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12 Technology Predictions For Kenya In 2015

Earlier this week I did a blog post that captured what I saw as the 10 biggest technology stories from 2014 in Kenya. I thought I would try and do the same in terms of looking into my proverbial crystal ball to predict what I expect to be the 12 most significant technology trends for 2015. This list is highly speculative but it does offer at least a few more or less accurate predictions that we can expect to happen. Once again, I look forward to your comments on the same so that you can offer your on take on anything else that I could have missed.

Safaricom Launches A Video On Demand (VOD) Service

To me, it seems like a foregone conclusion that Safaricom will take a foray into video on demand (VOD) services in Kenya ala Netflix. They have the largest broadband network in Kenya and de facto market dominance to pull this off. They have both wireless and fiber networks throughout Kenya and the benefit of M-Pesa as an ideal payment platform for ‘a la carte’ video content. This would put them head to head with the likes of Wananchi’s Zuku and Multichoice’s DSTV as competitors which is nothing new given what M-Pesa did to banks in Kenya. Its a natural fit. its the logical next step. Safaricom will become a VOD service provider in Kenya in 2015. Mark my words.

Equity Bank’s Equitel MVNO Becomes Kenya’s Third Largest Mobile Network

It is rumoured or estimated that Equity Bank’s Equitel Mobile Virtual Network Operator (MVNO) has already acquired over 400,000 subscribers since they quietly started distributing SIM cards to their banking customers. This has been achieved without a formal marketing approach to-date. Indeed, Equitel is leveraging its Equity Bank ‘Members’ to grow their MVNO in a more or less organic manner. This will change in 2015 when Equitel goes into full marketing mode and fully leverages the reach of their close to 9 million customers in Kenya. This in effect could mean that as many as one third or more of their Equity Bank customers (i.e. 3.5 million?) could be Equitel subscribers by the end of  2015, making Equitel the third largest mobile network after Safaricom and Airtel. This is a very real possibility.

Safaricom (Finally?!) Launches An M-Pesa API

Its been a long time coming but I have it on good word that Safaricom will definitely launch an M-Pesa Application Programming Interface or ‘API’ for short within the first half of 2015. The reason why this will finally happen after years of waiting is that the second generation Safaricom M-Pesa platform will have been deployed by then and this is one of the core enhancements built into the same. You see, the caveat is that the first generation M-Pesa was built and deployed for basic mobile money transactions and was never designed to do all sorts of funky things like an API.

According to my source at Safaricom, The M-Pesa API will first be deployed with their existing Value Added Services (VAS) Partners and then gradually expanded to include businesses such as mobile app developers and others for seamless M-Pesa integration. The e-commerce potential for the M-Pesa API is enormous which is why numerous businesses are salivating at the possibility of being fully integrated into the platform instead of using dodgy workarounds and clunky interfaces as is the case at the moment.

Orange Exits The Kenyan Market Through An Acquisition

Its a well known fact that Orange is bleeding red (pun intended) with its 70% stake in Telkom Kenya. They are quite simply not making money and its so bad that they could essentially go out of business unless the Government of Kenya intervenes. Indeed, it was late last year that Vietnam’s Viettel did an extensive due diligence on buying Orange’s stake in Telkom Kenya and found the terms of buying the stake to be unattractive. It does not look good given that Orange just wants out and the Kenyan Government wants to protect what it sees as a strategic national asset. It seems obvious to me that 2015 will be the year that Orange’s stake in Telkom Kenya will be acquired by a major player in emerging markets such as MTN, Etisalat, Econet Wireless or Orascom. Its simply a matter of time.

