{"id":2172,"date":"2022-02-04T16:43:38","date_gmt":"2022-02-04T16:43:38","guid":{"rendered":"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa"},"modified":"2022-02-04T19:23:34","modified_gmt":"2022-02-04T19:23:34","slug":"what-does-the-google-airtel-alliance-mean-for-africa","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa","title":{"rendered":"What does the Google-Airtel alliance mean for Africa?"},"content":{"rendered":"

Africa-Press – Botswana. <\/strong><\/span>The agreement between US giant Google and Airtel, the first Indian mobile telephone operator, marks its indirect entry into the shareholding of Airtel Africa and opens the way for developing new smartphone access offers, a sector dominated in Africa by Chinese players, who still risk being subject to US sanctions and a technological blockade.<\/b><\/p>\n

In a joint statement published on 28 January, the Indian telecoms group Bharti Airtel (present in 14 African countries) and the US telecoms giant Google announced a \u201cmulti-year and long-term\u201d partnership.<\/p>\n

The agreement, made through the $10bn Google India Digitalisation Fund and launched in July 2020, focuses on the large Asian market.<\/p>\n

In detail, it includes a $700m investment to acquire 1.28% of Bharti Airtel and up to $300m that \u201cwill go towards implementing commercial agreements.\u201d<\/p>\n

Last October, Google, which has been led by Indo-American entrepreneur Sundar Pichai since 2015, said it would invest $1bn over five years \u201cto support the continent\u2019s digital transformation.\u201d<\/p>\n

Smartphones, a sector with great potential<\/b><\/p>\n

Although the first part of the agreement with Airtel only indirectly concerns the continent, it does mark the US colossus\u2019 symbolic entry into the shareholding of one of the African telecom leaders. Bharti Airtel Limited holds about 67% of Airtel Africa Plc (of which 56% directly), which is listed in London and brings together the telecoms group\u2019s subsidiaries in 14 African countries, including Nigeria, the DRC, Congo-Brazzaville, Kenya and Gabon. The US firm obtains an indirect share of some 0.7% of Airtel Africa, according to our calculations.<\/p>\n

The second aspect of the partnership could affect African markets more directly. \u201cUnder this first commercial agreement, Airtel and Google will work together to develop Airtel\u2019s extensive range of Android devices available to consumers through innovative affordability programmes,\u201d said the two partners.<\/p>\n

\u201cTogether, our companies will continue to explore other opportunities to reduce barriers to smartphone ownership across a range of price points, in partnership with various device manufacturers,\u201d the Airtel and Google statement added.<\/p>\n

A SWOT analysis conducted by the Indian group identifies \u201csmartphone penetration\u201d \u2013 the growing market share and number of future users of these modern phones \u2013 as one of its \u201copportunities.\u201d<\/p>\n

Making it easier for subscribers to access smartphones is a double win for Airtel \u2013 and telecoms operators in general \u2013 as it allows them to offer bundled deals that are more expensive than simply buying credit top-ups, but also to sell digital offers and services (games, music, videos, etc.) that are only available on these devices.<\/p>\n

On the continent, traditional phones still account for 50% of the market (2020 data), according to the Global System for Mobile Communications (GSMA), which anticipates that \u201cthe number of smartphone connections in sub-Saharan Africa will almost double to 678 million by the end of 2025, representing an adoption rate of 65%.\u201d<\/p>\n

Another sign of how important this segment is for Airtel is that the group was alarmed last year when it read a report about \u201cthe recent announcement of low-cost smartphones by one of its competitors\u201d in India and said it was \u201cevaluating several options to remain competitive in this segment.\u201d This deal with Google appears to be one of these options.<\/p>\n

For the time being, the African smartphone market is dominated by Chinese players, including Transsion. With its brands Tecno, Itel and Infinix, the company supplies 47.4% of these types of devices sold in Africa, ahead of Korea\u2019s Samsung (21.3%). Next in line are its compatriots Xiaomi (6.1%) and Oppo (a brand of the BBK Electronics group) as well as Finland\u2019s HMD (which markets the Nokia brand), according to analysts at the International Data Corporation (IDC).<\/p>\n

