Posts Tagged ‘uganda’

Future of Software Development Industry In Uganda – 2015 Edition

These are my thoughts on the future of the software development industry in Uganda, after the official announcement of ThoughtWorks closure of the Kampala office (http://info.thoughtworks.com/Kampala-office.html).

I would like to approach this first of all by analyzing the contribution of ThoughtWorks to the Ugandan technology space, then what I see the future as.

ThoughtWorks contribution in two aspects – showing that its possible to run a pure-play software development business operation out of Kampala using Ugandan based talent, and the second providing an injection of new DNA into the local technology community. The exposure to international level processes, practices and projects have helped grow the experience of the local software development talent.

Local communities have been started & supported, included but not limited to Agile Uganda, Geek Night, Girl Geek Dinners (yay! Women in Tech), Rails Girls and Ruby Fridays. The OpenMRS community run a number of events to help grow its reach, while the Technology Radar discussions provided a continuous look into the present and future of computing. The contributions leave the local technology space different from three years ago.

What does the future look like? A tough question, and my answer is biased by over 15 years experience writing software in Uganda, my overbearing optimism, and my newly rekindled foray back into software development.

The future is bright, but can only be harnessed if the business and technology communities work hand in hand to grow the local technology capability. In this, a concerted effort to build a local technology practice with buyers pushing for a local component on all contracts leveraging open source. A good example is the Ministry of Health selection of OpenMRS (http://openmrs.org) as the EMR of choice for electronic medical records throughout the country with aggregate reporting done in DHIS2. There are lots of opportunities in leveraging technology in the agriculture and education sectors which remain new frontiers to be conquered.

I would further call upon the government entities and parastatals KCCA, URA, UMEME, NWSC to leverage OpenData approaches to provide the infrastructure for young innovators to build and monetize customer centric products and services.

Like Ghandi said, be the change you want to be in the world in this case “Coding in Uganda, for Ugandans, by Ugandans”.

Gakyali Mabaga (it is just the beginning)

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Uganda Youth – Radical Change Needed

This cold February morning signaled the start of the rain season in Kampala, which after the blistering heat is a welcome change before the populace starts complaining about the floods, mud and wanton debris associated with rain storms.

That being said the morning was punctuated by an insightful article by Simon Kaheru titled “it’s no wonder some of these youths are unemployed”  where unemployed youths are exalting how they have no opportunities, but do not put skin in the game to actually work their way up the ladder.

The response from Mwine Edgar, An Open Letter to Simon Kaheru is a clear picture to the entitled nature that the new generation of youth have today, and their expectation for a silver spoon to be provided by the government and community.

Out of the blue was Paul Busharizi’s, The Unwholesome pressure we put our children under, which underpins the fact that the populace is pushing children through the education system into a white collar career yet there are alternate options.

Not all is doom and gloom, however there is need to change the orientation of the messages going out to the youth and their parents/guardians to set them up for success in the future:

  1. It is okay to have a blue collar job career – everybody in the country is targeting a white collar job, but that means you have to work and compete to get the job and keep it.
  2. Education is an enabler for a successful future and not the end all for life. While Bill Gates, Steve Jobs & Mark Zuckerberg did not complete their education, they are an exception rather than the rule.
  3. Wealth and riches require hard work, patience and time. Majority of the successful entrepreneurs that we admire have over 2 decades of working under their belts.
  4. You do not need alot to start your journey, start small and grow what you have, like the saying goes easy come – easy go.
  5. Get off your high horse and get a job, any job because that will give you the appreciation of what it takes to make money and keep it.

Your thoughts and additions are welcome …

Mobile Money will not die by 2020 but Evolve to Survive

Nicholas Kamazi has an interesting perspective in his article, 5 Reasons Mobile Money Is Going To Die By 2020, which I fundamentally disagree with. While he caters for challenges with Mobile Money (MM), he does not take into account who uses MM and why, which are the reasons for the pervasive nature. Rebutting each reason for the death of MM:

  1. Death of Feature phones:
    • Battery life: smartphones are no where near the battery life usage of feature phones, and in areas where there is little availability of electricity to charge the phones, this becomes a deal breaker
    • Cost: I do not see $35 dollar smartphones becoming that popular
    • Rugged: Feature phones can take alot of abuse, falls, drops, plus general wear and tear which current age smartphones cannot match
  2. Digital Currency: Africa in general and Uganda in particular, are cash economies. MM just allows people to move money from one place to another very quickly.
  3. Unnecessary Charges:
    • The cost of sending MM is usually less than transportation and time for moving to acutally deliver the money without the risk.
    • Most transactions are between UGX 50,000 to UGX 150,000 (US$20 to US$60) usually under urgent situations
    • Urgency of transfer – most transactions happen with a need for urgency for example school fees, social functions, emergencies of different nature. Which can happen at any time of day or night, until there is an option which is that flexible MM is here to stay
  4. Capital Investment:
    • MM is a defensive option for telecoms as their core business is getting eroded, and will evolve in order to remain relevant.
    • I do not see any startup having the size, and capabilities to compete with the telecoms in this market, Uganda in particular and Africa in general.
    • Even in Asia the agents are the key, however managing them is not an easy process so the incumbents will remain in play for the next 5-10 years.
  5. Business environment shift: the telecoms are here to stay, and MM will evolve along with the business environment.

