Africa – shortly to become a 1-billion person market – is becoming a major focus for over the top (OTT) players looking to exploit the growing mobile ecosystem.
According to IDT Global’s Jonah Fink, the continent’s service providers have the capability to rise to the challenge OTT players provide. Speaking at the value-added services (VAS) Africa conference in Johannesburg, Fink says speed and customer loyalty were key factors in the battle to win the African OTT war.
“The goal for service providers is that they basically need to become OTT operators faster than the OTT providers can become carriers,” he says, “but they can do it and the fact is that consumers don’t like OTT operators very much – they would stay loyal to the African Telco brands if they could get the same services.
“Ovum is already estimating that globally carrier OTT could be worth $20-billion by 2018. That $20-billion will not just fall into laps of African operators – they’ll have to make sure they fight for it. They also predict that OTT operators could cost carriers $63-billion per year if they don’t react fast enough and in the correct way.”
The growth of mobile penetration across Africa and the ever increasing speed of cellular roll outs have enabled huge market potential for OTT operators such as Skype, WhatsApp and Viber, posing a huge threat to African Operators revenues.
However, this threat may not be as bad as once feared. In a recent survey by YouGov 42% of consumers associate the phrase ‘Services I trust’ with a mobile operator, rather than an OTT player. The survey found that respondents felt mobile operators would be more proficient in the provision of OTT-style services than current OTT providers.
Fink adds: “To take on the OTT operators you have to either have very deep pockets, very slick processes and cooperative distribution channels, or be willing to partner with someone who’s already been through the trials and tribulations of launching an app. Customers are not as loyal to OTT operators as they are to African Telco brands, paving the way for operators to launch their own OTT value added services that can take full advantage of this loyalty.”