The impact of mobile phones in Africa

Abstract

The demand for mobile phones in Africa in the last few years has been more than most people expected and continues to expand. Operators have traditionally target urban areas, but it is the demand from rural and low income areas that have exceeded all expectations. The use of phones has already become part of African culture. As urban markets become saturated, the next generation of phone users will be rural based, and they will be using mobile phones. Demand is driven by voice as opposed to data. Social uses such as keeping in touch with family and friends feature strongly. Benefits include a sense of wellbeing, improved income (e.g. arranging cash transfers from family members), and reduced risk (e.g. call for assistance). There is a growing body of evidence of the indirect impact on the poor arising from improvements in the delivery of pro-poor services that can be achieved through mobile phone based applications (many based on SMS). In the future, voice telephony will converge with digital services, so mobile phones will enable access to a range of data based services. In the longer term, handheld devices will combine features of radio, television, camera, mini computer (PDA) and phone. These will be even better suited to the culture of Africa’s poor, and will offer almost limitless opportunities for delivering services tailored to the needs of the poor. The challenge is to ensure the poor can access services, and that services are useful. This paper proposes three key areas where support from high level institutions could help African countries exploit the potential that mobile technology offers to the vulnerable: • Ensure the poor benefit from expanding access to networks - develop new business models for network investment which reflect the behaviour of African consumers. This includes low cost, low tariff models, and making sure universal access strategies are effective in extending networks to remote areas. • Ensure the poor benefit from the phone network through appropriate services. Services relevant to the poor need to be stimulated. Many of the existing commercial services – horoscopes, football results – have little relevance to the poor. Stimulate the development of locally designed, mobile based solutions to African opportunities by supporting local technology entrepreneurs (both for profit and not for profit). • Ensure the poor benefit from access to financial services, enabled through mobile phone networks. Integrating mobile phone operators into the reform of financial services will accelerate the introduction of electronic services to the rural poor. Mobile technology lends itself to this application, and phones offer a means of access through voice or text.