Quick Hits Around African Tech (May 2012)

This last month has kept me too off-kilter to get a good blog post up. However, there have been some very interesting happenings around the continent, here are the ones that caught my attention:

Pivot East

East Africa’s mobile startup pitching competition is just a month away. We announced the top 50 a few weeks ago, and now the 25 Finalists are named as well. Don’t miss this event, June 5 & 6th at the Ole Sereni hotel in Nairobi.

Google Releases “Insights Africa”

This truly deserves a blog post of its own… Google spent a lot of money and time gathering information from over 13,000 people across 6 African countries (Ghana, Kenya, Nigeria, Senegal, South Africa and Uganda) to determine why, and how, people use the internet. This data is all openly available, with an outstanding visualization tool to see what the information really means, and compare it, at InsightsAfrica.com. My chart below is just one example, showing how people access the internet across these 6 countries:

Donors prioritized “industrial policy” in Asia, but “social sectors” in Africa. Why?

Kariobangi writes a compelling blog post on the difference between the aid that was prioritized for Asia versus that for Africa.

TeleRivet: An Android SMS gateway

Similar what Ushahidi offers at SMSsync, TeleRivet is a tool that allows you to use your Android phone as an SMS gateway. It’s more robust, offers an API, and makes it easy for people to get started on SMS and USSD apps. Mbwana Alliy writes up a blog post on why this is important, and the business prospects involved in utilizing this type of service.

WEF: The Global Information Technology Report 2012

The World Economic Forum’s annual report on IT has some good information on emerging markets. You can read it online here. Here’s the video:

ForgetMeNot and the rise of Africa’s Smart(er) Phones

BizCommunity has a good article on ForgetMeNot’s Message Optimizer service’s growth on the continent. This service delivers internet content to users who can only access that information via SMS. Here’s how it works:

“First, a mobile phone subscriber sends an SMS to a given short code. The message is received in the mobile company’s message centre, which then forwards to ForgetMeNot Africa’s internet servers. The servers process, route and deliver the message to the subscriber, who can then respond.”

Kenya study, impact of venture capital on small and medium sized enterprise

VC4Africa reviews a report on VC’s in Kenya. This isn’t just tech, but it is interesting and surfaces some great information. [PDF Download]

“The minimum profit before use of venture capital was Ksh 34, 866. Upon use of venture capital, the minimum profit increased to Ksh 600, 000. This shows an increase in minimum profit of 94%. The maximum profit respondents reported before use of venture capital was Ksh 38, 567,951 which increased to Ksh 62, 864,152 an increase of 63%. The average profit also increased by 69% (from Ksh 7,204,653 to Ksh 12, 202,775)”

Mpesa, a 5 Year Infographic

Just how big has Mpesa become? Take a look [PDF version].

Jason Njoku, Funding and Nigerian Movies Online

In Nigeria, Jason Njoku is at it again, raising $8m from Tiger Global Management, a US-based PE and hedge fund. Here’s an interview with him on Forbes. Iroko Partners is the world’s largest digital distributor of Nigerian movies and African music. The firm is YouTube’s biggest partner in Africa, boasting over 152 million views in 2011.

Google Plays Dirty in Kenya

There is a damning post out by Stefan Magdalinski on some unsavory business practices being done by Google Kenya against Mocality. Mocality designed a fantastic crowdsourcing tool to create their mobile web-based business listings directory back in 2010. There is undeniable proof that Google’s team here has been systematically calling businesses in the Mocality business directory in an effort to poach them to their own “Getting Your Business Online” program for Kenya.

The long and short: Mocality claims Google Kenya is using its database to sell a competing product.

For some context, the Google team in Kenya has always been above board. They are genuinely good people, so seeing this happen is incredibly surprising. I’ve been trying to get in touch with them since yesterday when I first was made aware of this situation, but have had no response to any of my queries.

The problem here is that the sting put on by Mocality is so complete. They have all the forensics and even voice recordings to show what Google is doing. I want to believe that Google has an answer for this that makes sense.

