Telecom
Extending Telecoms Connectivity to rural Africa
In spite of tremendous growth in telecommunications service delivery in Africa, greater percentage of rural populace in the region is yet to enjoy telecom access, due mostly because rural areas are not commercially viable.
Governments in Africa have attempted to lure operators in providing service to rural dwellers through incentive such as tax waivers and provision of telecom infrastructure to no avail.
Against this backdrop that a report dealing with the broader issues of rural connectivity in Africa launched last week by the Commonwealth Telecommunications Organisation (CTO). The report reveals that a number of novel and multi-stakeholder partnerships, unique business models and innovative technologies are, for the first time, paving the way to connect many of Africa’s rural communities, on a sustainable, profitable basis.
The report provides evidence that contrary to some assumptions that the private sector can lead the effort to connect Africa’s rural populations, the experiences of industrialized countries like Canada, the Unites States and Australia is that governments have had to lead the effort, but in close collaboration with the private sector and local communities. The report calls for Commonwealth African governments to implement their national ICT policies as part of a wider national development strategy and to make faster in-roads into rural ICT rollout through public private peoples partnerships (PPPPs), with local communities playing a more pivotal role.
The report finds that the key to successful partnerships between the public and private sectors and other ICT stakeholders is to encourage local ownership, thereby nurturing the community’s enthusiasm for effective connectivity and ensuring the sustainability of ICT investments.
The CTO study found that whereas Commonwealth countries such as Malaysia and India have made significant in-roads in rural connectivity, Commonwealth African countries like Sierra Leone and Zambia are lagging behind in rural access, leading to poor and overall slow economic growth. The report finds that although recent years have seen dramatic growth in penetration rates in some African countries, especially through mobile networks, the continent’s aggregate penetration rate is still less than 20 percent.
"For Internet access and use, the figures are well below 5 percent for most of Africa. Over 60 percent of Africa’s population lives in unconnected rural areas and represent an untapped market, holding enormous potential for growth for service providers, equipment manufacturers and the entire telecommunications industry", the report claims.
By way of conclusion the report calls for ICT policy provisions that focus on universal and rural access, in order to affirm the commitment of governments to providing basic ICT services to poor, isolated and marginalized communities . There is also the need for continued incremental and a more methodical process of liberalization and privatization of the telecommunications sector in many African countries, and a variety of regulatory safeguards need to be put in place to foster competition and promote a conducive environment for rural connectivity.
Commenting on the initiative, Dr. Ekwow Spio-Garbrah chief executive officer of CTO said that the evidence they have accumulated in the course of the 9-month study demonstrates that most of Africa’s rural populations could well be connected over the next decade. "This is partly because an unusual confluence of sounder policies, relevant legislation, improving regulatory practices, the establishment of universal access and service agencies and the revenues they have acquired, new technologies and business models, and the availability of funding from a plethora of sources, all make it now possible for most of Africa to be connected wirelessly within the next ten years," he said. According to Spio-Garbrah, who is a former Minister of Communications in Ghana, ‘the pilot project models we have found to work best are where a combination of public institutions and private ICT operators or equipment vendors have found it possible to involve local groups or communities in structuring, ownership or management of the ICT assets, to ensure their more effective use and sustainable operation. We hope that more companies will join the CTO as we move to the second phase of this important initiative to replicate and scale-up a number of selected model projects, so that the benefits of ICTs can be enjoyed by millions more in Africa’. "Connecting the majority of Africans to the Information Super Highway is necessary if African countries are to benefit from the global knowledge revolution," he said.
The project was undertaken under the auspices of the Commonwealth Connects programme, which involves collaboration with a number of Commonwealth agencies, including the Commonwealth Secretariat. It is supported by the International Telecommunication Union, as part of efforts to help unearth market opportunities, enhance technological advancements, as well as accelerate social development and economic growth by connecting rural communities in the 18 Commonwealth African countries.
The first phase of the project was aimed at discovering how telecommunications regulation, policy, legislation, and operational, technological and financial models affect the potential for cost-effective rural connectivity in the 18 African Commonwealth countries. The research compiled similar information on initiatives and best practices of five selected non-African countries such as USA, Canada, Australia, Malaysia and India, countries that have enjoyed greater success in connecting their rural populations. Subsequently the initiative is to devise effective dissemination channels for the report and identify 10 pilot projects for adaptation and replication to form the basis for the second phase of the project.
Can it happen in Nigeria?
