The tech­nol­ogy wave grip­ping the con­ti­nent is em­pow­er­ing dig­i­tal en­trepreneurs to drive so­cial and eco­nomic change

Business Traveler (USA) - - INSIDE - By Jane Labous

The tech­nol­ogy wave grip­ping the con­ti­nent is em­pow­er­ing dig­i­tal en­trepreneurs to drive so­cial and eco­nomic change

As night falls, a flu­o­res­cent bulb flick­ers on in le cy­ber and two gi­gan­tic speak­ers wedged in the sand out­side blast tracks by 2-Pac and Vi­viane, Yous­sou N’Dour’s pop diva sis­ter. Karim Ndi­aye, the 32-year-old owner of this in­ter­net café tucked away on a side street in the Sene­galese cap­i­tal of Dakar, fixes a key­board as a bunch of teenagers swarm around three com­put­ers. They mer­rily sit on each oth­ers’ laps to surf Face­book and Mxit, post pho­tos, tweet, browse You Tube and, one hopes, do their home­work.

An hour’s web time here is CFA200 – about 40 cents – and judg­ing by the smiles and chat­ter, it’s money well spent for th­ese ur­ban teenagers. “Ed­u­ca­tion now is not just learn­ing to read and write but learn­ing how to use a com­puter,” says one of them, Mbis­sine, as she types. “If you don’t know how to do it, you’ll be left be­hind.”

The pro­lif­er­a­tion of les cy­bers in Sene­gal is one sign of the tech trend that’s ring­ing, click­ing, ping­ing and buf­fer­ing its way across Africa. This, and the men hawk­ing phone credit on ev­ery street cor­ner in Dakar, out­num­ber­ing the wa­ter and sports-sock sell­ers of old. Wav­ing plas­tic wal­lets of scratch­cards from Tigo, Air­tel, Orange, MTN and all the other providers jostling for at­ten­tion in this new mar­ket, they make a roar­ing trade from driv­ers who lean from car win­dows to stock up. Scratch off the back, punch in the code and you’ve got credit. The trou­ble is, says one Sene­galese friend, ev­ery­one spends all their money on it th­ese days.

The Virtue of Con­nec­tiv­ity

In a post on Google Plus in Jan­uary, Google chief ex­ec­u­tive Eric Sch­midt de­scribed the new, young tech gen­er­a­tion as Africa’s great­est hope. “The virtue of con­nec­tiv­ity is that peo­ple have more choices. And more choices lead to a bet­ter un­der­stand­ing of the value of go­ing to school, the need to treat women equally, the choice to not de­mo­nize oth­ers. This new gen­er­a­tion ex­pects more, and will use mo­bile com­put­ing to get it,” he said.

Africa’s tech in­dus­try is grow­ing by 20 per­cent a year, fu­elling busi­ness, en­trepreneur­ship and in­come growth. Sub-Sa­ha­ran Africa is the fastest-grow­ing re­gion for mo­bile de­vices in the world, ac­cord­ing to the GSMA (Groupe Spe­ciale Mo­bile As­so­ci­a­tion) – most no­tably in Nige­ria and South Africa, where the mo­bile sec­tor is pro­jected to con­trib­ute $12.7 bil­lion and $15.9 bil­lion to GDP re­spec­tively be­tween 2015 and 2020, cre­at­ing al­most 11 mil­lion jobs. In Tan­za­nia it’s pre­dicted to con­trib­ute $1.6 bil­lion, in Ghana and Kenya $1.5 bil­lion, and in Sene­gal $476 mil­lion, while in most other coun­tries, from Botswana to Rwanda, Mali to Uganda, the in­dus­try is also boom­ing.

“There’s a ris­ing mid­dle class with dis­pos­able in­come to spend on tech­nol­ogy, par­tic­u­larly cell phones,” ex­plains Fer­nando de Sousa, gen­eral man­ager of Africa

Mo­bile phone sub­scrip­tions in sub-Sa­ha­ran Africa have risen to 475 mil­lion from 90 mil­lion in seven years

Ini­tia­tives for Mi­crosoft, an off­shoot of the soft­ware gi­ant. “There’s in­creas­ing geopo­lit­i­cal sta­bil­ity, en­cour­ag­ing for­eign in­vest­ment. And African de­vel­op­ers and en­trepreneurs are en­gag­ing with each other and with or­ga­ni­za­tions such as Mi­crosoft to help bring African tech­nol­ogy to their lo­cal mar­kets and to the world. Africans are full of new ideas, and we’re see­ing that come to the fore­front as the younger gen­er­a­tion dis­misses the pre­vi­ous ap­proach of aid, and wants to trade.”

