Cape Town - Leading telecommunications providers in Africa agree that costs must be decreased drastically to unlock growth on the continent.
Leading networks represented at the annual Africa Coms conference in Cape Town said infrastructure sharing and innovation from manufacturers would be key to reductions.
Steven Evans, CEO of telecommunications provider Etisalat Nigeria, said that telecoms growth would be limited until costs were addressed.
"Infrastructure sharing is critical to bringing down unit costs," said Evans.
"There is a great deal of willingness from providers already, and regulation is not necessary for this to happen," he said.
Michael Joseph, CEO of Kenyan operator Safaricom, echoed Evans' sentiments and said cellular providers were being forced to look at telecommunications in a broader sense.
"Voice ARPU [average revenue per user] will decline, that is a natural phenomenon. Growth will come from data in the future. We need to become total telecoms companies," said Josephs.
He explained that Safaricom saw a doubling of data usage on its network when undersea cable Seacom was "switched on".
"And again with Teams [the East African Marine System]. Only 10% of Kenyans have access to the Internet ... there is a huge possibility for data - and not just in urban and corporate environments.
Everyone in Kenya is entitled to access. The revolution is coming and we are ready. However, we don't have enough cheap devices available in the market and we are working on that," said Josephs.
He suggested that cheap, connected portable computers, or netbooks, are required and that there is a huge demand, bringing with it a significant opportunity for both vendors and distributors.
Consumers' needs must come first
Jose dos Santos, CEO of Vodacom Mozambique, agreed with his counterparts.
"In the next three to four years, broadband is a key area," he said.
"The big challenge for providers is managing revenue versus costs. We must also place pressure on manufacturers to stop trying to sell us what they have developed, and instead develop what consumers need. They must think out of the box in bringing down costs," said Dos Santos.
The three CEOs agreed that growth in the next five years will come from rural areas, but that providing those areas with connectivity will require bringing down cost and sharing infrastructure.
Zolisa Masiza, group executive for regulatory affairs for the MTN Group, said it would be important for providers to ensure that their existing investments are not squandered.
"We've invested in undersea cable infrastructure, but how do we ensure that that investment doesn't lie fallow? We must ensure that we push all regions to have the means to aggregate bandwidth," he said.
Masiza added that MTN believes it must be involved in stimulating economic growth in Africa, which will have a positive impact on telecommunications.
"There must be desirable key economic factors, along with stability in the political environment," he said.
"But the reality is different. Some areas do not have infrastructure, and there are low literacy levels in other areas, for example."
Masiza suggested that telecoms providers should develop the small- to medium-sized enterprise (SME) sectors in their countries.
"It is our duty to grow or enable the [SME] environment to further grow the subscriber base," he said.
Masiza lists online government, banking facilities, tele-education and medicine along with other services as key elements that must be enabled by telecommunications.
- Fin24.com