WIOCC at East Africa Com, 21st – 22nd May

WIOCC be joining 600+ senior level representatives from telecom companies, mobile and fixed-line operators, ISP’s, regulators, investors, telecoms solution vendors, among others at Safari Park Hotel in Nairobi, Kenya on May 21st and 22nd at the East Africa Com conference and exhibition.

Africa’s leading carriers’ carrier will be represented at the event by James Wekesa – CCO; Martin Mutiiria – Director, Africa Sales; Hitesh Desai – Country Manager, South Africa and Gillian Koech – Marketing.

WIOCC will be exhibiting its products and services at the 2-day strategic conference together with local partner Frontier Optical Networks.  If you have any questions for WIOCC or would just like to meet us, please visit our stand (#24) where you will be able to meet the team led by our Chief Commercial Officer.

To arrange a meeting with WIOCC please contact gillian.koech@wiocc.net.

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New interview with Chris Wood, WIOCC CEO

Chris Wood, WIOCC CEO

Just over 12 months ago, WIOCC began delivering capacity on EASSy (East African Submarine System) when it went live. One year on, Adrian Linden, editor of Connected talks to WIOCC’s CEO, Chris Wood, about the changes that have affected wholesale and African telecommunications markets.

Adrian Linden: It’s been a hectic year for you and your team. What are the major changes that have taken place in the market since the EASSy network became operational?

Chris Wood: EASSy wasn’t the first fibre-optic cable system on Africa’s east coast, but in many African countries – particularly landlocked ones such as Zimbabwe and Burundi – the arrival of our network has, for the first time, enabled access to reliable and affordable internet connection. Over the last year the unit cost of bandwidth has dropped by between 50 and 60 per cent, which has had a major impact on both businesses and the way people live their lives. Business communications have evolved beyond recognition, bringing dramatic improvements in business efficiency. It’s hard to believe now, but receiving emails with attachments used to be a real problem in Africa and online booking and payment systems didn’t exist a couple of years ago. Local networks just couldn’t support the data demands of these services. Another key change has been the mass uptake of smart-phones in many parts of the African continent – one of the key drivers for the huge growth in bandwidth usage. As a result, growing numbers of Africans can now access social networks and other multimedia applications – with Skype and Facebook particularly popular. Africa is also now widely recognised as a global innovator in mobile applications such as e-banking and e-health.

AL: What about the impact on the international market?

WIOCC's footprint

CW: The arrival of EASSy has certainly accelerated the decision making of many national carriers in Africa, leading to significant investment in developing, extending and enhancing core backbone infrastructure. This has markedly improved connectivity into many parts of Africa. WIOCC’s 14 shareholders are all African telcos – tier 1 and tier 2 players in their respective markets. Together with WIOCC’s partner networks, they give us access to over 50,000km of terrestrial fibre-optic network in Africa, interconnecting 20 countries across the continent. In addition to this, our core network – comprising the EASSy system, together with the new EIG and WACS cables in which we have also made strategic investments – includes around 40,000km of submarine fibre-optic cable. For international carriers, this means we are able to offer a seamless, one-stop-shop service into many parts of Africa. Our carrier customers no longer need to work through multiple suppliers to connect customer locations across the continent – they can just come to WIOCC. This firmly positions us as the strongest partner for delivering African connectivity – Africa’s carriers’ carrier. We only sell capacity to carriers, so we really understand their needs and challenges.

AL: And what are their main issues?

CW: Diversity, reliability and ease of doing business. When we entered the market our aim was to offer carriers almost infinitely flexible commercial terms. To achieve this, we turned the traditional purchasing structure on its head to offer real choice of contract type, duration and terms. We have even developed a ‘pay as you use’ option, enabling carriers to secure the most cost-effective connectivity as their capacity requirements grow.

AL: You mentioned your shareholders – in addition to the terrestrial network reach, what other benefits does this structure give you as an organisation?

CW: Our structure gives us huge benefits. It provides us with a very strong financial base for a start – historically, the consortium approach has proven to be the most financially stable approach to building and operating a cable system. Regular, high-level contact between our shareholders in the various countries gives us a strong sense of solidarity and capability. In Africa, things can take time unless you know the right people to talk to AND how to get hold of them. This regular shareholder contact can be extremely useful for us, and for our customers, as it helps us get any issues or challenges resolved swiftly. Our shareholders also benefit by being able to share best practice. For example, shareholder Zantel recently set up a franchise for internet cafés in Tanzania, delivering I.T. skills training and enabling rural schools to provide pupils with Internet access. Other shareholders have been able to monitor its operation in Tanzania and are now exploring the model for their own markets.