UPDATE: Google has owned up to this, saying:

“We were mortified to learn that a team of people working on a Google project improperly used Mocality’s data and misrepresented our relationship with Mocality to encourage customers to create new websites. We’ve already unreservedly apologised to Mocality. We’re still investigating exactly how this happened, and as soon as we have all the facts, we’ll be taking the appropriate action with the people involved.”

Africa’s Android Invasion

Mobile phone manufacturers, operators and of course Google started a big push on Android into Africa this year. Samsung, HTC and Huawei are moving Android phones into the market. Some operators are seeing the signals and starting to subsidize Android handsets to get them to a price point that is palatable by a larger number of buyers. Google continues to push for local content, works with developers, does g-[country] events and puts on contests.

While the primary phones in Africa are still feature phones, Android has made a beachhead on the continent and will continue to roll forward. I believe we’ll look back at the landing of the IDEOS phone earlier this year in Kenya as an inflection point, where in 2 years we’ll define the times up until then as, “before Android”.

Developers as Leading Indicators

I see what the local programmers working on as a leading indicator of what everyone else will be using in the next 2-3 years. In the iHub, on the mobile side, we see a lot of programmers excited about, and working on, Android apps. It’s a balance between that and the SMS/USSD core infrastructure apps that Kenya is well known for.

Today, at the g-Kenya event, Google announced the three winners of their Android Developer Challenge for Sub-Saharan Africa. Each of the winners will receive $25,000.

There were 29 finalists came from the following 10 countries, which is a pretty decent spread. However, you can tell from the number of apps in each country where the real powerhouses are.

7 South Africa
6 Kenya
5 Nigeria
3 Ghana
2 Uganda
2 Malawi
1 Senegal
1 Togo
1 Tanzania
1 Republic of Guinea

The one pain point that developers have right now is that they feel pressure to support multiple operating systems. This is Primarily between Android and Symbian if the app is focused on Africa, if the app is global, then add in iOS and possibly Windows and Blackberry.

It will be interesting to see what happens with feature rich HTML5 and how it plays out into the mobile space. At this point, either we’ll see a lot of mobile web apps (working across PCs and all phones with real browsers) or we’ll see a lot of apps. Even if we do see the client-side Android apps, I’m guessing they’ll be more thin-clients than anything else. Only time will tell though.

The Future of Consumer Mobiles in Africa

The years ahead are hard to predict. However, in Africa I think we’ll see an increase in Android handsets and mobile web usage, and a continued decrease in the cost of low-end smartphones and data connectivity.

If I’m an operator, I see the writing on the wall in regards to SMS and USSD apps, and I’m trying to move my user base to data. This means more subsidized phones, and attractive data packages that are wide-spread across my region. I’m making deals with content providers and offering zero-rated (or reverse-billing) packages on data to large content houses in order to increase usage.

If I’m a manufacturer, I’m providing an array of Android handsets that allow my aspirational users to move up from a feature phone to a (we hope soon) $50 Android, then up to a tablet eventually. I’m doing whatever it takes to decrease costs on the low-end to get mindshare. If I don’t do Android (Nokia, RIM) then I’m doubling down on the mobile web and pushing for better browsers on my phones.

If I’m Google, I keep having dev events and competitions, but I also push for better localized payment options for developers in Africa. On top of that, I’m looking for an operator billing link for consumers with attractive percentages for app publishers, that way I attract them and everyone makes more money.

Of course, there’s more, but that’s where I’d start.

What Should Google Do in Africa?

This week I’ll be speaking to a delegation of around 30 Associate Product Managers (APMs) who are exploring leadership positions within Google. Along with them is Marissa Mayer, VP of Location and Local Services. Like I did when I addressed Nokia’s Africa leadership last year, this is a chance for them to hear from more than just one person with one opinion.

I will bring them your answers to the questions below:

  • What is Google doing well in Africa that they should continue?
  • What should Google be doing better, differently or new in Africa?

A Few of My Thoughts

Google has done what few other tech companies have done on this continent. Having 54 countries to scale across isn’t easy, so anyone trying it gets a lot of credit.

