Tackling Affordability To Bridge The Digital Divide

The next 10 years will see the mobile industry take centre stage as we come together and partner with Africa’s nation-states to help the continent achieve its overall transformational goals, as laid out in the African Union’s Africa We Want agenda 2063.

Mobile has, for more than a decade, been a key focus across Africa, and already promising progress has been made by the industry in increasing levels of connectivity across the continent, specifically in low- and middle-income countries within Sub-Saharan Africa. In fact, the recent GSMA State of Mobile Internet Connectivity Sub-Saharan Africa report shows such a concerted effort has been made that the coverage gap has been steadily closing. It is now at 15 per cent, compared to 17 per cent by the end of 2021 and 19 per cent at the end of 2020.

Meanwhile, the Mobile Economy Sub-Saharan Africa Report forecasts that, by 2030, both the mobile internet and smartphone market across Sub-Saharan Africa are expected to grow considerably. Smartphone adoption is expected to be at 88 per cent, 5G adoption at 17 per cent and 4G adoption at 49 per cent. Today, those figures are 51 per cent, 0.2 per cent and 22 per cent respectively so the outlook is strong.

However, while these figures are promising, there’s still a long way to go before the digital divide is bridged. There remains one large challenge that needs to be tackled for the continent’s ambitions to be met: the mobile internet usage gap.

The Usage Gap Is Leaving People Behind

Despite the connectivity gap closing, the usage gap within the Sub-Saharan region is still significant. The latest figures show the gap is still 59 per cent in the Sub-Saharan Africa region, larger than the global figure of 38 per cent. The gap matters on a number of levels. Lack of ability to take advantage of access to mobile networks is resulting in people not being able to access healthcare, education and e-commerce. And it can also dramatically impact financial inclusion.

Indeed, FinTech has revolutionised Africa’s financial sector, spurring economic growth and bringing digital accounts to millions, often for the first time. Mobile money has paved the way for a dynamic ecosystem. Sub-Saharan Africa now hosts more than 760 million mobile money accounts, with transactions exceeding $830 billion in 2022. However, as emerging products, services, and technologies continue to reshape the industry, the ramifications become more severe for those left on the other side of the digital divide, who are unable to use life-changing financial services.

These impacts are why it is essential for all key stakeholders at national, regional and continental levels across the mobile industry to come together to build meaningful solutions. It’s time to develop strategies and policies that will close the usage gap, in a spirit of partnership, but with a real focus on policy change to support the growth of a vibrant mobile economy, across Africa. If we can get this right, then it is likely to be one of the biggest deciding factors in The Africa We Want coming to fruition.

Overcoming The Biggest Barrier: Affordability

But to form these strategies, we need to understand the current barriers to mobile internet adoption. These are access; knowledge and skills; a lack of relevant content or services; safety and security issues; and, most pressingly, a lack of affordability.

According to GSMA Intelligence, 1GB of broadband – the equivalent of a one-hour web meeting – currently costs Africans 3.5 per cent of their income on average. The cheapest 3G or 4G feature phone or smartphone available in the market, meanwhile, costs them 30 per cent of their income.

The data also shows that, should the industry be able to retail smartphones at circa $20, an additional 270 million Africans would be able to afford handsets, and therefore be empowered to play an active role in the digital economy. That, in itself, is expected to reduce the usage gap by 23 per cent. So how can we make both handsets and mobile broadband more affordable for Africans?

Together as an industry, we need to work with political stakeholders across Africa to drive the development of new policies which will contribute towards closing the investment and usage gaps. For example, by reducing mobile-specific taxes and fees on devices, subscriptions and services to improve the affordability of mobile services.

Examples To Learn From 

We have already seen some strong initiatives in the area of affordability. For example, in Rwanda, the Bank of Kigali has partnered with MTN Rwanda to create the Macye Macye initiative, a device financing programme which empowers MTN Rwanda customers to purchase smartphones and tablets on credit. The programme has been designed to make it extremely simple to sign up for credit and allows customers to pay for their smartphones at a daily cost as small as 16 US cents.

In Kenya, meanwhile, the Digital Economy Cabinet Secretary and Kenyan ICT recently launched an affordable smartphone initiative focused on low-cost device manufacture. Supported by telecom companies such as Safaricom, Jamii Telecom and Airtel, the new proposal aims to manufacture smartphones locally in Kenya and sell them to consumers for around $40.

We’re also on the path to bringing everyone together, over and above these individual initiatives. Partner2Connect (P2C) is a digital coalition created by the International Telecommunication Union (ITU) to help connect people in developing countries. One of its key missions is to drive smartphone affordability across Africa by facilitating partnerships between governments, private sector stakeholders, and NGOs. It encourages them to jointly invest in programmes that will reduce smartphone costs.

With mobile devices and mobile internet usage growth so essential for citizens across Sub-Saharan Africa to thrive digitally and economically, these examples are just the start of what can be done if we can come together as an industry to ensure no one gets left behind. Smartphone and broadband affordability need to be the key focus for telcos, governments, and policymakers alike if The Africa We Want ambitions are to be met.

It is why this topic of conversation has taken centre stage at MWC Kigali, where we hosted a number of sessions bringing together all relevant stakeholders to find the policies and solutions that can tackle affordability, and help close the usage gap for good.

This article was written by Angela Wamola, Head of Sub-Saharan Africa, GSMA.