Africa Analysis is capitalising on founding member Andre Wills` experience in the telecommunications market to venture into the risky West African telecoms scenario.
The newly formed research company has ventured into the seemingly client-rich markets of West Africa, and recently opened an office in Nigeria to provide market research and analysis for clients looking to make headway and profits in those potentially lucrative, but notoriously tricky markets.
Wills, formerly the telecoms analyst with BMI-TechKnowledge, has joined with two other people, Geoff Daniels and Werner Muller, to create a company that looks at market analysis in telecoms, financial services and fast-moving consumer goods. Muller is permanently based at the office in Lagos - the business hub of Nigeria.
"West Africa is a growing and highly dynamic market. There is a huge demand for telecoms services, which almost outstrips supply, but one has to be extremely careful," Wills says.
Currently Nigeria has three licensed mobile operators, MTN, Econet and Nitel, which are competing fiercely to get a large slice of the potential $900 million market.
Wills says there are about 1.8 million potential subscribers in the country, willing to pay a minimum of $50 for a contract. However, there are serious infrastructure problems that have to be overcome.
"Power supply is one serious issue. MTN, for instance, has spent $120 million on putting in power generators at its base stations in order to ensure that they operate continuously," he says.
Mobile phone operators are well aware that lost minutes equate with lost revenue and that if they cannot depend on the electricity supply, they must supply it themselves.
SA, compared to West Africa, is fairly static and boring as the only big event on the horizon is the appointment of a second national operator (SNO) for fixed-line telecoms.
"The SA market has gone through its growth phase and is now waiting for the SNO. Unfortunately, the process has been taken behind closed doors and government would be well advised to conduct some kind of public relations campaign to keep people informed," Wills says.
Africa Analysis is also exploring other West African countries such as Cameroon. "West Africa, apart from Nigeria, is very French dominated in terms of it being the business language and culture. However, the opportunities are still great," Wills says.
He says that most of those countries have at least one mobile phone operator. But the real challenge is for the fixed-line operators to extend their value-added services.
"Internet access via cellphones is extremely expensive, but many African fixed-line operators don`t necessary have the funds to extend into these services as many subscribers are spending more and more on their mobile services - it is a Catch 22 situation," Wills says.
Africa Analysis is also conducting a remote study on the market space for a telecoms operator in Eastern Europe, including countries such as Poland, the Baltic states and Russia.
"The study is being done remotely and we hope to complete it in two weeks time," Wills says.
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