AL: What’s next for WIOCC?

CW: Well, more capacity for one thing. Business and residential demand for internet-based services is growing at such a pace that we are substantially increasing the lit capacity on EASSy from the beginning of 2012. Over the past year we have also seen the system’s design capacity grow from 1.4Tbps to 4.72Tbps with the upgrade from 10Gbps to 40Gbps wavelengths. I am confident that technological advances over the next couple of years will allow us to implement 100Gbps wavelengths on the system – further increasing the ultimate design capacity of the system.

AL: Are you expanding your reach further into Africa?

CW: As I mentioned, one of our key differentiators is our policy of strategic alliances and investments in other cable systems. This is a strategy we are continuing to pursue as it enables us to meet the full range of carrier’s capacity requirements. We have just finalised a multi-million dollar investment in two new high-capacity submarine cable systems, WACS and EIG, serving the West African coast and providing connectivity to Europe respectively. This investment reinforces WIOCC’s ability to offer carriers high levels of redundancy and to deliver the promise of reliable, affordable, high-speed connectivity all around Africa. For our carrier customers, this means winning more business from customers who expect and demand affordable and reliable, high-speed connectivity whenever and wherever they are in Africa.

BPO – the birth of a new industry for Africa

Intense competition in India’s business process outsourcing (BPO) industry has encouraged technology firm Spanco Ltd. to expand to Africa where it expects to earn nearly half of its profits within two years.

Pravin Kumar, chief executive officer of Spanco BPO Services reported earlier this year that his company sees Africa as a solid opportunity for the company due to its proximity and almost similar time difference to the firm’s major source markets — Europe and the United States — compared with India.

“By 2013, we see our BPO business in Africa generating a turnover of about US$ 100 million. This year we will do about US$ 40 million,” said Kumar. “In two years’ time at least 40% of our profits will come from here (Africa) purely in the BPO business.”

It’s yet another marker of the economic development now enabled by the availability of low-cost and reliable, high-speed internet access and improved international voice and data services between eastern and southern Africa and the world’s key commercial and financial centres.

Africa has long possessed the key requirements to become a major player in the Business Process Outsourcing (BPO) sector – a large pool of English language speakers, growing numbers of graduates, good basic infrastructure, encouraging governments.  The missing piece of the puzzle has, until now, been affordable and dependable international bandwidth.

In the past year, since the launch of the EASSy network, BPO has gained increasing focus in sub-Saharan Africa.  In January, the South African Department of Trade and Industry introduced incentive schemes by which it hopes to increase the number of BPO jobs to 40,000 by 2015 – making the industry a key socio and economic driver for the country.

Zimbabwe, which is estimated to have the continent’s highest literacy rate and most articulate English speakers, is keen to leverage its existing strengths and take advantage of the new technologies available to the country. The Ugandan government also launched a BPO program in Uganda at the start of 2011, allocating resources to train up to 3,000 graduates in BPO studies through the National Information & Technology Authority. Initially two call centres were to be set up in Kampala, with an expansion of jobs to 7,000 by the end of 2012.

And the Kenyan Ministry of Information and Communications has stated that the introduction of fibre-optic cables such as EASSy have ‘astronomically improved the quality, affordability and availability of broadband’ and are one of the factors behind the growth of the BPO industry in the country – “a new, but rapidly growing economic sector, with unprecedented government support, bursting with talent, innovation and entrepreneurship, driven by IT-enabled services that are transforming businesses and lives nationally and internationally”.

Interview with Chris Wood at East Africa Com, April 2011

Chris Wood, CEO of WIOCC, was interviewed by Larry Madowo of NTV Kenya during the East Africa Com event in Nairobi, Kenya on 5th and 6th April 2011. Below is a transcript of the interview:

Larry Madowo (NTV Kenya): The East Africa Com conference is happening right next to where we are at the KICC. There’s a lot of interesting people coming through for the next few days at the conference. Chris Wood is the CEO of WIOCC – the West Indian Ocean Cable Company – which is the majority shareholder in the EASSy fibre-optic cable… and he is with us.