Mobile Money is here to stay as it is:

  • Pervasive with 20,000+ agents and counting
  • With the telecoms opening up to 3rd parties for utility payments, diaspora remittances, merchant transactions
  • Rural-urban social dynamics which form the bulk of MM remittances within a country
  • Infrastructure challenges such as roads, railways which also provide a conducive environment for MM as an option for money transfer.

Your thoughts?

The Telecom Wars in Uganda – Round 5 – 2015 and Beyond

The telecom wars in Uganda just got a new lease in life, however looking forward the next round will claim some casualties. Why do I call this Round 5?

  1. Round 1 – Oct 21, 1998: MTN comes into Uganda, after a monopoly by Celtel (now Airtel) where simcards fell to the equivalent of US$30 with a monthly service fee of $10
  2. Round 2 – 2007 to 2009: Warid and Orange launch in Uganda, the Value Added Service Provider (VAS) boom, thanks to James Oloo Onyango for pointing this out
  3. Round 3 – 2009 to 2012: Mobile Money wars
  4. Round 4 – 2013 and 2014: Airtel acquires Warid telecom, Smart Telecom & Vodafone join the fray, MTN launches voice bundles

At this point each of the telcom companies operating in Uganda have voice bundles, data and internet plans plus mobile money platforms. With international calling plans falling towards zero, currently even cheaper than local network calls, social media/VOIP/Messaging applications cannibalizing SMS revenues, the battle for survival is ever-fierce with the any mis-step proving fatal.

Looking into my crystal ball, the next round is going to be fought along the following avenues:

  1. Mobile Money Partnerships – with banks, utilities, and other commercial players to entrench mobile money transfer deeper into the economics of the country.
  2. Service Partnerships – can be seen around data & internet services, so that the telecos are not reduced to dumb pipes. The agricultural, health and education sectors will see a new push for value added services via SMS in order to keep the users captive on a specific network.
  3. Personalized Bundles – combined voice, data and SMS bundles are not yet the rage, but they will gain prominence
  4. Family Bundles – with families having more than one phone, I see a push towards shared bundles to reduce the costs of new customer acquisition & increasing opportunity cost of switching. The impact of this tactic will be further complicated by the multi-sim phones that most consumers have.
  5. Smart device leasing plans – one I have called for, complicated by lack of a national ID, but I see success for whoever nails a working version of business model first.
  6. Business Customers: Majority of the telecom usage is personal, however business customers provide an interesting selling point with a knock on effect for smart devices, family or business plans and shared bundles. Most users are forced to use a service or network convenient to the bread winner or trend setter.
  7. Quality of Service: after all that is said and done, when the costs are almost at par, the quality of service for a specific provider will become a critical deciding factor both for business and personal use.

With all this opportunity also comes great peril, from the following:

  1. Niche players – ISPs for Internet and data as the capabilities for deploying metro-wide WIFI accelerate, informal money transfer services especially under Islamic banking
  2. Regulatory pitfalls and taxes – the impact of the recent 10% excise duty on mobile money fees is yet to be assessed
  3. Mobile Virtual Network Operators – are they friend or are they foe? Partner or competition if running atop of your infrastructure?
  4. Market saturation with falling revenues per customer – the telcos need to innovate to stay atop of the fast moving market that is to render them dumb pipes and their services commodity
  5. Number Portability – when this comes, it will disrupt the players as it abstracts the underlying providers.

How do you see the telecoms responding to these threats, please share in the comments below ….

UPDATE: Round 2 includes VAS providers who saw exponential growth in revenues at this time using SMS based solutions

Agriculture in Uganda – Where Next?

On this eve of the 52nd Independence anniversary of the Republic of Uganda, I look at the future of my motherland and wonder where the one big boost will come from.

Over the last 2 years my eyes have been opened to the potential for agriculture to improve the livelihoods of Ugandans in particular, Africa in general and emerging economies or Global south in general. While its well accepted in all circles that this is the case, there are a few key areas where emphasis is not placed which I see as critical success factors, and others which are not.

