Expect More African Reverse Innovations: 4 Top Players In African Tech, On What They Know For Sure
A strong year of development for the African tech space, 2016 has passed its promises on to 2017 — promises of further growth in a sector that seems immune to the economic downturn seen elsewhere.
Four key players in the African tech space talked to AFKInsider via email about the major developments of 2016 and what they are looking forward to in 2017: BRCK co-founder Erik Hersman, project Isizwe founder Alan Knott-Craig, Jumia co-CEO Jeremy Hodara and Ovum analyst Danson Njue.
BRCK co-founder Erik Hersman
Erik Hersman highlighted the “big video invasion” of Netflix, Amazon and Showmax as the major development of 2016, with all three firms launching video on demand offerings in Africa in the same year.
“They’re tussling it out, affecting normal TV and movies of course. However, they’re coming up against a hard reality of Africans’ ability to spend money past the monthly fees, as they don’t have the disposable income to put towards expensive streaming data plans,” he said.
Hersman said the visit of Mark Zuckerberg to Nigeria and Kenya in September had been an important landmark for the space, but criticized the overreach of government in the internet space, which he said is getting worse and crippling economic activity.
There were a number of spaces he was looking forward to seeing develop in 2017.
“Drone activity for specialized uses looks interesting, especially in Rwanda for healthcare and in other countries for poaching prevention. If these projects work out well, the scope and value will grow across the continent,” Hersman said.
“Connectivity is going to be an even more important item than in years past, as demand continues to grow, devices are more prevalent and the big international video players are on it, for the traditional ISPs and telecom companies, but also the ones like BRCK with new ideas on how to do it better.”
Project Isizwe founder Alan Knott-Craig
Alan Knott-Craig agreed the visit of Zuckerberg had been a major occurrence in 2016, as it put Africa on the map and would see more investors start looking at the continent.
“I guess it’s a bit like when the English Premier League starting looking to Africa for playing talent. Once the gates open they can’t be closed,” he said.
Knott-Craig said he expected the calls for faster, cheaper internet to become louder in 2017.
“The cost/MB is simply too high. The bundles offer decent value but are out of reach of 70 percent of consumers,” he said.
Jumia co-CEO Jeremy Hodara
Jeremy Hodara, perhaps unsurprisingly, thought Jumia becoming Africa’s first unicorn was the major bit of news from 2016, saying it proved the startup scene on the continent was “vivacious and dynamic”. He also highlighted definitive adoption of international e-commerce shopping habits like Black Friday across the continent.
“In a context of devaluation and reduction of purchasing power in many African countries, those commercial events have managed to pull the prices down in countries where products are usually much more expensive than in any other parts of the world,” he said.
In 2017, however, Hodara expects more African reverse innovations to address local challenges that could later be applied on an international level.
“For example, optimization of operational processes with technology innovations advancements, such as the creation of an app used by delivery fleets across Africa, allowing them, among other things, to pinpoint the localisation of their customers’ address and saving it onto a map,” he said.
Ovum analyst Danson Njue
Danson Njue focused on developments in the telecoms space, saying there had been an increase in LTE network launches across many countries in 2016 due to high demand for data services.
“Other developments were mainly in the MFS (mobile financial services) sector, where service providers increased partnerships to promote interoperability and international remittances, as well as in digital services where operators continued to launch digital services to take advantage of the increased broadband connectivity. Such services included OTT, VoD, IoT and Cloud,” he said.
Njue also highlighted a couple of mergers and acquisition by some of the major operator groups, including Orange and Bharti Airtel, as telecoms reacted to changing operating environments.
“In some markets, there was increased regulatory activity, especially through the enforcement of SIM registration and use of counterfeit mobile handsets regulations. The enforcement involved disconnections of unregistered SIMs as well as hefty fines to telecoms,” he said.
In 2017, Njue expects the major developments to be about the launches of new services, especially in the data, mobile financial services and enterprise segments.
“There is a growing appetite for digital services in the region, such as in entertainment, e-commerce, m-government and enterprise, and service providers will definitely innovate around these areas to create new revenue streams in their operations,” he said. “As such, the region will record increased adoption of services such as Cloud, IoT and Big Data, as well as music and video streaming services.”
Njue also expects telecoms and governments to continue to focus on increasing broadband connectivity through the expansion of 3G and 4G networks, as well as fiber networks.
“More countries are expected to complete digital migration to free the digital dividend spectrum. As such, we should expect African countries to start the allocation of the spectrum for use in 4G network launch,” he said. “In addition, FTTx will continue to be a favorite technology to deliver fixed home and office broadband services supported by increased fiber network deployment across many countries.”