WORLD TELEMEDIA SHOW OVERVIEW Lessons from the mobile industry in Africa

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With World Telemedia Marbella just two weeks away, Waheed Adam ffrom the Mobile Ecosystem Forum, examines what the industry can learn from mobile in Africa

By applying lessons learned from Africa, the global mobile industry can provide sustainable and scalable economic opportunities to all regions of the world. Yes, the continent as a whole has been lagging behind the technology adoption curve, and yes, it lacks formal infrastructure, but the advent of inexpensive mobile devices has enabled Africans to leapfrog directly to a mobile-centric economy.

Africa is expected to have 120 million new mobile subscribers by 2025, bringing the total number of subscribers to 615 million (50% of the region’s population). So what can the mobile industry learn from Africa?

Data cost inhibits growth

Although 75% of all e-commerce is now done via mobile, only 58% of Africans can now access 4G internet. The majority of people connected to 4G are in urban centers, with 47% of city dwellers connected compared to only 26% of rural people.

These mobile owners spend a large part of their salary on mobile connectivity. A single gigabyte of data can cost up to a third of a person’s salary. This is about 50% more than in Europe and prohibits growth

By focusing on reducing data costs while increasing penetration (including reducing the cost of handsets), more people can connect to the global digital infrastructure. This will create many global benefits, such as information sharing, innovation and economic growth.

Mobile adoption is Infrastructure

Mobile infrastructure is much easier to set up than the traditional infrastructure of wired landlines and fiber optic broadband. With a basic smartphone and a 3G signal, these resources then become technological infrastructure.

In Kenya, for example, ATMs are rare. They require a wired network, replenishment, and security. But with mobile wallets and online banking, someone selling fruit on the roadside can now be paid electronically, without the buyer or seller needing to go to an ATM. , which allows them to sell more and in greater quantities.

These fruit vendors now have the e-money needed to electronically pay vendors etc., creating a scalable digital infrastructure via a simple smartphone and 3G connection.

So, rather than seeing the deployment of mobile connectivity as a cost, we should view it as an investment. Mobile connectivity creates a digital infrastructure. Africa offers a fantastic model of how a mobile-first economy creates a low-cost, rapidly scalable digital infrastructure that can be replicated around the world.

Local innovation can benefit everyone

A growing number of successful African businesses have been created to solve problems specific to Africa. And while many made-in-Africa solutions can be designed to solve African problems, there are many innovations that will benefit other regions as well.

Take for example prepaid mobile credit. As many Africans do not have access to formal banking services, they are unable to complete the credit checks required for pay-monthly mobile contracts. So prepaid mobile credit was invented as a way to allow people to get online without the need for credit checks – an innovation that has benefited people across Europe and the rest of the world.

Large foreign multinationals, such as Google, as well as global venture capital firms, are beginning to recognize the potential of African innovation and are setting up regional innovation hubs. Thanks to the mobile internet, these innovations can be quickly shared and improved.

As such, the mobile industry should invest in innovation hubs, especially in regions historically affected by adversity. People in these regions have had to innovate to solve regional problems, making them silent drivers of innovation.

Talk about what is useful

In Africa, informal trade is enormous. For example, in South Africa, informal taxis generate around R50 billion a year, local fast food around R90 billion, and traditional medicine is estimated at R18 billion.

Informal local convenience stores, known as spaza shops, generated around R150 billion a year, selling more potatoes, for example, in 2020 than the big chain stores.

However, the needs of these informal businesses will not be the same as those of large retail chains. Someone selling products from a shipping container doesn’t need the latest and greatest Rich Communication Services (RCS) – they need fast and reliable mobile wallets, access to indexes of global pricing and the ability to quickly and easily order more stock.

Rather than assuming that every business has the same needs, we need to understand and meet the needs of each specific market sector. They do huge volumes of business and provide a key service to the community, but we tend to cater primarily to the needs of large, complex global companies, following the same pattern we are adopting in Europe. Africa is an opportunity to learn and recognize the benefits of talking to smaller, more agile companies.

Global standardization is crucial

One of the main challenges to mobile growth in Africa is the plethora of local regulations and cultural expectations. Africa contains 54 different countries, each with its own regulations.

Industry bodies representing the private sector, such as the MEF, have an opportunity to encourage businesses to grow through foreign investment by adopting a strategy to change policy and align business departments, both in Africa and globally. world. Africa is showing us that standardization is essential and as the global mobile industry grows, it must work together to ensure standardization in all markets.

Through events such as trade investment conferences, industry bodies can help create collaborative environments to make it easier for businesses and people to connect and trade across borders.

The potential is huge, and as an industry, mobile has a huge role to play. Above all, Africa demonstrates that a mobile-first economy can thrive without costly formal infrastructure. Mobile infrastructure is relatively cheap and easy to set up, can facilitate information sharing and innovation, and benefit businesses from fruit vendors to Google.

Author

Waheed Adam is the Executive Chairman of iTouch, headquartered in Cape Town, South Africa, and a member of the Board of MEF (Mobile Ecosystem Forum), a global trade body that acts as an impartial champion and authority to address issues affecting the expanding mobile ecosystem. Established over 20 years ago, the MEF has a strong presence in Africa, positively impacting the daily lives of millions of people.

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