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By Richard Agnew 2022-07-26T09:21:00+01:00

Safaricom works Vodafone links to expand in IoT

Safaricom highlighted a budding relationship with Vodafone Innovus, an IoT solutions-focused sister business within Vodafone, to deploy a connected goods tracking service for food and drinks distributors.

The Kenyan operator debuted an “end-to-end” cold chain solution, enabled through the partnership with Innovus, during the year to 31 March 2022 (FY21–22), according to its latest Annual Report.

The link-up was one of a number of new tech relationships formed during the FY as part of a plan by Safaricom to broaden out its IoT offering.

Apart from Innovus, new allies include Earthview Management — a Nairobi-based resource monitoring tech specialist, owned by parking systems group KAPS, which is collaborating with Safaricom on an “end-to-end smart water solution”. The offering is said to involve retrofitting of existing water meters with wireless connectivity to enable better data extraction and applied analytics.

Safaricom also released a vehicle telematics offering, based on a deal with an unnamed white-labeller, and confirmed work on further application development with IoT.nxt, a South African building and facilities monitoring tech business that is majority owned by Safaricom parent Vodacom Group.

IoT.nxt previously highlighted cooperation with Safaricom on roll out of various IoT-based business applications, starting with its CoVision footfall monitoring service (also in use at both Vodacom and Vodafone’s HQs — Vodafonewatch, #188). The tie‑up is initially focused on Kenyan clients but “will be expanded to offer the solutions to different countries in Africa in the future”, said IoT.nxt.

Safaricom is starting from a small base when it comes to building its IoT business. The Annual Report indicated the operator generated only KES 500m (£3.5m/€4.1m) in revenue from IoT clients during FY21–22, less than 0.2% of its KES 298.1bn total turnover.

Still, Safaricom evidently sees potential to create a more meaningful line of business in the space, after recording a 64.5%‑increase in IoT revenue and 66.6%-rise in customers during the FY. Within the Report is reference to plans to ramp up IoT sales in the current FY through a Centre of Excellence and channel development initiatives. It has also flagged multiple initial deployments and trials of IoT offerings in the past few months, including with Kenya Power (smart-meter installation), Kenya Breweries (cold chain tech), and Upepo Technology (water consumption tracking).

Safaricom did not go into the nuts and bolts of its relationship with Innovus, although the Report showed it has been working with the Greece-based provider since at least FY20–21, and spent KES 42.3m on its services across the last two FYs.

The cold chain system is seen as one of a number of value-added services Safaricom could market to local agricultural and logistics clients alongside flagship offering Digifarm, which is used by about 160,000 producers in Kenya for advice, credit scoring, crop insurance, input loans, and other services and content.

This chimes with Safaricom’s focus on growth through B2B and B2C platforms under its current medium-term strategic plan, to 2025.

In the Annual Report, Safaricom named one of its key goals for the current twelve-month period as fleshing out of B2B offerings through tie‑ups. It aims to establish the “right operating model and partnerships to scale IoT and ICT”, and is focused on a “platform play to orchestrate service provision by diverse multiple players”, the Report said.

Vodafone Innovus, formally known as Zelitron, was founded in 2004 and acquired by Vodafone Greece in 2012. It is already well versed in the logistics space, with ‘mobile asset control’, including temperature tracking, forming one of its four main product lines. Highlights from the business over the past two years have included recruitment by Vodafone to set up a digital health R&D hub in Greece, focused on remote solutions, and a deal to establish a “smart waste collection” system for the city of Athens (Vodafonewatch, #192).

The provider is one of a handful of small IoT players to gain investment from Vodafone Group or OpCos over the past decade, alongside: 2014 connected vehicle acquisition Cobra Automotive (now Vodafone Automotive); German IoT solution provider Device Insight (exited in 2017); IoT.nxt (51%-owned by Vodacom); and fellow South African solution provider Xlink Communications (which saw a full buyout by Vodacom in 2016). Vodafone has over the past year flagged interest in adding to these disparate IoT interests, while also mooting a spinout of its business in the space (Vodafonewatch, #207).

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