Qualcomm Inc (QCOM)

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Africa - a hub for future big telecoms growth

http://www.engineeringnews.co.za/eng/news/today/?show=73075
Published: 2005/09/16

Telecommunications in Africa is the current big thing; this is because the continent contains 12% of the world’s population and only 3% of the world’s telephone lines, creating a multitude of opportunities, says arivia.kom regional manager: SADC and Southern Africa Paul Wilde.

“Africa is beset by poverty to such an extent that it was one of two central topics at the G8 summit this year. Developing telecommunica-tions infrastructure is a key stra- tegy to overcome the predicament,” Wilde stresses.

The growing interest in telecommunications is already visible. BMI-T, the African ICT analyst firm, predicts growth of 25-million mobile subscribers in the Southern African Development Community (SADC) and East African Commun-ity (EAC) by 2009. That is almost double the current subscribers. Another report suggests that, by the end of this year, there will be at least one mobile network in each country on the continent. It also predicts that the number of mobile users in Africa will reach 200-million by 2010. Wilde says that Africa’s great distances and low popu- lation densities make wireless networks the obvious choice for when deploying new infrastructure.

“In countries such as Nigeria, the ratio of wireless to fixed line is already 6:1.

“Code division multiple access (CDMA) is also likely to take off faster than global system for mobile communication (GSM) since older versions already have a large footprint and it is far cheaper than GSM.

“Operators launching from South Africa have extensive experience in, and knowledge of, GSM networks and are likely to stick to their knitting.” Another divide in deploying these two popular technologies, Wilde notes, will likely be the public and private sectors. “The more expensive GSM will be deployed in the public sector while cheaper CDMA, with the appropriate services, will most likely be used for consumers.

“For instance, CDMA already has a strong presence in Nigeria under the Starcomms banner, while MTN operates a GSM network there. “The underlying network infrastructure is not going to be the differentiator for telecommunications companies in Africa. “That mantle will be handed to the service providers and the offer-ings they wrap around the networks.

“That is primarily due to a strong Chinese presence on the continent pushing infrastructure at extremely competitive prices, even into war-ravaged and cash-strapped countries such as Angola and Mozambique. “India too, to a lesser extent, is making inroads into the African tele- communications landscape with its skilled and cheap workforce.” Wilde says service providers must come up with the right creative mix. That is because what works in the developed world or even in South Africa does not necessarily work for the rest of Africa. “Whatever the packaging, Africa is ready for the latest technologies that the developed and developing worlds have to offer, including older flavours of CDMA, CDMA 2000, GSM, GPRS, VoIP, network infrastructure, middleware, project management, hosting, customer care, revenue assurance, value-added ser- vices, professional services, fraud management and data recovery, among others. “This is no backwater market where first-world vendors can dump dated technologies, though funding can be a major hurdle to large-scale, investment-heavy telecoms projects in Africa.”