Phone adoption may guide the quantum leap to 4G
With mobile connectivity now integral to the modern economy, a key part of any national development program must be digital inclusion. This is being achieved by expanding mobile broadband coverage, but there is another important consideration: the affordability of smartphones.
A recent report from the GSMA shows that smartphones account for 39% of the 774 million mobile connections in sub-Saharan Africa. This is projected to grow significantly, but for the people of Africa to reap the dividends of mobile connectivity, it is critical that 4G-capable smartphones are more readily available to the entry-level market.
This requires financial innovation alongside the technological innovation that characterizes the sector. Smartphones must be cheaper if Africa is to unlock the full potential of its people.
Fortunately, there are already encouraging signs that manufacturers, policy makers and network operators are partnering to embed such financial innovation in the drive for digital inclusion.
In Kenya, Safaricom recently launched a device financing program, in partnership with Google and Teleone, which enables low-income people in Kenya to access quality 4G phones at low fees from as low as Kshs 20 (R3) a day.
The country has high mobile phone penetration, but this has traditionally involved 2G phones. The campaign aims to attract a million more customers to the digital economy.
Airtel Africa has expanded 4G adoption on the continent with its “more for more” data offerings, increasing average data usage, and 4G now accounts for more than 60 percent of its data revenue.
However, one of the most effective ways to encourage smartphone adoption is to reduce the tax burden on mobile phones and services in the form of import duties and sales taxes. In this context, policy makers have an important role to play in empowering citizens with easier access to digital connectivity.
As smartphones become the norm, broadband spectrum can follow suit, and network operators can transition to 4G and 5G-based platforms, with all the benefits of massive high-speed connectivity that carries.
A growing demand for 4G phones indicates when a market is ready to transition from the 4G network and it is possible to shut down the 3G spectrum, as India was able to do recently.
At the recent 2020 LTE Global Summit, Sandeep Gupta, Executive Vice President of Barthi Airtel in India, said that the decision to shut down the 3G network was motivated by two considerations: smartphone penetration and the right network assets such as SDR (software Defined Radio) and singleRAN radio, which supports 4G VoLTE.
However, the core of this transition is affordable phones. In China, 4G adoption has accelerated with the introduction of 100 Yuan (R238) phones, catapulting millions into the future of 4G and 5G.
In South Africa, smartphones have also become significantly more affordable, with phones like the Huawei Y5 Lite retailing for around R1 300. However, there is scope to make 4G smartphones even more affordable. and really democratize connectivity.
Perhaps the simplest way to accelerate digital inclusion is a change in our understanding of the place of 4G phones in our society.
Once smartphones are seen as a commodity, a basic right rather than a luxury, they can be traded, sold, and taxed accordingly, leading all of humanity into the new digital economy.
