Advent of MVNO

During my short stay in Germany in 2006, I used a mobile service provider that did not own any infrastructure. By then, I only understood the company as a reseller of O2, later I came to understand that it was a mobile virtual network operator (MVNO). The first MVNO was created by Tele2 in Denmark, and subsequently rolled out in several European markets. This model formed the basis between the cooperation between Tele2 and Telia in Sweden. However, the first commercially successful MVNO was Virgin Mobile UK, which was launched in 1999. The success of Virgin Mobile UK was replicated by the United States licensee of the Virgin Mobile brand. Initially an independent company, Virgin Mobile USA was eventually acquired by its host mobile network operator, Sprint Nextel.

As of October 2012 there were 634 active MVNO operations worldwide, which in turn are operated by 503 companies. In April this year, the Communications Authority of Kenya (CAK) recently issued MVNO licenses to Finserve Africa Limited, a subsidiary of Equity Bank, Zioncell Kenya Limited and Tangaza’s Mobile Pay Limited, with the three companies entering into an agreement to use Airtel’s infrastructure. In hot pursuit of the same is Kenya Airways, having signed a Memorandum of Understanding (MoU) with Airtel to deliver an MVNO service for the airline, subject to regulatory approvals.

An MVNO is a cell phone carrier that typically does not have its own network infrastructure and licensed radio spectrum. An MVNO pays wholesale fees for minutes and SMSs and then sells them at retail prices under its own brand. The advent of MVNO in most countries is as a result of the regulation authority’s intent to compel mobile service providers to offer wholesale access to their network to encourage competition whose aim is to benefit the consumers. As the number of MVNOs increase, the consumer will have a variety of pricing models and value propositions to choose from. The main advantage of MVNOs is that they do not incur capital expenditure on spectrum and infrastructure and does not have the time-consuming task of building out extensive radio infrastructure. These factors make them fiercely competitive and innovative leading to new products and services in the market.

There are some disadvantages to MVNOs. Since they do not control the network infrastructure, the response time to technical challenges is hampered and may lead to instances of customer dissatisfaction. Some MVNOs do not allow roaming, due to lack of commercial agreements with providers in other countries. From the perspective of the mobile network operators, MVNOs cause a cannibalizing effect by targeting the same retail market as them. In some cases, it may lead to a shift of same consumers from the mobile network operator to the MVNO considering it’s essentially the same service rendered.  It is essential for the regulatory authority to consider the merits and demerits of MVNOs as the authority issues licenses. In developed markets MVNOs can avoid cannibalizing a host operator’s subscriber base by targeting low-end segments the MNO might find too costly to tap.

MVNO market in Africa is in its infancy with only a few countries having taken up the concept. South Africa is the leading with several operating and upcoming MVNOs; Virgin Mobile, Redbull Mobile, Econet, Hello Mobile, 8.da and Appchat. In Cameroon there is SET Mobile and SMS Mobility, in Senegal there is Sonatel and Toubatel, Morocco has Poste Maroc, Madagascar has Blueline and Tanzania has Zantel. Virgin’s subscription numbers are closing in on half a million, which probably makes it the biggest MVNO on the continent, although such figures only put it fifth in South Africa and barely noticeable behind the 60 million total of the big three. One of the biggest challenges is how to position an MVNO in a low-income market. Stability of retail pricing will be a key driver as to whether MVNOs can be sustainable in low ARPU markets.

MVNOs have to be innovative. Working with one host network operator across multiple countries sounds ideal; it could mean the same technology platform, contractual agreements and volume discounts on wholesale rates. This is the model Kenya Airways has adopted with Airtel leveraging on the provider Pan African coverage in 17 African countries. In some countries, MVNOs use a mobile virtual network aggregator (MVNA). MVNAs would normally establish scale of their own by working with a number of MVNOs. So far there hasn’t been sufficient activity in Africa to attract aggregators–MVNAs–which enable MVNOs to launch at a lower cost of entry and often greatly facilitate the set-up process. The single enabler–MVNE–model through which operators can cost-effectively host specific strategic MVNOs is more likely in the near term. Some MVNOs have taken advantage of popular established brands during market entry; Cell C’s sub-brand Red Bull has the obvious youth appeal of a ‘cool’ drinks brand. Set’Mobile, on the other hand, which came to market in Cameroon, borrowed the name of the country’s world-famous footballer Samuel Eto’o.

