Tuesday, 21 November 2017

South Africa: Progress and Problems

South Africa’s mobile networks are all growing their subscriber numbers, with Telkom the latest network to reveal its most recent figures.

Telkom’s interim results for the six months ended 30 September 2017 show it had 4.3 million active mobile subscribers.

This comprises 3 million prepaid and 1.3 million post-paid users.
The table below details the latest available subscriber numbers for South Africa’s mobile networks.

Vodacom40.0 million
MTN30.9 million
Cell C“Over 16 million”
Telkom4.3 million

According to Telkom their operating revenue was down by 0.6% compared to last year, reaching R20.1 billion.

“The first half of the year was characterized by a tough economic environment and increased competition. Even though South Africa exited the technical recession in the second quarter of the year, business confidence remains very low.”

 Despite the tough conditions, Telkom’s mobile division showed strong growth.
“The mobile business growth trajectory continued in the period with strong growth in active customers and stable ARPUs, resulting in an increase of 43.2% in mobile service revenue,” said Telkom.
“The strong mobile growth which boosted the group’s performance was underpinned by an expansion of our network, distribution, and the launch of innovative products which were well received by our customers.”
“We are pleased that our mobile business received the MyBroadband Best Mobile Broadband Provider of the year award, in the best value for money category.”
Source

Market leader Vodacom’s priority must be defending its market share in an increasingly competitive environment. According to Equities analyst Irnest Kaplan  they must offer consumers more value, beyond simply “selling megabytes”. So-called over-the-top players — companies like Facebook and Google — are profiting from the data pipes Vodacom sells; the company needs to develop value-added services of its own, such as quality content, that subscribers are prepared to pay for. Without this, there’s the risk that consumers will simply shop around for the cheapest data rates

He said Vodacom, and the other mobile operators, are in a powerful position in that consumers carry their products in their pocket all day.

 “They should do more to leverage that. It’s hard for them because they are operators and not app developers, but people carry their products all the time, they know where you are all the time — there must be amazing apps they can offer.” Source



Moreoever all the South African operators face issued due to the  impasse over new spectrum allocation. Vodacom may be forced to cut spending in rural areas to densify its network in the more populated urban centres because of this “spectrum crunch”.

This issue needs to be sorted as soon as possible. Technology is the driver of economic growth. Spectrum is vital for the roll-out of new technologies and innovation, which will drive economic growth, create jobs and allow South Africa to take advantage of the Internet of things and the other technologies.


Meanwhile Ericsson and MTN will start a 5G trial in South Africa during the first quarter of 2018.


The companies signed a memorandum of understanding at AfricaCom 2017 to collaborate on the rollout of 5G technologies in South Africa.

MTN will trial a range of 5G use cases and applications as a proof-of-concept for South Africa in its laboratory, which will lead to commercial deployment in the future.
The companies said they will collaborate to identify 5G use cases in industries such as mining, transportation, agriculture, manufacturing, and utilities.


“5G gives us the opportunity to rethink our business and address previously-untapped value chains” 
said Giovanni Chiarelli, CTIO at MTN South Africa.Source

Sunday, 12 November 2017

VEON: Rebrand and Revolutionising?

VEON came into existence early 2017, a rebrand of VimpelCom.
The Amsterdam-based telco was first founded in 1992 as Russian operator PJSC VimpelCom.  It took its current form in 2009 when shareholders Telenor and Alfa agreed to merge their assets in VimpelCom and Ukraine’s Kyivstar to create VimpelCom Ltd. In 2010 VimpelCom acquired Orascom Telecom Holding (operating in Pakistan, Bangladesh, Algeria) and Wind Italy from Egypt’s Naguib Sawiris.
VEON is among the world’s 10 largest communications network operators by subscription, with around 235 million customers in 13 countries.The company is in the process of shifting away from being a data services company, to internet via mobile devices.

VEON’s geographical footprint (September 2017) Source: VEON, STL Partners

It operates under a number of brand names in various countries for example: 
VEON’s largest market is Russia, where it has over 58 million mobile subscribers, making up 24% of its global total. Pakistan and Bangladesh comprise its second largest markets by subscribers, while it has over 30 million customers in Italy under its Wind Tre brand, a joint venture with CK Hutchison.

