Africa has overtaken Latin America to become the second largest mobile market in the world, after Asia, and the fastest growing mobile market in the world.
This is according to the latest GSMA Africa Mobile Observatory 2011 report, which says Africa achieved this milestone as mobile penetration reached 649 million connections in Q4 2011. The continent first exceeded 50% mobile penetration in 2010.
The report says SA, with its more developed infrastructure, leads the way in terms of broadband penetration in Africa. The country has 6% mobile broadband penetration, followed by Morocco as the next biggest market, with 2.8%, the organisation says.
It adds that South African mobile network operators contribute 3.5% to the county's gross domestic product (GDP). In regards to spectrum licensing, the country trails African peers like Nigeria, Tunisia and Morocco respectively.
GMSA says over the past five years, the number of subscribers across Africa has grown by almost 20% each year and will reach more than 735 million by the end of 2012.
It attributes fierce competition to driving down prices and increased penetration. “Price wars have been common across the continent as operators compete for market share with innovative revenue and pricing options,” the report notes.
“The mobile industry in Africa is booming and a catalyst for immense growth, but there is scope for far greater development,” says Peter Lyons, director of spectrum policy, Africa and Middle East, GSMA.
“To take full advantage of its potential, African countries need to both allocate more spectrum for the provision of mobile broadband services, as well as introduce tax cuts for the industry. By doing so, they will increase consumption of mobile services, thereby boosting their economic and social development.”
“It is also important to note the waiving of subscription fees that the majority of operators previously charged for SIM cards. This minimises barriers to the uptake of mobile services in Africa. In addition of voice telephony and SMS communications, mobile phones have become an essential part of banking, payments and money transfer, he points out.
Fezekile Mashinini, BMI-TechKnowledge senior telecoms analyst, believes that ease of connectivity is the main driver of mobile in Africa.
“Previously, due to costs of rolling out networks and bad terrain, fixed-lines (landlines) were only available in metropolitan areas and selected rural areas, which left millions of people unconnected. Introduction of mobile networks changed all that in terms of speed of connectivity and cost.”
GSMA also notes that the mobile ecosystem in Africa currently generates approximately $56 billion or 3.5% of total GDP, with mobile operators alone contributing $49 billion. However, the organisation says huge untapped potential remains on the continent, as 36% of Africans within the 25 largest African mobile markets currently have no access to mobile services.
Ozianyi agrees, saying African governments could play a critical role in developing regulations that require mobile operators to retain active prepaid subscriber numbers for longer periods such as two to three years.
“This will overcome the current habit of de-registering non-paying subscribers after periods as short as 90 days. This will allow consumers to retain their lines and recharge once their financial situation improves within this period. Such consumers would be able to continue using services such as mobile money transactions.”
Mashinini concurs, arguing that governments must enable universal access where operators are given targets to roll-out networks to under-serviced areas to ensure that communities in the deepest parts of the country are connected.
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