Part 2: Apps for Africa: Mobile Cloud Computing to Accelerate Innovation

Every cloud has a silver lining, a lining that emits beams of hope onto the continent it traverses. Africa's horizon has seen many clouds that have only passed on to deliver rains to the rest of the world. However, one cloud spread across the African continent, breathing a new hope of life on a part of the world that has always been referred to as a dark continent. That cloud is called the mobile cloud.

Mobile cloud computing is not a new trend in Africa, having first been introduced on the continent by the several mobile network operators. Services such as mobile banking and mobile money transfer have been around for over 3 years, operating on a private cloud computing framework that was tied to each network operator. These services have revolutionized mobile computing, delivering services that had long been a myth to many Africans. The advent of such services has had a far reaching reception pattern, creating trade links between the rural poor. In the biggest part of Africa, banking institutions are fragmented, without a reliable interconnected backbone that can facilitate trade and commercial transactions. And worse still, computer usage is very low in Africa, making it even harder to facilitate such transactions.

However, with the installation of the sea cable that had the first phase connecting the coastal countries to the global broadband infrastructure, fast internet cable is now being extended to the inland countries, providing a more reliable and faster internet link for both desktop and mobile internet users. The high penetration rate of cellular technologies will grow even faster with the adoption of fast internet on the continent. Mobile phones will therefore remain the preferred communication gadget in Africa.

The advent of fast internet will therefore leverage the existing services and provide a wider reaching cloud platform for building and deploying cloud-hosted applications. Even before the fast internet cable spreads to most of Africa, mobile application developers are already building solutions to take advantage of these new developments.

Microfinance Institutions to tap into the cloud:

RedCloud Technologies, the company behind the hugely successful M-PESA money transfer service in Kenya is already completing work on a project that will see micro-finance institutions connect to the M-PESA service, disbursing loans to their clients, improving cash flow management, helping the borrower repay the loan simply and cheaply without queuing in the bank using mobile money transfer, and getting the approved loan and money faster into the hands of the micro-entrepreneur. This project will provide support to customers with low-end phones using SMS technology, and high-end phones/ smart phones using a web-based application. The project will also provide support for loans officers that would like to use the web application option in areas with limited or no network coverage. The loans officer simply saves the loan application information and then posts it to a remote database when they move to places with network coverage.

Strategic partnerships between industry and academia:

Safaricom, Kenya's largest mobile network operator and Strathmore University, a leading private university in Nairobi partnered this year to launch an initiative dubbed the “Safaricom Academy”. The initiative aims at developing young talent to create employment through the development of mobile applications that are relevant to the local Kenyan mobile user. The main goals of the Safaricom academy are:

• Promote local innovation in developing relevant applications for the Kenyan market.
• Create an enabling environment for the development of relevant mobile applications.
• Attracting companies with applications to host them within the Safaricom portal.

This initiative will see more local content and mobile applications developed and hosted on cloud-based marketplaces.

Developer bootcamps:

Many developer initiatives have sprung up in the past two years. In Kenya, iHub (Innovation Hub) seeks to link technologists, innovators and investors. In Uganda, the HiveColab is working with local developers to help them nurture their ideas through provision of workspace, hardware and developer tools. All these are initiatives that have also helped some small companies find seed funding from venture capitalists and big industry players such as Nokia. Virtual City, a Nairobi-based mobility solutions company, received a 1 million dollar award from Nokia after winning a global competition for building innovative mobile applications.

These initiatives are continuing to grow and spread across Africa, showing a positive market response to the adoption of relevant innovative mobile solutions on the continent.

In part 3, we shall focus on the future of the mobile cloud and what it holds for Africa in the next five years.

Africa and the Mobile Handset Series

Africa's mobile market is the fastest growing in the world, growing at twice the global rate. ¹

A consistent market growth can be witnessed with the rapid innovation of new products and solutions for the African mobile user by mobile carriers and content developers. In this part of the series: Africa and the mobile handset, we shall delve into details of mobile subscription in Africa, mobile internet that is currently the major focus for most mobile carriers and the recent trends in mobile service(s) pricing.

