There Will Be More Than One Billion Mobile Phones in Africa…What Does This Mean?

A lot of telecommunications analysts have turned their sights toward the Middle East and Africa. That shouldn’t be a surprise, considering that, by 2016, analysts expect there to be more than one billion phones across the continent, with 991 million being feature phones. Indeed, Cisco expects that mobile data traffic growth will be fastest in this region.

It’s a particularly exciting time to watch these developments in Africa. The continent already has some of the highest mobile money payments in the world— in Kenya, Madagascar, Tanzania and Uganda, there are more mobile money bank accounts than traditional bank accounts.

All of these trends point to explosive mobile use and increased connectivity in Africa as a whole. So, what’s one of the biggest changes we can expect to see here?

A new boom in African creative industries

One significant shift that was highlighted at Mobile Web East Africa by tech website MemeBurn is occurring in television and literature. Traditionally, both of these industries have suffered from lack of art-based, educational programmes in schools and from a lack of resources.

The CEO of BuniTV and Buni Media, Marie Lora-Mungai, spoke at the conference and said that having mobile access to films will revolutionise the space. She hopes that filmmakers will be able to distribute their work much further than before and create pieces for mobile consumption.

Likewise, the vice president of marketing at BiNu, Mark Shoebridge, talked about how mobile will affect reading habits. At Mobile Web East Africa, he claimed that 70% of female readers who are using World Reader, an app for smartphones, are reading over a thousand screen pages.

How this is going to affect data use in Africa

I think it’s safe to say that 991 million feature phones are going to bring about a radical change in data use in Africa. As we’ve mentioned before, changing data use doesn’t just make for a better mobile experience, the increased connectivity enriches consumers’ lives.

Of course, there’s going to be a vast range of different needs among customers in Africa. Communications service providers (CSPs) will be hard-pressed to customise service packages and personalise their interactions to accommodate these trends.

Africa is in an interesting position because of the sheer diversity of needs when it comes to data. It’s happening fast, too. Last October, for example, more Nigerians accessed the Internet on mobile phones than on desktop computers.

To really meet the demands of the next decade’s mobile customers, CSPs will have to invest heavily in contextual analytics that can segment customers based on their individual behaviours when it comes to mobile data use. This way, no matter how vast the customer base or different the use cases, it’s possible to meet individual needs and prepare for the future.

AfricaCom 2012 – Making Data Beautiful

Tuesday 13th November was day 1 of the 2012 AfricaCom event in Cape Town. This is the first year it has been extended to 3 days, with day 1 being a ‘preview day’ … and I will confess to having been ‘worried’ that it would have ‘watered down’ the event. But I was wrong! Yesterday was probably the busiest first day Comptel has ever had at AfricaCom in 4 years of attending. With the organisers, claiming a record 8,000 pre-registrations and expecting 7,000 to arrive and with today being the keynotes, things can only get busier. So anyway, here are a few thoughts from day 1:

1.    Informa, the event organisers, presented an overview of the opportunities in the Africa market. Customer Engagement Management (CEM) was a big part of this, and it is clear that as competition heats up, and customers become more demanding in Africa, operators need to get more personalised and targeted with their offerings and customer engagement strategies. Perhaps it is best to quote the original releases as it says it better than I can paraphrase: “There is more depth to a mobile operator’s customer base in Africa than two or three years ago and, for this reason, MNOs need to gain a greater insight into their customers’ behavior and offer them services that match their individual needs and preferences. Using this insight to design new business models … will enable a more compelling and personalized set of services to a wider variety of customer segments

2.    And if the test of this was interest in finding solutions for it, then it is spot on! The majority of conversations yesterday with operators visiting our stand was about customer insight, serving customers more personally and better targeting of services to meet individual’s needs. These conversations could have been about simple analytics or segmentation … but they were more: they were about individual subscribers being treated as individuals. … and best of all was being able to explain how Comptel’s Social Links product can meet this by allowing CSPs to better determine customers’ needs, wants, likes and dislikes at a granular level based on historical and real-time data and predictive modelling … and in context.

3.    We have the best stand in the show!!!  Not my words only … but several visitors made this statement. Not the biggest or fanciest … but one that perfectly illustrates our tagline of “Making Data Beautiful” … a calm, clean and organised beacon of illumination among the chaotic hustle and bustle of the show.  And our engagement solutions built around the “Event-Analysis-Action” paradigm is brought to life as it slowly rotates on our back wall turning heads of passers-by … literally! Come see for yourselves at stand #C05.

“Minding” Your Own Business

A few months ago in a blog where I discussed the need for more service personalisation, I admitted that it was tough for operators to engage effectively on a more personal level because I myself “don’t always know what I want until after I have experienced it – or what I had is taken away” …

I also, however, suggested that it is possible and operators should be empowered with “mind-reading abilities”!

