High-speed mobile puts Africa and India on fast track
- 15 September 2015
- From the section Business
The roll-out of high-speed mobile connectivity in Africa and India is demonstrating yet again how emerging economies can leapfrog traditional developmental stages to accelerate their economic growth.
Governments in these countries are betting that faster 4G internet connections over the airwaves, rather than down expensive wired infrastructures, will give businesses a welcome productivity boost.
The tech upgrade is already making a difference to many small businesses.
"Having much faster internet access means we get more done," says Yomi Adegboye, a Nigerian entrepreneur running a popular blog that reviews mobiles and gadgets.
It has had a "huge" impact on his business, he says.
"I can get things done online in a much shorter and faster period of time than I could before now. Downloads are easier. This makes for greater efficiency and faster customer support," he adds.
Mr Adegboye is one of the first people in Nigeria - and Africa - to enjoy 4G mobile internet. courtesy of telecoms firm, the Smile Group.
Its chief executive, Irene Charnley, tells the BBC that the need for high-speed data services is much greater in countries that have no fixed-line infrastructure.
But why are they moving straight to 4G on a continent where vast expanses of land don't have 3G or even a 2G mobile signal, let alone fixed-lined internet?
It is because "4G is the quickest and most cost-effective means to access digital services", she says.
The 4G LTE (Fourth Generation Long Term Evolution) standard was designed first and foremost as a reliable, high-speed internet service, says Ms Charnley.
"4G is massively different in terms of quality, reliability and speed...it is not like 2G, which was designed for voice and then added some very slow data services, or 3G that was for voice and data but ended up being a compromise," she says.
Smile's 4G customers in Africa are enjoying average download speeds of 6Mbps (megabits per second), she says, with some experiencing 21Mbps. This average compares favourably to average 3G network speeds in UK cities.
The acceleration in internet speed is certainly being appreciated by small business owners like Mr Adegboye.
"It is a completely different world from the 3G I had been using," he says. "It is much faster, and much more stable and reliable than anything else we have ever used."
In India, Prime Minister Narendra Modi is prioritising internet connectivity under his "Digital India" initiative, in the hope that this will help modernise all aspects of the country, from health and education, to food supply and manufacturing.
The country's 950 million mobile users still use their phones primarily to make voice calls - internet penetration remains very low across the country.
Sameer Pitalwalla, chief executive of Culture Machine, a digital entertainment company making programmes for mobile and computer, is certainly looking forward to faster internet speeds.
"As the internet connectivity becomes fatter... one sees a direct co-relationship with users watching more video," he told the BBC's India Business Report.
"We see that not only will our subscriber base increase... it will be a rising tide which will lift all boats, because people will have access to content."
Last month India's largest telecom, Airtel, became the first to roll out 4G services. Other operators are likely to follow suit, precipitating a possible price war.
But consumers and businesses will be hoping that 4G in India proves more reliable that the country's existing 3G and 2G services, which have been patchy to say the least.
A paucity of mobile phone masts and limited radio spectrum has hampered efficiency, operators say. Modi's government recently auctioned off more spectrum to pave the way for faster connectivity.
Rural slow lane?
But as India and Africa embrace high-speed mobile internet, their rural communities may wonder whether they will miss out on this technological advance, given that operators tend to concentrate their roll-out plans on more affluent, urban areas.
Bongo Futuse, spokesman for South African operator Vodacom, almost concedes as much, saying: "Deployment is a function of a number of factors, including spectrum availability, sufficient backhaul, adequate user base, smartphone penetration, and so on.
"These factors tend to dictate a roll-out strategy that initially starts in urban areas and then moves to rural."
For this reason, Danson Njue, a research analyst at Ovum, argues that governments must get involved in 4G deployment, either directly or through subsidies to private operators.
"As has always been the case, telcos focus their investments in areas that guarantee a return on investment. In my opinion, it requires government intervention, or to give subsidies to encourage investment in the rural areas," he says.
One solution, says Mr Njue, is for governments to own the network, and telecoms operators to buy access and distribute it to customers. This, he says, would achieve nationwide coverage much faster than the fragmented approach of relying on individual operators.
Rwanda's government has already adopted this approach, with Mr Njue saying the country "serves as a good example where this model is working perfectly".
Carlos Martin Mwizerwa of Olleh Rwanda Networks (ORN), a public-private partnership operating the country's only 4G network, says ORN expects to achieve 95% 4G coverage of Rwanda's territory by 2017, with 98% of populated areas accounted for.
He believes the partnership approach enables a much quicker roll-out of services, because individual private operators are not wasting time building competing networks.
"Developing markets hardly have the time for a long deployment period and this approach promotes quick and affordable access to broadband services and reduces the digital divide," he says, "especially in emerging countries where rural areas are generally underserved by both mobile and fixed broadband access operators."
In India, Mr Modi's ambition is to extend high-speed internet access to rural areas where more than half the country's population live.
He may do well to learn some lessons from Africa.