Google's presence grows

By Paul Vecchiatto for Gartner
Cape Town, 14 Nov 2008

The increasingly powerful presence of Google in Africa is causing telecommunications carriers to up their game. The search engine giant is also keeping an eye on the continent, say analysts and industry players.

Google's presence is causing telecoms carriers to jack up their game in what services they offer and at what rates, but it also means that as it moves from one market to another, it can have a strong effect on developing that market.

Alex Winogradoff, research VP at US research firm Gartner, says: "The communications industry 'ecosystem' - encompassing regulators, Internet service providers, advertising, and media customers and service providers - finds itself in Google's crosshairs. [This is] not because Google necessarily wants to compete with telecoms service providers or content developers, but because it finds their business process to be an impediment to innovation and change.”

Winogradoff says Google will continue to be a market disruptor and 'disintermediator', especially in the communications market. "Carriers should selectively partner with Google rather than trying to compete, especially in areas where they don't have differentiated and core assets," he says.

"However, carriers should also find common ground with Google (for example, on network neutrality) and, if necessary, look for creative ways to oppose Google on issues critical to their survival."

Have to talk

Angus Hay, CTO of South African telecoms operator Neotel, says that almost everyone in the industry has to talk to Google at some time or another.

“Google is just such a large player. Neotel's position has always been to partner with, rather than oppose.”

Hay notes that Google does not have to be a carrier to influence a market, as it does partner with carriers to provide over-the-top (Internet services that run on top of a telecommunications network) transport for their services.

Henk Kleynhans, CEO and founder of Internet service provider Skyrove, who has just returned from a Google-sponsored conference in the US that discussed Africa's telecoms industry, says the group has a particular focus on eastern Africa at the moment.

“They are certainly very interested in what is happening in Africa and what the needs are. I did not hear any discussions about them getting involved in any particular infrastructure projects, but they are really interested in software development and the rise of citizen journalism,” he says.

Mark Buwalda, a director of publishing firm Brabys, which runs local search engine Ananzi, says different elements of Google seem to be coming together to develop the African market.

“Face it, Africa is the last frontier for the development of the Internet as so much infrastructure has to be built. However, the big question is: can it be done fast enough? With the financial problems the developing world is currently facing, it makes sense for them to want to move into the continent and this will have a strong effect on the telecoms carriers,” he says.

Google SA country head Stafford Masie is on record as saying the development of the Internet can add significantly to a country's gross domestic product.

* Can Africa benefit from the growth influence of Google, or will it be bad for business in the long run? Give us your opinion via our feedback facility.