05 September 2024

The African continent continues to advance along the path towards offering truly meaningful connectivity for every inhabitant…

What is meaningful connectivity?

For a long time, we’ve been talking about connecting continents, bridging the digital divide, and so on. However, truly meaningful connectivity encompasses so much more than just the physical or digital connection between individuals or entities; it implies a deeper, purposeful interaction that adds value, fosters understanding, and cultivates relationships.

“Connectivity is a fundamental characteristic of what it means to be human,” explains Andrew Schafer, CEO, PowerX Technology Ltd. “We are a social species - and the connections we have to our loved ones, our peers and the world beyond our immediate circle defines the nature of our existence. Technology has long played a key role in enriching and extending this connectivity – from cuneiforms on clay tablets, to letters, telephone calls, emails, and now mobile devices. Today, a smartphone can connect you to the vast bulk of accessible knowledge of the human race, and to most humans on the planet.

Having truly meaningful connectivity provides individuals, businesses, and governments with access to reliable, affordable, high-quality internet and telecoms services that enable them to effectively participate in the global digital economy and society.

“For individual consumers, this is access to opportunities, knowledge and services on demand,” explains WIOCC Group head of brand and communications, Greg Sellars. “For businesses, meaningful connectivity is a catalyst and is fundamental to success and competitiveness. For governments, meaningful connectivity plays a pivotal role in driving economic growth, fostering social inclusion and enhancing governance.”

According to Dobek Pater, director: business development, Africa Analysis, meaningful connectivity needs to fulfil three parameters:

Connectivity – This needs to be sufficient (in terms of throughput, download/upload speed) to allow unhindered use of the connection for range of tasks – work, education, health, other e-government services, leisure, and entertainment. The minimum parameters currently vary, depending on household and individual use, and range from 10-50Mbps download speed. This requirement will be higher in the future.

Data quantity availability – The quantity of data which a person or a household can afford over a period (e.g., a month) must be sufficient to enable the connection for the use in various use cases – work, education, health, e-government services and some leisure use. Currently, the minimum is probably 5-10GB per month and it will increase significantly.

Connection technology – A connection technology offering true broadband-quality services is required. Currently, this is offered by 4G and 5G (mobile or fixed wireless), several other fixed wireless access (FWA)/radio technologies, fibre, DSL, and some of the satellite technologies.

Meaningful internet connectivity provides access to a wealth of information and opens opportunities for education, healthcare, and jobs.

“Take cocoa farmers for example, who before mobile connectivity had to sell their produce to intermediaries and wholesalers without any knowledge of what the cocoa was fetching on the open market (and what margins the go-betweens were carving out for themselves). Now they can do business connected to the cocoa spot price on global commodities exchanges and protect their margins from avaricious middlemen,” explains Schafer. “Another example is the ubiquitous adoption of mobile money, an unintended consequence of being able to transfer talk-time from user to user but which has rapidly grown into the de facto method for Africans to transfer funds amongst themselves or pay for goods and services.”

But the promise of connectivity is not enough. For these benefits to be truly realised, access to the digital ecosystem requires affordability, reliability, and speed.
“In Africa, this means creating, extending, and in-filling networks to be resilient and cost-effective. Without an infrastructure that delivers appropriate bandwidth, reliable uptime and within manageable OpEx and CapEx cost constraints, tower operators and mobile network operators (MNOs) will be unable to make connectivity practical, meaningful, affordable, or reliable in this vibrant and developing region,” asserts Schafer.

Connecting the masses

Achieving meaningful connectivity across a continent as diverse as Africa is no simple task.

“There is no technological magic bullet that will immediately deliver meaningful connectivity to every African,” opines Schafer. “Instead, the expansion of digital services into new regions will come from efficient enterprises delivering a mixture of technologies dependant on geography, population density, infrastructure availability, and cost-effectiveness.”

There is a range of access technologies which can fulfil the requirements, which coexist and compete with each other, depending on the localisation.
“The different technologies are also suitable for different types of user behaviour. In areas where they compete, they provide a choice of connectivity with competing price and other characteristics, allowing users to buy services delivered by technologies that best suit their particular needs,” says Pater. “For example, fibre offers the best quality of connectivity for a person or a household that uses it for work, education and entertainment from a single location, while 5G would be more suitable for someone who needs connectivity in more than one location or on the go.”

