finance Initiative, which works with over 200 institutions to bring systemic change in global finance for sustainability.
“The private sector, whether a small store or a major conglomerate, must be given a place at the heart of our work,” said Erik Solheim, head of UN Environment, speaking during the MoU signing between Safaricom and UN Environment. “Its energy and its innovations will shape the success or failure of our common goals: to build a more inclusive, resilient and sustainable world. No organization, not even the United Nations, can do this alone.”
Bob Collymore, CEO of Safaricom, said, “As a purpose driven organization, we realize that it is important to use the SDGs as a lens through which we can do business while ensuring that we are also creating the basis for tangible change for our communities. Over the last few months we began the journey of adopting and integrating the SDGs in a way that made sense for the various divisions in our business.”
The MoU will provide a framework of cooperation and understanding, and facilitate collaboration and implementation of activities and projects that contribute to selected areas of the SDGs. The selected SDGs include Affordable and Clean Energy, Sustainable Cities and Communities, Responsible Consumption and Production, Climate Action, Life Below Water, and Partnerships.
Kenya’s Safaricom, the African nation’s leading network operator, said it’s working with Huawei to deploy a fiber-to-the-home (FTTH) network. Safaricom will use the Chinese telecom equipment manufacturer’s end-to-end (E2E) FTTH solution to rapidly deploy the FTTH network and expand its capability to new home broadband services.
Kenya has a steadily developing economy, but its fixed broadband penetration rate is lower than 1 percent, failing to meet the network requirements of home and enterprise users. Safaricom plans to enter the home broadband market, but it faces many challenges, including scattered user distribution, high network construction costs, and low early phase service provisioning rates and revenues.
For precise investment, based on the idea of value-oriented network construction, Safaricom uses analytics to determine network rollout in line with customer demand as its first step. And then, Safaricom deploys Huawei's E2E FTTH solution to achieve efficient network construction and operation.
For fast network construction, through infrastructure synergy and engineering innovation, Safaricom can fully utilize existing metropolitan area network (MAN) optical cables and preferentially use aerial cables.
Through the synergy of fixed broadband optical distribution networks (ODNs) and mobile backhaul networks, Safaricom can deploy mini optical line terminals (OLTs) and wireless base stations in the same cabinet, realizing fast deployment and centralized home access, and greatly decreasing network construction costs.
In terms of efficient operation, Huawei's lightweight mini operations support system (OSS) helps Safaricom to reduce the system integration period and complete deployment within only three months, down from 18 months.
Huawei also provides a smartphone app that integrates installation, maintenance, and operations, supporting on-site service provisioning and acceptance, shortening service provisioning period from two weeks to less than 48 hours, and doubling installation rates.
"By using Huawei's E2E FTTH solution, we can quickly build the FTTH network,” said Thibuad Rerolle, Safaricom's Director. “We are keen to broaden the development space for new fixed broadband services."
Jeff Wang, President of Huawei's Access Network Product Line, added, "Emerging markets place strong demands on FTTH network services. The top challenge that operators face is shortening the ROI period. To solve this challenge, Huawei released the E2E FTTH solution. It features precise investment, fast network construction, quick service provisioning, and efficient O&M, enabling operators to greatly shorten the ROI period and achieve business success."
South Africa’s Vodacom Group, part of Vodafone, recently announced that its proposed R35 billion (around US$2.6 billion) acquisition of an effective 35 percent stake in Safaricom, has been finalized. All regulatory approvals and conditions precedent in both Kenya and South Africa have now been met.