Let me illustrate with a totally non-OSS related example: my 6 year old son. Unlike a lot of his friends (and his parents), he is totally disinterested in food. However, over the years, we have observed that when he gets hungry, he starts to get unreasonable and emotional. He never says he is hungry or asks for food, but we have learned that when he starts behaving that way and he has not eaten for a while, that giving him a snack returns him to his usual good natured self.

In this example, my son apparently does not know what he wants or needs (un-communicated needs) – and feeding him any other time is of course pointless too (context).

So we:

1.    Learned (and re-learned) this behaviour using our human intelligence i.e. we do not use a list of rules to identify the situation;
2.    We take into account the context i.e. when he last eat or whether his sister had just bitten him again;
3.    We act then and when it is needed.

And this is a pretty good example of the “mind-reading” capabilities Comptel’s Contextual Intelligence for Telecommunications (CIQ4T) can offer operators: LEARN, examine the CONTEXT (in real-time) … and ACT.

I will be manning the stand for Comptel (C05) at AfricaCom in Cape Town from the 13th-15th November and would love to discuss further how Comptel can provide operators with “mind-reading” abilities for more personalised customer engagement.

Reflections on MEA

A few months ago, a friend made me aware of the Afrinnovator website displaying the tagline: “Putting Africa on the map,” with the goal of “telling the stories of African startups, African innovation, African-made technology, African tech entrepreneurship and entrepreneurs.”

As somebody who likes to visit technology blog sites like Engadget, GigaOM, Mashable and the slightly more quirky The Register, this was an eye opener – even for somebody living in Africa.

Two things stood out.

First, this publication is focused on technology really changing lives. We’re living in a world where seemingly everything is mobile, where there’s an “M-something” for everything. For instance, there is mobile banking, education, agriculture, trading, health, security and government. Additionally, it’s about mobile meeting the daily needs of the consumer — not just a mobile “entertain -and -share-everything” mentality as I am more accustomed to reading about.

Second, these services are not only being delivered by “sexy” data bandwidth hungry smartphone apps, but are also using low-tech solutions that will work with even the least technical phone. For example, there is mobile banking using USSD, mobile medical diagnosis using MMS to send pictures, and even mobile vehicle licensing and resume submissions for jobs using SMS.

So, you may now be asking what the OSS angle is for an OSS blog.

Well, the point is the differences I noted between the mobile service innovation in developed vs. developing countries is an example of how markets naturally work to allocate resources at an aggregate level to meet their needs. However, while most people will tolerate my generalisations of developed vs. developing markets, it is fair to say that generalised services are no longer good enough for individual subscribers within markets.

Essentially, what is needed at an aggregate level is not necessarily what is needed at an individual level within those markets. This is what Comptel’s Customer Engagement Solutions can do to ensure an operator that the appropriate services and customer experience is delivered for individual subscribers, given their personal context.

Now, as a consumer of services I am the first to admit that I don’t always know what I want until after I have experienced it – or it is taken away. So, am I suggesting empowering operators with mind-reading abilities? You bet I am…

Gearing Up for AfricaCom in Cape Town

On 9 November, the 14^th annual AfricaCom event kicks off in Cape Town, with the organisers expecting a record attendance, which they are predicting to be 12.5% higher than last year.

While I’m sure that the scenery and activities of Cape Town draw attendees, it is also certainly a reflection of the silver lining that Africa is to the economic cloud that hangs over many developed markets. For anybody in the telecoms industry, relatively high subscriber growth and low mobile penetration create compelling reasons to be doing business in Africa.

But, of course, Africa also has its fair share of challenges, most of which boil down to one thing: how to ensure profitability in highly competitive, price sensitive and sparsely populated markets. Most of the focus so far has been on controlling costs to enable pricing competitiveness—lean operations being something that the Comptel Dynamic OSS portfolio supports very well.

But this is only half the equation against a backdrop of high churn in Africa. As is generally recognised, it is almost always more expensive to acquire new subscribers than to keep them. Ultimately, African telecoms are entering a new battle for the ‘hearts and minds’ of their subscribers in a quest to create a ‘stickiness’ for their hard won subscribers.

So it is encouraging to see that the tagline for AfricaCom this year, “Advancing Innovation & Profitability for a Digital Africa,” is recognising this key link between innovation and profitability.

Please do come and visit Comptel at Stand F5 at AfricaCom this week to discuss how we can help operators win the ‘hearts and minds’ of their customers through innovative OSS solutions.

Gearing Up for AfricaCom in Cape Town, 9-11 November

In less than a week’s time, AfricaCom (taking place 9-11 November) kicks off in Cape Town, South Africa, and Comptel will be there at stand D9 (opposite the coffee point!).

