The speed and scale of technological change is undeniable, but what happens when you combine it with the dynamism and unpredictability of a continent experiencing unprecedented social and economic change? Marrying the themes of innovation and Africa-rising is a daunting task, yet it is important to consider whether emerging technologies such as wearable electronics, artificial intelligence and drones will drive business transformation on the continent in the same way that it has occurred elsewhere in the world.
Acknowledging the fact that significant changes are occurring is one thing, but the key factor that will guarantee sustainable change is the ability to resolve the myriad of challenges currently confronting Africa.
A helpful starting point will be recognising those issues that continue to plague the continent, ranging from challenging geography to unpredictable governance, extreme climates to a lack of financial capital, and from limited infrastructure to language barriers. Each of these issues could be tackled through the effective application of information and communication technologies (ICT).
Given the explosive growth of telecommunications over the past decade, it is not surprising that connectivity is often assumed to be ubiquitous; however, much investment is still required across Africa – both with regards to broadening coverage and improving the quality of broadband. Indeed, as services have evolved from 2G to 3G to 4G – and, soon, 5G – additional investment in infrastructure will be required to keep pace with accelerating demand. Increased involvement by governments in the sector as they seek to provide universal access makes investing that much more complex, but promising opportunities in infrastructure projects remain.
Beyond the passive infrastructure layer, two other key areas of opportunity can be identified. Firstly, there is the range of alternative connectivity mechanisms, whether satellite, wireless (such as Wi-Fi) or fixed line (fibre-to-the-premises), or other access technologies that are potentially more appropriate for wide-scale or event-based distribution (e.g. Wi-Fi balloons) or the emerging Internet of Things (e.g. LORA).
Secondly, there are technologies that improve the efficacy of existing networks, whether at a hardware or software level. Software defined networking (SDN) and network function virtualisation (NFV) are already recognised as key solutions at this level, promising major gains in connectivity speed and capacity as they are implemented. Given the growth of such applications, there is even a question as to whether platforms will emerge that separate the ownership of network infrastructure from the provision of connectivity – and Africa provides fertile ground for such endeavours.
With this rise in connectivity, so too will come the proliferation of devices to utilise it both at a consumer and enterprise level. From this, the next key area to consider is that of data analytics and the potential African innovations that will emerge on a continent that has often been challenged by a lack of reliable data. These could occur across the data value chain, ranging from the initial collection of data to the actual application of data-based insights to a business. Sensors, wearables, and mobile devices remain attractive opportunities on the data collection side, but expect more Africa-specific innovation to occur in the areas of data management, processing and analytics where the particular nuances of the local context challenge the effectiveness of solutions developed elsewhere.
The foundation of valuable data throws open the possibility of new business models that threaten to either disrupt, transform or, in the extreme case, completely overhaul existing industries. Already, Africa has been witness to the rise of mobile money, which has undermined the retail banking sector in a number of countries and will soon threaten adjacent services, amongst them cross-border transactions, insurance and retail. In addition, there is great potential for a blockchain-based solution to transform public finances, providing a secure, distributed mechanism to monitor such allocations.
The growth of social media, which facilitates the creation of peer-to-peer and sharing models, is another example of business model disruption. In the African context, these approaches could lead to new ways of financing assets, particularly for consumers. Hand in hand with this, consumer recognition that one’s information is of value to companies – even sought after – suggests new ways of interacting with Internet platforms, users of location-based services and other data gathering providers. Already we are seeing the application of gamification and other incentivisation schemes to compensate consumers in some manner.
Behind all of this will be the content that customers seek access to, whether it is media-driven or, as is increasingly the case, user-generated. Video is already recognised as the key medium of data growth and the demand for locally-relevant material will remain paramount – one need look no further than Nigeria’s thriving ‘Nollywood’. Ultimately, the consumption of video, incorporating the full line of activities from production to payment, will experience the disruption brought by such services as pay-on-demand, virtual reality and predictive analytics, leading to the emergence of a new media ecosystem.
It is also worth considering the impact that technology will have on other industries as they each follow their own paths to digitisation and, in time, digitalisation. The term ‘digital transformation’ encapsulates this usage of ICT within companies and, currently in Africa, the most prominent example is arguably the banking environment. However, as services become ever more reliant on connectivity, one can expect innovative responses to some of the continent’s most pressing concerns in areas such as transportation and logistics (where drones are already creating an alternative ecosystem), energy (smart grids and distributed power generation), and healthcare (remote monitoring and telemedicine).
Finally, given Africa’s track record of leapfrogging certain technologies, whether land-line phones or desktop computers, it is worth speculating as to some of the areas where such ‘jumps’ may again occur. One such example concerns the dearth of formal retail infrastructure across many areas of the continent, leading to the possibility that typical shopping mall establishments may be bypassed by a leap to virtual stores backed by sophisticated logistics systems. Similarly, with the rise of ride-sharing and new mobility platforms, will vehicle ownership still be an aspirational consideration? Or, with the rise of cloud-based services, perhaps we will see a complete lack of IT infrastructure in certain locations, substituted by a distributed architecture and reliable connectivity that ensures its use? Perhaps there will even be individuals whose devices don’t – and have never – resembled phones, replaced by chips that provide access to the Internet and, from that, any other service that might be required? As is often the case, the lack of existing and entrenched services in Africa provides both challenges and opportunities. And, while it is difficult to predict future technological development, rest assured that the continent will birth unique solutions that could not be imagined outside of its borders.
Media Contact:
Samantha James
Corporate Communications – Africa
P: 27 21 680 3574
F: 27 21 680 3296
E: samantha.james@frost.com
Twitter: @FrostSullivanSA