Markets (important): James Wire poses an interesting question, COMESA vs EU: What market for Uganda’s products?  Due to the infrastructure challenges that we face in Uganda, the country cannot compete favorably without economies of scale (important) and agriculture as a business attitude (important) While it is important to look externally, without a strong local foundation for best practices and support, external markets still remain a pipe dream

Economies of Scale (important): These provide means of leveraging the abundant fertile land, predictable rain fall (yes 4 months a year is good enough), cheap labor (if you can use it) to improve the profitability of agribusiness. Why do I focus on profitability and not cost reduction, this is because the costs can only come down to a certain point which is not low enough to compete with other countries. Unfortunately a lot of donor based programs supporting agriculture focus on small holder farmers, who will never produce enough to feed the nation, or even export

Agriculture as a business attitude (important): The bulk of agriculture productions by the elderly and rural folk without options whose only take on agriculture to survive by meeting only their basic needs. This means that there is a shortage of innovation in business models. record keeping and core practices to ensure that agriculture is profitable in the small, leading to increased investments and focus. On the other hand, there is a growing segment of the middle class who are looking to agriculture to compliment income from formal employment, however this suffered from being relegated to a side activity without the focus needed to make it successful.

Government buy-in and support (not-important): I know I am going to get shot for this one, but there is no role for government to play over and above providing basic infrastructure, and like in Uganda policies are already available. If there is sufficient evidence that agriculture as a business is profitable, private sector has always found ways of staying ahead of government.

Focus Production Areas (important): Agriculture focused on feeding the nation is the most profitable, given that there is always a ready market for produce, within the population. Hence my thinking is to focus on staples and livestock as a core foundation for the industry in Uganda.

Infrastructure (important): Transport is especially important for getting produce to markets, however if a business approach is taken, aspects like post harvest handling and storage can provide a mitigating element to infrastructure challenges

Financing (important): I say bankers are shrewd business people, show them potential and they will flock to it like bees to honey. Its not up to bankers to prove that farmers are good clients, but rather for farmers to prove to bankers that they are worthwhile investments.

MTN Uganda, Mobile Money and Operations Issues

I am not one to rant and rave but I seem to have been pushed over the edge this morning, but a large Telco service which leaves a lot to be desired yet despite being innovative seem to be leading more and more wastage in terms of time which would be used for more productive pursuits.

The service is Mobile Money, currently being hailed as Africa’s savior in terms of providing financial services to the millions of unbanked populace. Everybody knows that mobile telcom services in Africa have been very successful and are growing by leaps and bounds due to the infrastructure issues associated with fixed line laying, operation and maintenance. Couple the cost of handsets, $10 Nokias are available with a battery that can last 5 to 7 days, oh yes, coupled with SMS has lead to mHeath, mEducation initiatives being developed.

Mobile money has been a core driver of mobile service usage in the last few years coz it makes it easy to move money without the hassles of banks (line up, service fees) and with the licensing of thousands of agents (there are now more agents than bars and supermarkets and groceries combined), means that getting access to money is as easy as moving to your local grocery store.

However MTN Uganda (http://mtn.co.ug/) is a market leader in Uganda and currently holds the market leadership position, I would put it at over 70% but I can be corrected, with the greatest reach within the country. The service is estimated to transact about UGX 5bn ($2.2m at current rates) per day which is quite high considering averge transaction values are in the $10 – $100 range.

Anyway their success is maybe their undoing, because despite the phenominal growth, the service is even worse the electrictity availabiltity with the platform having an average uptime of 50% during normal working hours, after a 45 day downtime during November 1, 2011 – December 15, 2011 (which started as an upgrade then later turned into an outage).

From my software engineering background I am still baffled at why this continuously happens to one of the largest telco providers due to the established DevOps (http://devops.com/ and http://en.wikipedia.org/wiki/DevOps) practices: what are the possible solutions or approaches:

  1. High Transaction Volumes
    • Hardware – buy more hardware throw more power at the problem
    • Software – not scalable then run a cluster of boxes across the switches, load balance the sessions this problem is available even with HTTP
  2. Interface Operations – In database speak we usually state separate writes from reads. Separate balance checking (reads) from  withdrawals and deposits (writes) into separate distinct applications behind the interface. Use Queues, Gearman to ensure that the transactions are completed. Have the reads, balance checks run off slaves in the clusters …
  3. Notifications – SMS  Messages are good, for delivery but ensure they are sent and delivered. Queue the notifications so that they are always sent
  4. Provide options to execute transactions – provide a web interface for clients and agents. This opens up new revenue and agent opportunities since Internet cafe owners can also provide services from their interfaces. This is just an alternate way to access the service
  5. Be open to the public to lower the expectations – provide updates on service outages so that users do not just keep trying and only finding out from many failed trials. Failed transactions have been identified a known cause of application load spikes
  6. Reduce the number of available services and offload some services to other channels
  7. Use opensource software it has been proven to scale – or maybe some newer versions of your software applications
  8. New – Provide APIs so that developers can provide custom solutions to offload processing off your core system (switchboard)

These are just quick thoughts but they should be sufficient to start the discussion … not only rant and rave but also provide some concrete solutions

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