HUSTLE & FLOW #8: 5G vs COVID, conspiracy theories and the power of Whatsapp, the State of Fashion, content creation strategies, and more

Dear colleagues and friends,

First of all, Happy Holidays to those celebrating Easter, Passover, or Ramadan this long weekend or later this month.

Welcome also to all new readers who joined us through HUSTLE & FLOW’s new open subscription link. I hope you will find this newsletter helpful and, dare I say, entertaining, in this time of upheaval. After all, this too shall pass.

Last week was, in fact, pretty entertaining by COVID standards. First, Nollywood star Funke Akindele was arrested for throwing a birthday party for her husband despite the lockdown. They were both fined N100,000 ($260) and sentenced to 14 days of community service during which they will “ educate the public on the consequences of non-compliance with the restriction order." The incident generated intense debate on Nigerian social media and in the end, the whole commotion turned out to be a quite effective #StayHome PSA

Meanwhile in Uganda, fed up with people who continued to work out in groups in Kampala’s public areas against his instructions, forever young 75-year-old president Yoweri Museveni took the matter into his own biceps and released a video of himself doing 30 push-ups in his office. When I wrote in a previous edition that now was the time for African online workout videos, that’s not exactly what I had in mind.

This week in HUSTLE & FLOW, we’ll continue talking about some of the sectors currently experiencing fast-tracked growth, such as mobile money, logistics and VOD, but we’ll also delve a little deeper into the power of Whatsapp and COVID-specific content creation strategies

If you have missed previous editions of HUSTLE & FLOW, you can check out the archives here. And as always, do not hesitate to send me your questions, feedback, and topic requests at marie@restless.global. I’m looking forward to hearing from you.

Happy reading to all,

Marie


GLOBAL RESCUE MEASURES

Last week the World Bank confirmed what most of us were already expecting: Africa will enter its first recession in 25 years in 2020. To help mitigate the impact, the World Bank has called for a pause in debt payments and is unlocking $160 billion in financial support. In addition, the African Development Bank unveiled a $10 billion Response Facility, while the African Union and Africa CDC launched an “Africa COVID-19 Response Fund”, a public-private partnership with the AfroChampions Initiative, which will raise an initial $150 million and up to $400 million in total. Internationally, Agence Francaise de Developpement (AFD) committed 1,2 billion euros to its “COVID-19 Health in Common” initiative, mostly directed at the immediate health emergency in Africa. AFD’s Director Remi Rioux also hinted at other upcoming initiatives targeting the social and economic aspect of the crisis. 

In billionaire news this week, Twitter and Square’s CEO Jack Dorsey committed $1 billion, or just under a third of his total wealth, to relief programs that will be channelled through his newly-formed company Start Small. In 2019, Dorsey had announced plans to move to Africa for up to 6 months in 2020 after a month-long trip during which he met with some of the continent’s top entrepreneurs, so we can assume that Start Small will provide support to African startups in one way or another. Talking about startups, here’s a great centralized document that crowdsources COVID-19 related resources and initiatives for and from the African startup ecosystem. 

Now more specifically concerning the Entertainment sector, South Africa’s Department of Sport, Arts and Culture has finalised the criteria to distribute the R150M ($8,3M) COVID-19 relief fund for artists, athletes, technical personnel and the core ecosystem that supports them. In Kenya, president Uhuru Kenyatta announced that the government had set aside Ksh.100 million ($944,000) for local musicians, artists and actors through the Sports Fund. Kenya counts 19,000 entertainment professionals registered with one of the country’s 3 Collective Management Organizations (CMOs), which might mean that each person could take home approximately Ksh5,200 ($50!). Meanwhile, HEVA Fund is currently compiling the results of its COVID-19 Creative Sector Relief and Recovery survey whose results will be used by partners such as the British Council, Goethe Institute, UNDP and the Kenya Film Commission to map out future support measures.

INTERNET INFRASTRUCTURE

Despite having more than $350 million at hand to finance its various expansion plans for Africa, telecoms tower infrastructure company Helios Towers announced last week that it was postponing (but not cancelling) its investments due to the on-going crisis. Helios Towers currently has operations in South Africa, Tanzania, Ghana, Congo Brazzaville and DRC, and has expressed interest in the just-opened Ethiopian market, but also Tanzania and Morocco. 

MOBILE

The big news in mobile money this week was the acquisition of M-Pesa by South Africa's Vodacom and its Kenyan subsidiary Safaricom from London-based Vodafone. Yes, the names are confusing and all these companies are linked to each other, but the aim of the transaction was to give the local operators full control of the M-Pesa brand, product development and support services to boost expansion into new African markets. M-Pesa is currently Africa's largest payments platform with some 40-million users in Kenya, Tanzania, Lesotho, DRC, Ghana, Mozambique and Egypt. 

