Thought Leadership and Insight from Ayotunde Coker

Ayotunde Coker

For this edition of the Datacloud Africa Leadership Summit Interview Series, we spoke to Ayotunde Coker, Managing Director, Rack Centre

1. What are the biggest challenges facing the industry in Africa?

People generally think that power is the challenge for operating in Africa. To an extent, yes. However, this is a levelling factor, as data centres in other parts of the world must have on premise power generation as back up. However, in Africa, given the poor power delivery, an extra line of redundancy of diesel power generation is required; so, one point of extra cost. However, there are other challenges. We do not manufacture our technology which is therefore subject to import tariffs of about 15 to 30%. An immediate cost disadvantage. Africa jurisdictions are also subject to higher risk premiums on capital which could be about as much as four times or more the cost of capital. These are the real challenges!

2. What are the critical steps needed to achieve in the African Data Centre infrastructure development plan?

The steps are really in understanding Africa. The importance of the regions, language and economic areas. Much of the locations, language, economic zones, government macro policies defer significantly from country to country and region to region. A development plan must take these idiosyncrasies into account.

3. What are the current trends for data centres in Africa?

Growing. Africa will consume Cloud computing at scale. I have the hypothesis of the ‘sachet’ economy in Africa. People will buy small sachets at a time and not bulk. Cloud is the best way of delivering IT computing in ‘sachet’ modules on a pay as you go, pay as you grow basis. That is why post pay has been so successful in mobile telephony. Cloud will be a significant source of scale.

4. What will be the main drivers of data growth in the coming decade?

Broadband penetration, broadband penetration! Of course, governments must realise that taxing data is not the route to revenues, but to enable data growth and therefore economic growth. Africa has a young median population which is likely to generate more data demand growth. This should be an opportunity for growth, in tandem with growing smart phone penetration and a growing middle class. Smart phone shipments to Africa now surpass feature phones at a growing rate.

Ayotunde Coker will be at Datacloud Africa Leadership Summit 2018 in Marrakech on 28 September. Meet them there