By Sherry Zameer, SVP Internet of Things for CISMEA at Gemalto

Africa’s appetite for communications technology remains undimmed. Coming late to the telecommunications party, in a way, has proved to be advantageous: in many cases, African economies have been able to leapfrog directly to the latest technology, unhampered by the need to ensure a return on investments in legacy technologies. As a result, the majority of Africans with access to the Internet do so via mobile devices, and Internet penetration is growing strongly at around 20%, albeit off a low base.

There is wide consensus that Africa’s economic potential will only be fully reached if its economies digitise. Given that mobile technologies are the dominant means for accessing the Internet, this means that Africa’s telcos have a significant opportunity to provide the digital platforms for economic activity, something that is particularly important for them as revenues from pure voice and data will continue to reduce in the face of relentless competition.

In short, to survive, telcos will have to become more efficient in order to drive down costs, and position themselves to become trusted service providers to the business sector. These five trends will profoundly affect their strategies to do so:

Artificial intelligence (AI). AI is revolutionising the telco industry by enabling technology and solutions like natural language processing (NLP), robotics and smart government. NLP, in conjunction with machine learning, AI and linguistics will enable telcos to automate the processing of large amounts of customer data and feedback to create actionable business insights.

Robotics will also have a role to play in helping telcos to streamline repetitive processes while eliminating human error, thus making it possible to deliver quicker, more targeted customer solutions at a fraction of the cost.

While cities like Dubai in the neighbouring Middle East region are establishing themselves as front-runners in the smart city revolution, African metropolises are not yet in a position to undertake large-scale smart city projects. However, point solutions are emerging that will act as catalysts for wider ranging initiatives over time. African telcos like Vodacom and MTN are actively positioning themselves in this area by rolling out Internet of Things strategies to ensure that their SIM cards are used in a growing number of non-communication devices.

Identity management. As mobile-device penetration continues to grow strongly across Africa, security is growing in importance. Mobile network operators (MNOs) are becoming integral providers of identity management solutions. By offering convenient end-user authentication services, they can simplify customer access to services such as payment gateways and reward programs. By incorporating identity management in product offerings, mobile network operators are best positioned to lead the pack as identity-recognition service providers.

For example, one African MNO is offering a way for corporates to manage all devices securely and safeguard their networks and data, a service of particular importance as the “bring your own device” model becomes the norm. In time, offering identity-as-a-service solutions will help MNOs facilitate greater take-up of cloud services by enabling secure access to online resources and protecting the digital interactions.

Cyber-security. As the telco industry adopts a digital business model, it must develop cyber-security solutions that will protect the growing number of transactions that take place on their platforms. Effective cyber-security will have to encompass both cloud security and device security, covering the whole data life cycle.

Industry research consistently shows that security and trust are two of the top barriers to mobile technology adoption and innovation. Telco companies must remain abreast of the risks, constantly upgrading security standards to ensure a seamless service.

Internet of Things (IoT). Improved efficiency, reduced cost and new revenue streams are the benefits most businesses hope to achieve through IoT. Harnessing this technology means businesses will be able to easily, safely and cost effectively manage all networked devices through a reliable and intuitive platform.

African telco providers are already offering IoT solutions across industry sectors like health care, agriculture, retail, transport and logisitics, utilities, manufacturing and industry, real estate and, of course, mining.

Connectivity is an important part of the entire IoT/ M2M value chain. For operators to remain relevant and be a part of the ecosystem, they must invest in platforms that allow them faster time to market and differential charging mechanisms on M2M/IoT services. However, this is easier said than done—there are a few challenges that operators can face along the way. If operators are not fully immersed in the value chain, connectivity could once again be marginalised. It is important for operators to realise this, and to foster partnerships with key service providers to ensure they remain an integral part of the value chain.

eSIM. Once seen as disruptive, eSIMs (embedded SIMS that need to be activated by the MNO) are becoming mainstream in developed markets. eSIMs offer enhanced abilities to secure and manage multiple devices, and they also make it much easier for international travellers by enabling them to choose local packages without the need to buy physical SIMs.

Local MNO Vodacom announced plans to support eSIMs in September this year, and other operators across the continent will surely follow suit.

eSim integration will lead to a simplification of the manufacturing process for devices, eliminating the need to make adaptations to accommodate various SIM formats. This will allow for technical leaps such as enhanced battery life or smaller devices with fewer moving parts.

The advance of the Digital Age is set to disrupt the telco industry, but it will also provide huge opportunities for those MNOs in Africa that are flexible enough to seize them. Speed, efficiency and value are strong drivers, steering MNO away from volume-based charging models toward ultimately becoming the providers of services offered on their platforms.

At the same time, African telcos will also have to balance the imperative for bridging the digital divide in each market with the need to invest in new technologies like 5G as well as AI, machine learning and other technologies associated with managing and mining data.

Telcos will also have to use these new technologies themselves in order to improve their responsiveness to increasingly demanding customers by implementing lean approaches and speeding up processes though multiskilling and dedicated presales and sales support. They should also capture synergies with their core business in areas such as local presence, customer access, and industry knowledge.