Mobile penetration in two-thirds of Africa remains below 40 percent, leaving remote regions with small enterprises and villages without effective means of communicating with the outside world.
AS OF MARCH 2008, the total wireless user figure of the African Continent stood at 280 million, although it was widely predicted that the 300mn subscriber mark would be reached by Q4 of the same year.
Research house Telegeography more recently stated that 96mn new subscribers were added to Africa’s total in Q1 2009, alone. While this rate of increase maintains Africa’s first place as the fastest growth market in the world, it still remains second smallest1 in terms of cellular connections, behind the Middle East.
However, cellular penetration figures would drop dramatically to single digits at most, if the urban/sophisticated markets (some of which exhibit penetration rates of around 60 per cent) are excluded from the statistical analysis and are viewed separately from these remote communities, which remain largely unconnected.
Viable service provision
With Universal Service Obligations (USO) mandating service delivery to even the most remote small populations, African mobile operators need viable ways to deliver cost-effective services.
The major obstacle has always been the high cost of transmission bandwidth, whether for terrestrial core network or satellite backhaul, and this has prevented profitable or even sustainable service delivery to these enterprise or village communities.
Some of the technologies deployed in certain parts of the world to deliver services to remote regions and meet USO requirements, have simply not enabled a sustainable business model. While initial roll-outs have been cost-effective and basic wireless services have reached a large number of isolated communities, the cost of continuing services has often come as a shock to the operator. With very little revenue-generating traffic, the monthly overhead costs have become too high. The cost for a single BTS might appear small on paper but rises exponentially when hundreds of BTSs are involved. Therefore, the infrastructure providers have, in several cases, left the operators incurring massive operational overheads and costs – even before a call has been made – just to maintain a service for small groups of users whose ARPUs are, in any case, extremely low.
The key running cost is the expensive ‘always-on’ use of transmission bandwidth where the network backhaul resource remains open, whether core network or satellite link, even when no revenue-generating traffic is occurring. Despite the situation being addressed by the industry, widespread availability of suitable solutions remains low.
However, one specialist in the field, Altobridge, has been successfully working to solve these issues for many years and has produced the patented Remote Community Solution.
Altobridge’s practical experience working in remote parts of Africa, Asia, Latin America and the Middle East, has ensured an unsurpassed understanding of the business, technological, practical/logistical and cultural challenges facing mobile operators and infrastructure providers trying to deliver services to remote community users.
With leading operators already deploying the Altobridge Remote Community Solution across Asia, the company is also currently trialing its technologies with operators in Northern and Western Africa (as well as in Latin America).
Managing bandwidth, managing technology
What differentiates the Altobridge technology is its ability to manage and restrict the use of expensive transmission bandwidth by combining two of its patented technologies.
The first is the Altobridge Split Architecture, which ensures an ‘on-demand’ use of the satellite link only when revenue-generating traffic is occurring, and uses the lowest level of bandwidth in the industry at 5-8kbps per call.
This system not only cuts down transmission costs effectively, it also cuts down power consumption which is further reduced with a ‘night mode’.
The second technology is the Altobridge Local Connectivity Platform, which enables the intelligent switching of all local calls locally. This eliminates unnecessary double satellite hops and improves network quality, which encourages longer call holding times, resulting in increased call revenues.
As up to 70 per cent2 of calls can be local, there are significant opportunities to reduce transmission costs in all areas of the network. The Local Connectivity Platform has been licensed to world-leading infrastructure providers, including Ericsson.
The benefits of these two technologies combined in the Remote Community Solution, including a Fully Managed Service offering, makes this the most cost-effective solution for rural communities available on the market today.
According to Wireless Intelligence, the average penetration rates were 35 per cent in West Africa and 60 per cent in the Northern African regions at the end of 2008, but combined, these two regions show around 168.5 million connections, representing around two thirds of the continent’s total connections.
Within this network activity mix, the current Altobridge trials of its Remote Community Solution will demonstrate to African mobile network operators how to profitably meet their USO requirements to provide profitable services to their remote user groups.
Mike Fitzgerald, CEO, Altobridge