Telecoms & IT
Comprising approximately 10% of the nation’s GDP, ICT is the up-and-coming success story of Nigeria’s rapidly diversifying economy. Rapidly developing penetration rates, the exponential growth of the country’s population, increased government support for telecommunications, and competitive operators in the sector are set to revolutionize the ICT landscape.
When it comes to harnessing the potential of ICT, no target is too high for the Nigerian government. One of the key steps the government is taking to carry the country to the next level is to bring internet access to every corner of Nigeria. Currently, around 75% of Nigerians live in rural areas, where internet access is only now begining to reach. With a better-connected country, the government’s current goal is to increase broadband penetration to 30% by 2018. The government is keen to attract FDI to help bridge this gap.
In terms of telephony, out of 180 million people in Nigeria, there are 238 million connected SIM card subscriptions, a fine illustration of how many have more than one phone to cater to black spots in service provider networks. The actual number of mobile phone users comes in at closer to 154 million. According to the national statistics, 97 million Nigerians were connecting to the internet via mobile devices in 2016. This is a monumental achievement seeing that mobile internet connectivity was around 50,000 in 2001. Today, the vast majority of internet browsers connect to the web via 3G. That trend will not last for long, with experts foreseeing rapid growth in 4G as prices for smart and data-enabled phones devices drop. ICT plays a key role in two of the government’s most significant long-term plans, which are to reduce corruption through increasing transparency and diversifying the economy away from the oil and gas sector. As the driving force of many new developments, ICT is expected to contribute to monitoring and tracking information in real time, which will allow decision making to happen more rapidly as the country moves forward.
One of the key sectors expected to benefit from the increased use of ICT in rural areas is agriculture. There are already a number of ways that the government and private sector operators are targeting farming and village communities where technology is not only in demand, but beneficial for the local economy.
In an interview with TBY, Tesfai Tecle, Special Advisor of the Kofi Annan Foundation, explained that Nigeria is at the forefront of changing the agriculture sector with ICT, specifically mentioning the “e-wallet” concept for the supply and distribution of subsidized inputs. “Through mobile devices and apps, farmers can access up-to-date knowledge and information that is vital to their business, including weather forecasts, advice on best agronomic practices, and market prices for crops,” he said. Nigeria has the potential to seize even more opportunities in this regard, such as digital solutions that will allow small agricultural businesses to access seeds, fertilizer, credit, and insurance, thereby raising productivity and improving Nigeria’s food and nutrition security.
The National Information Technology Development Agency (NITDA) is also working on a strategy to bring farmers and other agricultural operators closer to the benefits of technology. As of late 2016, the agency had opened 400 rural “IT centers,” where villagers can access the internet and other services to support their businesses.
Increased ICT activity in agricultural areas will also have an indirect effect on the local populace through assisting with daily needs that would otherwise consume valuable time and limited funds. ICT is already granting greater and more flexible access to financing through mobile wallet applications and other innovative banking services. Meanwhile, there is the potential to develop programs such as remote education and medical services through e-learning and telemedicine.
With an ongoing state-level commitment to eradicating corruption, Nigerian officials and policymakers are looking to ICT firms to enforce transparency and provide much-needed security. “Technology helps to improve security and digitization helps to improve productivity and together, they improve accountability and transparency, as well as contribute to the elimination of corruption,” Olakunle Oloruntimehin, Country General Manager of Cisco Systems Nigeria, told TBY.
Cisco has already narrowed down five key areas in which ICT can help create a safer and more state-of-the-art Nigeria by focusing on government services, agriculture, energy, public safety, and judicial services. “We believe that improving on these five pillars could potentially encourage FDI… investors will invest in a country when they know their investment is going into a stable economy and is protected by transparent legal structures,” Oloruntimehin added. In addition, setting up solid e-government services will be pivotal in making bureaucratic processes efficient and more transparent.
President Buhari’s administration is focused on adopting a variety of e-government standards, with new projects and infrastructure already coming online. “This can bring otherwise unknown information to the fore, that encourages transparency and by extension, stamps out corruption,” Yusuf Kazaure, Managing Director & CEO of Galaxy Backbone Limited, explained to TBY in an interview. Galaxy Backbone Limited connects approximately 4,500 government offices, all of which feed into a larger data center that it maintains.