Chinese telecoms players, led by the global colossus Huawei, have found themselves subject to changes in US trade and security policies in recent years. For example, Huawei has lost access to Alphabet\u2019s (Google\u2019s parent company) Android technology and has been forced to quickly develop its own mobile application systems and platforms.<\/p>\n

A subsidiary worth over $2.5bn<\/b><\/p>\n

With 118.2 million customers at the end of 2020, the African continent is Airtel\u2019s second-largest market after India (350.3 million) and ahead of Bangladesh (50.9 million). Over the last five years, Airtel Africa\u2019s customer base has grown by +47.6% over the entire period, compared to +26% in India.<\/p>\n

\u201cThe telecom sector in Africa continues to have a positive outlook with increasing purchasing power, rapid urbanisation, a rising middle class and growing smartphone penetration,\u201d Airtel noted in its annual report.<\/p>\n

For its 2020 financial year ending March 2021, Airtel Africa had an annual turnover of $3.92bn (\u20ac3.33bn), up from $3.44bn a year earlier, with a net profit of $339m, down from $370m in 2019-2020. However, the group is pleased to report that its gross operating profit (Ebitda) increased by 24%, with an Ebitda margin of 46.1%, an increase of almost two points over the period.<\/p>\n

In recent years, Airtel Africa has increased its number of partnerships. In March 2021, the operator signed an agreement with the US-based TPG\u2019s investment fund The Rise Fund and with the specialist in payment solutions Mastercard, which invested respectively $200m and $100m in its mobile payment subsidiary. \u201cThese transactions value Airtel Africa\u2019s mobile money business at $2.65bn on a zero net debt basis,\u201d said the telecoms operator.<\/p>\n

In addition to telephony, mobile data and offering entertainment options, the Indian group, which claims to be \u201cnumber one or two in 12 of our 14 African markets\u201d, intends to fast track the development of a number of other services.<\/p>\n

These include: \u201chome broadband, satellite TV, enterprise connectivity, data centres, security, cloud, video conferencing, AdTech [digital advertising technologies].\u201d<\/p>\n

For More News And Analysis About Botswana<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – Botswana. The agreement between US giant Google and Airtel, the first Indian mobile telephone operator, marks its indirect entry into the shareholding of Airtel Africa and opens the way for developing new smartphone access offers, a sector dominated in Africa by Chinese players, who still risk being subject to US sanctions and a […]<\/p>\n","protected":false},"author":84,"featured_media":2171,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,6,8,13,16],"tags":[233,237,234],"class_list":["post-2172","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-files","category-homepage-english","category-social","category-twitter","tag-africa-press","tag-africa-press-botswana","tag-botswana"],"yoast_head":"\nWhat does the Google-Airtel alliance mean for Africa? - Botswana<\/title>\n<meta name=\"description\" content=\"The agreement between US giant Google and Airtel, the first Indian mobile telephone operator, marks its indirect entr ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What does the Google-Airtel alliance mean for Africa?\" \/>\n<meta property=\"og:description\" content=\"The agreement between US giant Google and Airtel, the first Indian mobile telephone operator, marks its indirect entr ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa\" \/>\n<meta property=\"og:site_name\" content=\"Botswana\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2022-02-04T16:43:38+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-02-04T19:23:34+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/botswana\/sites\/38\/2022\/02\/img-61fd7d1cc0c59.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"732\" \/>\n\t<meta property=\"og:image:height\" content=\"419\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/botswana\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"What does the Google-Airtel alliance mean for Africa?\",\"datePublished\":\"2022-02-04T16:43:38+00:00\",\"dateModified\":\"2022-02-04T19:23:34+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa\"},\"wordCount\":923,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/botswana\/sites\/38\/2022\/02\/img-61fd7d1cc0c59.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-Botswana\",\"Botswana\"],\"articleSection\":[\"all news\",\"files\",\"homepage-english\",\"Social\",\"twitter\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa\",\"url\":\"https:\/\/www.africa-press.net\/botswana\/all-news\/what-does-the-google-airtel-alliance-mean-for-africa\",\"name\":\"What does the Google-Airtel alliance mean for Africa? 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