VEON mobile customers by region, H2 2017 (millions)

In July 2017, VEON announced that it was making progress in its strategy to reinvent itself as an online player by introducing its messaging and mobile services app in four new markets, including its largest in Russia and Pakistan.The messaging app, which is designed to compete with the likes of Facebook Inc’s WhatsApp and Rakuten Inc’s Viber, offers free services to customers via its mobile network without users incurring data charges as other apps do. According to Mark MacGann, VEON’s Group Chief Corporate & Public Affairs Officer : 
"VEON is not just communication application. It is a complete platform. We promise to completely revolutionise the digital landscape of the country and how Pakistanis communicate. We aim to disrupt the market and redefine the personal internet experience by offering diverse services to our subscribers like access to information and services and engage with the world even when they are out of balance. VEON will create its unique position in the market in the months and years to come."

At the end of October 2017 VEON announced that its App had reached 1 million downloads, in Pakistan, in the just the span of 19 days.

Two more markets where VEON will offer the app are Ukraine and Georgia. VEON aims to offer basic communication for free, while taking a cut of proceeds from partnerships with popular internet services it offers through its app, using data insights it can glean as a network operator.Deals are expected to range from streaming music to ride-hailing to retail to financial services offers. Early partners have included music streaming service Deezer and credit card company Mastercard.


It will be fascinating to monitor future developments with this operator and its markets.

Thursday, 2 November 2017

The 4G explosion in China

The popularity of 4G mobile services in China continues to increase and subscriber growth shows no signs of slowing down. In fact China has built the world's largest 4G network within just four years and is aiming to add 2 million 4G base stations, mainly for townships and villages, by 2018. China began a campaign aimed at faster and more affordable Internet connection in 2015 resulting in a total of 950 million 4G network users as of the end of September 2017, according to figures from the Ministry of Industry and Information Technology (MIIT).


Served principally by three mobile network operators, China’s mobile sectors are largely divided along technological lines. China Mobile - currently the largest operator by subscribers focuses on the locally-developed TD-LTE 4G standard.  While rivals China Unicom and China Telecom have gone for a mix of TD-LTE and frequency division duplex LTE (FDD-LTE). 

According to Shang Bing, chairman of China Mobile the operator has pursued a strategy of 'Big Connectivity' and invested about CNY450 billion ($66 billion) over the last three years to build  the world’s largest 4G network. Its 4G user base reached 583 million in May 2017, with 4G penetration at 67.5 per cent. “One in four 4G users in the world is a China Mobile user.” It has deployed 1.6 million 4G base stations, or about 30 per cent of the global total, Shang said. Its 4G coverage will reach 99 per cent of the population by the end of the year, when its LTE base station count rises to 1.77 million.

China Telecom’s 4G user base doubled last year to 122 million, with LTE subscribers accounting for 57 per cent of its mobile connections and deploying 1.05 million base stations, while China Unicom’s 4G subs rose from 44.1 million at end-2015 to 104.5 million, representing 40 per cent of its customer base, with 770,000 base stations.



How 4G has helped change and improve lives in China

So why is 4G so important? Probably because it is a vital foundation for all that is to come:

"Future technologies, including 5G, the internet of things and AI (artificial intelligence) will drive society into the era of the internet of everything. The development of 4G has brought about the prosperity of mobile internet and changed people's lives," 

says  Li Zhengmao, vice-president of China Mobile. Industry pundits insist that 4G has been the greatest achievement in the national information technology sector during the past five years in rural and urban areas.But then the benefits of 4G are not limited to urban areas. Rural regions in China have also been opened up by the service. In Huanggang, Hubei province, farmers can sell their produce online through e-commerce sites, and buy crucial equipment safer and quicker through the network. China Telecom has spent 200 million yuan ($29.46 million) to roll out 1,300 base stations in Huanggang.

The decision has increased 4G coverage rates from 35 percent to 93 percent. It has also helped local farmers with vital agricultural information, as well as alleviating poverty through online education.

Even after all this progress, VoLTE is still long way away. According to a report in summer, China Mobile targets 17% VoLTE penetration this year. China Mobile group vice-president Mr.Liu Aili had said back in 2015, "VoLTE network deployment is the one of the most difficult project ever, the implementation complexity and workload is unparalleled in history"

Its not unreasonable to think that since China has the world's largest 4G market it is the  country that will lead the world in the development and utilization of 5G. 

Friday, 13 October 2017

The changing and challenging telecom landscape of India

The telecom landscape of India is changing exponentially. Approximately 215 million subscribers may have to change their allegiances due to the lack of financial stability at Reliance Communications, Aircell and Tata Teleservices (which is on the verge of closing down its operations across India).

