GSMA: Mobile Technology Will Drive Digital Transformation in Africa

Emma Okonji

Given the increasing rate of mobile technology subscription services in Africa, especially in Nigeria, Kenya, Tanzania and Uganda in the last two years, the GSMA, which represents the interests of mobile operators worldwide, has predicted that mobile services would drive digital transformation in Africa in the next three years. It has therefore called on African governments to address the issue of spectrum in delivering greater connectivity.

In a recent report, the GSMA group said mobile technology has emerged the platform of choice for creating, distributing and consuming innovative digital solutions as services in Africa. Many local and global innovators and tech entrepreneurs are now using the expansion of advanced mobile infrastructure and the growing adoption of smart devices to deliver mobile-based solutions that directly appeal to local interests and cultures.

According to GSMA, mobile internet adoption in Africa continued to grow rapidly, with the number of mobile internet subscribers tripling in the last five years to over 500 million at the end of 2016, with additional 250 million expected by 2020.

It, however, said that by 2020, about 60 per cent of the African population would still be unconnected, based on significant barriers to adoption of mobile internet, particularly for underserved groups such as women, rural communities and young people.

Mobile money continues to improve financial inclusion in Africa. The region accounts for 52 per cent of 271 live mobile money services in 93 countries and 64 per cent of all active mobile accounts. Six new services were launched in Africa in 2015, with another four in the first half of 2016, and mobile money is having a significant impact in enabling efficient and convenient international money transfer, the GSMA group said in its report.

According to the report, at the end of 2015, 46 per cent of the population in Africa, subscribed to mobile services, equivalent to half a billion people. The region’s three dominant markets for mobile services subscription, Nigeria, Egypt and South Africa, together accounted for a third of the region’s subscriber, with Nigeria alone registering over 150 million telecoms subscribers across its various network providers.

The group, however, warned that subscriber growth rates in most African countries were now slow, compared with the global average, citing affordability challenges, excessive taxes challenges and the challenge of Right of Way (RoW), as key barriers. The group therefore called on African governments and telecoms regulators across Africa, to ensure that they come up with policies that would not stifle telecoms growth in Africa.

It said over the next five years, an additional 168 million will be connected by mobile services across Africa, reaching 725 million unique subscribers by 2020. It said eight markets would account for the growth, most notably Nigeria, Ethiopia and Tanzania, provided that African governments encourage mobile technology penetration.

Addressing the issue of mobile broadband penetration in Africa, the GSMA report emphasised that subscribers are increasingly migrating to mobile broadband services, driven by network rollouts and mobile operator device and data strategies.

Mobile broadband connections accounted for a quarter of total connections at the end of 2015, but it is expected to rise in two-thirds by 2020. The 4G LTE service rollout are gaining traction, and by mid-2016, there were 72 live Long Term Evolution (LTE) technology networks in 32 countries across Africa, half of which were launched in the last two years.

The launch of new mobile broadband networks across the region coincides with the growing availability of low-cost devices. The number of smartphone connections has almost doubled over the last two years to reach 226 million, accounting for a quarter of total connections in the region.

This reflects strong uptake in the established mobile markets such as Nigeria, Kenya, Egypt, South Africa, as well as some relative new 3G markets, notably Algeria, Cameroon, and the Democratic Republic of Congo, the report said, adding that over the next five years, the African region will add a further half a billion smartphone connections, taking the adoption rate to more than half of the total connections.