The Arrival of Sub-Kes. 4,000 Smartphones In Kenya

In the blog post from earlier this week on Kenya’s 10 biggest technology stories, I mentioned that Safaricom plan to launch a smartphone for Kes. 2,000.00 in Kenya this year. This may be super optimistic unless then plan to subsidise the same considerably? Its possible that Safaricom will parter with an mobile devices OEM to launch such a device using a reference design from Android One which would make it feasible. That being said, we already have Android smartphones retailing for Kes. 4,500.00 in Kenya which is the equivalent of approximately US$ 50.00. Therefore, my prediction with or without Safaricom’s incredibly inexpensive smartphones is that we will have for the first time smartphones retailing for under Kes. 4,000.00 by the end of 2015.

Samsung Cedes Significant Market Share To Competitors In The Low to Mid-Tier Smartphone Segments In Kenya

I have great admiration for Samsung as a leading global mobile devices OEM. They are the largest global player for smartphone and have made dents for years in Apple’s iOS game plan. Samsung has led the way for so long and have also proven to be incredibly innovative. However, times are a changin and 2015 will be the year Samsung will feel the competitive pain more than ever in Kenya. You see, Samsung is a premium high quality smartphone brand on par with Apple and all the rest like LG, Sony, etc. However, there are loads of new vendors coming to Kenya in the mid to lower tiers that are eating their lunch, so to speak. These are mobile devices OEMs like Wiko, Infinix, Tecno, MiFone, and others I am not even aware of.

These emerging mobile device brands are hurting Samsung big time by offering high quality and lower cost smartphones that are actually really (as in really!) good. In a price sensitive market like Kenya, if consumers can save Kes. 5,000.00 to Kes. 10,000.00 buying a lower tier brand but get a decent quality smartphone in the process they will take that route. I have seen this first hand all around  me and people are opting to ditch hitherto dominant Samsung in the mid to low-end smartphone ranges. That being said, Samsung still enjoys ‘top-of-mind’ leadership for premium smartphones in the high-end and in my view that market segment will remain secure, for the time being.

Safaricom’s Competitors Launch 4G Services In Kenya

Although Safaricom was able to get a jump on its competitors in Kenya last month by being the first mobile network to come to market with 4G, one of the conditions from the Communications Authority of Kenya is that they have to open 30% of their 4G network to capacity competitors. This means that the barrier to entry for the likes of Orange and Airtel is actually really low as they do NOT have to invest as much as Safaricom in terms of network roll-out.

That being said, as I see it, even if 4G becomes widely available in Kenya over the next two years its quite evident we are not yet even using 3G to its fully capacity. I have rarely had connections of over 10 Mbps on any of the three mobile networks in Kenya that support it and yet 4G promises connections of at least 80 Mbps? We have NOT yet fully exploited 3G’s potential in Kenya so even if  it happens it will take years to feel the full impact.

Mobile Money (Read: M-Pesa) Interoperability Finally Becomes A Reality In Kenya

Late last year Safaricom agreed to open up its M-Pesa Agent network to Airtel and other competitors in Kenya after lots of pressure. Given the importance of mobile money in Kenya’s economy, its become increasingly obvious that M-Pesa needs to be interoperable with other mobile money platforms such as Airtel Money and Orange Money. This sort of interoperability could happen as early as 2015 once all the details are hashed out by the Industry regulators and stakeholders.

I am reminded of the time over a decade ago when Safaricom and Yes mobile were the main mobile networks in Kenya and neither could send or receive text messages to each other. It was amazing when interoperability happened as I recall and your mobile device became infinitely more useful. This is exactly what will happen when you can send and receive mobile money irrespective of platform you use. Its pretty obvious to me that regulatory pressure and simple business logic will make this happen, even if its ultimately to Safaricom’s detriment.

Digital Advertising Spend More Than Doubles As TV Audiences Plummet Due To Digital Migration

As I write this, surprisingly, Digital Migration in Kenya has still not commenced due to a court order from the consortium of Nation Media Group, Standard Media and Royal Media who wanted more time to roll-out their digital TV offerings. Part of the reason for their stalling as three of the largest media concerns in Kenya is the anticipated loss of viewers once their analogues signals go offline. Its estimated that Nairobi alone has close to 1 million TVs that are NOT yet digital TV connected to-date. This translates into millions of lost viewers going forward.

