The digital infrastructure of a country is the technological facilities and services that are utilized for its operation and more specifically its connectivity internally and to the rest of the world. When working with clients on process improvements and business transformation, digital infrastructure is often an area of focus. This is due to the fact that digital infrastructure significantly impacts the degree to which processes can be automated and for clients handling sensitive data, digital infrastructure has implications for safeguarding that data. What does digital infrastructure look like at a macro level?
Digital infrastructure at the macro level includes mobile telecommunications and the supporting facilities like the underwater sea cables that bring the internet, also known as data routes. It also includes the storage facilities like ‘the cloud’ or warehousing data. You can therefore understand why such critical services should ideally be homegrown and owned. In this article I focus on these 3 main components of digital infrastructure; data routes, mobile telecommunications and cloud computing.
Data Routes
In the article; Terrestrial Fiber Networks in Africa - The Optical Illusion, Surendra Kulkarni notes that a handful of companies like, AEI, Corning and of late, Huawei, all foreign based companies, control Africa’s subsea cable operations and management. While he identifies the risks and concerns with these particular companies, they aren’t the only companies involved. Silicon Valley stalwarts like Google and Facebook have also joined in these efforts, although with their motives also being called into question. Facebook recently announced a massive underwater cable around Nigeria and other African countries. Although Facebook plans to partner with local providers like MTN South Africa and other Africa based providers, this is another foreign led initiative to provide the very backbone of data connectivity to parts of the continent. As with any outsourced arrangement, the right policies and controls need to be established to ensure that good governance prevails and that foreign companies are acting in the best interest of the local populations.
Mobile Telecomuunications
The mobile telecommunications industry has seen rapid growth across the continent. According to Asoko Insights; 57% of mobile subscribers in Africa are covered by 5 pan-African providers. Two of these can debatably be said to be homegrown enterprises; those that originate in Africa. These are MTN and Vodacom, both headquartered in South Africa. The other 3 are; Orange, headquartered in France, Airtel headquartered in India and Etisalat headquartered in the UAE. For the financial year 2017/2018, the revenues from MTN and Vodacom totaled 14.07 billion, while the other 3 providers totaled 12.53 billion. That’s almost half the revenue of the top 5 providers, going to foreign providers.
Cloud Computing
In their research article entitled the The cloud over Africa the authors highlight the fact that “cloud computing is viewed as having the potential to significantly bolster economic growth [but] Cloud providers are mostly global US-based players with some local presence in the selected countries, or services provided through intermediaries”. From small businesses to large corporations to government ministries, cloud computing is utilized to back up and secure critical business records. Also, as national archives and records make the move to digitization of their countries’ records, this wealth of historical information is also being handed over to the management of foreign companies.
The Way Forward
Some may be inclined to cite more concern about government interference as seen in recent instances of governments in Ethiopia and Sudan limiting access to the internet. With foreign companies there are however legitimate concerns about security. Huawei’s founder’s connections to the Chinese government has sparked concern with foreign governments, most notably the US on data security. As governments seek to scale up internet connectivity, in light of COVID-19 pandemic and the corresponding shift to remote working, existing arrangements with foreign companies are likely to become more entrenched. Homegrown solutions are at risk of being deprioritized in efforts to meet the increasing demand. Even before the COVID-19 pandemic, scaling connectivity was seen as a significant undertaking. According to Broadband Commission Working Group's: A “Digital Infrastructure Moonshot” for Africa addressing digital infrastructure needs on the continent required a collaborative effort that would need to involve private foreign companies. Striking the right balance however, is key to economic independence for the countries of Africa.
How do we chart the way forward? In his Digital Economy for Africa Initiative presentation to the World Bank, Tim Kelly summarizes it well in defining the principle of Homegrown; “based on Africa’s realities and unleashing the African spirit of enterprise to have more homegrown digital content and solutions, while embracing what is good and relevant from outside the continent.” Some recommendations made that are relevant to this discussion include policy reforms to lower entry barriers, encourage competition and investment as well as modernizing regulatory frameworks to ensure data security and privacy.
Along the same vein of policy reforms to lower entry barriers, I would add policy reforms that support homegrown enterprises. Homegrown platforms in Africa represent over 80% of the total in operation, but the scale of usage data suggests that foreign platforms are capturing more market activity. One homegrown enterprise contributing to the digital infrastructure is BRCK, which creates locally manufactured solutions to improve connectivity in East Africa. From their point of view ”We live in Nairobi, so there’s no reason we should use devices designed in London and San Francisco. If products aren’t conceptualized and created here, they won’t fit our infrastructure needs, where electricity and internet connections can be problematic in both urban and rural areas.”
Ultimately the approach that is needed to bridge the gaps in Africa's digital infrastructure, will be a collaborative effort that includes a balance of regulated foreign companies and homegrown companies. With key components of data routes, mobile telecommunications and cloud computing already disproportionately foreign owned, there needs to be a shifting approach, supported by policy reforms to support homegrown companies and regulatory frameworks to ensure that the data of users is protected.