Communication is deeply ingrained in the human psyche. It is such an integral part of our life that we cannot think of voluntarily living in isolation, never getting to interact or exchange information with others.
In the days before the advent of modern technology, passing information to someone on the other side of the world was not only an expensive and challenging exercise but a time-consuming one. Take an example: written correspondences. Letters could spend weeks or months en route to recipients, depending on the mode of transportation available.
From that time onwards, communication began to evolve through series of disruptive technology, which helped to increase the speed at which people can send and access information.
Since its introduction into Africa in the 2000s, mobile technology has been a game-changer for the continent. Beyond being able to communicate virtually with anyone in just about anywhere in the world, we can access financial services, entertain ourselves, shop, and interact on social media, among other things.
Taking a look at the 2007/8 African ICT access and usage survey, it was shown that there was alarmingly little access to the Internet and a noticeable absence of computers on the continent. Fast forward to more than a decade later, the mobile phone is now the key entry point for Internet usage in many emerging markets, including Africa.
As affordable devices become available, smartphone adoption continues to increase rapidly in the region, especially among the youth population. They are quick to respond to social, economic, and political issues across the continent and even beyond.
To this end, a recent report by GSMA Intelligence reveals that in 2019, 477 million people in Sub-Saharan Africa (45 per cent of the population) have subscribed to mobile services, projecting that by 2025, about half of the population would have subscribed to a mobile service.
COVID-19 and its impact on digital connectivity
If anything, the COVID-19 pandemic has taught us to appreciate the value of connectivity that the Internet makes possible. Also, it highlights the importance of the mobile Internet in promoting access to education, work, healthcare, social networks, goods and services.
More importantly, being able to keep in touch with loved ones and others helped to maintain mental, social, and economic wellbeing, especially during the periods of lockdown and social distancing protocols put in place to check the spread of the virus.
Though still in full swing, the pandemic underscores the need to have a robust and inclusive digital economy that can only be strengthened by access to fast and stable internet.
Understanding this, the mobile industry in Sub-Saharan Africa has risen to the occasion, connecting individuals, businesses, and customers during the pandemic as well as offering them a range of digital services. However, a digital gap still exists as almost 800 million people in the region are yet to be connected to the mobile Internet, GSMA reports further.
As of 2019, there is a 23 per cent penetration rate of mobile Internet users in the entire SSA region. One reason that contributes to this low percentage is the imbalance of Internet adoption in some African nations.
For example, countries like Kenya and Nigeria have a higher penetration rate of mobile Internet while others, like South Sudan, have not yet made significant moves toward mass adoption of mobile Internet; hence, the need to bridge the digital divide.
Low broadband penetration, high cost of smartphones relative to average income levels, high cost of data, and limited digital skills among rural and less literate populations are some of the main barriers to mobile Internet adoption in Africa.
To ensure that all households in low and middle-income countries benefit from the current digital revolution sweeping across the globe, a World Bank and GSMA study, titled ‘The poverty reduction effects of mobile broadband in Africa: Evidence from Nigeria’, recommends that governments of such countries should do the following:
Set up a policy framework that supports the expansion of mobile broadband connectivity, especially in rural and remote communities.
Address the mobile Internet usage barriers such as affordability and digital skills, ensuring that underserved groups (women, people with disabilities, etc.) fully benefit from digital technologies. Promote complementary policies to maximise the benefits of digital connectivity, such as high-functioning public services and infrastructure development.
According to GSMA, in 2019, mobile technologies and services generated nine per cent of GDP in Sub-Saharan Africa, a contribution that added up to about $155bn of economic value. In addition to its contribution to the public sector through taxation, the mobile ecosystem also promotes job creation.
From the foregoing, it becomes necessary for governments to implement policies that boost access to connectivity and invest in building a more resilient digital infrastructure for the post-COVID future.
The rise of mobile money
Mobile money has been lauded as a revolutionary tool for driving inclusion in low resource environments. To what does the concept of mobile money refer?
It is an electronic payment platform that enables the transfer of money between cellphone devices. The technology is installed in the SIM card of a regular or smartphone device such that users, particularly the unbanked, are able to quickly transfer money at low cost without being connected to the traditional banking system.
Since digital payments and broader financial services are increasingly on the rise, they provide a solid platform upon which mobile operators in Sub-Saharan Africa can expand their offerings beyond connectivity, leveraging the opportunities in the digital payments ecosystem.
For instance, Kenya’s M-Pesa, a mobile money transfer service, accounts for just over a third of revenues generated by Safaricom, the largest mobile network operator in Kenya. What this exemplifies is the market potential of digital financial services for operators. Other telcos can take a cue by partnering up with fintech companies to provide digital financial services to subscribers.
Since 2010, Africa’s digital advancement has been profound, providing remarkable opportunities for the continent to circumvent traditional developmental stages and boycott numerous regulatory obstacles to effect broader change.
More so, a recent IFC and Google report describes Africa’s Internet economy as “broadly resilient” during the COVID-19 crisis. If this resilience holds, we can expect to see even more rapid growth of the continent’s digital economy.
ICT Clinic by CFA is published weekly in the Sunday Punch