Connecting the unconnected continues to be a fashionable industry term, with Facebook and Google in particular grabbing media headlines last year – and no doubt throughout 2017 - for their efforts.
However, I have three predictions for the rural market in Africa which don’t involve either company!
1. It will be the work of a small start-up in Tanzania that will have a greater impact on the industry.
I’m not alone in my admiration for the team at AMOTEL, Tanzania’s first licensed MVNO. The company has really captured the industry’s attention, picking up gongs in 2016 at both the prestigious Capacity Africa and AfricaCom awards for its inaugural rural network.
And with good reason - take one small grant from USF funds; an AMOTEL team determined to find a model which is commercially sustainable; and an extensive search for a vendor which was willing and able to incorporate AMOTEL’s ideas and needs into its existing rural product portfolio, and the result is a network which incorporates best practices which other operators trying to reach the unconnected should embrace.
AMOTEL has been generous in sharing its experiences and learnings, acknowledging that its challenges in building and maintaining rural networks are the same as for operators across Africa: low ARPUs, remote communities, lack of trained engineers, equipment developed for rich western markets, long ROIs etc.
In particular, Dr Frateline Kashaga at AMOTEL identified numerous factors that it considers essential for the successful deployment of rural networks by MVNOs, ISPs and other organisations:
- Ensure that technology partners can advise on all aspects of the project, commercial as well as technical
- Ensure that any agreements with MNOs are both transparent and comprehensive
- Propose a model for MNOs which is win–win from day one
- Keep a focus on OPEX and TCO in addition to initial CAPEX.
Having addressed and solved these challenges, and with a firm focus on ROI and sustainability, AMOTEL is currently raising funds to deploy more networks across Tanzania.
2. As well as additional networks both from AMOTEL and copycat operators, I also predict that in 2017 we will see wholesale carriers start to build in rural areas.
I know first-hand that wholesale carriers are now actively looking for ways to extend their services into un- and underserved areas. They know that there is a market for rural wholesale networks; operators are being pressured by regulators to extend their networks into poorer areas but are understandably reluctant to expand into areas where profits will always be small.
In addition, infrastructure sharing is now acceptable and widespread across the telecoms ecosystem. In fact, some regulators in Africa are now insisting that networks are open in rural areas as they want to encourage competition so that villagers can choose their network with pricing and customer service being the key differentiators.
3. We will start to see LTE displacing WiMAX and other wireless technologies and becoming the main way of delivering data services in rural areas. This is a natural progression as LTE networks continue to expand across the African continent.
My final prediction is that, even though the industry has been discussing Connecting the Unconnected for years with hundreds of individual networks across the world built by operators of all sizes, 2017 will be the year when we really see progress.
Leigh Smith is the MD of World Telecom Labs.