The young and interconnected market of Africa: Challenges, threats, and opportunities
If you’re wondering why Africa has been a constant topic of conversation in the communications industry over the past few years, there are many reasons for that. Here are some; despite political unrest and weak economic growth in the past, the ownership of smartphones is evolving at a breakneck speed and consumers are rapidly increasing their use of mobile applications.
On the other side of the fence, telecom operators in Africa are responding to consumption behaviors with the rapid deployment of 3G networks and expansion of LTE technology.
Young population, new technology
Africa has a predominantly young and innovative population, with six in ten people under 25 years of age and more than two-thirds owning a mobile phone. What’s more, young Africans are growing up in a continent that has become an integral part of the global economy. Most of them expect to be linked by modern communication networks to the world’s markets, media, and opportunities.
While other continents are still working out what to do with legacy cables, phone lines, and now-obsolete technology from previous generations, Africa has avoided fixed lines for the most part. They have gone straight into satellite and wireless technology, making access universal across the continent.
Significant infrastructure investment in some countries, such as mobile broadband and fiber-optic cable connections to households, together with the widespread availability of low-cost smartphones and tablets, has enabled millions of Africans to be connected.
This ease of access, lower technological and infrastructure costs due to economies of scale, has led to innovation and entrepreneurial activity as people apply the broad-ranging capabilities of the digital age to solve daily struggles.
In industries such as agriculture and fishing, Africa’s applied technology innovations are enabling farmers to communicate with each other and the markets. People can access information on everything from weather, crop selection, and pest control to management and finance. What is more, authorities are using technological developments to prevent illegal fishing.
Dialog trade net enables farmers and produce vendors to check the spot prices of agricultural goods via mobile phone, increasing efficiency and productivity, and reducing the likelihood of exploitation.
In banking, M-PESA is a mobile-based money transfer service which has become widely popular with Africans who may not have bank accounts but want to trade and transact in the formal economy. A similar service, Mobile Money, had 16.6 million total registered subscribers by 2014.
A mobile marketplace
The use of mobile devices and smartphones is rapidly increasing across the continent and expected to continue expanding. In fact, it is estimated that global mobile data will increase tenfold from 2014 to 2019 and that mobile internet usage could make up 10 percent of Africa’s economy by 2025.
The main reason behind the proliferation is that for less than $100, people who couldn’t afford computers or tablets can now be online and access data through a smartphone. The rapid deployment of 3G and 4G networks and the fledgling expansion of LTE services are additional key drivers.
With the meteoric pick-up of smartphone technology, Africans are becoming increasingly more sophisticated in their use of mobile applications. Locally relevant content, video-on-demand, and m-learning are high on their wish lists and are expected to drive competition and innovation in this booming marketplace for years to come.
By Nathan Sawicki | November 30th, 2016