A continent connects
BY STEVE HENDERSHOT ILLUSTRATION BY PETER AND MARIA HOEY
A telecommunications tower in Ethiopia
Sub-Saharan Africa is at a communications crossroads. After decades of relative isolation due to poor telecommunications infrastructure, projects building mobile and high-speed Internet networks for the region's more than 900 million people are being completed with astonishing speed. As cellular phone coverage expands, mobile devices are becoming more common: 79 percent of people in sub-Saharan Africa are likely to have mobile phones by 2020, according to Frost & Sullivan, up from 52 percent in 2012. By 2016, mobile broadband connections (such as 4G) are expected to quadruple from their 2012 level to 160 million.
Because weak telecommunications infrastructure has long hampered growth across the region, connectivity projects offer immense promise. For example, the creation of mobile broadband networks could give millions of people access to banking services for the first time. Sub-Saharan Africa currently has the lowest rate of access to financial institutions. Frost & Sullivan predicts the region's mobile payments market could be worth US$1.3 billion by 2019.
“The Internet is having a transformative effect” in both cultural and economic terms, says Tim Kelly, PhD, lead information and communications technology (ICT) specialist, World Bank, Washington D.C., USA, who has worked on major ICT projects in Africa.
“The Internet is having a transformative effect.”
—Tim Kelly, PhD, World Bank, Washington D.C., USA
While it's difficult to quantify the sector's precise stimulative impact, its rapid growth is certainly contributing to the region's current economic boom. Sub-Saharan Africa's combined GDP will grow by 4.5 percent this year, according to the International Monetary Fund, making it the world's fastest growing region after Asia.
As countries see their technological infrastructure move closer to the cutting-edge, their economies stand to benefit from what has been called the “leapfrog effect.” Rather than investing in—and then upgrading—older fixed-line technologies such as phone lines, countries can realize cost efficiencies by jumping straight into mobile broadband. This could enable the region to develop more quickly than industrialized countries have in the past.
For the “leapfrog” benefit to be realized, however, multinational organizations executing ICT infrastructure projects—often in partnership with local governments and companies—must learn to navigate one of the world's most ethnically and linguistically diverse regions. Whether their initiatives are large (building a broadband network) or small (building a cell tower), executed in one country or many, practitioners must identify unique project challenges. All 49 governments operate differently—and each country's transportation and energy infrastructure make their own demands on ICT projects. To assume that a strategy that proved effective in Ghana will also work in Rwanda is foolhardy, says Mark Walker, associate vice president for sub-Saharan Africa at market research firm IDC, Johannesburg, South Africa.
“It's interesting to see Western and Chinese telecommunications companies coming into Africa and making the same mistakes: underestimating Africa's size and complexity, and trying to use one go-to-market plan,” he says.
“It's interesting to see Western and Chinese telecommunications companies coming into Africa and making the same mistakes: underestimating Africa's size and complexity, and trying to use one go-to-market plan.”
—Mark Walker, IDC, Johannesburg, South Africa
Sub-Saharan Africa's largest economy, Nigeria, underscores this learning curve. To properly plan an ICT project, organizations have to be on the ground to understand how factors such as the country's underpowered electrical grid and snarling traffic affect day-to-day business, says Mr. Walker.
“You can't manage Nigeria by remote control,” he says.
The region's broadband revolution began underwater, with submarine fiber-optic cables bringing high-speed Internet to the continent. (Although consumers use them wirelessly, mobile broadband networks connect to the Internet through international cables, rather than satellites.) But the task of running those cables was not only daunting from a project management perspective, it was also capital intensive. More than US$3 billion has been invested in projects to connect cables to sub-Saharan Africa. Given their immense price tags, public-private partnerships—in which private and state-owned companies co-invest in projects, sometimes alongside not-for-profits such as the World Bank—have been vital to the success of many such projects.
For example, the Africa Coast to Europe (ACE) project will lay 17,000 kilometers (10,563 miles) of fiber-optic cable along the continent's west coast from South Africa north to France. The project, the first phase of which was completed in 2012, will cost US$700 million and involves a consortium of more than 12 stakeholders, including the Republic of Gabon and the French telecommunications giant Orange. The US$160 million South Atlantic Cable System (SACS) project, which will deliver the first high-speed connection between Africa and South America, is being led by Angola Cables. Launched in December 2014, it is scheduled to be complete late next year.
