We are all experiencing a global digital transformation, and mobile communication is playing a significant role. However, not all are progressing at the same pace due to the unique challenges and opportunities of the African telecommunications market.
While there has traditionally been a digital divide separating much of the continent from the rest of the world, many areas of Africa are in a unique position to bypass legacy technologies that other developed regions work through as their adoption of new communications technology and bandwidth increases.
While some lay plans to transition away from 4G/LTE as 5G standards and infrastructure begin to take shape, mobile network operators (MNOs) and communications service providers (CSPs) in Africa must set their sights beyond 4G to ensure the technology and infrastructure investments they make today not only address their current customer needs, but also ensure their investments are future-proof, able to leverage 5G services down the road. Therefore, software-defined networking (SDN) and network functions virtualization (NFV) should be of prime concern to many CSPs in Africa as they embrace and drive digital transformation.
Digital Transformation in a Growing Economy
What is driving the digital transformation in Africa, and why is there a need to think beyond 4G? Although many sources state that only about 20 percent of Africa is currently online, this number is growing fast as new networks are laid and the cost of digital devices decline. In fact, by 2025, 600 million African people and 4 billion devices will be connected to the internet, according to forecasts by Frost and Sullivan.
The African Development Bank (AfDB) has stated that Africa has seven of the world’s 10 fastest-growing economies. A recent article from McKinsey notes consumer spending here is projected to reach $2.1 trillion by 2025 and expects that by 2020, half of all Africans are expected to own a smartphone – up from 18 percent in 2015. This, in turn, is driving adoption of mobile technology. Mobile money and payments, for example, are growing five times faster here than in other regions.
Rebuilding and Future-Proofing Infrastructure
The majority of traffic in Africa still relies on 2G and 3G networks, with 4G adoption hovering right around 10 percent. With the rest of the world anticipating 5G on the horizon, now is the time to start thinking about a fresh approach to infrastructure as we prepare for a more connected world with faster data speeds, more system capacity and lower latency.
Our conversations with CSPs in Africa uncover growing excitement and interest in their evolving telecommunications needs. In fact, many of these conversations demonstrated that advanced technologies like 100Gbps (and now 200G and 400G), dynamic optical networks, OTN switching and restoration, and fiber to the home are alive and well in Africa.
With increasing demand and the resulting network complexity, SDN and NFV are expected to have crucial roles in the future, especially in terms of new network topologies, easier end-to-end service provisioning, improved network interoperability, and more, as SPs implement additional technologies to an already-taxed network comprised of various technologies from myriad vendors.
The latest industry survey conducted by Telecoms.com discovers most CSPs expect four major benefits from the implementation of SDN:
- Reduced operating expenses via simplified processes and automation
- Improved network performance and reliability
- Greater network and service agility
- Reduced capital expenses.
As the realities of legacy infrastructure and employee skillsets are beginning to sink in, however, industry enthusiasm over the benefits of SDN is a bit muted. Yet, taking the correct steps now will ensure they meet the growing demands of increasingly connected customers.
Choosing the equipment now and in the future
Keep in mind that being an SP in a developing market does not mean you should accept less-costly, legacy equipment. Rather, as you look beyond 4G, future-proof your market options through wise investments. African CSPs with less legacy infrastructure -- and who implement the right type of investment today, one that is flexible enough to change as network needs and demands grow and shift -- will be well set to take advantage of those aforementioned benefits tomorrow.
Although the economic situation in African markets is improving, high infrastructure costs mean that vendors may offer options to defer costs, from favorable financing to provisioning the manpower needed to build, manage and maintain their networks. While this may provide many immediate benefits, there are several issues that result. Choosing a network vendor based on up-front financing, rather than evaluating a solution based on its long-term costs and lifetime usability (TCO), may result in buying into a financial hole. Such vendors may offer rigid, proprietary systems and, in some cases, upgrading these systems will result in the need to rip and replace, more than doubling the required investment.
Moreover, by utilizing vendor-provided installation, maintenance and management, SPs may become beholden to these services, whereas a longer-term viewpoint (e.g. training, self-provisioning, and simple, easy to manage systems) also create opportunities for reduced TCO by eliminating middle-men and allowing SPs independence to serve themselves and hire locally on an ongoing basis.
What other considerations are required today in order to ensure that your network is ready for the future? Additional considerations include:
- Ensure autonomy by requesting tools simple enough that your staff can be trained to use and maintain them. Such tools exist today.
- Look for network planning tools that will enable self-service network planning. This will ensure that you define your own plan for network expansion and are not held captive by vendor preferences.
- When selecting vendors, it is crucial to work with those who are agile enough to provide products and solutions tailored to your unique needs and situations. Avoid vendors who have grown to the point that they only provide this critical service to Tier-1 customers that have a huge professional staff. Failure to heed this will likely result in being stuck with and dependent on that vendor for the SP’s entire service lifecycle.
- Look for equipment that is already SDN-ready. When the time comes to implement SDN or make other significant changes, if you must rip and replace then the TCO more than doubles.
- Find a vendor who is committed to long-term, sustainable growth and is dedicated to remaining a going concern, now and into the future. Such a vendor takes a long view, partnering to build their SP clients up rather than sucking them dry every time a minor change is required.
Understanding the trends and developments in the telecoms market and future compatibility is critical. Building an ELASTIC framework -- one that is both backward and forward compatible -- is more cost effective and will serve you for many years forwards. From swapping between modules or cards to providing software upgrades, even adding features and capabilities via customized software modules, ELASTIC frameworks offer more benefits to CSPs and customers today.
Finally, make it a priority to install only equipment that is SDN compatible, simple, flexible and forward-looking. Doing so can vastly reduce CAPEX for infrastructure as well as OPEX for training. Build with SDN compatibility in mind to not only survive digital transformation and market evolution, but to harness it.
It now seems that industry progress to SDN is inevitable. There are many things to think about regarding SDN, however.
Technology investments should always pay dividends and create opportunity for immediate ROI, yet the path toward tomorrow still must be paved. The growth of mobility in Africa is tremendous, and the market’s appetite beyond simple bandwidth is huge. SPs need to consider this, now and in the future.
While the African marketplace’s growth far outpaces that of more developed markets, this is not a reason to turn a blind eye to making investments for long-term advantage. SPs can maintain profitability by doing everything possible to leverage and maximize the network they have today – as well as implementing SDN for managing the network and virtualizing services in the future.
Want to know more about SDN? Download White Paper: SDN Great in Theory, Less in Practice.
About the Author
Gerard Halimi joined ECI in 2015 to manage the African Market. Prior to this he held managerial positions in Sky Vision, TTI Telecom and Bezeq and has over 25 years of experience in the telecommunication industry.
Mr Halimi earned a Bachelor of Science degree in Electrical Engineering from the Technion Israel Institute of Technology and a Master in Information Management System from Skema Business School.
This article is sponsored by ECI Telecom.