The beneficiary is Mukesh Ambani. The oil tycoon who ties with Tencent Holdings Ltd.'s Pony Ma as the third-richest person in Asia is winning subscribers at a rate of 5 million a month by offering free voice calls and cheap data through his operator Reliance Jio. 


“…there are more than 50 crore (500 million) feature phone users who have been left out of the digital revolution,” Ambani said at Reliance Industries’ annual general meeting in Mumbai, where he launched the JioPhone. “This digital disempowerment and unfairness must end. Jio is committing to end it today.”
 In effect, apart from giving telecom companies a run for their money, Reliance Jio is also set to disrupt India’s smartphone market. Launched last September, Reliance Jio already offers free voice calling, as well as the world’s cheapest internet data plan, starting at Rs49 ($0.76) per gigabyte (GB). On the JioPhone, voice calling will “always” be free and unlimited data will cost only Rs153 ($2.38) per month.


Its free schemes and recharge options have expanded Jio’s user base rapidly. Some 66% of Reliance Jio customers were using the service as their primary connection by March, up from 50% in December. The company claims that mobile data usage in India fared around 0.2 billion GB per month in the pre-Jio era. After Reliance Jio’s entry, overall data consumption supposedly skyrocketed to 1.2 billion GB per month, of which 1 billion is consumed by Jio subscribers. According to Ambani the service provider now has over 125 million customers. 

However such radical changes are accompanied by various issues for example with only 300 million smartphone users in the country, the growth could soon hit a wall—hence, the development of the JioPhone, a 4G-enabled feature phone with a large screen and access to apps. More on the JioPhone here. Not to be left behind Airtel and Vodafone India are also launching smartphones. 



So Jio are dynamic enough to offer competitive data rates and a 4G phone but  as a result the prices of wireless data have fallen by about 97% in one year after the entry of Reliance Jio, from about Rs 200 per GB a year ago to about Rs 6 per GB in the June quarter.
While operators like Bharti Airtel and Idea Cellular used to offer 1 GB of data for Rs 250, they now offer about 50 GB for the same price. 

Such massive growth creates its own problems for example: Reliance Jio’s network is “overloaded”, with congestion creating a bottleneck that is slowing down connections for its customers, according to new analysis by OpenSignal. According to this report, Reliance Jio lags behind Airtel, Vodafone, and Idea in terms of 4G speeds, but is market leading in terms of 4G coverage. 

Moreoever what about the ARPU downshift? According to analysts due this reorganisation of subscribers and the very reasonable prices they are paying this is will continue. Reliance Jio has irreversibly changed the market from a pricing-focused one to an ARPU-focused one. In the price-focused market, companies like Vodafone and Airtel tried to keep prices high, volumes low and margins fat. In the volume-based game, pricing is dictated by two factors — the ability of the network to support demand, and the need to increase consumption by users. While the second factor — the need to increase data use — puts a downward pressure on prices, the first factor — network stability and quality concerns — puts a bottom on how low they can be kept.

 Another major issue is spectrum India allows relatively little spectrum for mobile communications, and splits that up among a dozen operators. A lot of radio spectrum is blocked for defence use. The 'Spectrum Crunch' is pretty bad, for example Delhi's top operator has roughly the same number of 3G users as its counterparts in Singapore and Shanghai (about 3 million), but it has about a tenth of their spectrum. As user numbers grow - faster than spectrum availability. And more people will use data, especially video, stressing the network further. This is yet another challenge for the operators. Success in this new telecom landscape depends almost entirely on network capacity. The more capacity the network has, the lower your offering can be priced and the higher consumption can be driven.

Tuesday, 15 September 2015

Vodafone and Connected Farming in India



After reading several very tragic reports about large numbers of Indian farmers committing suicide. I was intrigued to come across Vodafone's 'Connected Farming in India' report. This report alleges that the mobile services summarised below could enhance 
earnings by an average of US$128 a year for almost two-thirds of Indian farmers, achieving
a material positive impact in communities where the average farming household lives on 
less than $4 a day and many farmers struggle to feed and educate their families.


I
ndia is one of the world’s largest food producers with more than 200 million people currently estimated to work in agriculture, around 100 million of them farmers and the remainder working as agricultural labourers. In India, around 62% of farmers own less than one hectare of land, significantly increasing their exposure to the effects of crop failure, pests, disease and volatile market pricing.