Just as the telecom sector in India is fully liberalized and fastest growing so also is Nigeria’s. The question now is why is Nigeria moving at a slow pace? Currently, all the successes recorded in the sector are essentially an urban phenomenon. The four digital mobile operators have concentrated their activities in high density areas. Locations without access are either remote or are relatively poor communities. This has therefore affected some regions more than others.
A Nigerian Communications Commission NCC/World Bank study has looked at the market potential for telecoms services in the country. The study looked at a range of variable including geo-demographic, socio-economic and infrastructure data. It concludes that the entire country is reachable and that a significant market scope exists. The study conducted ranking among states. The most challenging northern states are typically low socio-economically.
They have low revenue potential, poorest infrastructure and highest cost for telecoms development. However, some challenging southern states exist, but are less difficult to serve. These states usually are small in size: have potential to cover cost, and have good chances of returning a profit.
So far, digital mobile licensees have been slow in expanding into rural areas, despite the fact that the NCC requires them to invest part of their income in setting up services in the rural communities. Market assessments suggest that about 22 states will need some form of incentive to attractive mobile operators. The universal Access fund (UAF) operated by the stakeholders (operators, government and donors) is expected to be a vehicle to deliver these incentives.
Over two thirds of Nigeria’s population resides in rural area. Increasingly, poverty in the country is wearing a rural face. From 28.3 percent in 1980 poverty among the rural population grew to 51.4 percent in 1985, has since risen to 69.8 percent.
Little wonder that global consultancies and analysis believe that if only the operators could convert the challenges in rural Nigeria to opportunities, Nigeria would be an exciting story for other countries of the world to emulate.
Association of Licensed Telecommunications Operators of Nigeria (ALTON) has declared support for the Nigerian Communications Commission (NCC’s) push to promote local smartphone manufacturing in the country.
Gbenga Adebayo, chairman, ALTON,
The News Agency of Nigeria reported that ALTON described the move as a practical measure capable of accelerating broadband adoption and expanding digital inclusion across the country.
Gbenga Adebayo, chairman, ALTON, made the remarks to newsmen on Saturday while reacting to comments by Idris Olorunnimbe, chairman, NCC Board, who had earlier called for local smartphone production and innovative financing models to address Nigeria’s digital inclusion gap.
Adebayo said Nigeria must intentionally transition from being predominantly a technology consumer to becoming an innovator, designer and manufacturer of digital technologies, pointing to the country’s large telecommunications market and youthful population as the scale and human capital needed to support world-class manufacturing.
He said Nigeria’s ambition in local manufacturing should extend well beyond simply assembling imported components into finished devices.
“Our ambition should extend beyond assembling devices. We must pursue genuine knowledge transfer, research and development, product engineering, software development, semiconductor capabilities and large-scale manufacturing,” he said, adding that the goal should be producing devices and digital technologies for Nigeria, Africa and the global market.
Adebayo explained that the emergence of artificial intelligence has further strengthened Nigeria’s opportunity to become a competitive technology manufacturing hub, noting that AI is transforming product design, manufacturing, quality assurance, supply chain management, customer experience and software innovation.
He said investing in AI-enabled manufacturing would improve productivity, create high-value jobs and strengthen Nigeria’s competitiveness across Africa.
On tackling counterfeit and non-type-approved devices, Adebayo described the grey market as a major challenge affecting consumers, original equipment manufacturers and the wider telecommunications ecosystem.
He said robust local manufacturing backed by strong quality standards would provide credible alternatives to grey-market imports.
“This will strengthen consumer protection, improve network performance, retain greater value within our economy, and stimulate industrial growth,” he said, while also endorsing innovative smartphone financing, stronger device management systems and identity-enabled credit frameworks to help more Nigerians afford quality smartphones.
Adebayo said telecom operators remain ready to partner with government, manufacturers, financiers, academia, investors and development partners to build sustainable local manufacturing capacity in Nigeria.
Ayotunde Coker, managing director, Open Access Data Centres has reiterated availability of abundant capacity and world-class infrastructure in key data centres in Nigeria.
This is coming against the backdrop of the Central Bank of Nigeria (CBN) directive to banks, fintechs, mobile money operators, and other payment service providers to host their payment transaction data generated within Nigeria on local servers from January 1st, 2027.
Mr. Coker made the assertion at a media interactive session on readiness of major data centres in the country such as Open Access Data centres to effectively host financial sector data.
“As far as readiness is concerned, we have the co-location base, the co-infrastructure basis, and interconnection capability. Indigenous cloud companies are building out, such companies like Unicloud Africa, Layer 3 within the data centres, adding cloud capability, and providing cloud solutions to local companies.