There are al­ready some 700 mil­lion SIM cards in Africa and it’s es­ti­mated that half of Kenya’s GDP moves through mo­bile money. The po­ten­tial mar­ket re­mains huge, bear­ing in mind that the pop­u­la­tion of Africa now num­bers more than a bil­lion peo­ple. Mo­bile phone sub­scrip­tions in sub- Sa­ha­ran Africa have risen to 475 mil­lion from 90 mil­lion in seven years and, in some African coun­tries, more peo­ple have ac­cess to a mo­bile phone than to clean wa­ter, a bank ac­count or elec­tric­ity. Top play­ers in­clude Orange and Voda­fone, and new en­tries such as Glo Mo­bile in Nige­ria.

The in­tro­duc­tion of mo­bile tech­nol­ogy is one of the big­gest pos­i­tive changes to the con­ti­nent’s so­cial land­scape in his­tory. On a con­ti­nent where ba­sic in­fra­struc­tures do not work, it’s no sur­prise that a cheap, ac­ces­si­ble phone con­nec­tion has been uni­ver­sally em­braced. Sud­denly, ev­ery­one can be in touch, whether they live in a ma­jor city or a thou­sand miles into the un­tamed bush.

Karim Ndi­aye per­fectly em­bod­ies the new African tech geek – up­beat, savvy and en­tre­pre­neur­ial. Like many, he is on Mxit, the so­cial me­dia site by Africans for Africans, where users send 750 mil­lion mes­sages ev­ery day. He set up his in­ter­net café be­cause he felt lo­cal chil­dren would ben­e­fit. “Peo­ple want to be con­nected th­ese days, to talk to their fam­i­lies in the vil­lages, or send money, so you won’t find many peo­ple with­out a mo­bile. The kids need to have IT skills, too, so ac­cess to com­put­ers re­ally helps them, and their fu­ture prospects will be so much bet­ter with th­ese new op­por­tu­ni­ties.”

De Sousa says: “From the small­est ex­pan­sion of con­nec­tiv­ity for farm­ers to do busi­ness with neigh­bor­ing com­mu­ni­ties, to the largest ex­pan­sion of a mo­bile app de­vel­oped in Africa go­ing global, it means in­creased wealth cre­ation for Africans.

Con­nec­tiv­ity for more peo­ple is the crit­i­cal first step. With tech­nol­ogy – par­tic­u­larly the com­bi­na­tion of smart de­vices and cloud ser­vices – African com­pa­nies with am­bi­tion can ex­pect to go a long way.”

Leapfrog­ging the Past

Phones are so es­sen­tial now that peo­ple skip meals to buy phone credit. I’m no longer sur­prised to pass an Orange “bou­tique”in vil­lages hun­dreds of miles from any­where, or have my in­ter­view with a grand­mother of seven, liv­ing in a mud hut with no run­ning wa­ter in north­ern Sene­gal, in­ter­rupted by a phone call.

In Zim­babwe and Nige­ria, mo­bile ac­counts for more than half of all web traf­fic, at 58.1 per­cent and 57.9 per­cent re­spec­tively, com­pared with a 10 per­cent global av­er­age, ac­cord­ing to the GSMA. Pen­e­tra­tion lev­els for 3G are fore­cast to grow 46 per­cent by 2016, as the use of mo­bile-spe­cific ser­vices de­vel­ops.

Mean­while, Kenya is dubbed the “Sil­i­con Sa­van­nah,” thanks to its tech­savvy young en­trepreneurs hun­gry for new op­por­tu­ni­ties, and the con­struc­tion of a tech­nol­ogy park out­side the cap­i­tal, Nairobi, that the gov­ern­ment hopes will cre­ate more than 20,000 IT jobs by 2015.

In many re­spects, Africa’s dig­i­tal rev­o­lu­tion is tak­ing a dif­fer­ent tra­jec­tory from the West’s, skip­ping the first steps that the de­vel­oped world took through­out the eight­ies and nineties. Most ru­ral Africans’first ac­cess to the in­ter­net is via a mo­bile phone. In cities, stu­dents are boot­ing up lap­tops that they set up in WiFi-con­nected cof­fee bars.And 4G is on its way to Kenya (al­though its roll-out has re­port­edly been de­layed).

