With shiny new 4G smartphones clamouring for attention, it’s easy to forget about the humble talk-plus-text mobile phone. But the device continues to dominate in emerging markets, such as Africa, where access to third generation cellular — let alone 4G — is not even close to being widespread. ABI Research says GSM (2G) mobile subscriptions now account for 62.7 percent of mobile subscriptions in Africa, while 3G, in both CDMA2000 and WCDMA flavours, only represents 11 percent of the overall market. Just over a quarter (27 percent) of subscriptions rely on 2.5G access technologies for mobile data.
In its latest quarterly update for the region, the analyst says it expects mobile phone subscriber penetration levels to pass 80 percent in the first quarter of next year. In Q3 this year, Africa’s 54 countries and 1.08 billion people had accumulated 821 million mobile subscribers, according to ABI, up 16.9 percent year-on-year — to 76.4 percent. In Q1 2013 it predicts penetration levels will “eclipse” 80 percent — going on to note that, since many mobile users in the region maintain more than one active prepaid subscription “to minimize interconnection charges”, there is scope for (yet) more growth.
ABI adds that it expects the cellular market in Africa to grow to 1.12 billion subscribers by 2017 — contributing 13.9 percent to take the global cellular market to 8.11 billion.
The mobile subscription growth rate in Africa is easily outstripping mature mobile markets elsewhere in the world. ”While Western Europe languishes with barely positive overall growth quarter-on-quarter, Africa managed to generate 4.2 percent growth in the same period,” noted Marina Lu, research associate, ABI Research, in a statement.
A Deloitte report earlier this month — for global mobile carrier association, the GSMA — named sub-Saharan Africa as the fastest-growing mobile market in the world, with a “prodigious” average annual growth rate of 44 percent since the year 2000. The report noted that mobile connections in sub-Saharan Africa had grown to 475 million vs just 12.3 million fixed line connections.
According to ABI, the top seven Africa carriers by subscriber number are
Prepaid — as opposed to monthly carrier billing — accounts for the “vast majority” of Africa’s mobile subscriptions, owing to the relative lack of access to banking facilities and credit cards. In South Africa, ABI pegs carrier prepaid ratios at between 70 to 86 percent but in most other African countries it says prepaid ratios are more than 95 percent — “if not close to 99 percent”.
Mobiles have stepped in to help Africa’s unbanked in other ways too — via SMS-based mobile money services such as the Safaricom/Vodafone M-Pesa service. Earlier this week, a new mobile-based financial service launched for M-Pesa customers in Kenya — in partnership with the Commercial Bank of Africa. Called M-Shwari, this offers interest bearing savings accounts and small loans via the M-Pesa menu on mobile users’ (not so humble) mobile phones.