Africa has over 260 million mobile subscribers, with at least 27 in every 100 people owning a mobile phone. In North Africa, 53 out of 100 people own mobile phones, while in South Africa, at least 87 out of 100 people own mobile phones. ² Mobile subscription penetration rates are expected to exceed 40% by the end of 2010, according to an International Telecommunications Union report released last year.

Mobile Network Operators (MNOs) in Africa are taking advantage of their IP-based data networks to extend internet services to users of internet-capable mobile phones. Partnerships between MNOs, web companies and handset manufacturers are already being created. A recent partnership was made between Huawei Telecom, Google and Kenya-based Safaricom to introduce a fairly priced Android phone for the Kenyan mobile market. The Huawei Ideos was launched this year in Nairobi and it will be retailing at approximately 100 US dollars. The launch of the Huawei Ideos followed an announcement earlier this year in Kenya at the Gkenya event to open the Android market for Kenyan developers to publish both free and paid mobile apps for the Android market. All these developments are positive indicators of a growing market that is still fairly developed but has high potential for investors.

Mobile internet usage in Africa is on the rise, and in some developed markets like South Africa, innovative products such as Mxit, an Instant Messaging application, are more popular than facebook. In Nigeria, mobile internet usage has surpassed computer internet usage with up to 7.3 million Nigerians browsing the internet using their mobile phones. The adoption of internet-capable phones in Africa is also on the rise as the prices for high-end feature phones and smart phones continue to drop globally.

While mobile internet usage in Africa continues to grow, mobile data charges have dropped drastically. These prices will even drop further as mobile network operators expand their data infrastructure across the continent, courtesy of the undersea fibre-optic cable that has now reached many African countries. The fibre-optic cable extension has also increased connectivity speeds which had greatly slowed down the adoption of internet services on the continent. In Uganda, data charges were as high as 1 dollar per MB of data. In less than one year, prices have dropped to as low as 10 dollars for a 350 MB mobile data package.

However, the major challenge with the adoption of mobile internet in Africa is that there is not a lot of content that is available online that suits the African context. African societies are fragmented, and the lack of a common language makes it very hard to develop universal content or information. It would require content and application developers to translate their products into so many languages. There's a need to develop language translation systems for African languages.

In part two of the series, we shall delve into the growth of the mobile applications market in Africa, building mobile applications and content for Africa, and how innovative mobile applications can be relevant to the African mobile user.

1http://www.itu.int/ITU-D/connect/africa/2007/media/kit/africa_ict.html

2http://www.itu.int/ITU-D/ict/statistics/at_glance/af_ictindicators_2007.html

Smartphones and The Facebook Factor

Facebook has continued to dominate the social networking sphere, cutting across all continents, while providing a platform that meets the unique social needs of different global cultures. In Africa, Facebook has even been seen to drive the adoption of smartphones , especially among the technology savvy youth. This trend seems to fit perfectly in Africa's budding mobile data market, indicating an increasing demand for social applications as the world embraces the benefits of a digital age. Smartphones and facebook have been around for less than ten years, but the rapid influence they have on our social culture is something that cannot be ignored.

As social networking continues to dominate communication over the internet, smartphones will continue to replace the less capable low-end feature phones that don't have support for web browsing and instant messaging. Applications such as ebuddy will be favorites among today's youth. Initiatives such as facebook zero will continue to come up to tap into the rapidly growing mobile internet market. As mobile network operators prepare for a new battlefield i.e the mobile data market, smartphone prices will drop sharply. (The Huawei Ideos is a perfect example of a subsidized smartphone).

The facebook factor therefore, will remain a major driving force for smartphone sales and intuitive applications that leverage social networking in Africa and the world over.

