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Smartphones becoming African standard

Bonnie Tubbs
By Bonnie Tubbs, ITWeb telecoms editor.
Johannesburg, 24 Oct 2012
Aidan Baigrie, head of business development at Seacom, says the telecoms industry will be challenged to grow rapidly in line with local demand.
Aidan Baigrie, head of business development at Seacom, says the telecoms industry will be challenged to grow rapidly in line with local demand.

Smartphones will become the standard in SA and on the continent at large, in the foreseeable future, boosting Internet connectivity considerably and, in turn, the local economy.

This is according to industry professionals, who say rapidly dropping smartphone prices will play a major role in bringing the Internet to Africans over the next five to 10 years.

Aidan Baigrie, head of business development at undersea-cable company Seacom, says, with some smartphones already dropping below the $100 (about R870) threshold and sub-$50 (about R435) devices inbound, smartphones are rapidly falling to price levels that make them accessible to a larger market in Africa.

Arthur Goldstuck, MD of World Wide Worx, says SA will be among the first to benefit from the latest smartphone developments. "Smartphone penetration is directly linked to price of handsets, while mobile Internet access is closely linked to the cost of data."

He says the prices of low-end smartphones has come down to the same level as mid-range feature phones, and "eventually they will drop down to the level of basic phones". At that point, says Goldstuck, smartphones will become standard phones, and all phone users will have the potential to use the Internet.

"It will happen sooner in SA than in other African countries, due to both high phone penetration and high smartphone penetration."

Smartphone spread

In mid-2012, about 10 million smartphones were in use. Goldstuck points out that of those users, around three million will upgrade next year, and a further two million to 2.5 million people will buy a smartphone for the first time, bringing smartphone penetration to 25%.

"Give it another two to three years for smartphones to be used by more than half of phone users. Other African countries will follow that trend, if behind SA."

Baigrie says, across Africa, there is a mobile phone penetration of about 70%, but smartphone penetration is only 10% to 15%. "The question is how we lift smartphone penetration closer to the 70% level, so that as many Africans can enjoy mobile broadband services as the current numbers that have access to basic GSM services?"

Economical options

The answer, he says, lies in the falling prices of smartphones and other smart devices. "Huawei's $80 (R695) IDEOS Android smartphone has been a hit in the Kenyan market, and similar examples can be found in other parts of the continent, showing that the market for data services is there once consumers can afford smart devices."

Chinese firm Spreadtrum Communications recently released two new low-cost, 600MHz Android smartphone platforms aimed at the ultra-cheap smartphone markets in the $40 (R350) range. "These devices are having a massive effect on the African market, bringing Internet services in reach for more people than ever before," says Baigrie.

He says, in more mature markets such as SA, operators are already reporting that they are shipping more smartphones than cellphones or feature phones, "a trend that will soon become apparent on the rest of the continent".

This will result in scores of Africans gaining access to services such as social networking, the Web, and e-mail for the first time, says Baigrie. "Africa will leapfrog the PC era to the mobile, post-PC world."

Baigrie says this will challenge the telecommunications industry to rapidly grow its infrastructure and capacity to keep up with demand.

"African operators will need to keep investing in national backbones and last-mile connectivity to cater for the extra strain put on their networks by the millions of smart devices that will enter the market in the next few years.

"The Internet is on Africa's doorstep; the key to unlocking this opportunity is getting it from the doorstep and into our home."

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