Cellular telephony`s importance for Africa`s overall development was a recurring theme at this year`s GSM in Africa Conference. The event, staged in Cape Town last week, also highlighted the industry`s move out of the development stage and into early maturity.
While Africa`s spend on telecommunications accounts for only around 2% of the world`s total spend in the industry, it is still a potent driving force for development and economic change, the conference heard.
In his opening address, Vitus Olunga, deputy chairman for GSM Africa, emphasised the economic development role cellular telephony plays in Africa. The theme was picked up by a number of other speakers, including Zachary Wazara, CEO of Econet Nigeria, and a panel discussion that included members from Zimbabwe, Angola and Kenya.
The speakers stressed that giving ordinary people interactive access to information could help them improve their lives both socially and economically.
An example of this was Kenya GSM network operator Safricom`s GSM community project, which allows small-scale farmers to access price information and so decide early in the day to which of the fresh produce markets to take their crops.
According to Safricom MD Michael Joseph, this allows for more efficient price matching and reduces waste caused by produce not being sold on time. Safricom receives the information from the Kenyan Agricultural Commodities Exchange and farmers are able to dial into the service and set price alerts if necessary.
Governments` role of issuing licences did not assume as large a portion of discussion as it had in the past because most countries are in the process of offering late entry licences. The primary licence-holders are generally only about a third of the way into their licence period and the new entrants are essentially there to expand the market choices.
However, the conference heard that governments should not see the issuing of licences and the taxing of seemingly consistently profitable mobile operators as a means to cover their own budgetary problems.
Delegates to the conference heard that rapid growth of mobile telephony did not mean fixed-lines had no role to play. Guy Zibi, a director at Pyramid Research, said it was too early to write an obituary for fixed access.
Generating more revenue
Other illustrations of the move from a new to a maturing industry were the presentations on how operators can generate more revenue through value-added services, the importance of having reliable back-office systems, especially on the accounting side, and product/operator branding and the importance of marketing in a heavily competitive industry.
EDGE/3G applications were touted as a good means by which average rate per unit could be increased to cater for increasingly cost-conscious consumers.
However, demand for information is not equal and Uganda Telecom COO Hans Paulsen pointed out that subscribers have to be prepared for value-added services and that variable billing is essential when introducing them.
"SMS is the silent voice and one must stimulate increased traffic by focusing on the aspects that drive customers to use the service again and again," Paulsen said.
Collecting the money
The emphasis on collecting the revenue generated by the cellular operators and their networks was evident from the number of presentations looking at how to move from scratch cards to 'virtual cards`.
Safricom`s presentations emphasised the need to convert prepaid subscribers to virtual cards as a cost-saving measure, but noted that various security concerns had to be addressed.
Cell C, the third SA licence operator, showed how it depended on branding, marketing and offering solutions that its incumbent opposition had not thought of. According to Jose dos Santos, Cell C`s chief commercial officer, the company focuses on keeping its customers for life and is now well positioned to capitalise on the "one number for life" irrespective of operator, when this is allowed in the country.
There were nearly 700 delegates at this year`s event, which market players see as an indication of how seriously the African market takes GSM issues.
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