Established in 2011, FPG Technologies & Solutions Limited has become the foremost IT security company in the region, specifically in Nigeria. The company partners with similar agencies to educate the general populace, as well as larger organizations, regarding the importance of cyber security. FPG has also compiled a portfolio of solutions that can be used in cloud computing, much of which the company expects will create unprecedented business agility in Nigeria. “As our cloud platform comes into play, we are trying to work in partnership with telecoms to build capacity for the smaller companies, helping SMEs convert capex to opex. We currently serve the top tier in terms of business size and we are now going to the mid-tier; we are also keen to go to the mass market,” Rex Mafiana, CEO of FPG Technologies & Solutions Limited, told TBY.
A variety of ICT operators, including hardware providers and e-commerce providers, are seeking to set up networks that will offer Nigeria a base from which to grow.
IHS Towers manages approximately 16,000 towers in Nigeria and 23,300 towers across Africa. Considered the 10th-largest tower company in the world, the company provides jobs to over 40,000 people across five countries. “Nigeria needs 20,000 to 30,000 more towers for the network to be at the level it should be,” Mohamad Darwish, IHS Towers Co-Founder and interim IHS Nigeria CEO, explained to TBY. By increasing the number of towers and expanding its network, IHS Towers hopes to help operators overcome issues of coverage and capacity.
Meanwhile, although Nigeria’s fiber-optic network can deliver 10 terabytes to locations in coastal areas, the National Information Technology Development Agency (NITDA) also highlights reaching rural areas as a challenge. To address the deficit, NITDA is working to build a network of locally trained ICT experts who will join the workforce and ideally create a “multiplier” effect in terms of boosting the number of people who are employed in the sector. “Between February 2016 and 3Q2016, we trained about 1,500 Nigerians in different areas of ICT. Our target is to train a minimum of 3,000 Nigerians within one year,” Vincent O. Olatunji, Ag. Director General of NITDA, said. The Office for ICT Innovation and Entrepreneurship (OIIE) is a subsidiary company of NITDA, with the primary mandate of driving ICT innovation and entrepreneurship to create jobs and increase national competitiveness. It supports startups, investors, academia, government agencies, and R&D. The OIIE’s inclusive development strategy also aims to shift the concentration of ICT in urban areas toward making technology available and more relevant in rural areas. Although these rural areas are not always a commercial priority, IHS Towers, NITDA, and OIIE are focused on designing solutions that specifically target underserved areas, in conjunction with government assistance.
Although still a long-term goal, operators in Nigeria have outlined the country’s potential to pave the way for a generation of “smart cities” in Africa. As the local population begins to outweigh capacity to deliver high-quality services, ICT providers are needed to devise creative, sustainable solutions. Nearly a dozen cities in Nigeria are home to populations of over 1 million, with Lagos establishing itself as one of the top 20 megacities in the world.
For IHS Towers, a complex, well-functioning supply chain is key. Bearing in mind the impact on the environment, the company has invested USD500 billion toward upgrading its network in Nigeria in order to be powered by renewable energy systems. IHS Towers currently consumes more than 200 million liters of diesel per year, with aims to reduce consumption and support the smart city initiative.
Within its first year of operation, e-commerce giant Konga.com saw 100,000 customer visits. The company looked to international partners to establish the right logistics network that would allow the company to deliver orders to all of Nigeria. Today, there are over 40,000 registered sellers on the platform, with 50% of them active. Sellers can ship with a unique Konga Express solution that employs 90 couriers, 40 of which are based in Lagos. To ensure the most advanced and innovative service possible, Konga.com retains more than 130 in-house engineers.
Ericsson, which has been present in Nigeria for almost 70 years, is one of a handful of companies with its gaze firmly fixated on the future, considering ICT a cornerstone of long-term development. Johan Jemdahl, Managing Director for Nigeria of Ericsson, told TBY, “I think it’s important to see a smart city as a vision… it’s an evolution, and not the flip of a switch. We have the ambition, capabilities and will to play a key role in that transformation.” Wtechnology companies, the dream of building smart cities may not be so far off.