Orange Launches Orange Money in Kenya

Orange Kenya in partnership with Equity Bank unveiled their money transfer service last week to their customers. The service is mapped to a bank account to allow Orange subscribers access to financial services using their mobile phones. Orange money is different from the other mobile money transfer services in Kenya, combining money transfer and mobile banking to provide a richer banking experience for its customers.

The Orange money service in Kenya is currently hosted on Equity bank's mobile banking platform, giving customers the convenience that comes with a bank account.

The difference between Orange Money and the other money transfer services:

Orange money provides the following services, on top of its money transfer feature that supports money deposits, sending money and withdrawing money through your bank account using your mobile phone.

• Making purchases
• Paying bills
• Managing Payrolls
• Repaying Loans
• Mini Statements
• Stock Prices
• Forex Rates
• Full bank Statements
• New Cheque Books
• Stopping Cheques
• Stopping a Card

Benefits of Orange Money:

• Convenience: You can directly access your bank account from your phone and can send money to any mobile phone network and any bank using your phone.

• Security: Unlike the traditional mobile money transfer solutions you can store unlimited amounts of money and your funds have deposit protection. Transactions are subjected to the processes and procedures of a bank.

• Time Efficient: Currently you incur a cost to move money from a bank account to a traditional mobile money transfer system, after which you have to pay additionally for sending money. Time and effort is also required to deposit money via agents into a traditional mobile money transfer system. However, with Orange Money, you transact your bank account using your phone, thereby saving time and energy.

• Rich Functionality: Since real bank accounts are transacted using the phone as an access channel, limits are higher than traditional mobile money transfer solutions. To protect customer interests, we have set the current limit at Sh. 100,000. You can also minimize errors of transactions by using the phonebook lookup to access the receiver’s details.

• Easy Registration: If you have an existing Equity account, you do not need to open a new one to access Orange Money – you can just link your existing account to Orange Money. If you are a new customer, then the registration process is quick and easy – you just fill a one page form, either provide two photos or have an agent take your photo. Your application will be sent to a central processing centre and once successful you will receive an SMS with your 5-digit PIN.

This convergence of Orange Kenya and Equity Bank seeks to tap into the unbanked Kenyan population by extending financial services through mobile phones that have a higher penetration rate in rural Kenya. The service is a first of its kind in Africa and it has already been launched in 5 other African countries. It will be rolled out in 19 countries in Africa and the Middle East.

 

 

Google Will Buy Java

The ongoing face off between Oracle and Google over the use of Java on the Android operating system seems to be making headlines, with many christening Oracle as an evil organization. If you may recall, Oracle acquired Sun Microsystems earlier this year, taking over control of Sun's hardware and software divisions. This acquisition was not well embraced by many including the Java developer community and partners, as well as some of Sun's top engineers that left the company recently, including Jon Gosling, the father of Java.

Oracle's major interest in the acquisition was Sun's much coveted hardware line that boasts of a powerful SPARC processor architecture and their advanced server technology. Oracle specializes in database management systems and ERP software, a clear indication that Sun's hardware products fit perfectly in their core line of business.

So why then, did Oracle sue Google for patent infringement over the use of Java on the Android operating system ? Sun's software line consists of several UNIX systems including the stable Sun Solaris operating system, and many open source platforms like the Java platform. Many of their software products are free and open source, hence they don't really make a lot of money. The Java platform is patented under the GNU General Public License Version 2 (GPL v2), which has some restrictions on using patents. Some of these patents are licensed to Sun, and Oracle claims that Google infringed on them without a license.

Since Oracle does not seem to advocate for open source development and does not seem to care about the fate of the Java language, they will find it easier to hold Google at ransom and indirectly force them to buy Java at a very high cost, or share revenues derived from the Android platform. Google will most likely opt for the latter because the Android platform is performing pretty well. Eric Schmidt, Google CEO stated earlier that Android could easily net a cool $10 billion in annual revenue. Google would therefore not be willing to share revenue with Oracle over the next ten years.

