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.
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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 on LinkedIn Feed
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.
Nigerian Telcos Jitter As Google And Facebook Roll Out Plans for Free Internet
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Plenty things. If you play wait and see, you could be steamrolled, and decide you go for frontal confrontation, then you get a hiding.
Nothing has worked so well anywhere such that there won’t be value left on the table, or dissatisfied customers; it becomes a question of whether those crumbs and fallouts are big enough to keep you in business.
Many things sound interesting, at least from the abstract possibilities perspective, it remains to see the practical and commercial realities.
Of course the cheaper the cost of broadband services, the better for the public, because it will allow many more businesses who have been operating with handbrake on to speed up, birthing new ones also; one of our portfolios needs that convergence to come sooner than later.
We will see which parties that have more ammunitions in their arsenals.
Telecoms have a head start now, but as we’ve seen, they’re not utilising it to their advantage. They’re actually using it to their detriment. Their main run now is they have the numbers already, but what value do they offer those numbers? None actually.
An average user would try out anything new and different from what’s obtainable and when that new offers more, they’re hooked until the next best new.
Current players in the telecoms sphere, can have an edge today by not just offering broadband services to homes and businesses, but make it tasty and appealing. One example, make unique and niche offers. Make data uncapped. What’s the catch, speed and a daily minimum per value plan.
Examples:
Ntwk provider xxx has an array of plans:
Plan 1: pay ?500 monthly get 30mins call to any ntwk in Nigeria, 50 free text messages, and an unlimited data with a daily (Max downloadable speed cap, presently 4G of 500Mb daily) then speed reduced to 312Mb until next day.
Plan 2: Pay ?1000 monthly get 1.30hrs call to any network in Nigeria, 150 free text messages to any ntwk also, unlimited data with a daily (Max downloadable speed Cap @ 4G speeds of 1GB for the day )and speed throttled to 312Mb until next day
Plan 3: Pay ?1500 xxxxx xxxxx xxxx
keep this menu spicy and make the demand come from users, they’ll end up making more.
Now once these new players come, we all know what speeds google offers 1Gbps! Yes, I use GCP and my speeds are 1.3Gbps and they’ll likely offer more services in between, they’ve just killed all regular players and they’ll command the demand. Leaving these existing players nothing. Sad to see them own this much but not appreciate what they already got and make good use of it.
Can’t wait for the shift to this. Our business need to move ahead not get back kicked like it’s always been. I’d welcome them without giving a thought, current players have had years to make changes they didn’t buldge. Believing they earn more.
Imagine knowing your xxx million number of subscribers will pay for plan 1, 2 or 3 or plan xxx monthly? You’re already seeing value and cash flow and upfront payment too. Spice that with rewards for bulk payment we know it’s JACKPOT, we really need the paradigm shift in this sector.
You nailed it!
Real talk,
My fear is that NCC will get the kind of sense we are talking about and make this work without turning these new competitors become like the overfed old ones.
Lovely contribution.
The crux of the matter in all of telecoms problems is the lack of the will in Nigerian government to offer good services and governance to its people.
The costs of data, calls and dstv services in Nigeria is ridiculous and is not in the overall best interest of the Nigerian consumers. This is the least of the social services one would expect to enjoy in the midst of the massive social deficit and exclusion in Nigeria.
What is the use of the state governments not offering easier access to the telecoms right of cable ways? Whose interest is the government stance serving? Cheap, fast and generally affordable INTERNET services is one thing that Nigerians and the youths in particular need and will cherish to encourage small businesses and discourage the rush to the urban areas with no growth potential. The greatness and development of Nigeria is in the rural areas where there are potentials for Agronomic purposes. Our future lies in Agrjc and the only way to lure our youths back is by good infrastructures eg fast internet services and electricity.
The state governments have their eyes on the
immediate pie that comes from giving the right of way not other perks that would give long term benefits such as the ones you listed above. In this case,it is obvious that they see the telcos as their cash cows.
Thanks, my mind.
The problem is not that the current telecom players don’t know the right thing to do or that they don’t do the right things in other sensible countries but our people at the top had / are using greed to spoil the benefits of the masses.