The Most Technologically Advanced World Cup

The 2014 World Cup in Brazil made headlines all over world. The most popular, of course, was the embarrassment of the ‘Samba Boys’ at home in the hands of an efficient German ‘machine’. We need not over emphasize this point. Other headlines included various demonstrations by Brazilians against the development of extensive infrastructure for the tournament at the expense of other programs, the rumours of Jennifer Lopez not performing at the opening ceremony, collapse of a bridge in Belo Horizonte, and so on. Among the headlines was the fact that the 2014 World Cup in Brazil was definitely the most technologically advanced football tournament we have ever seen. Everywhere you looked, there was technological amazement. If we start with basics, the soccer ball, Brazuca. The ball was made up of six propeller-shaped polyurethane panels being thermally bonded together to ensure smooth gliding in the air. The purpose of the design was to overcome the challenges of the Jabulani, the ball used at the 2010 World Cup tournament in South Africa. 

With most of the cities at the coast line of Brazil, the weather during the tournament was bound to be warm and humid. The clothing vendors went all out to provide players with kits that had a cooling mechanism. For the home team Brazil, Nike combined technical fabrication with thermo-regulation. The team’s jersey had 56 per cent more airflow than previous versions. It was composed of 94 per cent polyester and just 6 per cent cotton thus giving the players a comfortable feel of cotton, but the heat regulation properties of polyester. Adidas on the other hand, had designed a series of pre-cooling sleeves and vests that can be worn by players before and after matches, or during training. The garments were cooled in a freezer before being worn by a player, bringing their temperature down over 15 to 20 minutes. In some matches, the weather was so harsh that there were water break. Technology can only go so far, right?

Apart from the players, the referees were technologically advanced. The World Cup referees had access to foam, water-based, vanishing spray that will be carried in special belts. This particular brand new feature of the World Cup impressed most the football fans. This was the first time it was used in the tournament, having been used prior at the under-20 World Cup. Every time there was a foul, the referee would first circle the ball using the spray, walk nine meters and spray a straight line where the ‘wall’ of players would be. In this World Cup, the referees did not have to guess if there was a goal or not. In fact, the word "GOAL" would appear on the screen of their watches courtesy of goal line technology. A German company, GoalControl, had fitted 14 high-speed cameras - seven per goalmouth - to the roof of each of the 12 stadiums. The cameras were connected to an image-processing computer that filtered out non-ball-shaped objects and tracked the ball's position to within a few millimeters. Some experts predict that goal line technology will soon be used to detect offside, most offside called by the referee are always controversial and the technology would ensure precision.

This World Cup has also seen an abundance of apps make their way to various devices in order to keep fans better connected than ever before. Fans would keep up-to-date with the latest scores and fixtures on their mobile devices. There were a myriad of applications to choose from. With the Official FIFA World Cup app the fans did not miss any news, standings, or team schedules throughout the tournament. The ‘Onefootball Brasil – World Cup’ app kept the fans updated and informed, the app features all the latest team news, match schedules, results and statistics. With this app, you could choose your favourite team and keep track of their performance throughout the tournament. The ‘World Cup Brazil 2014’ was packed full of features including a countdown timer for the next games which can be displayed on your device’s home screen, fixtures, videos, news, data match updates in real time, notifications and more. The ‘FotMob’ allowed fans to access lives scores, match stats, lineups, goals, assists, cards, penalties, substitutions, tables and more. In addition to this, the fan would also be able to access news from the World Cup as well as various football leagues.

Using Technology for Health in Africa

Hitherto, Africa has been plagued with the threat of disease and other health related issues amongst its population.  There rarely has been real-time disease surveillance and monitoring of data on Africa, and as such have had to rely upon a few sentinel sites and modeling estimates to track the spread and prevalence of disease. Use mobile telephony technology has drastically changed this. A recent TA Telecom report on the African telecommunications market indicates that mobile penetration in Africa hit 80 percent in the first quarter of this year and is still growing at 4.2 percent annually. That’s faster than anywhere else in the world, the report says, and Africa is, after Asia, the world’s second-largest market. Which means that today, more than eight in 10 Africans have a mobile phone.

Using systems integrated to mobile telephony, quality data has been gathered such that one can tell who is dying and from what, who is sick, and where clusters of disease are occurring. Mobile phones are also helping by improving vaccine supply chains. By allowing real-time data of stock levels in remote facilities to filter back up the chain, it is possible to prevent unnecessary stock-outs and ensure that vaccines are available when infants and children are brought in to be immunized. Meanwhile, health-care workers in the field are now able to access health records and can schedule appointments using their phones. They can even issue automated text reminders to parents about when vaccine clinics are being held. These are simple measures, yet highly effective.

