New York, US//-: The GSMA today warned that the world risks creating a new global divide between AI “haves” and “have-nots” unless urgent action is taken to address the digital divide and make smartphones affordable for billions of people in low- and middle-income countries.
Launching its State of Mobile Internet Connectivity (SOMIC) Report 2026, the GSMA, which represents the mobile ecosystem worldwide, warns that while artificial intelligence is transforming economies and societies, its benefits will remain out of reach for more than 3.4 billion people who still do not use mobile internet – despite more than 90% of them already living within mobile broadband coverage. Without affordable smartphones, these people will remain unable to benefit from the AI revolution.
The report highlights a growing threat to digital inclusion: a sharp increase in the cost of smartphone memory and chipsets, driven by global demand for AI infrastructure and data centres. These rising component costs are already feeding through into entry-level smartphone prices, placing internet access further beyond the reach of low-income consumers and threatening years of progress in closing the mobile usage gap.
The GSMA is calling on chipset and memory manufacturers to take meaningful steps to increase availability of affordable components for entry-level handsets, in order to avoid a large portion of the population in emerging economies behind completely left out of the digital economy. The GSMA encourages these companies to enter in a dialogue with the wider mobile ecosystem, policymakers and multilateral financial institutions to identify solutions and bring affordable connectivity within reach of millions.
Vivek Badrinath, Director General of the GSMA said: “Artificial intelligence has the potential to improve lives on an unprecedented scale, but AI is meaningless if people cannot get online in the first place. The greatest risk is not simply an AI divide between countries, but between people who can afford to participate in the digital economy and those who cannot.
“Unless we protect the affordability of entry-level smartphones, billions of people risk being excluded from the next generation of digital services before they have even had the opportunity to experience the internet. The current memory price increases make this a clear and present danger. Preventing that outcome requires coordinated action from policymakers, mobile operators, device manufacturers and component suppliers alike. We call upon all parties to mobilise all possible tools, both on the production side and on the distribution and taxation areas, and to take measures to ease reuse of devices.”
The State of Mobile Internet Connectivity Report 2026 shows that 4.8 billion people now use mobile internet on their own device, but growth is slowing. Around 160 million people came online in 2025, down from 190 million the previous year, while 3.1 billion people continue to live within the footprint of mobile broadband networks but do not use mobile internet – the “usage gap”. The majority of this group still does not own an internet-enabled device.
The report identifies handset affordability as the single biggest barrier to mobile internet adoption across surveyed low- and middle-income countries, followed by a lack of digital skills. By the end of 2025 an entry-level internet-enabled handset cost the poorest 20% of people in LMICs the equivalent of 44% of their average monthly income, rising to 76% in Sub-Saharan Africa with these costs expected to dramatically rise due to increases in memory costs.
GSMA analysis also shows the scale of the opportunity. Until a year ago, reducing the price of entry-level smartphones to $30 could make devices affordable for almost 1.6 billion people, while reaching a $20 price point could make them affordable for around 2.2 billion people currently living within mobile broadband coverage. However, the report warns that, despite the efforts of operators and manufacturers, including the GSMA’s own Handset Affordability Coalition, achieving those price points is today out of reach as memory costs continue to rise.
According to the report and data from Counterpoint Research, memory prices more than doubled between the third quarter of 2025 and the first quarter of 2026 before increasing by a further 80–90% during the second quarter of 2026.
The result is already visible in the market, with entry-level smartphone prices increasing sharply and global smartphone shipments forecast to suffer their largest annual decline on record, driven primarily by the collapse of the sub-$100 handset segment. Emerging markets are expected to be hardest hit.
The GSMA warns that this threatens to undermine not only digital inclusion but also the economic opportunity created by broader internet adoption. Previous GSMA analysis estimates that closing the mobile usage gap would generate $3.5 trillion in additional GDP between 2023 and 2030, with more than 90% of those benefits flowing to low- and middle-income countries.
Improving handset affordability, alongside addressing other key barriers to digital inclusion. Including low literacy and digital skills, safety and security concerns, and availability of relevant content and services, is critical to realising this opportunity.
As governments and businesses increasingly invest in AI-enabled services across healthcare, education, financial services and public services, addressing the digital divide and ensuring affordable access to smartphones is becoming an essential prerequisite for inclusive AI adoption.