Africa is a mobile-first continent, and even with expansion of fixed connectivity, large segments of society will continue to use mobile. Just 36% of Africans are connected today, implying lack of mobile connectivity access, awareness of its benefits, and affordability of handsets and mobile contracts.

“For most users in Africa, cellular networks are the go-to gateway for access to each other and the wider world, delivering high-speed internet, voice, data, and multimedia,” shares Schafer. “With an estimated 208,000 cell towers across the continent, expected to rise to 261,000 by 2029, cellular networks are continuously growing and evolving to meet increasing demand for data, coverage, and capacity.”

Today, “satellite is important for the provision of meaningful connectivity in very remote locations,” adds Pater. “However, with the expansion of LEO services, the importance and prevalence of satellite for broadband connectivity will likely grow in Africa. From a monthly premium perspective, Starlink, for instance, is price-competitive with many fibre or FWA services in Africa, while the upfront cost is also decreasing. From a performance perspective, LEO is also very competitive with a number of terrestrial broadband technologies.”

Andrew Schafer

Schafer reports that, for those in urban areas, fibre promises the fastest and most reliable internet connection available - with high-speed, low latency broadband capable of delivering gigabit-speed internet. However, despite being the gold-standard in speed and bandwidth, fibre infrastructure is expensive to roll-out, requires substantial time and labour to deploy, and is vulnerable to breakages and theft, making it unsuitable for the expansive terrain, challenging transport and utility infrastructure, and dispersed populations of the African continent outside of urban centres.

If it’s rapid deployment that’s needed, meanwhile, “FWA has gained popularity in recent years, using a network of antennas and radio signals to deliver high-speed connectivity at a lower cost,” says Schafer. “FWA has some technical constraints however including line-of-sight limitations due to obstructions, frequency overlap with other networks, and impacts from harsh weather.”

Cooperation is key

As beautifully exampled following the March 2024 cable cuts and subsequent rapid reconnection of the populace, when it comes to effectively connecting an entire continent, cooperation is key.

“Operators should cooperate where necessary, e.g., limit overbuild in the case of terrestrial infrastructure which can be shared (such as fibre),” says Pater. “This would allow them to use the CapEx not wasted on network duplication to expand into areas of lower profitability. To this extent, the government can also play a role by forcing operators to build in certain areas of the country only and then share infrastructure to provide services nationally. This can be done as a spectrum assignment condition, for instance.”

Schafer agrees that “the most significant contributions to delivering meaningful connectivity come from investment in infrastructure, improving quality of service and making digital connectivity affordable. Investment is essential for expanding coverage and improving the quality and reliability of connectivity across the continent, and this is one area where Africa is uniquely positioned to raise the bar. As mature markets struggle to retrofit existing towers with recent technology, often on sites constrained by physical limitations, African TowerCos and MNOS have an opportunity to leapfrog with investment in new towers that employ the very latest passive and active equipment. This will deliver innovative mobile services with resilient, cost-effective power solutions designed and optimised to meet the challenges of Africa’s diverse terrain, climate, and grid issues.”

Fully planning out new sites is crucial to deploy networks that really work for every African. Further, the expansion of footprints with new towers can also have an additional impact on remote communities with no grid access, says Schafer: power systems installed for a cell tower can be provisioned to support a level of local community power access, having an even greater impact on the communities they serve through the creation of mini grids.

They say that ‘it takes a village’ to raise a child; but it also takes a village to connect Africa’s unconnected: “operators and service providers can seek out suppliers of lower-priced end-user devices, such as mobile handsets, routers, other customer premises equipment. This would lower the barrier to entry for a segment of the consumer and business markets, ensuring higher adoption rates and greater revenues for the operators and service providers,” says Pater.

Operators and service providers can also innovate their business models to reduce operating costs to make meaningful connectivity more affordable through lower total cost of ownership; and structure the products to be more in line with economic characteristics of the users, such as selling connectivity in bite-size chunks in a cash-based, informal segment of the market, where income is irregular. This is particularly important in lower income regions of Africa, reports Pater.

Moreover, “operators and service providers who are able to afford it financially can provide free connectivity services to certain institutions, such as schools, particularly those that may struggle to pay for such services,” adds Pater. “This can be considered part of the operators’ corporate social responsibility and would contribute to greater use of meaningful connectivity and enable digital education of segments of the society.”

Trials and tribulations

In the search for meaningful connectivity, price competition becomes a tricky balancing act. While in and of itself, competition seems positive for consumers by rendering premium products more affordable – for example, high quality fixed broadband, once a premium product for Africa, is well on its way to becoming a commodity, which benefits operators who gain an expanded customer base and higher revenues – it also causes certain problems.