Delia Si­eff, head of com­mu­ni­ca­tions for Nokia in south­east Africa, says: “Africa tra­di­tion­ally has a lack of fixed in­fra­struc­ture, which has made pre­vi­ous tech­nolo­gies chal­leng­ing to adopt. How­ever, with mo­bile in­fra­struc­ture, Africa has been able to leapfrog tra­di­tional tech­nolo­gies and bring it into the hands of mil­lions. As mo­bile phones in­crease in func­tion­al­ity, es­pe­cially ac­cess to the in­ter­net, this has spurred an un­prece­dented rev­o­lu­tion in the way peo­ple con­nect.”In Kenya, for ex­am­ple, some 99 per­cent of all in­ter­net con­nec­tiv­ity sub­scrip­tions are mo­bile, ac­cord­ing to the coun­try’s Com­mu­ni­ca­tions Com­mis­sion.

The likes of Google, Mi­crosoft, Nokia and Sam­sung are plung­ing in. As Africans are more likely to be us­ing a mo­bile ser­vice for prac­ti­cal pur­poses – for ex­am­ple, to send money to a ru­ral rel­a­tive, buy goat meat or find out where they can get the best price for their goods – op­er­a­tors

Most tech cor­po­ra­tions have re­al­ized that Africa is the next – pos­si­bly the last – big fron­tier

are de­vel­op­ing ded­i­cated tech­nol­ogy. Mi­crosoft’s new Huawei 4Afrika phone –“made for Africa, by Africans”– was launched in Fe­bru­ary and al­lows users to check prayer times in Egypt and track shares in Nige­ria. Phones are be­ing used to pro­vide fi­nan­cial ser­vices in Kenya (M-Pesa) and agri­cul­tural mar­ket in­for­ma­tion in Ghana (Es­oko), while on Google, users can re­search topics in 31 African lan­guages, in­clud­ing Swahili, Amharic, Ewe and Ga.

M-Pesa (M for mo­bile, pesa for“money” in Swahili), a mo­bile-based money trans­fer ser­vice from Sa­fari­com (Kenya) and Vo­da­com (Tan­za­nia), is one of the most mon­u­men­tal tech­no­log­i­cal de­vel­op­ments any­where in re­cent years. Al­low­ing users to de­posit, with­draw and trans­fer money via text mes­sage, it means you can send money to rel­a­tives and pay for shop­ping, util­ity bills or a taxi ride home, all on your mo­bile de­vice.

That’s as­ton­ish­ing on many lev­els – first, be­cause such trans­ac­tions are largely im­pos­si­ble in the de­vel­oped world (pay­ing a taxi by text is def­i­nitely not the done thing in NewYork), again prov­ing that Africa is leapfrog­ging the steps un­der­gone in the de­vel­oped world. Sec­ond, be­cause fewer than 10 per­cent of Africans have a bank ac­count, many will go straight to hav­ing an elec­tronic wal­let. Third, be­cause bank­ing via text is of huge sig­nif­i­cance in a re­gion where trans­port in­fra­struc­ture is so poor – the man whose Peu­geot has bro­ken down no longer needs to travel miles to the bank to get money to pay the me­chanic; he can trans­fer it by text in­stead. And, fourth, be­cause the ser­vice reached 17 mil­lion users last year, with 50 per­cent of Kenya’s pop­u­la­tion cur­rently us­ing it.

“It has com­pletely rev­o­lu­tion­ized bank­ing and pay­ment ser­vices by pro­vid­ing res­i­dents of ru­ral ar­eas with ac­cess to con­ve­nient and af­ford­able fi­nan­cial

ser­vices,” ac­cord­ing to Vera Rosauer, Africa ex­ter­nal re­la­tions leader for IBM.

‘The Moon’s the Limit’

Mean­while, on the fourth floor of a mod­ern of­fice build­ing in Nairobi is iHub, a space for young Kenyan en­trepreneurs to net­work, join fo­cus group dis­cus­sions and chat to in­vestors. Equipped with a fast broad­band con­nec­tion, it’s an ob­vi­ous place for the na­tion’s di­gerati to gather.