Since the Digital Migration train is almost certainly leaving the station next week, it suggests that media advertisers will start looking at alternatives to Digital TV in the short to mid term. In my view, given that print and radio are already well utilized, it seems obvious that digital media will be the biggest beneficiary of alternative ad spending plans. I expect that digital media ad spend will more than double in 2015 from what was spent in 2014. My best guess is that most big brands are spending less than 3% on digital advertising so an increase to 6% or more would be massive.

Cybercrime Goes Into Overdrive In Kenya

Many of the affected businesses and individuals don’t talk about it but more and more are becoming victims of cybercrime incidences. Whether its bank fraud and identity theft, lots and lots of cybercrime is happening in Kenya and 2015 will be the year it becomes absurdly obvious that its a serious problem. As a result, it will be the year that organisations of all sizes and in every conceivable sector will invest inordinate resources to secure their technology platforms across the board so as to protect themselves and their stakeholders. Indeed, being secure from cybercrime will become a C-Suite priority agenda item, ensuring ICT security consultants and firms are going to coin it BIG time in Kenya! For sure, 2015 will be the year cybercrime will be as much a major threat as a well as a business opportunity

On Demand Mobile Apps Proliferate The Kenyan Market

2014 was the year than on demand mobile apps became available in Kenya. Some of these mobile apps include Easy Taxi and Sendy that enable you to ‘push the button’ and a service appears. Indeed, the global poster child(ren) for on demand mobile apps includes Uber and many others. Its the wave of the future. In Kenya, I have become an advocate of using Easy Taxi – it has literally changed my life!

Therefore, my predication is that this class of mobile apps will become far more prevalent in Kenya from 2015 to the extent that we will be spoiled for choice and get confused as to which ones we should use or not. Expect to see on demand mobile apps for cleaning services, mechanics, etc coming online in Kenya very soon. The bottom line though is that the added convenience of on demand mobile apps will change how we perceive the usefulness of our mobile devices paired with the Internet for real-time and real world offerings in Kenya

Internet-Based Mobile Messaging Eats SMS/Texting For Lunch In Kenya

Its more or less a foregone conclusion that almost everyone you interact with on your mobile device in Kenya is on WhatsApp. This is the most dominant Internet-based mobile messaging platform in most emerging markets globally. In Kenya, a survey conducted by Jana Mobile early last year found that approximately 49% of ALL mobile users in Kenya are on WhatsApp. The cool thing about this trend is that WhatsApp users straddle both feature phones and smartphones so its not just about the ‘latest and greatest’ mobile devices as far as the trend is concerned – this is happening across ALL Kenyan consumer demographics and psychographics – trust me!

Although WhatsApp leads by a wide margin its not the only action in town as Facebook Messenger, Vyber, Kik, SnapChat, WeChat, and Line are all starting to make inroads in the marketplace. Therefore, on the basis of this trend, my bold prediction is that mobile messaging WILL eclipse SMS/texting as the preferred messaging choice in Kenya from 2015 (thats if it hasn’t happened already!). Its cheaper, more versatile and more capable than SMS/texting could ever be. However, given that you need to be connected to the Internet means that its still unaffordable for large number of Kenyans out there.

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3 Comments

  1. it6
    January 7, 2015 at 1:01 pm — Reply

    Very informative: Yes on demand Apps are going to be huge. I can see on demand grocery deliveries. Lets say i need groceries and dont have time to buy them. I can have someone shop for me by sending them a list of groceries on my phone and they can deliver them to my house. Sendy or easy taxi are a good start and may be they need to be thinking in these terms

  2. Cindy
    February 13, 2015 at 9:31 pm — Reply

    Well written. Let us hope the exit of Orange – if it happens, won’t take us back to the days of high charges, especially for the internet. As for the digital migration – the loss of viewers for the Free-To-Air channels will be massive!

  3. […] This article was originally published on Moses Kemibaro's blog. […]

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