With submarine cables now connecting directly to each coastal sub-Saharan country, the big task facing practitioners is extending high-speed broadband connections to inland consumers, says Bridge-water, New Jersey, USA-based Eric Handa, CEO of APTelecom, a U.S. company that is part of the SACS project consortium.
The challenges facing inland projects vary from country to country. Obstacles can include slow-moving government regulators and a lack of local operators to collaborate with. The logistical issues alone make threading a cable from continent to continent look easy.
That is particularly true in less-developed African nations, such as South Sudan. The World Bank is working with China EXIM bank on a US$1.3 billion program to bring fiber-optic connectivity to the country and make other infrastructure improvements. After the initiative launched in 2012, a civil war began in late 2013, throwing the country into violent instability and halting project planning for five months when the World Bank evacuated its office in the country.
Even after the fiber-optic project was approved in 2014, sponsors hit a major obstacle related to the project's financial returns. The South Sudanese government announced that it planned to charge network operators US$500 million for a 15-year license to do business in the country. South Sudan's economy is largely based on oil exports, and as prices have fallen, it has put financial pressure on the government. Dr. Kelly—and telecommunications operators—are trying to persuade the government not to squeeze the companies too hard for revenue.
“Having good connectivity is a good way of encouraging growth,” Dr. Kelly says.
If South Sudan sits at one end of the sub-Saharan ICT infrastructure continuum, South Africa's mature market is at the other end. In between are countries such as Kenya, Ghana, Ethiopia and Nigeria, which seem capable of making an economic leap forward once infrastructure upgrade projects are completed.
It's in these developing countries where skilled project managers can make the greatest impact. If they can push projects to the finish line during a period of development marked by inefficiency and corruption—as well as progress and potential— then new African digital economies seem poised to emerge.
In “high-growth countries, building infrastructure is still the name of game,” Mr. Walker says. “But once you look beyond that, you see a banking sector that's very sophisticated, and the same with government, healthcare and education. They're on the cusp of a whole new way of doing things.” PM
“Having good connectivity is a good way of encouraging growth.”
—Tim Kelly, PhD
Konza Techno City, Kenya
Beyond the Basics
Three tech projects made possible by sub-Saharan Africa's ICT boom
Sub-Saharan Africa's improving ICT infrastructure translates to an increasingly connected populace. That, in turn, means big project opportunities for technology businesses. Here are three examples of sub-Saharan African tech projects building on the region's developing technology base.
RWANDA‘S SMART COLLABORATION. Like other countries in the region, Rwanda is keen to capitalize on what Jean Philbert Nsengimana, PMP, minister of youth and ICT, government of Rwanda, Kigali, Rwanda, has called “the transformative power of technology for development.” As part of the Smart Rwanda program to help the country become an ICT hub, Mr. Nsengimana in March signed a memorandum of understanding with Swedish electronics company Ericsson to collaborate on projects delivering online government, healthcare and education services. Ericsson also will provide network security for government systems as part of the deal.
GHANA‘S DIGITAL CAMPUS. When he noticed the vast majority of Ghanian college students are now using smartphones, David Mumuni saw an opportunity. Mr. Mumuni, 26, is CEO of Flippy Campus, an Accra, Ghana-based mobile-app development company whose signature product facilitates electronic communication between colleges and students, extending the reach of physical campus announcement boards. “Right now you have people who are tech-savvy enough to use a mobile app or a web application,” Mr. Mumuni says. “Seven years ago that wasn't the case.”
Yet Flippy Campus’ app rollout project last year hit a few snags. At Knutsford University College in Accra, where Flippy Campus first promoted the app, wireless Internet access was too inconsistent to facilitate its use. Mr. Mumuni turned his focus to the nearby University of Ghana, where wireless Internet service was better—but still not stellar. The organization's 3.5-megabyte app takes students more than 10 minutes to download and register.
Despite the infrastructural limitations, Flippy Campus’ app is a success: More than 1,000 students downloaded the app within a week of its release, and Mr. Mumuni will pitch for US$50,000 of seed capital from the Meltwater Entrepreneurial School of Technology, a tech-business incubator in Accra, in June.
