Businessman Strive Masiyiwa’s Liquid Telecom, one of the continent’s largest telecom infrastructure providers, has prioritised investment in data centres, cloud computing and cybersecurity as the company repositions itself as a technology provider.
Liquid Telecom is entering a space dominated by companies such as BCX, Telkom’s subsidiary, Dimension Data, EOH and Altron. Part of Masiyiwa’s Econet, it has built Africa’s largest independent fibre network stretching more than 70,000km, and operates data centres in Johannesburg, Cape Town and Nairobi.
The company is rebranding itself from Liquid Telecom to Liquid Intelligent Technologies, to expand its offerings beyond telecommunications, says Nic Rudnick, Liquid’s group CEO.
“We want to go beyond infrastructure,” he said, explaining that Liquid, headquartered in London, will focus its investments on cloud computing, providing enterprise software and cybersecurity as new areas of business.
As part of the change, Deon Geyser, head of Nokia’s Southern Africa market unit, was recently named CEO for Liquid’s business in SA.
In April 2019 the UK’s Commonwealth Development Corporation acquired an 8% stake in Liquid for $180m, valuing the company at $2.2bn (R36.4bn). The company is not publicly traded, though it has $730m in senior secured notes listed on the Irish Stock Exchange.
Econet Zimbabwe listed its investment in Liquid at more than $135m in August.
“Over the last decade we have been building infrastructure. But now we want to go beyond simply saying that we can provide connectivity. What we now want to provide to our customers is technology that they can use to enhance their businesses,” Rudnick said.
As an infrastructure provider, Liquid competes with companies such as Telkom’s Openserve and Seacom.
The company has since leveraged its fibre network to create data centre service. Through its subsidiary, Africa Data Centres, Liquid Telecom is Africa’s largest data centre operator. The company recently bought the Samrand data centre, north of Johannesburg, from Standard Bank for an undisclosed sum. The deal, stalled in part by Covid-19, is now complete, Rudnick said.
“We say cloud but ... the benefits and the compute that cloud can deliver, I think are only beginning to be understood.”
Cloud computing presents a variety of technologies, including more traditional services such as customer relationship management, billing, accounting, back-end solutions and stock control systems, he said. These are things that large corporate firms have been using for many years and would need to buy expensive servers and software licences to operate.
“Particularly across Africa, small to medium enterprises were never able to afford the kind of huge capital outlay that these systems needed. Now with cloud, those systems are readily available to everyone. No capital outlay. No licence fees. It’s pay as you go. As your business grows and becomes more successful, you then use more services but for a start-up, it’s great because you’re only paying for what you consume,” Rudnick said.
Liquid has enjoyed a good working relationship with Microsoft, offering Azure cloud services as part of its growing offering, to the extent that the company was a launch partner in Africa for the US firm’s Azure Peering Service. “We’re looking to expand and grow that relationship,” Rudnick said. However, Liquid does not constrain its customers, allowing them to use cloud providers of their choice.
Articulating the vision for Liquid’s repositioning, he said various services — “all of your cloud services, whatever connectivity you need, unified communications” — could be bundled in “one simple bill that you get from Liquid Telecoms”.
In addition to applications, Rudnick said the second part of the equation is the amount of computing available in the cloud. This, he said, is something the company could take to more customers especially those looking to create products or services that use artificial intelligence (AI).
AI is “one of the things that is going to have an enormous impact on the continent and people are only beginning to understand the impact of smart businesses and smart agriculture and the huge impact that will have”, Rudnick said.
“[For instance], what we’ve seen in Kenya, which is, in fact, one of the countries where we started this journey first, is that the highest users of cloud are start-ups,” he said, explaining that fledgling technology businesses take advantage of cloud to develop and become part of the new digital economy.
Another investment focus for the company is cybersecurity, an “underinvested” area in general by organisations, Rudnick said. As progressive as remote working is, such new ways of operating present security risks for organisations, he said. And with Africa being seen as “weak back door”, Liquid is seeing an opportunity to expand its service base and expertise.
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