Vodafone and Accenture Strategy have identified six mobile services with the potential to transform Indian farmers’ lives and livelihoods.

Agricultural information services providing early warning of weather events, information on the best times to harvest and advice on crop techniques to enhance yields. These services could increase an estimated 60 million Indian farmers’ annual incomes by an average of US$89 a year in 2020.

Receipt services to provide greater transparency in daily commodity supply chains, allowing farmers to raise their incomes by improving efficiency and eliminating fraud.

Payments and loans enabling farmers to access simple and secure financial products and services using mobile money payment systems such as Vodafone’s M-Pesa, launched in India in April 2013. Access to highly cost-effective micro-finance and quick and transparent electronic payment systems could provide an annual benefit of US$690 for some farmers in 2020, representing a 39% increase in their average farming income.

Field audit enabling auditors monitoring quality, sustainability and certification requirements to move away from paper records and adopt instead electronic reporting via tablets and mobile data, greatly enhancing efficiency and potentially increasing annual average income by US$612 for some farmers.

Local supply chain enabling small-scale producers to transact with local co-operatives through simple but robust information services and mobile money systems. These could boost some farmers’ annual incomes by US$271 in 2020; a 50% increase on current farming incomes.

Smartphone-enabled services to provide deeper functionality and richer sources of information than is possible using basic SMS and voicemail services. While smartphone penetration is currently low in rural areas in emerging market economies, average device prices continue to fall year-on-year. Advanced and affordable mobile services could lead to an increase in average annual farming incomes of US$675 for more than four million farmers in 2020.

For more information: link to the report. 



Friday, 7 August 2015

Indonesia’s operators and ISP make progress with LTE














As of June 2011, the number of mobile phone subscriptions in Indonesia was recorded to be 220 million which corresponds to a penetration rate of 92% over an estimated population of around 237.6 million.

At the end of 2012, The three main operators owned 221 million of the then 278 million mobile subscribers in Indonesia.
  • Telkomsel is undeniably the largest operator, and its user base of 123 million makes it the 7th largest mobile company in the world. 
  • Indosat with 55 million subscribers 
  • XL Axiata with 42 million subscribers
  • 3 (known as Tri in Indonesia), which has 20 million subscribers.

As of December 2014, all three of the biggest telcos, along with ISP Bolt! launched their 4G LTE networks commercially in the country. In order to be able to use the 4G connections in Indonesia, you must use 4G-ready smartphones. To connect to 4G network from operators, users in Indonesia must first exchange the SIM cards in respective service centers, and then subscribe to specific data plans. For Bolt, you can either connect to its 4G modem via a 4G smartphone, or directly use Bolt SIM cards which are only compatible with Bolt’s own smartphones.






Bolt! at the beginning of 2015 it claimed to be the first operator of 4G LTE  to have more than one million customers in Indonesia .
Based on the presentation (embedded below) they are using two carriers and they move users between the frequencies using inter-frequency handover to which ever one is less congested. This process is done automatically as a part of Mobility Load Balancing (MLB) which is a feature of Self-Optimising Network (SON). 




Thursday, 20 November 2014

Country Overview: Pakistan

This seemingly struggling nation has one of the highest rates of cell phone usage and penetration in South Asia. Close to 140 million people have a cell phone connection in Pakistan, and they enjoy some of the cheapest service rates in the global market.

  • Of Pakistan’s 180 million people, 68 percent are under 30 (compared to 63 percent in India, 40 percent in the US)
  • Pakistan expects to have 110 million 3G or 4G subscribers by 2019
  • Pakistan has the fourth largest middle class population in developing Asia
  • 30 million internet users
  • 6.8 million smartphone users



Mobile Internet is also widely used in Pakistan, which has led to operators introducing 3G and 4G services in the country. One of these operators, China Mobile’s Zong – the world’s largest mobile network operator – invested $516 million in acquiring 3G and 4G licenses and is currently the only operator providing the latter.

Zong is Pakistan’s fourth biggest mobile telco.

In March 2014 Zong surpassed 25 million customers, out of a total of 125 million mobile subscribers in Pakistan. Mobiilink remains number one with over 38 million subscribers, Telenor is second with 33 million, and Ufone is third with 26 million. Warid is down in fifth with 13 million.

Mobile subscribers in Pakistan - to January 2014