Things have also improved for pregnant women by use of technology. KimMNCHip, a national-scale mHealth initiative to offer pregnant women in Kenya more choice, control and care during their pregnancy, and improved medical care for them and their babies during and after delivery. Once pregnant women register with their due dates, information via a Maternal, Newborn, and Child (MNC) mHealth advisory service is shared. The women receive a mix of “push” SMS and voice messages, and access to call-in advisory hotlines and information databases for Maternal Newborn and Child Health issues. This information is disseminated at no cost to the women since SMS/voice charges to be covered by donors. In additional to the information dissemination, the women also get mFinancial services. They are provided with electronic vouchers to redeem in a collaborating clinic of their choice. The vouchers act as an incentive for clinics to enhance the quality of their services and attract more pregnant women, through a results-based payment system.

Further afield, a team of ophthalmologists comprising of Dr Andrew Bastawrous and Stewart Jordan at the London School of Hygiene & Tropical Medicine, Dr Mario Giardini at the University of Strathclyde, and Dr Iain Livingstone, at the Glasgow Centre for Ophthalmic Research had a vision to extend eye care in Africa. Working with developers, they created an Android application, known as Peek, which is integrated to a clip on to run a range of tests, including visualization of the back of the eye. Peek, portable eye examination kit, is currently under testing with approximately 5,000 patients in Kenya. It can diagnose blindness, visual impairment, cataracts, glaucoma, macular degeneration, diabetic retinopathy and other retinal and optic nerve diseases and crucial indicators of brain tumour and haemorrhage. The application is expected the help health workers in the remote areas without skills in eye care to share images of the patients’ eye with their skilled counterparts.

Smart tablets are also playing and important role in improving health. In Cameroon, a 26 year old engineer developed a touch screen tablet that would be used to examine a patient’s heart. Named a Cardiopad, the device is integrated to sensors and is capable of carrying out an electrocardiogram. Mr. Arthur Zang is currently working on a model that can run on solar power to cater areas without access to electricity. The great invention will help patients with cardiovascular health problems to access medical treatment faster and cheaper thorough their local clinics and dispensaries. It wasn’t possible to send or save the results electronically. With the Cardiopad, the results are digitalized and transmitted. There is no need to print them; the heart surgeon can interpret them, even remotely.

Wearable Techs, The New In Thing

In February 2014, Samsung launched the Galaxy S5, plus three new wearable techs – the Gear 2, Gear 2 Neo and Gear Fit. In fact, Samsung's not the only one. The Razer Nabu, the LG Lifeband Touch, Sony, and the Huawei Talk Band are all entering similar smarter-band territory. The Apple's mythical iWatch could have some of these elements in common, too. Wearable techs are changing the way we live our daily lives. With the wearable gears from different vendors, we receive notifications, track your heart rate, control music, use a camera, speak on the microphone, share music, make calls, receive calls, and other fancy things using a myriad of apps. Both, Bluetooth Smart as well as optical sensors are state of the art for most of these bands. From mood-monitoring smartphone bracelets to temperature-adjusting wristbands, these high-tech accessory pieces are turning these otherwise ordinary bracelets into fascinatingly futuristic designs.

Wearable techs date back to the 1960s and 1970s; wearable computing devices found much of its history in attempting to cheat casinos. Inventors built some of the first wearable in the 1960s to count cards and improve a gambler's odds at the roulette table. A mathematics professor at Massachusetts Institute of Technology, Edward Thorp, indicated that he had created the first wearable computer to cheat at roulette and it allowed the player a 44 per cent improved chance to win. In the 1970’s, the calculator wristwatches came to being but without much impact in the market. The devices got more sophisticated and in the late 1980’s, the first hearing aids were developed but had power challenges due to short battery lives. Leading to the year 2000, the wearable techs gained commercial relevance and more companies invested into the research and development of this new trend. This lead to the invention of wearable webcams, pacemakers and Bluetooth headsets.

Modern wearable techs include glasses, smart watches, gears, hands free, fitness trackers, and so on. Wearable techs are mostly used in an informal set up or for personal pleasure but cooperates can also leverage from the benefits of these technologies as well. By using current technological trends, companies can use wearable technology to improve business processes, resulting in more satisfied customers and happier employees. When faced with challenging tasks in the field, it’s tough for technicians to solve complex problems with the use of real-time video with an expert or 3D video tutorials illustrating how to troubleshoot a problem. Well, with the tools in his or her hands, the only way for a technician to access this information is via wearable technologies. Safety can also be improved via this technology, monitoring of workers activity and issuing alerts or warning if need be. By informing workers when a mistake is about to be made before it is made, companies can increase inventory accuracy, making techs more productive and customers happier.