KENYA‘S TECHNO CITY. Kenyan officials are executing a technology hub megaproject to bypass the piecemeal, gradual upgrades that are the hallmark of ICT infrastructure development. Konza Techno City, located southeast of Nairobi, aims to provide world-class urban infrastructure to position Kenya for rapid, high-tech economic growth. Preliminary construction began last year at the site, with the first phase of the project expected to close by 2019. The whole project is budgeted for a cost of US$14.5 billion.
Sub-Saharan African nations’ economies are in different stages of development—and so are their ICT sectors. That's no coincidence: Rising mobile phone usage and broadband connectivity rates stimulate broader economic development. Here's a look at mobile phone and broadband usage rates and projects underway in four countries—including the region's two largest economies, Nigeria and South Africa. All usage rates represent the number of subscriptions per 100 people. —Imani Mixon
Mobile phone subscriptions: 66.8
Wired/wireless broadband subscriptions: 0.01/18.4
Project: Sponsored by the Nigerian government and the World Bank, the US$10 million Nigerian Research and Education Network project gives 27 universities fiberoptic Internet connections. The first phase was completed in March. The second phase aims to give an additional 3.4 million students access by the end of 2015.
2. SOUTH AFRICA
Mobile phone subscriptions: 130.6
Wired/wireless broadband subscriptions: 2.1/25.2
Project: The Western Cape provincial government is sponsoring Project Isizwe, which is scheduled to deliver free Wi-Fi to all government educational institutions by 2016.
Mobile phone subscriptions: 83.6
Wired/wireless broadband subscriptions: 0.7/3.6
Project: Senegal's government and the African Development Bank are co-sponsoring a US$120 million project to build a 25-hectare (62-acre) “digital park” in the port city of Diamniadio. Construction is scheduled to begin in 2016 on the site, which will feature broadband access and an ICT and data training center.
Mobile phone subscriptions: 71.2
Wired/wireless broadband subscriptions: 0.1/2.2
Project: Internet service provider AccessKenya will spend KES7.2 million by the end of 2017 on a project to provide primary and secondary schools for the blind with broadband Internet connections and “assistive technology labs.”
MTN's Broadband Buildout
In recent years, the telecommunications company MTN Group has invested millions of dollars to co-sponsor undersea fiber-optic cable projects to create the Eastern Africa Submarine Cable System and West Africa Cable System. The high-bandwidth cables deliver incredible advancements in Internet speeds.
To both provide that premium product to its customers across the region and stabilize its network, Johannesburg, South Africa-based MTN needed to overhaul its operations in the 17 sub-Saharan African countries where its operating entities do business. So the company launched a program in 2011 to build a network capable of delivering broadband throughout its footprint.
“It's about really providing a platform that can both carry the capacity and provide redundancy to our services.”
—Michael Paul, MTN Group, Dubai, United Arab Emirates
“It's about really providing a platform that can both carry the capacity and provide redundancy to our services,” says Michael Paul, who is based in Dubai, United Arab Emirates. He leads MTN's group technology team and co-managed the initiative. In order to support services such as video conferencing, file-sharing and application hosting, MTN decided to build a multiprotocol label switching virtual private network—a multiyear initiative that would require substantial projects in countries across the continent.
With Shenzhen, China-based Huawei Corp. contracted to handle network design and implementation, and its subsidiaries and vendors operating in each country, MTN created a program management strategy to ensure coherence, efficiency and success. The organization maintains consistency through a universal methodology—the same communications, reporting and governance structures, as well as a uniform escalation matrix—in each country. Program leaders tightly control project budgets, with capital expenditure governance centralized to ensure consistency. The planning phase also included risk management strategies that accounted for variables that could pose major challenges.
“We are talking about a multiyear program here. We knew that many geopolitical, inflationary or other economic aspects could come into effect in one country or another,” says Dani Abu Ghaida, head of IT and network PMOs, MTN, Edmonton, Alberta, Canada, who helps lead the program. “We forecast the budget across three years to see how this program would be executed, so we could predict how the budgets would be constrained each year, and how we need various operating entities to collaborate and play their part in the investment.”
Troubleshooting From the Hub
Program leaders act as a multinational communications hub to coordinate cross-border work among the different country-level operations.
The West African Cable System links southern Africa and Europe. The 14,000-kilometer cable cost US$650 million.
