I made a prediction a few years ago, noting that Nigeria would enter the year of immersive connectivity by 2022: “2020s, starting at 2022, will be the decade of immersive connectivity.” I used the same model which I used in my book – Nanotechnology & Microelectronics – which received IGI Global Book of the Year award, to model that by 2022, a parity would develop, closing some telecom infrastructure gaps and unleashing immersive connectivity at scale in Nigeria. I do think we are getting there.
In today’s videocast, I make a case that Africa will enter the era of affordable broadband internet in 2022. That will be the year we will begin a new dawn of immersive connectivity where you can eat and surf all you can. Industry players will take off the Internet meter and then focus on service, experience and quality. From satellite broadband vendors to the MNCs with balloons and drones, the sector will become very competitive and service will drive growth. This has happened in the past – every decade, Africa experiences a major industrial transformation. We saw that in banking and voice telephony. 2020s, starting at 2022, will be the decade of immersive connectivity.
But as that happens, there would be major dislocations: Google and Facebook which I baptized as ICT Utilities in a Harvard Business Review article, will play key roles. There is a convergence and consolidation of power in technology. Yes, once you have capabilities in one thing, the cost of doing other things is so low that you can just do it. Blame Moore’s Law for it. So, as time goes on, the powerful technology companies are doing more things in-house and becoming more powerful.
Today, Facebook makes hardware for its servers. Google does the same. Now, they are becoming telcos in Africa, offering possibly near-free broadband services. Sure, they will serve you adverts. But who will resist that? Add the promise of Elon Musk and his Starlink, you get a future-worry for the likes of 9Mobile, Airtel, Glo and MTN.
Yes, if Google and Facebook provide broadband services at near-free cost, before us is a massive disruption. In this piece, Samuel Nwite explains what is happening in that space.
For some years now, Google and Facebook have been working to provide free global internet. However, this push to help internet users, especially in Africa to access reliable and fast internet has become a topic of interest recently due to the disruption it will cause to existing internet structure in the African continent.
There would be a new order, depending on what regulators do. But if they do not do anything smart, I will ask the telecoms to follow the same thing I have recommended to startups in the above Harvard Business Review article: do not resist frontally; simply, find a way to work with Google and Facebook because they are utilities, and utilities like electricity and water boards do not offer choices. Yes, any frontal confrontation will lead to value destruction for traditional telcos. Telcos need to master the flank strategy from Sun Tzu’s Art of War!
For Facebook, the playbook is one thing: control demand (yes, users).
In the digital age, what matters is not who controls supply, but who controls demand. Supply is largely infinite as there are many ways to get to the web, and because it is infinite, users congregate to platforms to help them navigate and make sense of the web.
In 1980, before the digital age as we have it today, the most powerful people in media were newspaper publishers. They were the people you needed to reach to get your message to the world. They decided what everyone read on the dailies and they were powerful. They controlled supply and by controlling supply, they shaped everything including advertising.
Comment: Do you think that is what the Indian Telco Jio’s parent (Jio platforms) has recently done with FB taking some stake in it, in part sensing what you are saying?
My Response: Absolutely – that is the only option for Jio. The real question is how do you partner with these ICT utilities? Jio got a good deal and was very smart to have done that. For every $100M, Facebook spends/wastes to get more IPs in India, it would add at least $500M in its market cap. So, investing in India was not to make direct “profit” but to get IP addresses (users) which it can convert into another value as its stocks move upwards. It is like using $10m to do discount in retail stores a week to end of quarter to improve same store numbers so that your stock can add $100m by beating estimates.
Click to join Tekedia Capital and build Next Africa with min of $10,000 co-investment in startups.