The future of wearable techs is bright and is beyond most of our imagination. It may seem laughable to suggest that people will soon neglect their smart phones in favour of amped-up watches, eyeglasses, rings, and bracelets. But then again, 10 years ago it seemed laughable to think that people would use their smartphones to email, surf the web, play games, watch videos, keep calendars, and take notes—all once core tasks of desktop PCs. We can already see how wearable devices might peel off some of the phone’s key functions: One study of smartphone users indicates that on average we unlock our gadgets more than 150 times a day, with some of us pawing at screens far more often than that.

Unfortunately, each of these benefits can also be a drawback. With wearable computers, that frequency is likely to increase—making corporate security even more complex and confusing than ever. Wearable computers’ ever-presence and connectedness is at the heart of security vulnerabilities that such devices have the potential to introduce at companies large and small. Additionally, many of these devices feature GPS for maps and user applications, which, if used maliciously, could allow an attacker to track your physical position anywhere on earth.

Celebrating Mobile Money

On March 6, 2014, Safaricom celebrated the 7^th Anniversary of MPESA since it was launched by former Safaricom Chief Executive Michael Joseph on March 6, 2007. The mobile money transfer service is one of the biggest success stories in the history of serving more than two thrids of the Kenyan population and flowing approximately 43 percent of the country’s Gross Domestic Product (GDP).  Most of the unbanked in Kenya benefited from the service as a channel of conducting business without incurring the hefty bank transaction charges and enjoying convenience of doing commerce anytime anywhere. Soon the other service providers followed suite with Airtel Money, Orange Money and Yu Cash. The initial concept of M-Pesa was to create a service which allowed microfinance borrowers to conveniently receive and repay loans using the network of Safaricom airtime resellers. At the moment, MPESA has over 17 million users, over 65,547 agent outlets, 1,482 paybill partners and 541 bulk payment partners. Three factors are attributed to the great success of mobile money in Kenya namely; the high mobile telephony penetration rate, simplicity of the SIM based application and lack of extensive banking services in the rural areas.

Kenya stands out as unique with the thriving mobile money transfer market. The same service has elicited different consumer reactions in other parts of East Africa. M-Pesa was launched in Tanzania by Vodacom in 2008 but its initial ability to attract customers fell short of expectations. Vodacom M-Pesa offers mobile money services at around 53 percent of the Tanzania’s mobile money market while Tigo Pesa is at approximately 18 percent and Airtel Money at approximately 13 percent. In June 2009, 14 months after the launch of M-PESA in Tanzania, Vodacom announced that registrations had reached 280,000 users who were transferring USD 5.5 million per month at about 930 agent locations. When this is compared to the 2.7 million users and 3,000 agents that had been registered in Kenya 14 months after the local launch of M-PESA, it is clear that some key differences exist between the two implementations. However, there has been a change of trend with the future looking more optimistic. Last year, Vodacom Tanzania reported that M-Pesa revenue from its Tanzanian operations shot up by 125 per cent during its financial year ended 31 March 2013. This shows a good trend of the Tanzania market in adopting mobile money service and possibly follows the Kenyan example.  

In Uganda, consumer can chose from Airtel Mobile Money, Warid Pesa , Orange Money, MTN Mobile Money and UTL M-Sente. Since its introduction to Uganda in 2008, mobile money solutions have had a profound effect – today some 9 million Ugandans use the service to exchange, save and spend money. The Bank of Uganda (BOU) has showed in its financial report for January to November 2013 shows mobile money transfers in the country reached US$640 million. Small businesses can now bank their money every day instead of handling large amount of physical cash, and people are able to deposit money immediately without the risk of theft or needing to travel to a bank. Some 80 percent of Ugandans are farmers, but with mobile money, distance from traditional banking facilities is now no longer a barrier to taking control of your finances. Since the introduction of mobile money in Uganda, there are more mobile money users compared to bank account holders.

In Rwanda, citizens are finding it easier to transact business through the mobile money platform provided for by telecom operators MTN and Tigo than using the bank. Approximately about 45 per cent of the households have access to mobile phone in Rwanda. As of 2012, according to Rwanda Utilities Regulatory Authority (RURA), there were over five million subscribers in Rwanda. MTN Rwanda, the country’s largest telecom operator by market share, has handled transactions worth Rwf65 billion through its mobile money service since 2010. It has 470,000 subscribers registered on the MTN Mobile money service. TIGO, the second largest operator has 9127 subscribers on its TIGO Cash with 1,917 transactions daily. Judging by this trend, East Africa will become an economic powerhouse facilitated by mobile money services.

Sources

The Financial Inclusion Tracker Surveys Project

www.cnbcafrica.com

www.newtimes.rw