PHOTO BY © NIC BOTHMA/EPA/CORBIS
For example, Mr. Paul and Mr. Abu Ghaida conduct a weekly update meeting with stakeholders, and step in when they learn of conflicts or challenges. Sometimes that means asking two vendors in conflict with one another to meet. Other times, clearance delays at a hub located in one country have affected the rollout of services in other countries.
“If there is a problem in clearing the equipment, or custom clearance is taking longer than expected, it's affecting many countries…that are relying on connecting to this hub,” Mr. Abu Ghaida says. In that case, “we need to inform the other CIOs of this dependency to ensure that they also coordinate with their vendors or teams. This is our bread and butter,” he says.
The initiative will help MTN make significant inroads into what has proven a thorny problem across sub-Saharan Africa: extending powerful transoceanic fiber-optic cables from coastal cities to people living across the continent. The broadband network is “certainly the biggest in terms of footprint and capacity across Africa,” Mr. Paul says. “We haven't had any like this…not to this scale.”
Nigerian ICT projects are transforming the country's dynamic economy—but an infusion of project talent would boost its progress.
PHOTO BY SUNDAY ALAMBA
“A lot of projects here are not managed by project management professionals. There's no specific methodology, and many times those projects fail.”
—Ifeyinwa Anaele, PMI-RMP, PMP, MTN, Lagos, Nigeria
Fueled by the largest oil reserves in sub-Saharan Africa, Nigeria surpassed South Africa in 2014 to become largest economy on the continent. Yet for those who see Nigeria's potential for competing on the world stage, it might also be Africa's most frustrating country. For all its promise, Nigeria is beset with infrastructure obstacles such as an insufficient power grid and horrific acts of violence perpetrated by the Islamist militant group Boko Haram.
The development of a robust national ICT infrastructure is one way Nigeria aims to increase prosperity and stability. And thanks to a series of successful projects that have expanded the country's network capacities, the sector is booming. Companies have invested more then US$32 billion in Nigeria's ICT infrastructure, the Guardian newspaper reports. ICT consumer spending is on pace to reach US$167 billion in 2020, up from US$115 billion in 2010, according to Nigerian government statistics.
By 2019, Nigeria will have 182 million mobile phone subscribers—more than one per person, on average.
Source: Pyramid Research prediction
Most of the ICT boom is in mobile network projects. Pyramid Research predicts that by 2019, Nigeria will have 182 million mobile phone subscribers—more than one per person, on average. (The country's current population is about 175 million people.) But only 3.4 percent of households had a fixed-line (DSL or broadband) Internet connection as of 2012, according to a report by the not-for-profit organization Research ICT Africa (RIA). The gap is partly explained by the poor power grid and a shortage of computers, says RIA, but also by a lack of fixed-line infrastructure.
Project practitioners working in Nigeria's ICT sector say the dearth of infrastructure is partly the result of a difficult project environment. Lagos, Nigeria-based Ifeyinwa Anaele, PMI-RMP, PMP, is a project coordinator for MTN, a Johannesburg, South Africa-based telecommunications company that leads in the Nigerian market. She says indigenous companies have struggled to execute projects, both on their own and in conjunction with multinational organizations, because of a lack of project management acumen. “A lot of projects here are not managed by project management professionals. There's no specific methodology, and many times those projects fail,” she says.
According to Ms. Anaele, low stakeholder engagement and frequent conflict are among the consequences, not to mention the time and money devoted to doomed-to-fail projects that didn't receive a proper risk assessment.
“So often, people don't do risk plans. They don't plan the mitigation,” she says. “Everybody is running helter-skelter, and that means more money and more time, and more adjustments to the project scope.”
Indeed, a significant portion of MTN's Nigerian revenue is spent on network expansion (see “MTN's Broadband Buildout”), which RIA describes as proof of just how challenging the country's ICT infrastructure deficit remains. While Nigeria has seen an extraordinary increase in available broadband bandwidth capacity since 2010, thanks to four new submarine cables connecting to Lagos, “the area of difficulty remains the last mile,” says Clifford Agugoesi, editor, Africa Telecom & IT, Lagos, Nigeria.
In other words, the type of ICT infrastructure that could facilitate an enormous growth spurt is within arm's reach. What Nigeria needs now are project managers capable of seeing the job to completion. PM
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