The organizers, Informa, are claiming that this year a record 4,200+ attendees from more than 1,500+ companies have registered—up 70% from last year.

From a biased perspective, I would like to think that holding this event in beautiful Cape Town (which IS Nice!), has something to do with this increase, but in reality, I suspect it is more a reflection of the rapid growth of the telecoms sector in Africa.

The temptation is to say growth = money for events…but I believe this cynically oversimplifies the value operators get from an event like this.

Growth has also meant increasing competition with everybody wanting a slice of the pie, so I suspect operators are primarily attending to find answers about how to generate and manage new revenue streams and cut costs in order to ensure future growth.

African operators need to grow their revenues from services (e.g. data and VAS) in the face of declining voice and SMS margins. For operators with OSS heavily geared towards simple voice and SMS services, an increasingly complex service portfolio brings many new challenges with respect to designing, launching and managing them. Comptel has seen a lot of interest this year from African operators in its catalog solutions for helping them get new services to market more quickly and cheaply, and managing the increasing service complexity.

There is also a non-growth-related challenge that needs mentioning, and that is one introduced by the legislation being enacted across Africa requiring operators to identify subscribers prior to their SIMs being activated. This shatters the current operating model of simply bulk pre-provisioning SIMs and introduces the challenge of only activating them after subscribers have been identified. It also presents operators with the ‘opportunity’ to leverage a closer relationship with what was previously a largely ‘anonymous’ subscriber base using ‘one-size-fits-all’ packages. Comptel has also seen a lot of interest in its dynamic SIM management solution, which helps operators comply with the legislation, cut costs from SIM wastage and leverage the legislation to actually get additional revenue streams.

So here’s to problem-solving at AfricaCom. Hope to see you ‘here’.

FIFA World Cup 2010: Lessons Learned from Spain

On Monday morning, South Africa woke up with a big ‘hangover’ (figuratively, but no doubt also literally for many!), as the month long party that was the FIFA 2010 World Cup came to an all too sudden end. As if the final seemed to read South Africa’s desire for the tournament not to end, it took 116 minutes of dueling, with a penalty shootout looming four minutes away, before Iniesta’s goal saw Spain defeat the Netherlands 1-0.

Of course, the conclusion of the World Cup also kills my ‘license’ to waffle about football on what is a telecoms, and more specifically OSS, blog.

So what better way to conclude the blend of football / telecoms posts than to take a look at some of the lessons communication service providers (CSPs) in Africa could possibly learn from the winner of the World Cup – Spain.

1. Get a good goalie. Spain did not win the tournament as one of the top goal scoring teams; in fact, they finished sixth on the list with only eight goals (their finals opponent, the Netherlands, were second with 12). The lesson for operators in Africa is that, in an environment where ARPUs are constrained by low GDP per capita, you cannot always ‘score lots of goals’—so you need to focus on ensuring that you do not ‘leak them’ to ensure profitability. In Spain’s case, they had Casillas as their goal keeper who went on to win the Golden Glove as the tournament’s best keeper, who only let through two goals in seven matches. For operators, this starts with a reliable OSS: automated fulfillment to remove the risks of user error (or fraud) and ensure that all activated services are being billed—and a robust policy control, charging and mediation platform to ensure that services are differentiated and all usage is being monetized. Comptel has many times seen the returns on investment operators have achieved by plugging revenue leaks using our tried and tested OSS solutions.
2. Keep possession. One of the keys to Spain’s success was the way in which they strangled their opposition, starving them of the ball and reducing their goal-scoring opportunities. In the final, they had 57% of the possession. For operators in Africa, where about 96% of subscribers are prepaid without any tie-in, churn is a major issue, and CSPs need to focus on retaining their customers to ensure their opposition don’t score off them. This is, of course, easier said than done and involves a multi-pronged approach, including ensuring that the customer is not over-charged, services are quickly and reliably activated/de-activated and end-users have access to innovative services.
3. Play the game—not the man. One of the features of the final was the aggressive approach the Dutch took in an effort to disrupt the Spanish game. While this appeared to work in the first half, the Spanish continued to focus on their game, and eventually, the Dutch had no response. Similarly, operators should avoid being dragged into price wars as a means of competing, but should focus on service innovation. Nobody ultimately wins price wars, and unless you are sure you can win playing ‘ugly’, you may find that your opposition actually has a better game than you. Key to doing this is the ability to rapidly launch new and innovative products to the market in a cost-effective manner. As a founder of the Product and Service Assembly Initiative (PSA), Comptel has been involved in many TM Forum (TMF) Catalysts since 2006, working with other operators and vendors on ‘proof of concepts’ to define how products can be rapidly launched by allowing existing and third-party capabilities to be discovered, modeled and assembled into marketable product bundles ready for automated fulfillment upon ordering. The lessons learned from this have been built into Comptel Catalog to assist operators in rapid, but cost-effective, product assembly.
4. Get a Psychic Octopus on your side …

From the FIFA World Cup 2010: Mobile Networks Under Control

Even though a 2-1 victory against France was not enough to see my home team through to the second round, I am loving the whole atmosphere, vibe and spectacle of the FIFA World Cup. Thanks to dual nationality, I am extremely happy to cheer on my ‘other home team’, England, and just now see them make it through to the next round!

