providing cost efficient coverage topreviously unprofitable areas
TRANSCRIPT
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"Providing Cost Efficient Coverage To
Previously Unprofitable Areas”
12th November 2013
bad news, worse news, drivers, challenges, issues, opportunities, not so bad news…
The challenge of rural coverage
• No money - $2 ARPU
• No power – dead devices
• No access – bad or no roads
• No interest – from MNOs
• High cost – Capex & Opex
• Low literacy – voice only
• Vast areas – remote communities
• Long distances - distributed communities
• Tech divide – urban priority & data
• High risk – licence obligation vs loss making sites
GSM industry in a state of change
• Licence renewal (10-15 year anniversary) looms (unprecedented threat of losing a licence - imagine
losing it because of a lack of rural coverage)
• As voice revenue declines, data revenue
demands significant investment
• Operator generation shift – Technology centric to
marketing centric
• Leading to a focus on greater efficiency and
leveraging capex to maximise returns
• While regulators and users grow more
demanding
OPERATOR CHALLENGES
• Licence renewal
• Flattening revenues
• Increased costs
• New technology capex (LTE – 5G)
• Legacy maintenance & upgrades
• Increasing opex
• Regulatory pressure
• Competition – other operators and government
Traditional Solution Challenges
• MNOs have difficulty in accepting technologies
outside their major vendors – so limited rural
solutions
• Towerco model presently limited to passive
infrastructure – so its not the answer
• USF models are slow and politically motivated -
so not necessarily sustainable on its own
• Major backbone upgrades to fibre for data
means low priority rural rollout for operators –
but NOT regulators
Demand for Rural GSM
• The next 1billion subscribers • 87% will come from emerging economies
• Large areas in developing countries without
coverage • 70% live in rural communities
• Telecoms - the key to economic development • Economic growth increases by 1.2% for every 10% rise in mobile
users - GSMA
• Political and regulatory pressure • Licence renewals and a drive towards rural empowerment are
resulting a scramble to address the lack of rural service delivery
The challenge of rural coverage
• No money - $2 ARPU
• No power – dead devices
• No access – bad or no roads
• No interest – from MNOs
• High cost – Capex & Opex
• Low literacy – voice only
• Vast areas – remote communities
• Long distances - distributed communities
• Tech divide – urban priority & data
• High risk – licence obligation vs loss making sites
No money? - There is money
No power? - Solar innovation
No access? - Lightweight solutions
No Interest? Regulation & politics
High cost? - New business models
• Outright purchase of equipment
• Supply, installation, commissioning, support.
• Vendor MNO
• Leasing
• Installation, commissioning, support
• Vendor Finance House MNO
• Managed services
• Provision of capacity against set of KPI’s
• Vendor Entrepreneur MNO
• Revenue share
• On sliding scale
• Vendor Entrepreneur MNO
Low literacy? - Smart people
Vast areas? – VSAT solutions
Long distances? - Added value solutions
Tech divide? – Rural tech solutions
High risk? – Zero risk solutions
The answer to rural coverage
• No money
• No power
• No access
• No interest
• High cost
• Low literacy
• Vast areas
• Long distances
• Tech divide
• High risk
• There is money
• Innovative solar
• Lightweight solutions
• Regulation & politics
• New business models
• Smart people
• VSAT solutions
• Added value solutions
• Rural tech solutions
• Zero risk solutions
Thank you
CONTACT:
Dion Jerling
Special Projects Director
CONNECT AFRICA
Cell: +260 965 860 113 (Zambia)
Cell: +27 82 487 8354 (South Africa)
Email: [email protected]
www.connectafrica.net