At the Connect Africa summit presently being held in
Kigali,
Rwanda, the GSM Association (GSMA) has announced that the mobile industry plans to invest more than US$50bn in sub-Saharan
Africa over the next five years to provide more than 90% of the population with mobile coverage. The investment will be used to extend the reach of GSM mobile networks, enhanced with GPRS, EDGE and HSPA technologies, to provide a varied suite of mobile multimedia services, including Internet access.
The GSMA reckons that since sub-Saharan governments began liberalising their telecommunication sectors at the turn of the millennium, the mobile industry has invested US$35bn, providing more than 500mn people (67% of the population) in sub-Saharan
Africa with mobile coverage. “This surge in investment by the mobile industry has changed the lives of millions of Africans, catalysing economic development and strengthening social ties,” claims GSMA ceo Rob Conway.
MTN,
Orange , Vodacom and Zain subsidiary Celtel are among the mobile operators planning to invest heavily in the expansion and enhancement of their local networks.
There are more than 150mn mobile subscribers in sub-Saharan
Africa today. However, a further 350mn people have mobile coverage and are not yet directly connected. As well as extending coverage, the mobile industry is focusing on using economies of scale to connect these people. The GSMA estimates that an increase of 10 percentage points in mobile penetration can increase the annual growth rate of GDP by up to 1.2 percentage points.
In order to create the conditions that will maximise the benefit of this new investment, the GSMA is calling on governments across the region to remove barriers in the path of greater mobile access. In particular, says the organisation, African governments need to make sure sufficient spectrum is available to enable the hundreds of millions of Africans, who live beyond the reach of today’s fixed networks, to gain access to cost-effective broadband services. The GSMA believes the World Radiocommunication Conference, currently meeting in
Geneva, needs to reserve the 750MHz to 862MHz spectrum band for mobile broadband services in Europe, Middle East and
Africa. “It is important that the world’s governments set aside this spectrum in a harmonised way, enabling handset makers to achieve economies of scale, thereby reducing the cost of access devices for consumers,” judges Tom Phillips, chief Government & Regulatory Affairs officer of the GSMA.
African Governments also need to address other barriers to the uptake of mobile communications, such as high consumer taxes. Mobile specific taxes are levied in
Ghana,
Kenya,
Tanzania,
Uganda and
Zambia; if these were lowered or removed, reasons the GSMA, government tax receipts would actually increase as more people will connect and use mobile services, boosting Value Added Tax receipts and stimulating wider economic activity. High license fees and other regulatory bottlenecks, such as international gateway monopolies, also constrain the competitiveness of African business.
We say: sitting alongside the mobile industry’s humanitarian concern, altruism and desire to accelerate economic and social development in sub-Saharan
Africa and other emerging regions is the not entirely disinterested circumstance that equipment vendors and service providers are now having to cast around for new outlets for their wares. As noted in Pyramid Research’s new report,
‘The Next Billion: How Emerging Markets are Shaping the Mobile Industry’, the share of the population with mobile subscriptions is far higher in the richer economies of the world than in the emerging markets - regions such as Western Europe exceed 100%, whereas in most of Africa and Southeast Asia penetration rates average less than 20%. “It is thus evident that the bulk of future mobile growth will come from emerging economies,” concludes Pyramid. According to this company’s reading of the runes, the global mobile market will add its next billion subscriptions by year-end 2009, with roughly between 85% and 87% of the next billion to come from emerging markets.
John Williamson 