So what will Oracle achieve ? Oracle, in the end will kill two birds with one stone. Sell off Java at a hefty price, while retaining Sun's hardware division which was their major interest in Sun Microsystems.

Larry Elison is a smart businessman. I wonder why Google didn't see this coming and acquire Sun and take control of Java, than have it sold to them at ransom !

Cloud Computing for Mobile Value Added Services

Following the rapid development of cloud-hosted services, there has been a sharp focus on building internet-based solutions that cater for today's active internet user. Solutions ranging from social networks, communication services, commerce are all being integrated within the confines of a web browser. This shift is an indication that the internet has evolved from being a communication enabler to a computing platform, and if we take a close look at the nature of today's use of a computer, we realize that we spend more time on the internet. Applications like facebook take up so much of our time chatting away, communicating with friends, etc.

With the recent drop of internet connectivity costs in Uganda and Africa in general, more people are getting connected to the rest of the world. As the prices drop further, the internet speeds are surprisingly getting faster too (Courtesy of the undersea cable).

What we don't see is the impact of these fast changing trends on the mobile communications sector. It is evident that: As internet services become more affordable and the speeds increase in Africa to match the rest of the world, mobile carriers will continue to lose a bigger share of their “voice” market to the “data” market. What our mobile carriers are not understanding is that the internet provides far more communication and information services than the services they develop for the mobile user to access.

This shift from voice to data has now been the emphasis of the mobile carriers in Africa, and many of them are now investing enormously in data infrastructure. Again, they don't seem to understand the direction of the market. What the consumer wants is a service that gives them their money's worth. If I buy a 350MB data package at 10 dollars for my internet-enabled phone, what will I use the internet for ? I will use it for accessing my facebook and reading my emails. Usually, the websites we can easily access on our mobile handsets are the ones that are optimized for our browser-supported phones ie the high end feature phones and smart phones. These phones are many on our market today, and more are being shipped to Africa. The manufacturers of these phones, ie Nokia, Blackberry, Samsung, Motorolla, Huawei, etc are releasing new features and models at a speed that is not being embraced by the mobile carriers. Today's smart phone has support for GPS, WiFi, Flash, HTML, extended data storage, faster processing and memory(some of them now come with 1GHZ processors and upto 512MB of RAM) to mention a few. All these features are not being exploited at full potential in Africa.

The only way we can embrace these new developments in technology is through innovation. However, we need to innovate new products and services at a speed that is even faster than the technology advancements in both hardware and mobile device specs, and this can only be achieved if we open up our mobile carrier platforms to developers that can build new competitive value added services for the mobile user. The current business arrangement caters for only those companies and businesses that register for SMS short codes and develop only SMS solutions. With the advent of cloud computing, SMS is bound to become an obsolete technology in providing rich content for today's tech-savvy mobile user. Sharing revenue between the mobile carrier and VAS provider will definitely not be a viable business solution in the near future as long as smarter and better phones continue to flood our market. Mobile carriers should therefore focus on building stable data infrastructure and open up the VAS market to developers by building an internet-based platform for hosting VAS products . With this kind of business model, they will definitely make much more money from data charges than what they have been making from SMS-based services.

Bigups to UCC and Warid Telecom for Championing Price Reductions in our Telecommunications Sector

Following Warid Telecom's unprecedented price cuts a few days ago, the major players in Uganda's telecom sector reacted pretty fast to announce price reductions to a record low of 3 shillings per second for calls across all networks. Am wondering why MTN, Zain and UTL had to wait for Warid to announce price cuts before they could jump on the band wagon and reduce their rates too.

If you may recall, following an announcement by the Uganda Communications Commission to fix interconnection rates across networks earlier this year, MTN ran to court to block the move, in fear of cut-throat competition. Fortunately, UCC's announcement came to fruition and call rates have dropped instantly.

We should have more new policies like this implemented in Uganda to curb unfair competition in our private sector and weed out deliberate extortion by such companies.