It certainly feels like the right time to go all-in. According to statistics from a new report from the GSMA trade body, 50 million sub-Saharan Africans created a mobile-money account in 2019, bringing the total number of users up to 469 million. Boosted by coronavirus’ self-distancing measures, this number is likely to top 500 million in 2020. One country where we might see a strong rise in mobile money adoption is Nigeria, which suffered from an initial tepid support from the Nigerian government. The Central Bank of Nigeria is now planning to roll out a new payment licence system in order to streamline the regime for fintechs in Nigeria.

Still in Naija, the Nigerian Communications Commission has confirmed that the country has successfully completed its 5G trials. It also addressed the widely circulating conspiracies suggesting a link between 5G and coronavirus and clarified that 5G had not yet been deployed in the country. Nigeria is far from the only country where these theories have spread. What is particularly concerning is the speed and ease at which misinformation travels across Africa through the ubiquity of Whatsapp. But Whatsapp reacted quickly by limiting the ability to forward messages that have been sent through a chain of more than five people to only one more contact. Under South Africa’s coronavirus disaster regulations, Whatsapp group admins knowingly spreading false information may also now be held criminally liable.

Now, as someone always looking for the silver lining, what I see here is a proof of the power of Whatsapp when it comes to content distribution in the African context. Several weeks ago, WHO tapped into it when it launched a dedicated messaging “COVID-19 hotline” service in collaboration with South Africa’s Praekelt.org. Back in 2014, after discovering that pirated clips of our new Nigerian show Ogas At The Top were being circulated on Whatsapp, my team and I experimented with it as a distribution platform. We collected hundreds of phone numbers from people wanting to receive the videos directly to their phones, but Whatsapp Business didn’t exist yet (again, too early) and, faced with the platform’s anti-spam measures, we had to give up. The other issue was that there was no way to track where your content went after it was released into the wild, and of course no way to monetize. Facebook, if you’re listening, enabling the use of Whatsapp as a content distribution and monetization channel would be a major boost to the African creative industry.

LOGISTICS

The African logistics sector is facing intense pressure, according to Kobo360 which estimates that the industry in emerging markets has lost $7.5 billion since February because of the drop in imports from China and other countries. Confusion over which businesses qualified as “essential services” also led the Lagos State Environmental Protection Agency to seal off Jumia’s main warehouse on April 1st, but the matter was sorted out quickly and the warehouse reopened that same day. 

And there are of course concerns over the global food supply chain. But in the same week, Lagos-based deliveries startup kwik secured an undisclosed amount in new funding from the founder of French video games company Ubisoft to scale its operations in Nigeria. All these services are indeed demonstrating that they are indispensable, and I agree with Kobo360 Chief Strategy Officer Kagure Wamunyu when she says that “the pandemic will push the sector to its limits, however we  believe that in the end, we will succeed”.

For some interesting points of view on the future of Jumia now that Rocket Internet is out, this webinar on countercyclical investment opportunities in Africa is worth watching. Speakers Aubrey Hruby of Insider, Rob Eloff of Lateral Capital, and Iyin Aboyeji of Future Africa also discussed trends in tech, industrialization, housing, and human capital.

FASHION

I’m not going to lie, this is not a great time for the fashion industry. Mckinsey and the Business of Fashion just released a special coronavirus update to their State of Fashion 2020 report, which shows that revenues for the global fashion industry will contract by –27 to –30% in 2020 year-on-year. The COVID-19 crisis will fasten or enhance consumer shifts that were already visible previously, such as anti-consumerism, digital transformation, seasonless design, and the decline of wholesale. But it will also be an opportunity to reset and reshape the entire value chain towards more environmental sustainability and to foster collaboration within the industry.

One big unknown is how Africa’s resilience will interact with some of these global trends, but also with local ones such as the growth of e-commerce and a (hopefully) new focus on industrialization. After all, African fashion is built on the deep-rooted, sustainable tradition of made-to-measure tailoring for a hyper-local customer base which passes for the future now in developed markets, and is yet to be integrated into the international marketplace, meaning that it will barely suffer from the drop in sales in Europe or the US. For those who want to go further on this, the on-going (online) Woven Threads program by Lagos Fashion Week is currently exploring some of these themes. So here also, I remain hopeful. One positive example of Africa’s resilience as applied to the textile industry is this story about how a gardening clothes factory in Kenya transformed almost overnight to produce 30,000 surgical masks a day.

SPORTS

In 2019 BC (Before COVID), Deloitte had forecast a “golden” outlook for the sports industry this year. Now, it has come to a standstill. Sports will come back eventually, but the question is what will change in the meantime. With live sports on hold, sports TV viewing hours (which usually represent 30% of viewing time) plummeted by 91% globally last month, according to Conviva. But the company also believes that “sports will bounce back with a vengeance” as the pivot to e-sports has demonstrated that demand remains. Indeed, sports organizations have continued to transition as much of their activity online as possible to keep fans engaged, such as America’s most popular motorsport with its eNASCAR iRacing Pro Invitational, and the NBA with its NBA at Home and NBA Together Live initiatives, which saw for example Nigerian-American player Chiney Ogwumike take part in a three-point challenge and Mo Bamba, whose parents are from Ivory Coast, perform a ball handling circuit which fans can practice at home. Former players Luol Deng and Pops Mensah-Bonsu have also been holding live conversations on Instagram. Looking further out, virtual Reality might be in the future, as well as a boom of sports betting, as we discussed last week. And while everyone in Africa (including Don Jazzy) is now dancing on TikTok, I am still waiting for these workout videos.

