LIVE FROM GSMA MOBILE 360 AFRICA: Dion Jerling, CEO of Connect Africa, said that proving there is a need for mobile coverage in rural Africa has been easy but deployment and gaining operator confidence has been a challenge.
Connect Africa has managed to set up service centres in many rural areas – delivered by individuals going door-to-door, as well as in internet cafes and via mini grid systems. It has developed the infrastructure for networks with “low power, low towers and low costs” which results in reduced maintenance requirements, proving that the technical side works, said Jerling (pictured).
However, “there is a lack of confidence in deep rural business” from mobile operators and in trusting smaller companies to represent their brands in rural areas, he commented.
Jerling believes that “the answer lies in proving that the bottom of the pyramid is commercially viable.”
There is an integral opportunity, maybe even a need, for bigger operators to partner with smaller ones who do not have the same revenue requirements. Smaller companies, for their part, need to up their game and be competitive, he said.
Connect Africa is expected to hit a footprint of 20 countries in Africa soon and Jerlin hopes to build on the confidence that this announcement will bring.
Jerling thinks that the model operators seem most comfortable with is a tower company. There is an influx of business coming from that end.
There is a lack of confidence in deep rural business
He is confident that Connect Africa “can sit with operators and extend coverage for them at zero operating and capital expenditure.”
He warned operators that whoever enters the rural side first would quickly be able to capture most of the market and come out a winner as there will not be room for many operators to work together.
Jerling also added that the demand in rural areas must not be underestimated. He gave the example of a tobacco growing region where Connect Africa set up a satellite payphone which wasn’t enough to meet demand and within three months MTN had set up a tower there.
Sifiso Dabengwa, Group CEO of operator giant MTN, who spoke earlier and was in the panel discussion at the end of this session, said that in order for rural mobile connectivity to really be successful, cheap smartphones for around $10-$15 need to be available.
Operators well placed to benefit
Meanwhile Pikie Monaheng, CEO of Amdocs South Africa, said that operators are well-positioned to take advantage of the spread of mobile usage.
He said that there have been many predictions about the future of internet usage, such as 3 billion internet users by the end of 2014.
“This all means that the way in which we communicate and do business will be different,” he said. “It will have an impact on our social lives, economics and politics as well as how we consume goods and services.”
“In such a world, operators are well-positioned to influence and reap benefits of a connected world,” he added.
The challenges, however, will lie in meeting the high demands and expectations of customers.
In the past, IT systems have not been efficient, they have taken years to set up, “with every ‘i’ to be dotted and every ‘t’ to be crossed”, and there has been minimal communication between IT departments and businesses.
“Fundamental change has to happen,” said Monaheng. “IT systems need to meet the requirements of the business.”
The optimal approach is that IT systems respond quickly to business needs, influencing systems using single, easy-to-use interface.