Telcos, OTTs declare peace at AfricaCom

Peace broke out between telcos and OTT players on the opening day of AfricaCom 2014 in Cape Town, South Africa. The headline discussion panel attempted to tackle the longstanding issue of cooperation between mobile operators, which invest in the infrastructure to provide mobile broadband, and over-the-top (OTT) service providers, which rely on that infrastructure to serve their customers.

Historically there has been friction between these two sectors as operators have seen subscribers increasingly use OTT services in preference to their own, but at AfricaCom 2014 there were strong signs that we’re entering a new, more collaborative phase. The panel featured speakers from MTN, Millicom, Orange, Airtel and Facebook.

“It was an excellent forum,” Ahmad Farroukh CEO, MTN SA, told Telecoms.com. “I came with sharpened weapons, a bit, but I was very happily surprised by Facebook on the way they put things into perspective. I think the approach is completely different now, telcos are not just the pipe – we need to cooperate for our mutual benefit and for three billion people to have more access to the internet.”

Farroukh’s experience was echoed by Arthur Bastings Executive Vice President Africa at Millicom. “It was a really interesting panel, which featured a more conciliatory stance on the part of the telecoms industry,” he told Telecoms.com.

“With players such as Facebook, I think historically the relationship has been a bit more fraught, with tension over who gets to participate in what, and how. What I’m seeing is much more realism, as the industry is embracing the realities of the African market, it’s obvious to everyone that Facebook in particular is a great entry-point for African customers to the internet space, so partnership is in the interests of everyone.”

The key outcome from the panel was a consensus that it’s in the mutual interest of call concerned parties to resolve the question of how telcos and OTTs can profitably collaborate, and that when they do the results should be of benefit to everyone, consumers included.

Matthew Reed, Practice Leader, Middle East and Africa at industry analysts Ovum, attended the discussion. “Major operators and OTT providers now seem to believe that they can work together in mutual benefit,” he told Telecoms.com. “And we are seeing a growing number of such partnerships in African markets. But it is still early days in the development of these new business models, and it is not clear to what extent they will indeed be ‘win-win’.”

The discussion was one of the prominent topics on the show-floor too, with exhibitors and attendees from across the industry inspired to explore ways in which the mobile comms and internet worlds can successfully and enduringly coexist. It’s clear that events such as AfricaCom, which bring businesspeople together from a broad geography and wide range of sectors are key to catalysing the kinds of discussions that eventually make things happen.