“The other key thing with the directive is that it sends a signal to the world that data sovereignty localization is key. And will also trigger the global providers to bring their own scale of cloud in here in time, which is good for building our digital infrastructure scale”.
The CBN directive signed by the Director of the Payments System Supervision Department, Rakiya Yusuf, also introduced new market structure rules, beneficial ownership disclosure requirements and systemic oversight measures for payment service operators.
According to the apex bank, the reforms became necessary following the rapid expansion of electronic payments and digital financial services across the country.
The CBN said it had observed “significant structural developments within the Nigerian Payments ecosystem, characterized by rapid growth in electronic payments, increasing adoption of digital financial services, and the emergence of operators with substantial market presence across key payment activities.”
It noted that while the growth had improved innovation, efficiency and financial inclusion, it had also created concerns around market concentration, operational dependence, ownership transparency and the storage of critical payments data.
To address these concerns, the regulator ordered all financial institutions facilitating payments in Nigeria to ensure that transaction data generated within the country are stored domestically.
The circular stated, “All Financial Institutions and participants facilitating payments within Nigeria shall ensure that payments transaction data generated within Nigeria are stored and managed in Nigeria in accordance with data protection laws and regulations applicable in Nigeria.”
It added that “all affected Financial Institutions shall fully comply with this requirement effective January 1, 2027.”
The move is expected to strengthen regulatory oversight, enhance data sovereignty and ensure that sensitive payment information remains within Nigeria’s jurisdiction.
It also aligns with broader efforts by regulators globally to localise critical financial data and reduce reliance on offshore infrastructure.
Association of Licensed Telecommunications Operators of Nigeria has thrown its weight behind the Nigerian Communications Commission’s push for local smartphone manufacturing, saying the initiative could significantly boost digital inclusion, create jobs and position Nigeria as a technology manufacturing hub.
ALTON Chairman, Gbenga Adebayo, gave the endorsement on Saturday while reacting to the call by the Chairman of the NCC Governing Board, Idris Olorunnimbe, for increased local smartphone production and innovative financing models to make devices more affordable.
Adebayo described the proposal as a practical response to one of the biggest barriers to digital inclusion in Nigeria, noting that smartphone affordability had overtaken network coverage and data costs as the major obstacle to broadband adoption.
He said Nigeria must deliberately shift from being a consumer of technology to becoming a producer, innovator and exporter of digital technologies.
“Our ambition should extend beyond assembling devices. We must pursue genuine knowledge transfer, research and development, product engineering, software development, semiconductor capabilities and large-scale manufacturing,” he said.
According to him, Nigeria possesses the population size, telecommunications market and youthful workforce needed to build a globally competitive technology manufacturing industry.
He said the country’s long-term objective should be to produce smartphones and other digital technologies not only for domestic consumption but also for export across Africa and the global market.
Adebayo said the emergence of Artificial Intelligence had further strengthened Nigeria’s opportunity to become a major technology manufacturing destination.
He explained that AI was already transforming manufacturing through improved product design, quality assurance, supply chain management and customer experience.
He noted that investments in AI-enabled production would improve productivity, create high-value jobs and strengthen Nigeria’s competitiveness.
The telecom operators’ chairman also backed the NCC’s proposal to tackle the proliferation of counterfeit and non-type-approved devices.
He described the grey market as a major challenge affecting consumers, original equipment manufacturers and the telecommunications ecosystem.
According to him, robust local manufacturing supported by strong quality standards and effective type approval would provide credible alternatives to substandard imported devices while boosting consumer confidence.
“This will strengthen consumer protection, improve network performance, retain greater value within our economy and stimulate industrial growth,” he said.
Adebayo further endorsed innovative smartphone financing models, improved device management systems and identity-enabled credit frameworks, saying they would enable more Nigerians to own quality smartphones through affordable payment plans.
He said telecom operators were ready to partner with the government, manufacturers, financiers, investors, academia and development partners to establish a sustainable local manufacturing ecosystem.
“The initiative represents a national economic transformation agenda capable of creating jobs and strengthening Nigeria’s position in the global digital economy,” he added.
Olorunnimbe had, during the Digital Africa Summit Roundtable in Shanghai, argued that Nigeria’s biggest digital inclusion challenge was no longer network coverage or data affordability but the high cost of smartphones.
He urged coordinated efforts involving local manufacturing, trusted devices, financing and policy reforms to accelerate broadband penetration and unlock the country’s digital economy.
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