How is Liquid Telecom unlocking Africa's fibre connectivity?
02 July 2019 | Laurence Doe
New fibre capabilities being unlocked by Liquid Telecom are providing Africa with access to powerful systems. CEO Nic Rudnick talks about the benefits this will bring and how Liquid Telecom plans to address the challenges that come with more connectivity.
When Capacity last interviewed Nic Rudnick in last year’s August-September edition, the Liquid Telecom CEO provided an optimistic outlook on how the data, voice and IP provider was performing in eastern, central and southern Africa as part of its new legacy for the continent. Its wholesale open-access fibre network business model had recently achieved a huge success after a Telecom Egypt agreement allowed the African operator to complete a pan-African terrestrial fibre network from Cape Town, South Africa, to Cairo, Egypt. Since then, Liquid Telecom has continued its run of impressive accomplishments by securing $180 million in funding from UK-based development finance institution CDC Group – the largest equity investment the firm has made in its 70-year history.
With great pride in his voice, Rudnick tells us that it’s a “good validation of the strategy and business model that we have been adopting”, which consists of widening its fibre footprint and broadening its data centres and cloud services product portfolio across Africa for wholesale, enterprise and retail customers.
“CDC likes to invest in high-impact companies, which is also a reflection on the impact that we are having on the countries and communities which are using our network across Africa,” explains Rudnick, adding that Liquid Telecom’s plan is based on two “highly evolved” strategic objectives. The first is to continue its connectivity throughout Africa “in a way that improves the quality of data”, he says, especially through cross-border links; a plan that involves aims such as enabling latencies to be reduced when people use either Liquid Telecom’s or other operators’ networks.
“That, we believe, is more important now than it’s ever been,” Rudnick says excitedly, “due to the introduction of cloud servers, which are a complete game-changer for Africa because they are allowing the most advanced technologies in the world from more enterprise resource planning systems all the way to artificial intelligence becoming immediately available to enterprises and start-ups in Africa”.
Rudnick explains that up until now the technology has been “out of reach”, with enterprises having to buy hardware, servers and paid licence fees, which normally run into several millions of dollars.
However, Rudnick has seen this all “completely change”, with African SMEs able to access the cloud services for the first time in a pay-as-you-go business model, all bundled together and payable in a local currency with their connectivity. “It’s a quantum change, bigger than the impact that cloud is having on developed countries,” states Rudnick, but he quickly adds that it does require a network that can deliver the services “which is why we have been investing in and focusing on new internet exchanges, increasing cost order links and building up our One Africa network”.
Liquid Telecom’s Sudan link with Telecom Egypt’s network formed a new cross-border interconnection, completing a 10-year project to offer a 60,000km network running the length of the continent. The vision to create a single fibre network from the Cape to Cairo was incomplete when Capacity spoke to Rudnick last year, but now the link is finished and takes just 97ms to connect, which is impressive when you consider that Liquid Telecom’s ping tests found that the subsea route would take 209ms to return. “The impact is that cloud services can now be accessed right across the continent and as the cloud service and software providers, such as Microsoft or AWS, start rolling out, it now means that it will be possible for enterprises and start-ups to access their cloud services at low latencies and that those cloud systems will work,” explains Rudnick.
Data centres are another component of Liquid Telecom’s African expansion. With facilities in Cape Town, Johannesburg and Nairobi, the company wants to also add centres in Mombasa, Egypt and Nigeria “and some other countries where we may have smaller rollouts”, explains Rudnick. He sums up the strategy in two words: “comprehensive ecosystem”, which, Rudnick adds, will encompass existing fibre networks plus additional builds, large scale deployments of data centres and relationships with cloud providers who bear the fruits of services that can be hosted in Africa for the first time. All this will result in a “new future for access to technology across the continent”, says Rudnick. Asking what feedback Liquid Telecom has had so far, he says: “We’ve received a lot of enthusiasm for One Africa,” replies Rudnick. “I think if one looks to see what One Africa does to latencies, and the opportunities that it opens for the availability of cloud and online services, they will find it has considerable impacts. It’s early days yet because we’ve just completed the network and are fully commercialising it, but certainly the interest that we’ve received from within and outside Africa from people wanting connectivity in and from the continent looks extremely promising.”
In Rudnick’s last update, he told Capacity that Liquid Telecom has invested “a lot” in the subsea cables surrounding Africa. The company is a shareholder in the West Africa Cable System and the West Indian Ocean Cable Company, but also The East African Marine System (TEAMS), which is an initiative spearheaded by the government of Kenya to link the country to the rest of the world through a submarine fibre optic cable. It was first proposed as an alternative to the East African Submarine Cable System (EASSy), which Liquid Telecom also has investments in.
Rudnick tells us that there are a number of new initiatives underway on the East and West coast of Africa, which are primarily being driven by the US OTTs and has led him to discuss opportunities, leaving him with “no doubt” that Liquid Telecom will participate in such cables. “This will happen to ensure that our future requirements for capacity in the years to come are able to be satisfied,” he says, not giving too much away. One area of development that Rudnick has kept his eye on are the projects that will link Africa to South America. His particular focus was on the technical and economical elements of the unfolding projects, but has Liquid Telecom acted on it? “Is that something that’s been realised yet?” I ask. Disappointingly, Rudnick doesn’t reveal new and great investments, and responds by saying that he’s still “keeping tabs”, but believes the cables are “well underway” and that Liquid Telecom is planning to connect its pan-African network to them.
Great power and responsibilities
To round up a very insightful update, I concentrate on Liquid Telecom’s great growth, which was always bound to be challenging and create opportunities, but what has happened to the organisation itself over the course of its transformation?
“As you grow as an enterprise, the structure of the organisation needs to change to position yourself in a way that makes your technologies, products and services available to as greater number of people as possible,” Rudnick explains. “It’s also reasonable that the enterprise structure also evolves over time in order to ensure that we’ve got the right people in the right places to continue to grow the business at the speed that we’d like it to grow.”
The greatest opportunity across Africa is the cloud, according to Rudnick. He explains that the continent “doesn’t really understand what it is”, causing many missed opportunities as it can grow “a start-up in any country within Africa”. “You can access artificial intelligence, you can get automatic conflation and speech functionality, the amount of technology and capability that is now just there is just incredible”, he states excitedly. “This is the biggest and most unbelievable opportunity that is arriving at people’s doors in Africa, but the challenge is that a lot of people don’t appreciate the opportunity.” Giving an example, he says that some businesses believe that cloud “is just an online storage and backup system”. “We run the risk of building networks, putting in data centres, bringing in connectivity and access to the most advanced technologies in the world and finding that they’re underutilised because the awareness and knowledge to make use of them is not there. That is the biggest challenge for us as an industry, to make sure that we are telling people that we’re bringing in knowledge and that we are making these services available at affordable prices so people can make use of them.” He concludes by emphasising that if the industry can’t achieve this awareness “it will have failed”.