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Will China takeover African connectivity?
January 30, 2018 | By Osvaldo Coelho @ poa! internet
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We are pleased to share with you all an interesting article contributed by Osvaldo Coelho who is senior ICT Planning & Implementation consultant.

 
 

Osvaldo Coelho

Business Development at Athonet

 

 

All Articles by Osvaldo Coelho

 
     
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In April, 2016, Sharing Mobile, a Chinese virtual network operator, acquired an 80% interest in a Nigerian telecoms operator, GiCell for USD200 million, showing the ability of Chinese private enterprises to acquire overseas telecoms operators.

 

That was interesting as it is aligned with the Chinese possible inroads in the African continent. That would lead to a Chinese operator buying a big African operator. Orange or the Chinese: MTN international player and the acquirer?

 

Last December China Mobile launched an MVNO In The U.K. China Mobile’s primary goal with the service is to target Chinese tourists and expats in the U.K. with a range of pay-as-you-go wireless phone services.

 

Africa is teeming with thousands of Chinese workers and new business are opening by the day and there are millions of unconnected in Africa.

 

There is no need to repeat the lack of connectivity in Africa as the case is well understood. The problem is: Who is going to connect the unconnected?

 

Do not wait for Universal Service Obligation. They are still in serious doubt! Is Universal Access/Service a Government or Operator Obligation? How about these mobile operators that built greenfield and bought the pioneers Celtel and Investcom? How about the MTN and Vodafone empires? Well, they are incumbent and have lost the animal spirits. Just happy with what they have while others are consolidating fast: Tigo, Orange, Airtel, and the GCC operators Etisalat and Zain are gone. Faced with the economic recession, which spewed a number of other challenges, the telecoms industry is shrinking in numbers across all operations, like any other business.

 

Who have tried to connect the unconnected? Google has had its chance starting in 2011 but it blew it. They even interviewed me, back then, to build fiber for them. Facebook wanted to lower the costs of connectivity but are more talking than acting. By the way, Facebook also interviewed to build shared backhauls in Africa but I have not written an article about it.

 

How about the start ups? They are building, aren’t they? Not really. Start ups are thinking too small to be able to make a dent on the unconnected. They spend more time chasing funding than scaling up. They are seeking funding like single guys seek sex: As soon as they finish one round, they are already thinking how to get the next round.

 

The Chinese. Why the Chinese? Think transport bits efficiently and cheaply.

 

West Africa linked to South America

 

Huawei SAIL Submarine cable landing in Duala, Cameroon

 


From Douala, West and East Africa Linked overland

Because they are building fiber like crazy along the railways and power lines. With fiber in place, the rest is easy. Power lines do not cross the urban areas. Rail lines and pipelines are way out of the beaten tracks. Thus they are close to the hard to connect populations in the middle nowhere.

 

And from East Africa linking to Asia

 

Huawei PEACE Submarine cable

 


Now picture this scenario. The Chinese, in cahoots with ZTE and Huawei, plus a check book of the China Development Bank propose to connected the unconnected to the African Ministries of ICT.

 

They will love the idea! The incumbents have never gone beyond the urban, suburban and road coverage.

 

  Now the Ministry of ICT sells this idea to connect the unconnected to the President. The president envisages him landing his helicopter in the ocha (the country side) the Chinese throwing water at the landing place -see truck in the background in the photo- to avoid raising dust as he lands, I was there when the President Buhari came to the site to inaugurate. President Buhari and me were both young then, today he is again the Nigerian president as I battle here in East Africa.

 

The President lands, waves to the locals and proceed to cut the tape under the flashes of the photographers showing him connecting to Chinese platformsonly: Tencent. No Whatsapp but Wechat. No Google. No Tweeter, but Weibo. No Facebook, but Renren. No Amazon but Alibaba. Even Douban is on display.

 

They he will be greeted by the young ladies performing traditional dances. It was fun those inaugurations.

 

Who will pay for all that?

 


Opportunities abound. Oi in Brazil. Airtel in Kenya, Rwanda and Tanzania. Adding to that the Wananchi Group and Telkom Kenya here.

 

The Chinese are getting ready and the Chinese enterprises are dedicated to building the “Information Silk Road” China Go Abroad (4th Issue) Key connectivity improvements along the Belt and Road in telecommunications & aviation sectors September 2016

 


Incumbents should beware: China Telecom aims to set up services in the Philippines and Zhang Honglei, general manager of Sharing Communication Brand Management Department, also said...The communication in Nigeria still stays on 2G technology. The cooperation of sharing communication with Nigerian telecom operators will provide Nigeria with Better communication service.

 

Africa is ready and it does look the Chinese are ready too.

 
     
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