  • They’ve invested in people; both their own and the community in general.
  • They realized early that there was a need for tech policy change, and put time, resources and energy into that.
  • They have surfaced content, from maps to books to government data that wasn’t available before.
  • They have localized search into multiple local languages, made their services more mobile phone friendly and experimented with services for farmers, health workers and traders.
  • Their Google Global Cache has sped up the internet by upwards of 300% for some countries.

Here’s are my suggestions:

Double down on Android. Do this in two ways; first, keep driving the costs down, like what was done with the IDEOS handset. Second, help your partners (Huawei and the operators) push the spread of these beyond the few countries they’re in now (and at the same price as in Kenya).

Gmail ties everything together. Google has been the beneficiary of most other companies ignoring Africa. Facebook is the only challenger in the chat, mail and social spaces. Get started on zero-rating Gmail with the mobile operators, figure out how to make Google Voice work here, and extend Gmail SMS Chat beyond the 8 countries that it currently works in.

Figure out payments. It’s still difficult to get paid if you’re running ads or making Android apps, you’re not on an even playing field with your counterparts in other areas of the world. It is clear that Google Wallet is a strong personalized LBS play on consumers in the US. Take that same energy and figure out how to crack Africa, realize just how much money there is in a payment system that spans the continent.

Keep experimenting. Many don’t know of the apps and services you build and test out in various hyper-local areas. Some work, some fail. This curiosity and willingness to try something innovative and new is what makes the open web such a great space, and it is what helps us all overcome the walled gardens of the operators. Don’t stop.

Finally, though you have all the power and brand name needed to make things happen, remember that it’s the local devs and companies who need to own their space and especially their data. While flexing your muscle, especially with government types who own vasts amounts of data, do push for local ownership over taking it for yourself.

[Notes: hat tip on this post goes to Steve Song who started thinking through this years ago. Image credits from Memeburn.]

Quick Hits Around African Tech

Umbono: Google’s South African Incubator

In Cape Town, Google has initiated a tech incubator that gives 6 months of free space, $25-50k startup funding and access to an extensive mentoring network. The secret sauce here is in the angel & mentor network, who will be providing 50% of all investment money, while Google provides the rest. Johanna Kollar leads this initiative, and tells me they’re looking for at least 5 companies to get behind in this first go at it, though if there are enough exceptional applicants, they might do more. If you’re a registered business in South Africa, then you can participate. (more on the Google Africa blog)

The BoBs

Deutsche Welle runs the “Best of Blogs” awards each year, showcasing excellent blogs from all over the world. If you haven’t yet, take a few minutes and vote for your favorites. There are quite a few from North Africa.

21st Century Challenges: Digital Technology in Africa

I’ll be a guest to the Royal Geographic Society in London on May 18th for a discussion on technology in Africa with Nicholas Negroponte, Herman Chinery-Hesse and moderated by Bog Geldof. Our main topic:

“Can digital technology such as laptops and mobile phones offer the countries of Africa realistic economic and educational opportunities?”

If you’re in London, you can get a ticket to the event and join us.

Ushahidi moves

There are over 10,000 deployments of the Ushahidi platform around the world, and as you might imagine, a lot has been happening at Ushahidi, including:

  • The launch of Crowdmap Checkins at SXSW, a way to “roll your own Foursquare-type service”. It’s in it’s beta stage, but you can play with it now, as others have already using the Ushahidi Android or iOS apps.
  • Some amazing people created a Japan deployment after the earthquake and tsunami there, we helped by getting our SwiftRiver Sweeper app to do real-time translation using Google’s APIs.
  • Japan earthquake Ushahidi data, heatmapped

    Japan earthquake Ushahidi data, heatmapped

  • We’ve released some reports on past deployments and are part way through an evaluation by the Harvard Humanitarian Initiative.
  • One of our volunteer deployers, Anahi Ayala Iacucci, spent a great deal of time and created a 90+ page Ushahidi manual for anyone looking to deploy Ushahidi. Having worked on over 20 deployments of her own, she’s one of the best placed people in the world to do this.