What it is you’re here to talk about is the EASSy cable – how is that coming along?

CHRIS WOOD: It’s very good – we went live last year in August and we’ve had great sales since then. It’s been a very import cable for the Kenya market, but also for the rest of East Africa because it means there’s now diversity on the coast. Up until August last year there was only one cable serving most of Africa on the east side. In Kenya we had TEAMS as well, but now that EASSy is there we have a lot more diversity and a lot more service quality in the network.

LM: In fact the EASSy cable is slightly different from TEAMS and Seacom in terms of who’s in EASSy – explain that one.

CW: EASSy is owned by a number of telecoms operators around Africa. WIOCC is the largest shareholder, but there are other companies like Vodacom and TSA in South Africa, MTN Group, Orange–France Telecom. So its owned by the operators who actually use the cable, which means that the cost structure is very different from a private system which has to go out into the market and raise a lot of capital. Whereas we’ve actually distributed the cost of the system around 26 different carriers, which means that our cost bases are very low.

LM: So how much capacity have you sold so far?

CW: As WIOCC, we have sold about 400 STM1s – which is a lot of capacity. If you break it down into Gbps – another technical term – we’ve sold about 50Gbps of capacity, for delivery over a long period of time, not all delivered now – but delivered over the next 4 or 5 years.

LM: Put that in to context for us based on the capacity of the cable itself…

CW: It’s still only a very small fraction of the total capacity of the cable. The cable itself has about 4.7 Tbps of capacity ultimately, which is more capacity than you could possibly imagine. You could download something like 10,000 high-definition DVD full-length movies in 1 second…

LM: Wow!

CW:… if you used the entire cable just for that purpose, so it has an enormous amount of capacity and we’re only starting to use it. What we’ll do next year is to light another large chunk of  capacity in January next year. The EASSy cable will be upgraded and we’ll have a lot more capacity in the market from that point.

LM: So the fact that you’re upgrading – at least doubling the  capacity. Do you see there is a market for this?

CW: Absolutely. In fact we announced in December that we were going to more than double the capacity. We’ve now re-looked at that and we’re probably going to increase it by 2 or 3 times more than we originally thought we were going to have to do because demand has moved so fast.

LM: Who exactly are you selling capacity to?

CW: As WIOCC, we sell capacity to all of the major operators and ISPs in the Africa region on the east side. So one of our customers in Kenya, for example, is Orange Kenya; we are also selling to Uganda Telecom in Uganda, to Onatel in Burundi and UCom in Burundi. So we sell to a large number of the big carriers, and then they on-sell that to their own customers and use it for their own networks.

LM: How has this changed the internet landscape in the region – in your estimation?

CW: It’s enabled the prices to come down – and I know price is always the hottest topic.

LM:..right, because I was getting there…

CW: I’m sure you were! Prices have come down considerably in the last 2 years. If you look to what people were paying for a very slow internet connection 2 or 3 years ago, we’ve seen probably prices come down by 70 or 80% already and the speed is going up commensurately with that. We’ve probably seen a trebling in the individual speeds you can get at the home or on your dongles, and that’s all because the international capacity pricing has come down so much.

LM: So give us a sense of how much for example – I don’t know in what sort of bandwidth/capacity you sell to these operators – how much it costs them for a certain unit of it. just for more of a technical aspect

CW: We sell large chunks of units – 155Mbps is our standard unit of capacity that we sell to the operators, and we’ll sell that from Nairobi to London for around $30,000 a month. That’s a far greater reduction than what was in the market less than a year ago, when prices were up to $60 – 70,000 a month. So we’ve reduced prices considerably.

LM: Based on how much you sell to these operators – do you believe the end consumer – somebody like me, I’m using a dongle over here – the costs that I pay for the internet; have they come down considerably? Is it fair?

CW: It has come down considerably but what you have to remember is that the operators who sell you the dongle have a lot of other costs in their network. They have to get the capacity out into the country. They have all their wireless networks that they have to maintain. They have fibre networks that they have to maintain. So there is a large additional cost that they have within their network. It’s not just the cost of the international capacity, but it’s certainly one big factor that’s come down.

