Africa , The next outsourcing haven

Here is a quite interesting interview a found. It's quite clear that Africa will be the next stop for outsourcing. But it's also factors of few steps that Africans and their governments needs to take. More importantly , the African diaspora will have a huge role to play.

Why is Africa becoming of interest to offshore outsourcing decision-makers? Asian countries have been very successful over the past few years at growing their outsourcing industries. However, India, for example, is now experiencing a labor shortage, which is leading to high attrition, high cost and lower-quality service as Indian companies move to rural areas to find resources. Naturally, this is starting to slow down their growth. People are now considering other locations. The only untapped region left with a large supply of underemployed labor is Africa.

The AT Kearney Global Services Location Index 2007 showed a steady rise of African countries in the ranking, pushing out countries from Eastern Europe and Latin America as labor costs increase in those regions. Seven African countries are among the world's top locations for outsourcing. Datamonitor predicts Egypt will experience most aggressive growth in next decade.

What are some of the benefits of Africa as an outsourcing destination? Africa has a population of 933 million (2007 estimate), and 50% are under 20 years. It has a large pool of underemployed at highly competitive rates. With Asia rapidly increasing in costs, Africa will be a strong alternative over the next few years, and work may be cascaded to Africa.

Another significant advantage is language capabilities. Due to its strong history of European colonial rule, many European languages are spoken on the continent, including English, French, German, Portuguese, Dutch (Afrikaans), Spanish and Italian. As other non-English-speaking countries start to take outsourcing seriously, Africa seems to be a good choice.

It also has a favorable time zone, almost the same as Europe. For U.S. companies, working hours are usually in the evening, so Africans avoid the night shifts that Asians have to work.

Its geographical location may be an advantage. North Africa is a few hours away from Europe compared to India and China.

What are some of the problems about sending outsourcing work to African countries? They are the same concerns that people talked about in Asia a few years ago, things like infrastructure, political stability, training and so on.

Africa needs to address the following issues if it wants to be a serious player: 1) [It needs] a redundant and reliable Internet broadband infrastructure; 2) more IT education; 3) government needs to invest in IT or business parks for outsourcing businesses; 4) the regulatory environment needs improving; 5) a change in mind-set, e.g., [companies] cannot depend on government handouts; and 6) more entrepreneurs to build markets, probably having the diaspora to come back and start building the Infosyses and Wipros of Africa.

Some African countries such as South Africa, which already has a strong brand, and Mauritius, which is well known to Europeans but not as well known to Americans yet, are quite advanced and already have fast-growing BPO sectors. From Mauritius, I host officials visiting from many of these countries to learn about how we have done it in Mauritius. Given their enthusiasm, I expect improvements to continue steadily.

Countries like Kenya, Botswana, Ghana and others are already organized and quite stable. They seem poised to be strong outsourcing destinations over the next few years.

Deliver us from dial-up

As we all came to agree , landlines and a wired cable network will not help Africa to fully utilize the internet. Africa's experience of the internet will be a wireless one. Consortium like Google O3b network seems more like a feasible project by deploying 16 satellites to provide fiber like speed and performance to developing countries. To all the nay-Sayers that doubt that Africa is ready for the internet , I would like to take a minute to illustrate some of the innovative ideas that have emerged and how people use the internet to better their day to day activities. I have heard people argue that a continent that does not have proper electricity service available all the time could ever benefit from the internet. Well, here are a few example of people making the best of it:

• The Village Phone: some recluded areas might only have one phone available. That phone called the "village phone" comes with an antenna ( with a range of 25 km ) , a car baterrie and a solar panel. The solar panel is a beautifull way to show that there are many option other than conventinal means of getting electricity. Solar energy is the way out!
• Web enabled phone: A few website allows used to update their contents through their cell phone. This is pretty interesting in Africa where free speech is not always respected. This feature allows journalists especially those against the government to speak up their mind freely even when government censored all other means of communication.
• PDAs for Health care: Some health care officials are using PDAs to exchange data. In absence of the website, PDAs allows data to be uploaded and download from a central server alllowing communication around the country.
• DrumNet project: This project uses GSM technology to allow farmers to get small loans to develop their farms. Through cell phone their able to exchange infromation between lenders ans farmers

So their is hope for Africa. It's the fastest growing continent in terms of internet penetration and wireless adoption. With programs like OLPC ( Once Laptop Per Child ) it's cheaper and cheaper to own a laptop in africa. Moreover , with the fusion of nanotechnology and solar power we can only be more and more hopefull

ITU TELECOM AFRICA 2008

The 2008 ITU African conference took place in Cairo, Egypt earlier last moth from the 12th to the 14th. This networking event is an opportunities for manufacturers, regulatory agencies and African government to elaborate a vision of Africa's Information and Communications Technology future. Here are a few highlights I found interesting to note on the way Africa's ICT should move forward.

• Africa and Outsourcing

Here in the USA, politicians and activists are outrages by outsourcing and are doing everything they can to diminish it if not stop it completely. But let's face it, what CEO wouldn't want a customer service center that cost him less than $2/hr per head. I know I would. Well African countries want part of that money too. Even though India's dominance on the market is substantial and doesn't seem to go away anytime soon, many african countries have the advantage to have the same time zone as most countries in the western world. As India's workforce are getting more expensive African can take advantage of it and increase its market share. To do so , many prerequisites need to be fulfilled. There is a need of a more-skilled workforce. Cisco and Microsoft researches agree that about 1 million IT skilled worked are currently needed in Africa. Even though , I would argue that the African diaspora of Europe , the US and Canada can surely offset this deficiency. Another important fact companies would look at before outsourcing jobs in Africa is stability. Many countries are still recovering from War and others a re so unstable that any little spark can start a fire that will plunge them in chaos. So to see an increase in outsourcing jobs in Africa, we need more IT skilled workers, stable governments, incentives for companies ( like tax breaks) and fair regulatory agencies.