Samsung Seeks to Grow in Africa

Samsung is opening a new Electronics Engineering Academy for youth in Boksburg, South Africa. As Afrinnovator states, they have about 20% of the market, which will only increase as they’ve been smart enough to get behind Android in their devices (currently with 22 models). We’ve felt this presence at the iHub in Nairobi as well, where Samsung has a great interest in reaching out to Android programmers.

Local Web Cache Lessons: Uganda

The chart you’re looking at is amazing. Orange Uganda has seen local traffic jump from 3Mbs to over 30Mbs in just two weeks due to partnering and implementing Google’s Global Cache. One wonders how much business they’re starting to chip away at from their competition.

In layman’s terms this means that once anyone in Uganda using Orange has visited a website (especially Google’s data heavy ones like YouTube, Google Maps or even Search results), that the content is cached locally. Once that is done, the next person to visit that same site gets it served to them locally, which is much faster than having their traffic make the round trip from Uganda to Europe.

There are 8 peering ISPs in Uganda, and only one of them is using Google Global Cache. Yet, below we see that Orange Uganda has made the whole country’s usage start to look like a hockey stick.

This begs the question, “why aren’t the other 7 peers using Google’s Global Cache?”

It also makes you wonder why more ISPs haven’t started using this in other countries. After all, it gives your users a distinct advantage, they get a much better user experience than they did before.

From all that I’ve heard, it sounds like each ISP is more interested in keeping their competition away from the Google Global Cache than they are about their customer’s experience. This means that they refuse to sign a deal with Google unless they’re the only ones who can use it, blocking out their competitors.

Take a moment to ponder this idiocy with me. Right now we’re all on equally crappy load times for data-heavy content, all of the ISPs suck at relatively the same level. If they all moved to Google’s Global Cache, they would still all be at relatively the same level, but it wouldn’t suck. Sure, no advantage gained over the competition, but a lot less pain to their users.

Here’s the kicker… with faster data speeds and load times, people use more data. Their profits would increase.

This is a perfect example where a rising tide would float all boats, but all the captains have decided they like to wallow in the mud instead.

[Note: Thanks to Tim McGinnis for the tip]

Google Baraza: Q&A for Africa

There’s a new service coming out from Google, tentatively called “Baraza”, which is the term used for meeting place in Swahili. It’s a service focused on creating ways for Africans to interact and share knowledge by asking and answering questions, many of them hyper local, or of regional interest only.

Google Baraza is accepting alpha testers right now, you can sign up to try out the new service at this link.

Q&A websites like Baraza aren’t new, perhaps the best known one is Yahoo! Answers which has been phenomenally successful. Even the other, smaller sites have a lot of traction. There isn’t a Q&A site focused on Africa, and that is the niche that Google is working to fill.

Why?

Simple really, Google has a vested interest in seeing more African content coming online. More African content means more Africans engaging with the open internet, more information to organize and more search queries.

There are already millions of Africans with Google accounts, and that’s a good thing, they’re going to need it. Q&A sites need critical mass on both the questions and answers sides of the equation. Yahoo! Answers being the top Q&A site has shown that a large member base gives you the edge. It takes a lot of people answering and asking to make it work. Of course, this isn’t new to Google, three years ago they launched something similar for Russia.

I talked to the Google Baraza product manager yesterday to find out a few more things before I wrote this. They’re accepting a limited number (100) of signups right now, and alpha testing will begin shortly.

Right now Baraza is firmly rooted in the PC space – that is, you need a computer to access it. However, we already know that mobile phone access to the internet trumps PC access to the internet in Africa, so that leaves me wondering when they will create at least a mobile web (WAP) access as well?

Regardless of the mobile side, this is a good idea that could make a large impact if they can get African users involved.

Notes from gKenya

This is the third day of gKenya, where there are 30+ Google employees running a big Google-focused conference in Nairobi. They’ve just done one in Ghana and Uganda as well. The first day was for university students, the second for programmers and today is for entrepreneurs and marketers.

Nelson Mattos, VP of Africa, Europe and the Middle East gave a keynote, here are some notes from that.

Challenges

High penetration of mobile devices, and growth in mobile, yet not many fixed lines and very little high-speed connectivity. This provides a major challenge to Google, whose internet paradigm is based on a different type of user. Low speed and unreliable connectivity.