Start-up in­cu­ba­tors like this, known as M-Labs, are spring­ing up across Africa. Nokia works with sev­eral part­ners to fund M-Labs across the con­ti­nent in South Africa, Nige­ria, Kenya and Egypt. Meah­while, Mi­crosoft is work­ing with the iHub and M-Lab net­work to en­able start-ups, in­no­va­tors and the de­vel­oper com­mu­nity of East Africa to grow skills and build busi­nesses.

“Con­sid­er­ing the ta­lented young pop­u­la­tion, in­cu­ba­tion labs are a great idea as they pro­vide an av­enue for like­minded skilled tech­ni­cians and stu­dents to col­lab­o­rate and de­velop new tech­nol­ogy that will solve do­mes­tic prob­lems,” Rosauer says.“The labs pro­vide fa­cil­i­ties that most would oth­er­wise have no ac­cess to, piquing in­ter­est in tech­no­log­i­cal in­ven­tions. Th­ese labs rep­re­sent a mile­stone for Africa as the con­ti­nent’s mind­set to­wards in­no­va­tion has shifted from tak­ing the back seat to driv­ing change.”

Most tech cor­po­ra­tions have re­al­ized that Africa is the next – pos­si­bly the last – big fron­tier. Mi­crosoft now has of­fices in 14 African coun­tries and 10,000 part­ners. IBM has of­fices in 20 African coun­tries and has built a re­search lab in Nairobi and a new HQ in Dakar; it is work­ing with Sene­gal’s Min­istry of Fi­nance to au­to­mate cus­toms clear­ance and has part­nered with uni­ver­si­ties to cul­ti­vate tech­nol­ogy skills. Rosauer says it re­flects grow­ing op­ti­mism re­gard­ing progress in Africa.

“As de­vel­oped economies strug­gle with stag­nant economies, African economies are grow­ing sig­nif­i­cantly,” she says.“The young African pop­u­la­tion is also a fac­tor as it sig­ni­fies a work­force for com­pa­nies in­vest­ing and ex­pand­ing to Africa. It is a great ad­van­tage that gov­ern­ments are im­ple­ment­ing co­her­ent ed­u­ca­tion sys­tems tar­geted at im­prov­ing hu­man re­source ca­pac­ity. Com­pa­nies are also in­vest­ing in their em­ploy­ees by of­fer­ing train­ing pro­grams.”

The next step will be uni­ver­sal ac­cess to smart­phones, says De Sousa of Mi­crosoft’s Africa Ini­tia­tives. “Smart­phone pen­e­tra­tion is still quite low in Africa, at 10-15 per­cent, and it’s ac­cess to those that will have an even greater im­pact on the so­cial land­scape – we see even greater po­ten­tial for trans­parency, pro­duc­tiv­ity and in­no­va­tion.

‘Smart­phone pen­e­tra­tion is still quite low, and it’s ac­cess to those that will have an even greater im­pact on the so­cial land­scape’

This is why we’re work­ing with Huawei and our other part­ners such as Nokia, HTC and Sam­sung to en­sure that af­ford­able, qual­ity smart­phones are get­ting into the hands of Africans as quickly as pos­si­ble.”

No one’s pre­tend­ing that Africa is the per­fect con­ti­nent for busi­ness. Its swift tech­no­log­i­cal trans­for­ma­tion means there are chal­lenges, Rosauer ad­mits. “Lack of in­fra­struc­ture such as com­put­ers, roads and elec­tric­ity is a hin­drance to ac­cess, in­te­gra­tion and in­no­va­tion in many parts ,” she says.“There’s also a se­vere short­age of tech­ni­cal skills as com­pa­nies con­tin­u­ously adapt tech­nol­ogy and re­quire more skilled tech­ni­cians.”

Google’s Eric Sch­midt wrote about the func­tional prob­lems of con­nec­tiv­ity in Africa, in­clud­ing a lack of elec­tric power, the gen­eral trend of ru­ral to ur­ban mi­gra­tion, and per­va­sive cor­rup­tion. Still, he re­mained pos­i­tive. “In­for­ma­tion is power, and more in­for­ma­tion means more choices,” he said. “Doc­u­ment­ing abuses, get­ting pres­sure from out­side to fix real prob­lems, and solv­ing il­lit­er­acy are just a few func­tions of even the most lim­ited of fea­ture phones.”

While Africa may have its daunt­ing prob­lems, he seems to say, tech­nol­ogy may be the key that can help solve them. Or, as Karim Ndi­aye puts it: “Con­nected is cool. If us Africans have tech­nol­ogy, the moon’s the limit for us.” BT

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