19 Jul African Startup Future: Infrastructure and Access
Last week, I wrote about the future of the African startup. I tried to answer what our future in the tech startup space entailed, I am not sure there is a solid answer to that question. Something that does need to be discussed, however, is the infrastructure and access problem that we are still battling to solve.
The ‘West’ has this romanticised view of Africa, the dark continent, the continent on the rise, the home of the next billion users. For those of us that live here, it is a completely different view, we see the daily struggle for basic necessities – the lack of electricity, water and access to the internet and information and basic education. I don’t mean admonish the African dream (something I firmly believe in) but I would like our friends in the West to understand that: Africa is not a project, it is not summer school, for us that live here it is our lives, our home and our future.
The above statement is very important if we are to understand and fix Africa’s startup future. It is no good for you to come here with grandiose ideas about problem-solving in many sectors that, yes, need it, when we don’t have the basics right. If we begin at the start, and overlook the romance of the Africa we all desperately dream of, we begin to see the cracks for what they really are: laziness, lack of foresight and indiscipline. This might seem harsh but like I said we are going back to the beginning. Nigeria, Africa’s most populous country has oil – a decent amount of it. Nigeria does not have a refinery, it exports crude and imports petroleum. The price of crude tanks, Nigeria loses, the price of petrol goes up, Nigeria loses. You get the idea. For the first time its 60-year history Nigeria is building a refinery, why did it take so long? Crude is not that hard to refine, you can learn how on the internet.
Solving the access and infrastructure gaps are so fundamental to Africa’s startup future and the possibilities of what entrepreneurs can and could possibly do. The damage that lack of infrastructure and access is creating is fucking everything up. For entrepreneurs and small businesses, the limited opportunities created by infrastructure absence creates unhealthy competition that limits potential for deeper product understanding and refinement. This creates rather ridiculous funding gaps and funders are now dictating where the emphasis should be because we rather see what is sexy and looks good in the press. Very little to no true innovation is happening Africa right now. The investor class in Africa is too powerful and it is fundamentally problematic and dangerous.
If we examine the many initiatives that have been started to tackle these problems, we have to wonder why are they working or why is it taking so long. We all know what the problem is – the current policy frameworks in play on the continent do not prioritise access and infrastructure. On the surface, sure, governments talk a good game, they all “understand” the importance of technology (no, they don’t). The capitalistic pursuits of corporations continue to leave the African people at a disadvantage. If we look at access, yes there are countries with long ways to go in terms of basics such actual cables. However, there are last mile solutions that could easily be employed with collaboration. A novel and maybe even simplistic view of this lies in the hands of mobile operators. Towers cost money, so operators hike up data prices to make up costs (at least that’s what they tell us).
Imagine, if all the operators in a country worked together to share the costs of towers and covered an entire country. Two things come from this: the user will always have connectivity and the cost of data would somewhat if not significantly cheaper. Tigo and Ericsson is a good example of this with their Tanzania partnership. Yes, we can agree that it is rather complicated from a business point of view. Take roaming for instance. The operator offering the roaming service dictates pricing, and with African telcos, and currency issues, home operators have little real negotiating power when it comes to price. The operating expense is very high and as many networks in Africa are still ‘new’ they’re still paying for suppliers and charge in USD. Then there is the skills gap, engineers cost money, good ones cost a lot. These factors are understandable in a growing economy and would be even more so, if there was significant effort from policymakers to encourage cut costing collaboration or if telcos where openly lobby for these.
It is too simple to think that a business’s purpose is for the benefit of the user not the business. How do you explain why data is perishable? Data expires after 30 days, gas for your car doesn’t, books don’t, education doesn’t but data does. A useful product that allows for access to information and help, expires. If we had better policy that made it easier for telcos to operate (South Africa is a mess) and encouraged innovation and competition that would go a long way to help in solving some of the access and infrastructure problems.
How do we build an ecosystem that engages corporations and governments, and that allows them to understand that there can be no innovation if the people we are innovating for can’t access or afford to use the products we are creating?
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