LM: What is the redundancy set-up like for EASSy.

CW: EASSy has redundancy between its own landing stations, so if we lose Mombasa we have terrestrial capacity between Mombasa and Dar es Salaam, so we can take the traffic out through that way. On the network itself, we have what is called a ‘collapsed loop’ – we have two fibre pairs which back each other up on the actual cable itself. Which is unique on the east coast of Africa – no other system has that. So if we have a cut on a landing in Dar es Salaam, it doesn’t affect the rest of the system.

LM: How come you’ve not had that many cuts compared to others, because I believe that your business is prone to cuts – it happens?

CW: Fibre cuts do happen. We’ve not yet had a cut on the cable other than one cut off the Madagascar coast on the trunk cable that goes to Madagascar – which was repaired within 5 days and that only affected Madagascar traffic. We’ve had no other cuts on the EASSy cable apart from that. So you could say we’ve been lucky, but we’ve also built the cable in the right way in the most safe areas of the sea to ensure we don’t have cuts.

LM: We’ve just grabbed you from  East Africa Com conference right next door. What is your sense of the conference?

CW: Its excellent. The conference itself is one of the key conferences for the industry in this region. There’s a lot of operators there that I want to talk to. We’ve just met up with one of our other partners in Kenya, called FON. They’re building a network terrestrially in Kenya. They’ve put 200km of fibre into the Nairobi area and they’re lighting their network soon. So we’re having great discussions with them about how we’re going to jointly attack the market.

LM: Alright, so there’s obviously a lot of contracts inside here…

CW: Absolutely, yes.

LM: Chris Wood, CEO WIOCC, thanks for dropping by.

CW: Thank you

With thanks to Larry Madowo and NTV Kenya for permission to publish this interview.

WIOCC’s network reaches 700 cities in >70 countries

WIOCC has announced  the interconnection of its network with that of Global Crossing, a leading  global IP solutions provider, in order to meet the rapid growth in demand for  cost-effective, high-quality, end-to-end connectivity between Africa and the  rest of the world. “This strategic relationship with Global Crossing, with its  comprehensive global network reach, significantly improves our ability to  deliver end-to-end service to WIOCC customers in Africa and the rest of the  world,” said WIOCC CEO Chris Wood.

Global Crossing's network

“Our shareholders own terrestrial networks that interconnect 20 African countries over more than 50,000km of optical fibre, serving more than 400 African locations,” added WIOCC’s COO Ryan Sher. Global Crossing’s network reaches more than 700 cities in more than 70 countries across North America, Latin America and Europe. The two networks are interconnected in London, offering both service providers improved reach from their respective markets.

“EASSy represents the majority of the international capacity available on Africa’s east coast,” said Habib Issa, Global Crossing’s head of Carrier Sales for South Europe, Middle East and Africa. “WIOCC has unparalleled reach throughout eastern and southern Africa, and will play an important role in improving Internet connectivity throughout this region.”

With African consumers and businesses increasingly demanding improved access to data-rich services and Internet content originating outside the continent, the WIOCC/Global Crossing relationship benefits African telcos and ISPs by improving their ability to deliver cost-effective, high-speed connectivity with the rest of the world. International carriers looking for better connectivity into Africa can now take advantage of Global Crossing’s network as a convenient access mechanism for exchanging traffic directly with eastern and southern Africa using the WIOCC-EASSy cable and network.

Read the full press release here

For more information, contact info@wiocc.net

Meet WIOCC in May at ITW & Satcom Africa

Following our successful representation at East Africa Com last month, WIOCC will be participating in two events during May.

We will be sending a delegation to Washington DC, USA for ITW ’11. Chris Wood (CEO), Ryan Sher (COO), Mike Last (Director, Marketing & International Business Development) and Winnie Karisa (Marketing) will man the WIOCC stand and meet with customers, partners, etc. from 23rd – 25th May. Chris will also be participating in the Africa panel session on Tuesday 24th May (11:00 to 12:30).

The WIOCC stand will also be at Satcom Africa in Johannesburg, S. Africa later in the month (30th May to 2nd June), where it will be manned by Hitesh Desai and Marcel Bhatti from our S. Africa office.

Please come along to the stand to meet our representatives, or send a mail to info@wiocc.net to set up a meeting.