Connecting the Unconnected Connecting the Global South

by Artur Mendes, Chief Commercial Officer, Cables

As digitisation has gathered pace in Africa, there has also been a proliferation of technology hubs across the continent. With over 442 technology hubs currently active and several more planned it is clear that there is a strong urge to create homegrown digital businesses across Africa.

Artur Mendes has been the Chief Commercial Officer of telecommunications multinational company, Angola Cables, since 2013. Operating in the whole- sale market, Angola Cables commercialises data through submarine fibre optic cables. Artur has more than 20 years of experience in the European and African telecommunications sector with a particular interest in mobile telecoms, submarine cables and satellites. He is responsible for marketing the three mega-projects that the company is currently carrying out in Fortaleza, Brazil. This includes a tier III data centre, under construction in do Futuro on the Ceará coast, and two submarine fibre optic cables. The first of these is , which has been in operation since the end of 2017, connecting Santos, in São Paulo, to Fortaleza and then on to Miami. The second is the South Atlantic Cable System (SACS), which is in its final phase of implementation and will link , in Angola to Fortaleza, by an alternative and innovative route, via the South Atlantic.

Angola Cables is also one of the largest shareholders of WACS (West Africa Cable System), which links to London, providing services to operators in Angola and the sub-Saharan region, making it one of the largest IP providers in the region. The company aims to build a digital bridge that will connect the African and South American continents. Its aim is to transform Angola into one of the key telecommunications hubs of the African continent.

In the last decade, the growing impact of Leapfrogging and the digital over 442 technology hubs currently active digitisation on the world economy has economy and several more planned it is clear that significantly surpassed all expectations. there is a strong urge to create homegrown With seven of the top ten most valuable While the benefits of digitisation are digital businesses across Africa. iHub in companies being technology companies, it self-evident to many, for low income Kenya has already helped more than 150 is clear that the internet has had a transfor- countries there is a necessary cost benefit start-ups, while programs from large mative effect on much of the world. analysis in pursuing digitalisation. Budgets multinationals like Microsoft BizSpark However, there are still four billion people for developing key services such as health- give access to training and technical experi- who do not currently use or have access to care and education are already highly ence that can be extremely valuable. The the internet. This is more than 55% of the constrained. However, digitisation can spread of these hubs has been made global population and shows there is still a often bring about substantial economic possible by the increased availability of massive growth opportunity in much of the benefits. As with the example of M-Pesa internet services on the continent. This is developing world. The internet is not only a where the mobile money introduced by especially the case regarding the expansion major driver of productivity for firms but Kenya has helped to reduce extreme pover- of international services such as Massive also one of the fastest growing sectors of ty and increase consumption. Better Open Online Courses providing free educa- the last decade. The submarine cable internet coverage also helps make up for a tion and Social Media sites which have industry will play a pivotal role in connect- lack of investment in infrastructure, a helped to connect like-minded technolo- ing the next 4 billion people. In doing this it process known as leapfrogging. In some gists in their countries. will be absolutely necessary for significant cases this can actually solve weighty digital integration between lower income developmental problems for a far lower The rapid expansion of inter- countries, emerging markets and high cost: by giving farmers access to an national data income countries. In the coming decades accurate price for their crops or providing we will likely see far greater internet training and remote working opportunities The expansion of international data has investment between rapidly growing at some of the best companies in the world. been strongly affected by the American emerging regions such as Pacific Asia and cloud giants however it would not be sub-Saharan Africa. With this, there will be As digitisation has gathered pace in Africa, possible without the accelerating demand a raft of opportunities to shape the future of there has also been a proliferation of from developing nations. According to the digital development. technology hubs across the continent. With TeleGeography global international

Asia Pacific III | 2018 . 24 Connecting the Unconnected bandwidth grew by 40% year on year than its fair share of military and economic between 2012 and 2016 with the large cloud instability, DDOS and cable damage. Emerging nations having gone through the American providers being responsible for Ultimately this vulnerability impacts IP process of leapfrogging themselves will be approximately 70% of the growth in global transit speeds, reliability, bandwidth and in a prime position to invest in lower international bandwidth. While American latency. Instead, the new SACS route will income countries and offer affordable companies use the international cloud save between 20-40 milliseconds in latency. services and devices as well as key training providers for their expansion so do many Projects such as this have historically been and development. These cross-border flows firms expanding between developing seen as risky by companies from the US and of investment, technological training and nations this figure therefore does not fully Europe thus leading to a lack of investment capacity will further contribute to the clarify the true extent of growth from between developing regions. integration and economic growth of developing nations. In fact, one of the most developing countries. Underscoring much significant factors for American cloud Sino-African collaboration of this will be investment in submarine companies has been growth of demand for cables that provide the infrastructure for internet services in developing nations. Where there was once an absence of capital connecting the global south. India has become the second largest user of there are now a large number of companies LinkedIn worldwide and the hosts 270 from developing countries investing in each million Facebook members far surpassing other’s technology sectors especially in the the United States’ 210 million. This need case of China. Much of this investment is for content will only continue to increase as part of the Belt and Road Initiative first the next 4 billion people come online and announced by Xi Jinping in 2013. This provide a robust demand for international includes significant capital expenditure in data capacity. Africa where China is aiming to promote development not just via trading routes but In the last two decades one of the most also digitally. Whether it is the Chinese important developments underscoring the internet giant Alibaba providing training; or expansion of international internet compa- Huawei’s multitude of investments in nies has been the rapid growth in submarine African telecoms, there has been a consid- cables carrying data internationally. With erable amount of engagement between 98% of international data being carried China and a multitude of African nations. through submarine cables it is clear they Huawei first established sub-Saharan account for a massive expansion in capacity operations in Kenya 20 years ago, from between count ries. As countries continue to there it has become one of the three connect with each other and more OTT telecommunications companies in the companies develop and choose to expand region. This engagement has worked partic- internationally it will become increasingly ularly well as Chinese companies often important for capacity to keep up with the provide low cost solutions such as afford- generation of data. Governments and able smartphones and telecommunications businesses the world over have realised networks custom built for African nations. this, leading to vast sums being invested in In the case of Tanzania China has helped building new submarine cables. From 2017 finance much of the telecommunications there has been more than US$4.4 billion infrastructure for the country as well as proposed for 41 projects, with capacity providing a large suite of ancillary system expected to rapidly increase. While services. African countries and China are between 2003 and 2015 Africa had the very much committed to continuing this highest regional share of investment there is mutually beneficial collaboration at the still a significant connectivity divide recent 2018 Beijing Summit of the Forum between Africa and Europe or North Amer- on China-Africa Cooperation (FOCAC) ica and far more investment necessary for President Xi announced “eight major African nations to bridge this gap. initiatives with African countries", this is on top of the announcements he made at the The rise of new submarine BRICS summit regarding investment of cable routes US$14 billion in South Africa. In the next decade the cooperation between African The growing demand for connectivity in countries and China is likely to continue Africa has meant that submarine cable and even grow in depth. routes that where once not viable have now begun to see investment. For example As larger emerging markets continue their Angola Cables has built the South Atlantic rapid economic growth they will play an Cable System (SACS) — the first subma- ever-greater role in helping lower income rine cable carrying data directly between nations improve their connectivity. This South America and Africa. This new route will be coupled with the continuous provides opportunities for the transit of IP. increase in demand for capacity as data Historically for data to travel between US availability grows around the globe and and Asia it would use the cabling route in services continue to reach more remote the Suez Canal region which has had more regions.

Asia Pacific III | 2018 . 25