One thing that has been performing well, according to reports, are the mobile networks. I even performed some tests at a match I attended in between blowing my vuvuzela. (An aside: to those who find vuvuzelas offensive or annoying … don’t knock it until you have tried it! There is something addictive to ‘answering the call of the hive’, something that appeals to the ‘primeval instincts’ deep inside!)

Despite the 65,000 people in the stadium, I had no problems exchanging a few SMS with the baby sitter, receiving a call from my father-in-law asking ‘are you there yet’ and even updating my Facebook status with ‘at Italy-Paraguay match’ to up my social network cred. That is certainly more than I have been able to do at midnight on just about any 1 January anywhere in the world! Of course, there may be many explanations for this—not least of all that most people were actually watching the football match rather than playing with their phones.

There are two, more likely explanations. Firstly, it is possible that foreign visitors are being cautious when using their mobiles while roaming for fear of receiving large bills on their return home. This issue of ‘bill shock’ is currently a hot topic as blogged about by my colleague here.  But, this is probably not the entire reason though, as many visitors are likely to have activated their pre-paid SIMs distributed by MTN, along with international ticket sales, upon arrival.

Secondly, and more simply, it appears that the investment in additional capacity around potential congestion points, like stadiums and airports, has paid off. Of course, this investment is only half the story, as the backhaul and core network capacity also need to be upgraded to support this. So, while nobody gets embarrassed by the performance of these investments during the World Cup, the interesting question will be how can operators recoup this type of investment after the World Cup: price wars or service innovation to increase ARPUs?

FIFA World Cup 2010 Kick-Off: Is South Africa (and Mobile Operators) Prepared?

With only a few days left until the FIFA World Cup kicks off, it feels as though the world is watching my home country, South Africa.

While the flow of news is increasingly focused on football (or soccer) itself rather than the preparations (thankfully!), there is still that nagging (even if unasked) question at the back of most peoples’ minds of whether South Africa can successfully host the single greatest sporting event on earth.

This is not only a doubt expressed by foreigners, but also South Africans who have endured seemingly endless infrastructure projects in preparation—road upgrades (and the resultant traffic jams), airport renovations (and waiting to board your plane from a temporary draughty tent structure), stadium and hotel building sites (noise pollution and more traffic jams)…and even shattered house windows from ‘over-eager’ blasting for the high-speed rail link in Johannesburg!

But now, most of these are completed, and over the past few weeks, South Africans have been getting increasingly excited.  Most roads have re-opened, the traffic jams caused by construction are now forgiven, travelers are thrilled with the new airport facilities, and talk-show radio stations have been inundated with calls from self-confessed naysayers who are now ‘believers’.

Of course, the recent (surprise) show of form by South Africa’s own team (Bafanna Bafanna) culminating in the ‘friendly’ win over Denmark the other day has only helped to raise the sense of excitement that South Africans themselves may actually have something to cheer about.  Even my grumpy and cynical old father-in-law bought my four year old son South African flag face paint after that victory.

Now, we have to convince the world.  The majority of spectators will not experience the World Cup first hand but rather via the media and conversations with friends there.

That brings me to one bit of infrastructure where the investment has been almost ‘invisible’ and not affected me personally at all—and that is telecoms.  Of course, the communications infrastructure dedicated to supporting the organizers and media is unlikely to have any direct impact on me or the majority of visitors now—but the mobile networks will be a different story, as these will be inundated by visitors using their mobiles to ‘stay in touch’.

Visitors calling families at home, sneaking a look at work emails, looking up directions to the hotel, updating their Facebook status (‘At WC Final’)…  For many visitors in an increasingly ‘online-addicted world’, some of the experience will be defined by them having (or not) continuous and seamless Internet access on their mobiles.  One thing for sure is that the demands placed on the mobile data networks will never have been as high at previous football World Cups.

Will they cope?  Only time will tell.  The real impact of the investment on mobile networks will only become evident once the games begin.  And, one only hopes that the impact will live on where I, the consumer, can benefit from the supposedly extra capacity following the World Cup, with reduced prices and better service.  Then the question for the operators, once the visitors have gone home, will not be so much how to manage the demands on their data networks, but how to maximize and recoup their investments in that capacity.  Here’s looking forward to the kick-off—and excess network capacity after the World Cup.