The statistics that emerge on the mobile phone market in Africa are staggering. In a continent often stereotyped as being poor and underdeveloped, the level of take-up of mobile services is amazing, with the average rate of ownership of mobile phones around 6% of the total population.
With an average age of 18.6 years it is perhaps not so surprising that many people in Africa own mobile phones. By 2100, the World Bank forecasts that one third of the world’s young people will live in sub-Saharan Africa alone.
Sub-Saharan Africa’s population now stands at just below 1 billion people and the International Monetary Fund (IMF) says that since 2003, the Gross Domestic Product has risen on average between 5% and 7% per year. In the past decade, six of the ten fastest growing economies in the world were African. In 2012, five African countries were predicted to also outgrow China.
The World Bank estimates that this will double by 2050, when it is believed that 21% of the world’s work force will live in sub-Saharan Africa. The increasing population will add 122 million to the working population in the region, which has the potential to create major issues if these people are unable to find jobs.
The increasing population will create a huge reservoir of potential users that mobile phone operators can tap, with huge economic benefits. The question is how to do that in a continent where the IMF estimated for 2010 the average daily salary ranged from $1 to $10 a day in some of its poorest countries.
Africa also suffers from the lowest penetration rate of the internet at 15.6% as personal computers and tablets have yet to be produced at levels that can be widely afforded. With people clamouring for mobile technologies the mobile phone companies have filled the void. Such was the level of investment poured into mobile phone infrastructure in Africa that it overtook international aid in 2006. Today that investment is twice the level of aid flowing into the continent.
Over 700 million Sim cards are in use in Africa today in what is the fastest growing market for mobile technologies in the world. At the turn of the century, barely a few million people owned mobile phones in Africa. Some estimates suggest this might have grown to 735 million by the end of 2012 and onto 1 billion by 2016 at current growth rates.
Petrol price app
Of course, across such a vast continent, the take-up of mobile technologies will not be uniform. In South Africa, a population of 50.5 million people currently own 59.4 mobile phones. In Kenya there are 74 mobile phones for every 100 people. Language diversity and literacy levels can also pose problems. Sub-Saharan Africa currently comprises of over 48 nation states where over 3,000 languages are spoken.
In Kenya, as petrol prices have soared by over 50% since the start of 2012, students have developed a simple mobile phone application called Mafuta Go, which collates prices from petrol stations.
When the app first became available, over 300 people downloaded it on the first day, causing the system to crash. In time they hope that major oil retailers will provide online prices to the Mafuta Go service directly. Currently, three drivers move around the capital city Nairobi collecting the price data.
Users who also submit price information earn credit points that save money on their subscription fees. In Uganda, applications have been developed to help shoppers find the best deal for specific products and identify where it is available.
The vast potential for mobile users in Africa is unleashing a new set of entrepreneurs who can see the potential for simple application services. Mobile phone technologies can be a force for good, but can come at a price – and it is a price that much of Africa currently finds hard to bear.
The World Bank has set a standard level of income of $2.50 a day as their benchmark for poverty. In research noted in The Economist, some people in Kenya will go without meals or walk instead of taking a bus in order to maintain credit on their mobile phone.
Almost half of the people surveyed were using internet-enabled mobile phone technologies. In Kenya this figure is 99%. However, only 16% of the survey respondents said they were actually using their mobile phones to access the internet. In Nigeria, 45 million people of the 170 million population currently use the internet. This is the highest in Africa, followed by Egypt with 21.7 million users out of a total population of 82.5 million at the end of 2011.
By far the most important applications in use in Africa today relate to the movement of money. One organisation specialising in this is M-Pesa, a mobile money-transfer system pioneered by Safaricom, one of Kenya’s leading mobile phone operators. One of its main uses is to ensure school fees are paid on time. M-Pesa has over 14 million subscribers.
In the area of mobile money, Africa leads the world with over 70% of Kenyans and over 50% of Sudanese people using services. Tanzania, with around 15%, comes third in a world table of users dominated by the African nations. Not far behind are Afghanistan and the Philippines. India and China are just starting to see the market for mobile money start to develop. It is an area where Africa has the potential to export its ideas and services into major world economies.
It is estimated that M-Pesa has facilitated the movement of $8.6bn in the first half of 2012. At $17bn a year, this represents a significant percentage of the total income of Africans. A new service called PesaPal offers more features than the text-based M-Pesa by offering printable receipts and notifications of when payments are due. There are also developments in loyalty schemes over mobile services that offer their creators ways of making a return on the investment in building the application.
Other applications seek to tackle problems such as the abundance of counterfeit pharmaceuticals in Africa. The organisation MPedigree.org provides an application that can scan barcodes and establish authenticity, as well as checking for expiry dates.
In sub-Saharan Africa, where so much of the population depend upon agriculture for their livelihoods, many mobile applications focus on helping pastoralists. There are applications which help a farmer to know what rates are being paid for cattle and other goods at markets. Other online services provide famers with basic animal husbandry information and encourage villagers to preserve their folklore.
An application called iCow.co.ke helps predict likely birth dates of calves. The location of the nearest vet is also available. Another application called M.Farm allows farmers to form collectives to buy and sell goods. Many of the solutions that are being developed address specific local issues that are unique to Africa.
In locations where looking after your crops or herds can make the difference between life and death, such services are hugely important. Weather forecasts are also becoming available and it will not be too long before flood warnings are also routinely made available over the mobile phone. There are, however, services also developing to serve the needs of those with higher incomes.
After mobile money applications, the next major area of development may be in mobile digital maps. For aid agencies operating in Africa, mapping data is a vital source of information. Some novel ideas are being developed that may see large areas of Africa mapped by crowd sourcing data. Students can be trained in how to collect the basic data using their mobile phones and the information derived can be uploaded onto a central service to be accessed by tourists, government agencies and aid agencies.
The story of the uptake of mobile phone technologies in Africa is truly remarkable. Despite the economic frailty of some nation states, its people have decided that mobile phones are not simply a fashion accessory. In a continent where literally every cent counts, having access to a mobile phone is crucial.