The diversity of Africa is also a challenge, especially languages. Example, is that there are 51 African languages with more than 2 million speakers.

Devices and affordability. Cash flow constraints impede the ability to pay the entire device price at once. – plus limited access to financing options as the whole of Africa only has 4% of the population that is banked.

Africa is a fragmented market with 54 countries and 1 billion people compared to other emerging markets like India (1.1b) and China (1.3b). This means lower volumes of things that can be sold and lower return for investors.

Broadband in Africa is 10x more expensive than in Europe. The price is just too high outside of cybercafes and certain limited mobile plans.

14% of the world’s population, 2% of the internet
Globally, 94 domains per 10k people, Africa is 1/10,000.

Opportunities

Africa is embracing mobile, so Google is trying to speed up the process of getting more and more people online using mobile. They’re also working on many different levels to create a more holistic ecosystem for the internet in Africa, including policy, education and developer outreach.

Access – reducing the barrier for potential users
This mainly means reducing the cost to access, data and services. They do this with with devices (like this week’s release of the Android IDEOS phone from Huawei). They also engage with major telcos and ISPs to reduce the price of entry for data connections.

Google works a lot with the African developer communities as well, they’re particularly heavy in Kenya, Ghana, Uganda, Senegal and South Africa, but are growing to more countries. One of their goals with this is to educate on how to better create efficient and effective websites, and it’s also to help grow a higher calibre of developer.

They have a university access program, where Google helps bring universities into the internet era in Africa (though I’m not sure what that means to be honest, outside of giving them Google Apps for free.)

Finally, they work to Improve the end-user experience, including latency for both Google products and internet services in general (ie, Google Global Cache). Note: Google Global Cache only works in certain countries, Kenya is not one of them due to political bickering amongst certain ISPs, AccessKenya amongst them

Relevance – making the internet relevant and useful to local people
Google is working to create and enable more African content online (ex: Swahili Wikipedia challenge and Google books partnerships). They’re helping to develop applications that are locally meaningful and enabling African devs to do the same by launching Google products in more languages.

Sustainability – helping to build an internet ecosystem in Africa that has long term sustainability
Developer outreach is a major component, where they are strengthening the developer community (through places like the iHub), working with universities by raising the level of curriculum and awareness about Google, and are also working and partnering with startups, publishers and NGOs.

Awareness and education (Doodle for Google in Kenya and Ghana, “Best place to watch the match” in Kenya during the World Cup, etc.

Google Tools

Taking advantage of Google apps (email, docs, calendar):
50k students using Google apps for free at universities
Small, medium and large sized organizations are using Google Apps as well, examples given were: Kenya Airways, Homeboyz Radio, USIU

Products developed for Africans – recent launches:

  • YouTube (South Africa)
  • Streetview (South Africa)
  • Google maps in 30 African countries: including driving directions in Kenya, Ghana and SA
  • Google News in many African countries
  • Google Places (Kenya)
  • Google Trader (Uganda)
  • iGoogle in 36 Sub-Saharan African countries
  • SMS chat in Gmail (Ghana, Senegal and Zambia)
  • Tools in local languages (ex: Gmail in Swahili)
  • Android Marketplace launched in Kenya and South Africa on Monday, but it’s crippled by lack of Google Checkout use in these same countries.

(There were actually quite a few more “Africanized” tools and features that he listed, but I couldn’t copy them all down in time. I’ll try to get the full list later.)

Ability for organizations to start local and expand globally:

  • Google Maps: 300 cities mapped, and represents a chance for local businesses to have a global presence by getting into the business listings
  • Google Site Creator: get indexed faster, uses the example of AkiliDada
  • Monetization opportunity through AdSense and Adwords: uses an example of “BabyM“, a business out of Nigeria, who used $400 on Adwords and sold their complete inventory in 4 weeks.

$100 IDEOS Android Phone Launches in Kenya

Google and Huawei have launched a very competitively priced Android smartphone in Kenya today, called the IDEOS. It is being sold for 8,000 Ksh (~$100).