• The State of the Continent
  

Africa's mobile networks are more than ever expending. There are about 200 million mobile users in the continent with 66% of its area covered. In five years, 90% of Africa is projected to be covered by a wireless network. This grow can be attributed to the fact that most countries harbor a least 2 mobile companies to compete for customers. Fairer regulatory rules will get this number even higher. The next step would be to focused on providing data access to a majority of the population. The main problem hindering this is the monopoly of international gateway by government. The creation on many submarine projects aims to solve this problem by being more fair. Then the last step would be to focus on intra-country connections which are quasi inexistent. In this case, wireless broadband technologies such as Wimax and HSPA would be required to get the job done.

African Fiber Telecommunication structure

Many people wonder why Internet traffic in Africa is so low or why there's such a low bandwidth utilization in the continent. A big part of theses problems is related to the policy issue of "Open Access".Let me break it down. Africa's international connectivity is provided by one sole cable called SAT 3. That cable was financed by a consortium of 36 operators from Africa, Europe , Asia and the U.S. It lands in Angola, Gabon, Cameroon, Nigeria, Benin, Ghana, Ivory Coast, Senegal, Canary Islands.It has a capacity of 120 Gbps but about 40 Gbps are currently used. Each operator, which is, for African countries, the national carrier, owns capacity on the cable depending on their contribution to the project. Non-owners who need international connectivity can get capacity on the cable in one of two ways. They can lease it from the national carrier if they have a license to carry international traffic. Or, they can buy it directly from the pool after the national carrier 5 years exclusivity. That is where comes the problem. Because the incumbent have exclusivity , it can basically charge whatever price it want. What ended up happening is that small ISPs who don't have enough capital to buy capacity from the cable pool or pay the enormous rates charged buy the incumbent settle buy using satellite telecommunication. "Open Access" will actually solve this issue by allowing the ISPs to compete with the incumbent cable capacity. It's a fair competition which will benefit the African countries by increasing the internet bandwidth utilization and making internet available for a wider audience. Among many advantages, adopting an "Open Access" policy will provide a better alternative to expensive and not-so-reliable satellite communications, reduce the cost of communications services, allow international trade and job creation, extent learning and promote social participation.

Neotel WiMAX offering

South African’s first fixed line telecommunications competitor to Telkom, Neotel says it plans to deploy its enterprise WiMAX solution as last mile access in areas where it already has a fibre network. The rollouts will commence in July. Neotel currently has a 12,000km national backhaul fibre network, as well as metro fibre networks. Stefano Mattiello, executive head of the enterprise group said, ‘We are in the rollout phase of our enterprise broadband wireless network and have already established 22 sites’. The service will initially be available in the Johannesburg, Pretoria, Cape Town and Durban metropolitan areas, with increased availability as the company continues to rollout its fibre network. Solutions offered to customers are scalable, ranging from 2Mbps to 10Mbps, depending on customer need.

POWER OVER ETHERNET

This is the presentation I gave a couple of weeks ago on power over Ethernet. It focuses on the technology diffusion. I used a Fisher-Pry model to predict how long it will take the technology to reach its full potential.










Theta is the market size
T_0 is the number of years to reach 50% of the market
Alpha is the diffusion rate

BUILDING A WIRELESS NETWORK in Developing Countries PART III

PART III: INSTALLATION CONSIDERATION


When installing a Wireless Access point a couple of consideration need to be taken into account. If the WLAN access point is to be installed outside , it needs to be protected from rain , wind , sun and other elements that may deteriorate it. It needs to be properly grounded to sustain when lightning occurs, power spikes. Also, power needs to be provided to it and antennas need to be installed in such away that will cover the maximum area possible.

• Lightning protection and power spikes
  

It's imperative to properly protect not only your equipment but also all equipments connected to your network against lightning. To do so , you can make use of fuses and circuit breakers. Too often neglected , a simple installation of a circuit breaker can protect network managers from very tragic situations. Another protection is to ground the antenna. When grounding remember that you are trying to accomplish two goals: First you want to create the shortest path from the highest conductive surface to the ground . Then you want to create a circuit to dissipate that excess of energy. The idea is to have the lightning energy to travel through the shortest path thus bypassing the equipment. Power stabilizers and regulators take different level of power and provide the desired voltage. Although , they are very important devices they offer little to no protection from lightning. You should always check power stabilizers after a lightning strike because more than often they'll burn out. Regulators are less likely to burn out.

• Providing Power: Power Over Internet

I actually did a presentation on this subject this week. I'll try to find a way to post the slide on my next post. Basically, Power over Internet is defined in the IEEE 802.3af standard and soon the IEEE 802.3at. The later is expected to be adopted in early 2009 and expect to provide power up to 60W ( more than enough to power a laptop!). The IEEE 802.3af standard was adopted in 2003 and provide 13W of power to Powered Devices. It defines the means of supply power to devices using an Ethernet cable. Power is supply without interfering with data transmission on the same wire. Some Ethernet switches will provide power using the same wires used for data others will use unused wire pairs. Power Over Ethernet is the first internationally approved power standard. The adoption of the new standard promises a bright future for power over Ethernet. Anything can be powered by it laptops , WiMax base stations , the only limit is human's brain.



(To be continued....)