By Eric M.K Osiakwan
On the 1st October 2020, the Global System Mobile Association (GSMA) released their “Mobile Economy Sub-Saharan Africa” report which forecasted the mobile economy in Africa into 2025. A positive outlook to start the month of October and the last quarter of 2020.
The highlight of this forecast is by 2025, though there would be 1.05B sim connections of which 50% would be unique mobile subscribers adoption, only 39% of Africans would be experiencing their mobile web on osesmartphones which are expected to grow to 65% of the population. This seems to suggest that even though there would be exponential smartphone growth over the period the cost of connectivity may be a showstopper. That’s not necessarily the case because there’s more happening than meets the eye.
The Mobile Network Operators (MNOs) are going to spend collectively about $52B on infrastructure between now and 2025 and this would grow their revenues to $48B by 2025 – generating about a million formal and three million informal jobs across the continent.
By 2024, the industry would contribute $184B to the continent’s collective GDP bringing it to the 9 to 10% range. In the first quarter of 2020, the Information Communication Technology (ICT) sector contributed 17.83% to the Nigerian economy – suggesting that the GDP contribution may be higher by the larger ICT sector.
According to the report, COVID-19 has increased the demand for digital services and so there is an urgent need for government to create policies that enhance access to connectivity and
drive investment in more resilient digital infrastructure for the future. This is crucial
to reactivating the region’s economy post Covid-19 as digital technologies play an even more important role in society.
The UN projects that Africa’s population of 1.3B would quadruple over the next two decades getting to 4.3B by the end of the century. Whiles Asia’s population would be declining, Africa’s would be ascending so Africa would eventually overtake Asia 2100.
Africa’s exponentially growing population of the century would be 70% below 25 years.E so the demographic dividend would not only be in her favor, but the youth have taken to mobile and the mobile web platform to build solutions to the many problems they are faced with. Since the beginning of the 21st century, some of Africa’s youth have being building companies like Interswitch, Cellulant, MSF Africa, Hubtel, IrokoTV, Paga, Jumo, Farmerline, etc.
These mobile web solutions are being consumed by the emerging middle class which according to the Africa Development Bank in 2011 was 313M – 34% of the population. This middle class spends $2.20 a day. The bank’s definition of middle class in Africa is people who spend the equivalent of $2 to $20 a day based on an assessment of the cost of living for Africa’s more than one billion people.
By 2060, the the bank predicts that the number of middle-class Africans will grow to 1.1B (42% of the predicted population). This means Africans living below the poverty line will be in the minority at 33%.Now, to address what’s really going on with mobile growth and the seeming cost prohibitiveness of taking advantage of the growth. Given that the middle-class would grow and increase their purchasing power, they would have more disposable income to afford the cost of connectivity and more people would be able to do that. Secondly, as indicated by the GSMA in their report the cost of connectivity would reduce over the period and hence more people would experience their mobile web on smartphones.
To conclude, by the end of 2100, Africa’s population would most likely surpass Asia with a middle class that would be more than 50% of the population. Smartphone penetration would be almost 100% and the cost of connectivity would be more affordable such that majority of the population would have great mobile web experiences consuming mostly African applications developed by the African youth.