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Africa: A Billion Opportunities for Mobile

54 countries, 19 million sq miles and a billion people. How is that for a large market? In a developed country like the US, we take cell phones and the associated convenience for granted. In many cases, they free us from being “tethered” to a fixed desk if you want to get online and you do your shopping, email, Facebook updates, etc. There is a whole plethora of humanity out there, however, that these are alien concepts when they are still trying to struggle with basic essentials such as infrastructure, roads, telephones etc. The Africa panel at the GMIC SV took a look at some of the issues and benefits of mobile adoption in one of the lesser developed regions of the world.

Disruptive innovation

Africa is one place that not a lot of people think is associated with innovations in the mobile space. But with 700M mobile connections, it is now the 2nd largest mobile market in the world. A blistering 30% growth rate brought it to its current state, and the continent is not done yet! A disproportionately large share is taken up by some of the bigger markets: Nigeria, South Africa, Kenya, Egypt, and the Maghreb countries of North Africa,  etc, but there are areas of innovation throughout the region.

This growth is to be celebrated giving Africa a new face different from the common stereotype of poverty and social ills. Infrastructure in some cases is preceding basic essentials including electricity.

One advantage of the large population is the intense competition to gain marketshare is making technology more affordable to the bottom of the pyramid.   Most of the development so far has focused on feature phones, but data connections are rising as increased awareness of the utility of mobile data drives increased adoption. The price war is driving down the price of devices and plans, but with innovation, the average revenue per user (ARPU) is being expanded to services.

There are many areas of disruption enabling empowerment of the people. Farmers interact with the ecosystem and get better data for their farming methods. Businesses and families can get insurance by answering a few simple questions on their mobile phones, parents wanting to develop the next Justin Bieber from Africa on youtube are investing in iphones.  In finance, things that we can’t even do in the US with the latest smartphone, people in Africa are doing with first generation nokia phones without having bank routing numbers or accounts. Some teachers in africa receive their paycheck on the phone!

Africa still has some catching up on female rights, but mobile phones have empowered more women than ever before. They are able to take short courses, quizes, little-wiki pages, form sympathy groups for widows and disaster victims, report abuse. According to the panel, governance is much better: if you post on twitter, you probably get a faster response time from the police and perhaps a better chance to catch the culprits.

The mind boggles for those of us who don’t have these issues.

Issues, Opportunities

With all that said, there are still challenges. Take the issue of bandwidth for instance. Govts have a long way to go in managing  spectrums and licensing transparency is still not there. Also, Africa is not one country: each country has its own laws, regulations and barriers to entry. But as modernization resolves some of these challenges, entrepreneurs should look at the future opportunities in coming  decade: how creating smart communities enables new business models. Maybe, just maybe, if you solve basic human needs in the developing world, you will get a bigger return on investment than one more social networking app.

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