Accenture’s Managing Director for Communications, Media & Technology Lead Africa, Nitesh Singh (pictured), warned telecom operators they must embrace digital transformation to survive, especially with innovative players like Starlink encroaching on the connectivity market.
Speaking to Developing Telecoms, Singh described the current telecoms landscape as akin to the “Great Depression,” citing the declining profits and revenues of mobile operators.
This struggle is compounded by the “massive disruptive threat” posed by SpaceX’s satellite connectivity company, Starlink, which continues to secure operating licences across emerging markets. Singh acknowledged that Starlink is a “good thing” for plugging coverage gaps and connecting rural communities seeking connectivity. As an example, he highlighted Zimbabwe, where demand for Starlink services has outstripped supply since its launch in early September this year.
“I think what these operators need to do is reinvent themselves, offer different services, explore new verticals, and enter different industries. They must transform their businesses because the traditional telco won’t survive. Even the techco model everyone talks about – tech without traditional services – is not good enough,” said Singh.
“Consumers are changing. If you look at the younger generation and the vast amounts of data they consume, you have to offer a different value proposition for them.”
Singh urged traditional telcos to place digital transformation at the core of their operations to reinvent themselves and reverse their declining fortunes. He stressed the importance of first structuring their data and migrating it to the cloud. This provides the foundation for operational improvements and enables access to revenue-generating technologies such as generative AI (Gen AI).
“I think the trick here is that when you start training these large language models with structured data, you’ll uncover new algorithms and customer needs. Telcos will figure this out and be able to offer a unique set of services to their customers. That’s the problem right now – everyone is just selling data. Those days are over. That was a decade ago, and they are still stuck there.”
Singh likened this need for digital transformation to the telecoms industry’s “Kodak moment,” referring to how Kodak, despite dominating 70% of the camera market since the 1950s, dismissed the rise of digital cameras in the 1980s. The company filed for Chapter 11 bankruptcy in 2012.
“If you look at the threats to telco businesses – the Starlinks of the world are a big threat, right? It’s over the air; it’s not deployed on the ground. If licences are granted to players like Starlink, it will have an impact. Telcos must realise this is a threat they cannot ignore, and they need to reinvent themselves to counter it.”
Handset affordability in Africa
Singh also addressed handset affordability in Africa, noting that while hyperscalers are stepping in to help reduce costs, the core challenge lies in trading in local African currencies, which are often affected by exchange rate volatility.
He pointed out that most handsets are manufactured in markets like China and sold in dollar-based currencies, further complicating affordability for African consumers. Singh emphasised the need for Africa to establish local manufacturing hubs for handsets, leveraging the continent’s workforce to reduce costs and eliminate import duties.
Building such infrastructure, he suggested, could create a more effective supply chain and address pricing challenges, which have hampered the long-term success of low-cost devices in the region.