“This has taken place in South Africa, in the FTTx market,” highlights Pater. “Operators and service providers try to gain market share by competing on price. This takes the value out of the market for everyone, including potentially the users of services, if an operator or a service provider goes bankrupt due to unsustainable price competition.”

Service providers must therefore become technology service providers, not only connectivity providers, to generate higher revenues and profit margins, asserts Pater. This would alleviate the need to maximise revenue from connectivity only; and diversify the revenue stream to make operations more sustainable.

Schafer, meanwhile, warns that where well-intentioned network expansion and related investments do not fully deliver on their potential, this results in higher energy and maintenance costs than expected, as well as under-utilised assets and sub-optimal renewable yields.

“Often this is a product of the, ‘if it isn’t broken, why fix it?’ mindset, where TowerCos and MNOs don’t have a view of inefficiencies or optimisation potential, letting CapEx, OpEx and revenue opportunities go unnoticed and unrealised,” explains Schafer. “The inadvertent consequences are increased operating and maintenance costs that subsequently end up being passed down to consumers, pricing services out of reach for low-income populations and exacerbating the digital divide.”

Connecting Africa (meaningfully) – when, not if

The future of connectivity hangs in the balance. Ensuring that every single African has access to truly meaningful connectivity, and the ability to participate in the global economy (if they so wish), is the very definition of an ambitious target.

“This is a goal that should be actively pursued given the tremendous benefits it unlocks. Some estimates suggest that significant improvements could be achieved within the next decade, but full coverage may take longer, possibly several decades,” shares Schafer. “It will require a concerted effort from governments, the private sector, and the international community to overcome the existing challenges and bridge the digital divide across the continent. Considering this, I think it’s a question of when, not if, every African is truly, meaningfully connected.”

“It may take another 15-20 years, and this could be an optimistic scenario when we consider the entire continent. The ability to connect all Africans meaningfully is a function of a number of factors which will determine how quickly or slowly we achieve meaningful connectivity,” warns Pater.

Such factors include affordability, which is dictated by the price of service vs. disposable income; as well as the upfront price of connectivity, as high costs may create a barrier to entry. Meanwhile, useful services and use cases will help drive adoption and must comprise local content; here, the government can play a key role by pushing e-government services.

To really bring meaningful connectivity to the African populace, enabling infrastructure must be available in all inhabited areas. However, operators are unlikely to deploy such infrastructure if it won’t generate an expected return on investment (RoI), explains Pater. This may be problematic in low-income areas, which is where government assistance and public-private partnerships become important. The government can also set certain obligations on the operators to enable meaningful connectivity in under-served areas.

“Whilst factors such as policy and regulatory frameworks, international cooperation, digital inclusion initiatives and public-private partnerships all play their part in improving connectivity in Africa, the heart of the issue is the rollout and subsequent management of infrastructure,” agrees Schafer. “The speed with which MNOs and TowerCos can extend the reach of their networks depends on the delicate balance between their revenues from new and existing customers and the cost of running and maintaining their networks. Building new towers and in-filling for 5G requires considerable CapEx, and so the more efficiently and cost-effectively they can operate their networks, the more they can direct financial resources into the expansion of their infrastructure.”

“Digitalisation and the application of advanced data science (including ML/AI) to achieve networks optimised for power and maintenance is part of Africa’s future telecom growth strategy,” adds Schafer. “This minimises energy and maintenance OpEx, improves asset performance and drives up employee productivity in managing expanding networks. By achieving these efficiencies, the objectives of reliable, cost-effective tower operations can be realised, and data science becomes a key enabler in delivering the vision of widely accessible, meaningful connectivity across the African continent.”

“Government intervention/assistance is required to ensure that unprofitable areas of a country also have high-quality digital infrastructure available and those least able to afford meaningful connectivity are able to do so,” asserts Pater. “This can be in the form of subsidies for infrastructure deployment and/or for services provision. However, an important role that the government can play is to enable and support (through policy, legislation, and regulation) a competitive environment for the provision of connectivity and related infrastructure and services.”

The key, according to Pater, is to ensure that various state and private institutions have high-quality broadband connectivity as soon as possible. Schools are one example, allowing individuals access to connectivity meaningfully even if it is not yet available in the household or individually.

Will Africa ever be meaningfully connected? It seems so, but there’s a long road ahead…