BROADCAST

South Africa’s national lockdown has given rise to some record TV ratings, with MultiChoice reporting a 100% increase in its daytime audiences, and the same is probably happening across the continent. One long-term impact of the shutdown will be that millions of viewers will have been exposed to new content and formed new TV habits. Broadcasters (and platforms) are also currently buying finished programs to fill their gap in fresh programming, so if you’re sitting on films or TV series that you haven’t yet sold exclusively to Netflix or MultiChoice, you should be trying to make some sales right now.

More specifically, educational TV programs or channels aimed at children currently out of school are booming across the continent: South Africa’s public broadcaster SABC and the Department of Basic Education have rolled out a multi-media (TV, radio and online) learner support initiative titled “COVID-19 Learner Support”; the Ghana Education Service has announced the launch of Ghana Learning TV, a 24-hour free-to-air channel for high school students; whereas in Kenya Akili Network premiered Akili Kids!, the country’s first children Free-to-Air channel (in the works pre-COVID). Being far away right now, I am not able to watch any of these programs and I’m really curious as to whether they are locally produced or all foreign. Please email me to let me know. In any case I am hoping that this period will contribute to a change of perception among local and regional broadcasters as to the value of African children shows, which has long been the poor parent of TV content. Also, I don’t see why these special channels shouldn’t stay on the air even after schools reopen (with maybe some time slots dedicated to adult education).

VOD

In global VOD news, Quibi launched last week, and reported an unimpressive 300,000 downloads on its first day in the US. TechCrunch has some strong words for the fledgling service: “It takes either audacious self-confidence or reckless hubris to build a completely asocial video app in 2020 (...) Quibi manages to miss every trend and tactic that could help make its app popular.” The entire article, entitled “Quibi is the anti-TikTok (it’s a bad thing)” is a must read. I’ve talked in previous editions of HUSTLE & FLOW about how well suited to the African market TikTok was, and how Quibi is not (it doesn’t seem suited to any market, really).

Meanwhile, ad-supported VoD service Pluto TV, owned by ViacomCBS, has launched in 17 Latin American countries with 24 channels, and is aiming to expand to 70 channels in the next 12 months. I’ve been following the growth of Pluto closely because I think that model might work well in Africa (the main issue being the depth of the local online ad inventory). Its performance in Latin America, the world’s second-fastest growing mobile market after Africa, will produce some relevant insights, which I will of course bring to you.

CONTENT CREATION

I’ve talked at length in the past few editions of this newsletter about the global increase in demand for content. The question is: how can African creators take advantage of this trend? 

First, performers have been having some good success with live digital events as those become more accepted. Nigerian comedian AY hosted an online version of his AY Live this Easter Sunday on various platforms. The event gathered a staggering 84,646 viewers on Instagram alone. Online sets by DJs like Kenya’s Blinky Bill have proved popular, despite major issues with Instagram flagging their content (again, Facebook, if you’re listening…).

For other creators, if you’ve already sold everything in your catalog, the first thing to do is find a way to produce new content despite the lockdown. You can edit or repurpose unfinished projects, you can write, you can record podcasts (where are the African scripted podcasts?). If you are an animator, you can and should absolutely continue to do your thing as animation is one of the sectors that stand to eventually gain from this crisis. One strategy is to take advantage of the various grants and competitions currently open for the production of COVID-related content, such as the CcHub/African CDC initiative which I had already linked to, the Docubox Short Film competition, or the UN’s Global Call Out to Creatives (deadline tomorrow!). The BBC’s script competition is now closed.

But, you can also produce more ambitious video content remotely. In California, CBS courtroom drama All Rise has returned to production by tapping into FaceTime, WebEx, Zoom and additional online technology to film a new episode in which Judge Lola Carmichael virtually presides over a bench trial. Characters will be shown managing their “new normal” in the actors’ real homes, with VFX being used to create the necessary backgrounds, while a cinematographer operating solo from a vehicle will capture exterior footage of the empty Los Angeles streets. How cool is that?


So I’m thinking of you, Nigerian filmmakers, as this is right up your alley. If kids in Kaduna with a smartphone and a green screen can create content that goes viral and gets them in front of top Hollywood producers (I hear a deal is in the works), then you can certainly come up with a cool concept that can be shot remotely by various people in their homes. I’ll do my part and give you feedback on your concept or script, and if it’s really good, I might even help produce it.