It runs Android 2.2 (Froyo) and have access to the Android Market. The IDEOS is a touch-screen phone that comes with bluetooth connectivity, GPS, a 3.2-megapixel camera, up to 16GB of storage and can be transformed into a 3G Wi-Fi hotspot connecting up to eight devices.

2 out of every 3 internet users in Kenya connect through their mobile phone. This is why data is the current battleground in the mobile operator and handset space. Though there are only 6 million internet users in Kenya, the data market though the mobile is huge. Currently, there are 20 million mobile phone subscribers of a total 38 million possible.

Data enabled phones of any type cost a minimum of $40-50 in Kenya, a touchscreen smartphone coming in at $100 is going to be a big deal for a lot of people.

gKenya

Google Kenya started their gKenya conference today. They are meeting with software developers, entrepreneurs and CS students at Strathmore University over 3 days to discuss innovation and growing businesses, as well as discussing their own suite of products.

[An update, after discussions with a bunch of Google employees at the iHub yesterday. The Google team said they didn not know when the phone would be able to be bought in Kenya.]

Android and pre-paid phones

There are two very big issues that the Android team will need to take care of before we see Android being used heavily in Africa.

First, the lack of access to SIM applications is surprising. These are the apps like Mpesa, top-up services and such. These aren’t just “nice to have” features, these are critical and the phone will fail if it doesn’t have them enabled. Your most basic phones can do this, but smartphones running Android cannot? (Note: unless you root your phone)

Second, there are a lot of background services running on an Android phone that use data. That’s fine for people living in an all-you-can-eat world of bandwidth, but here where we have to pay by the megabyte, it doesn’t work. I remember one day when my phone used up 1000 Ksh of credit ($12), that’s unacceptable and will drive users away very quickly.

Tandaa Kenya Meeting: Local Digital Content

“If Africans are to get online en masse, they need a reason to go there. Their lives, their stories”

– Dennis Gikunda of Google Kenya, requoting Alim Walji who was at Google.org and is now at the World Bank.

The Kenya ICT Board is throwing the Tandaa event today in Nairobi at the iHub, sponsored by Google Kenya. It’s all about getting more local Kenyan content online, and it’s a good mixture of speakers so far, with Dennis Gikunda starting off, giving us examples of successful local content plays.

A “remember when” session just started, talking about how slow the internet used to be just a couple short years ago. Jimmy Gitonga scolds us for not doing more with what we have, figuring out business models and ways to make money off of our fast connections. He also reminds us that 2 million Kenyans access Facebook on their phones today. Moses Kemibaro steps up to give the real numbers showing the costs of internet, and the speeds, that has happened over the last year.

Joshua Wanyama, of Pamoja Media and Africa Knows, is up to talk about “The internet at 500Mb” – how to help Kenyan companies make money online. He’s giving us a short summary of his background, about how he started a web development company from the ground up in the US, then how he’s brought that same mindset back to Kenya.

“If I were to go online and try to find all the dentists nearby me in Nairobi, I couldn’t find it since it has not been digitized yet.” – Joshua Wanyama

Josh goes on to say that we don’t have enough success stories, though he does reference Ushahidi and Safaricom’s Mpesa. We need more of them, as it will help get more young, smart entrepreneurs operating in the internet space. Most of the internet traffic from Africa goes to websites like Facebook, YouTube and Yahoo, all outside of Africa. What are we doing to get our own content up and make it more of a viable business alternative for our own society?

Eddie Malitt of Sega Silicon Valley is here to talk about turning Sega village, a remote village of over 10,000 inhabitants located in Ugenya district – 25 km from the Kenya- Uganda border, into a “Silicon Valley” – an African ICT hub. One of the interesting findings that Eddie shared with us is that the children are leading the training of their parents and other adults. It doesn’t sound like their operations are self-sustainable, but that good things happen due to them being there.

[More of the Tandaa event will be going on today, but I’ll be unable to keep up with it due to other meetings. Follow it on Twitter at #Tandaa or @TandaaKENYA. I’m sure that Moses and Mbugua will also have something up later today.]