Around 8% of the GDP in Nigeria and other Sub-Saharan (SSA) African nations was contributed in 2021 by mobile technology and services, adding close to $140 billion to the region’s economy.
More than 3.2 million employment were supported by the mobile ecosystem (directly and indirectly), and the industry’s $16 billion in tax revenue significantly aided in funding the public sector.
The Global System for Mobile Telecommunications Association (GSMA), which published the Mobile Economy sub-Saharan Africa report 2022 at the weekend, stated that by 2025, the contribution of mobile services will increase by $65 billion (to almost $155 billion), as the countries in the region benefit more and more from the increases in productivity and efficiency brought about by the increased uptake of mobile services.
According to the GSMA, 46% of the SSA population, or 515 million people, had mobile service subscriptions as of the end of 2021, an increase of about 20 million from the previous year. It stated that by 2025, there would be close to 100 million additional customers, bringing the total to 613 million (or 50% of the region’s population).
The two most populous nations, Nigeria and Ethiopia, will contribute nearly a third of all new users between now and 2025, claims the telecoms lobby group.
It was stated that due to the SSA’s demography, which has a sizeable section of the population under the age of 18, subscriber growth will continue to be robust as young consumers reach adulthood and become eligible to sign up for mobile services.
Young subscribers are more likely to be tech-savvy and eager to acquire mobile Internet services, especially more advanced 4G and, when available, 5G services, according to the GSMA. Given the ramifications for high-speed connectivity and the development and dissemination of digital services in the area, this is one trend to keep an eye on.
The GSMA reported that regional 5G-related activities are starting to take up. These include attempts to build regionally pertinent 5G use cases, 5G pilots and commercial trials, and 5G spectrum auctions.
For instance, the spectrum auction for the 700, 800, 2600, and 3500 MHz bands was finished by South Africa’s ICASA in May 2022; MTN Nigeria launched a commercial prototype for its 5G network in August 2022; and Vodacom launched a commercial 5G network in September 2022.
The GSMA said that there is increased interest in the role of 5G in the connectivity landscape as a result of the enormous demand for connectivity in the wake of the COVID-19 outbreak.
It emphasized that although though it is still widely believed that a comprehensive 5G rollout in SSA is more of a long-term probability, there is a compelling case for using the technology in select situations to meet specific connection needs for both consumers and businesses.
Although 3G will continue to dominate connectivity in SSA, accounting for more than half of all connections by 2025, the telecoms group stated that this year represents a turning point as 3G penetration starts to fall for the first time.
This is a reflection of the operators’ efforts to move customers away from outdated networks and the rapid trend towards 4G. (2G and 3G). In the region, 4G connections will make up a third of all mobile connections by 2025, up from just a fifth in 2021.
The GSMA said that policymakers may support equitable growth on all fronts. Mobile connectivity, according to the report, has the ability to hasten the SSA’s digital transformation and propel socioeconomic growth in sectors including smart city infrastructure, healthcare, education, and digital commerce.
The body claims that in order to realize this potential, regulatory changes are needed to encourage network investments and raise consumer access to affordable digital services.
In order to meet the region’s rising demand for mobile services both now and in the future, it was recommended that governments and regulators in the area adopt forward-looking spectrum management and fiscal policies.
These policies should include developing a spectrum roadmap, ensuring access to mid-band spectrum, especially 3.5 GHz, given its significance for the development of 5G, and accelerating access to sub-1 GHz spectrum to provide widespread rural mobile broadband services.
The slow adoption of 4G across the area is, in large part, due to the high cost of devices relative to average income levels, according to the GSMA, who stressed that this is especially true given that the availability of 5G devices and at cheap pricing will be important to 5G adoption in SSA.
Additionally, the report noted that regional smartphone shipping data points to an increase in the demand for 5G-capable devices. For instance, the shipping of 5G-enabled devices climbed by 26.9% in the second quarter of 2022, greatly exceeding the growth of smartphone exports to the region as a whole.
It highlighted that a number of factors, including a young, tech-savvy populace with a desire for the newest technology and growing competition among handset manufacturers to bring the most cutting-edge yet reasonably priced models to market, are driving development.
