West Africa is Still Going to Be the Most Profitable Region for Mobile Operators  

 

GSMA data

Accra, Ghana, May 3, 2018//-Over the period to 2025, around 72 million new mobile subscribers will be added in West Africa, taking subscriber penetration to 54% in the region.This subscriber growth will be driven by a demographic shift in the coming years, as many young adults take out a mobile subscription, according to the recent GSMA report.

So, mobile operators  in the region are still going to be the most profitable.

The report titled ‘The Mobile Economy: West Africa 2018’ which  is authored by GSMA Intelligence, the research arm of the GSMA, revealed: “By the end of 2017, there were 176 million unique subscribers across the West Africa sub-region, comprising the 15 member states of the Economic Community of West African States (ECOWAS)”.

“Overall subscriber penetration reached 47% in 2017, up from 28% at the start of this decade. Despite the remarkable subscriber growth in the sub-region in recent years, and indeed across Sub-Saharan Africa, more than half of the region’s population do not yet subscribe to a mobile service”.

Mobile adoption on the rise

Mobile adoption has grown rapidly in West Africa in recent years, helped by the expansion of mobile networks to underserved communities and the increasing affordability of services and device costs.

Also the report noted: “The transition to mobile broadband is gaining momentum across West Africa. 3G remains the dominant mobile broadband technology, but 4G adoption is rising rapidly from network expansion and greater availability of 4G devices.

The number of smartphone connections has more than doubled over the last two years to reach 112 million, accounting for 35% of total connections on average at the end of 2017”.

Mobile contributing to GDP

In 2017, the mobile ecosystem contributed $37 billion, equivalent to 6.5% of GDP, to the West African economy. The mobile ecosystem consists of mobile operators, infrastructure service providers, retailers and distributors of mobile products and services, mobile handset manufacturers, and mobile content, application and service providers.

The use of mobile technology also drives improvements in productivity and efficiency for workers and firms. 3G and 4G technology allow workers and firms to use mobile data and internet services.

This  according to the report improves access to information and services, which in turn drives efficiency in business processes across many industries, including finance and health.

“This impact of mobile internet is particularly significant where fixed infrastructure is poor and mostly confined to large cities and business & industrial districts” in the region comprising Ghana, Nigeria, Ivory Coast, among others.

The researchers predicted: “Going forward, we expect the economic contribution of the mobile ecosystem to continue to increase in both relative and absolute terms. In value-added terms, we estimate that mobile will contribute $51 billion to the West African economy by 2022, equivalent to 7.7% of GDP”.

Employment

Mobile operators and the wider mobile ecosystem provided direct employment to more than 200,000 people in West Africa in 2017, predominantly in the retailing and distribution of services and handsets. In addition to this, economic activity in the ecosystem creates jobs in other linked sectors as a result of the demand generated by the mobile sector.

Mobile delivering greater inclusion and empowering consumers

The report was quick to acknowledge: “The number of mobile internet subscribers doubled over the last four years to reach 78 million, nearly half of the total number of mobile subscribers, by the end of 2017.

The number of registered mobile money accounts in the sub-region reached 104.5 million in 2017, while the total value of transactions for the same period reached $5.3 billion”.

The rapid adoption of mobile services and the funding and infrastructure gaps in the provision of essential services present an opportunity for local innovators to create digital solutions that address a wide range of social and economic challenges across different countries in the sub-region.

As of February 2018, there were 142 active tech hubs across West Africa. Collaboration among all stakeholders is required to sustain growth and innovation in the mobile industry across the sub-region. In addition to the work of operators to expand and improve networks, significant efforts from governments at all levels are needed to create the right conditions for continued investment.

At the supranational level, ECOWAS is well placed to convene and facilitate dialogue between multilateral stakeholders; serve as a hub for knowledge sharing and dissemination with regards to best practices; and provide a platform to harmonise differences in approach towards key issues that impact the mobile industry across the sub-region, it recommended.

At the country level, national and municipal governments have a role to play in addressing fiscal and regulatory issues that directly impact investment sentiments, especially on capital-intensive infrastructure deployment and the rollout of innovative mobile-based services.

By Masahudu Ankiilu Kunateh, African Eye Report

 

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