The Co-founder, My Music Africa, Mr. Dolapo Taiwo, spoke about challenges of digital transformation and the need for government to invest in technology in order to enhance innovation across Nigeria. Nosa Alekhuogie brings the excerpts:
What is your assessment of the level of digital transformation we have attained in Nigeria and Africa, and what are the challenges?
I think the digital space is getting quite interesting. One of the most interesting things to happen to the digital space in Nigeria for me, is the Unstructured Supplementary Service Data (USSD) code. This is somewhat looked at as a primitive technology but in Nigeria, USSD code has helped to lift the people on the lowest part of the pyramid into the digital space. For example, market women who were previously unbanked can now open digital wallets using USSD code without even stepping into the bank or understanding what a bank account is and you see them transferring money to each other. I think that has created a lot of growth in Nigeria and I think lots of people should latch unto it and build solutions on top of USSD. There is no reason why insurance companies or BRT buses can’t get people to buy tickets through USSD code or pay insurance premiums via USSD code.
I think the future is getting really bright. I also think there has been a lot of focus on e-commerce in Nigeria and the infrastructure for that hasn’t been conducive for this market so a lot of the e-commerce players haven’t gained as much mileage as you would expect but if we focus more on solutions that appeal to the bottom of the pyramid, which is at least 80 million Nigerians and then build those solutions from the ground up, then the digital space would truly come to life in Nigeria.
If you look at Kenya’s M-Pesa for example, it was something that was grown from umbrella recharge card sellers on the streets of Kenya, which later grew into a big monster, which the entire Kenya now use for their financial transactions. The digital space in Nigeria would be fully ripe when we create solutions that grow from the ground up and can appeal to the market women and others. One thing which I also feel is important is localisation. I feel like our local languages need to be infused into the technology space because in Africa, I think technology will be fully ripe in Africa when it learns to deal with us on our own terms, we don’t need to force a market woman to learn English before she can engage with technology. I see that some Automated Teller Machine (ATMs) have started having alternative languages like Yoruba, Igbo, among other languages, but we can do a lot more in Nigeria to address our peculiar challenges.
Can you give a brief history about My Music Africa?
My Music Africa used to be mymusic.com.ng but we have re -organised the company a bit and my music.com.ng is a product now. We are also offering a lot more services in the music value chain because we found out that it is not just music sales that is necessary but we also have distribution models. The idea of birthing this company is that the vast majority of Nigerians were downloading music for free online and easily 80 per cent of people were getting their music when we did our research, and what we found out was that most of the people driving this downloads were the mass market audience, so pretty much the people at the time didn’t have much of smart phones, apple products and the likes, so we found out that the easiest way to compete with that model was to find a method that was easy and affordable for the people because nobody wants steal but the reason why people steal music is because it is easy and straightforward. So the model we came up with was to create music downloads and then to embed mobile payments and then wrap all that around one click, you don’t have to do too many steps, that was the vision at the time and over the years, we have fine -tuned the model and we have expanded the scope, that’s pretty much the over view history of how my music started.
Who are your target audience?
Our primary audience is still the mass market because these are the real music consumers. We also have the secondary target which is now the high profile audience; the people with the smart phones, some of the guys that use apple devices. In the past few years, we have also added an application (APP) to our offering to target these secondary audiences but so far, the primary audience is still where the bulk of consumption is coming from. Our apps are more android and iOS compliant, and what we are trying to do is to make it easier for the masses at home to access music in a legal way and also in an easy fashion.
What has been your greatest challenge going into technology business in Nigeria?
One of the biggest challenges we currently have is with the telecommunications operators. The sharing ratio for mobile billing is a bit skewed too much in favor of the telecoms operators and that makes it really hard to monetise an average user. We are talking about an average of 70 per cent to the telecoms operators and then the remaining 30 per cent to both the content owner and the platform which is a bit challenging. Some of the regulations in the telecoms space has also offered a lot of challenges because what we were known for was ease and simplicity but some of these regulations have posed serious challenge for content providers. I know in the past, you would have probably noticed that you receive a lot of messages of people trying to bill your phone, so I guess in their bid to curb all of that, they also put a lot of restrictions on legitimate services. The other challenge would be general infrastructure in Nigeria, which everybody experiences such as power, which is a big challenge to the sector. Other than that, I think we are surmounting some of the major challenges.
What do you want the Nigerian government to do about this?
I think the Nigerian Communications Commission (NCC), the telecoms industry regulator needs to consult with the private sectors in partnership with Value Added Service (VAS) companies. They need to create policies and innovations that will help grow the VAS space and not necessarily destroy it. It looks like some of these policies they are bringing out are being done in isolation of the market and you can’t regulate a market you do not understand. So, I think as a matter of urgency, the NCC should engage VAS operators and the other added services that play around and look for innovative ways to make that space work. Believe it or not, the telecoms space is probably one of the top five Gross Domestic Product (GDP) revenue generators in the country and if they over-regulate the space, they are going to kill thousands of businesses and their subsidiaries. I also think the government needs to invest in technology and innovation sector. I think there has been a few initiatives like the N-Power and world bank assisted growth grants but it is important for the government to engage with this sector and really look for innovative ways to spur growth in the technology sector. As I said, most of the initiatives and their policies really comes without much of consultation but they need to consult with technology companies and startups, find out the biggest challenges they have and look for the most innovative ways to intervene in that space and I’m sure that once they can get it right, the sky is the limit for small businesses.
Who are your major partners and investors?
We are in talks with a bank for white labeling. For partnerships, we have done some partnerships with some premium processors. When you want to buy airtime from a bank, worth N1000, then you get a free voucher to buy music on our platform. Those are some of the things we have done in the past. Then, for our platform to work, there are so many connections and so many organisations we are connected to in order to have that seamless flow. So for example, central switch interconnects, they help us to determine which phone number goes to which network for appropriate billing and of course, we are partners with all the networks so we can bill adequately. We are also partnering now with a USSD payment company and the strategy is to shift focus a little bit of the Telcos and unto the banks because the telco space is getting a bit over regulated because of initiatives like the double opt-in which makes it much harder to bill mobile phone users so we are partnering more with people that power the USSD payments for banks so that people can actually buy music with the bank accounts via USSD in a very simple seamless flow. On the part of funding, we have gotten funding from Microsoft, we also got funding in the area of server resources from Amazon Web Services (AWS). So far, we have had $150,000 in cyber infrastructure from AWS and Microsoft has given us $30,000, those are the two major investments. However, most of the funding have come from personal investment, friends and family.
Are there any major projects being worked upon by your organisation?
We are looking to roll out more of the connections to the banks, less focus on the telecoms space because that’s the reality currently and we are also looking to push out a few initiatives along the music value chain, for example, we are interested in developing talent in the music space and helping that talent monetise their content, more of talent development, how artistes can have more international appeal. My music Africa looks to get complete music value chain and aggregate that into our service. Very soon, we are looking to push more live events and pretty much more live music. At the moment, we have about 80 per cent of Nigerian content on our platform.