Globally, everything - voice and data- is in the process of (or is already) becoming data. It will soon become as natural to use something like WhatsApp to make a call and to think that SMS is quaint and outdated.
The smartphone will – as Olivier Laouchez of Trace TV told me – become the remote for young Africans.
This article explores why this transition has begun and how quickly it will take place.
At first sight, as with many of the large changes that have happened in Africa over the last 15 years, a transition to data would seem an unlikely thing.
Voice continues to dominate revenues and the majority of Africans are more likely to own a feature phone than many of the more recent variants.
However, two groups of people have begun to change how the mobile market works.
Firstly, you have the elite or middle-class users who have moved quickly to smartphones. Secondly, you have a key demographic for change in Africa – 18-30-year-olds (often students) – who have adopted cheaper Android phones or the more sophisticated feature phones.
The importance of the 18-30 group is that demographic change is relentless: every year that passes, those in that cohort get older, move out of the cohort and new young people are added. Over 5-10 years, it is perfectly possible to imagine that the people with a smartphone will be slightly in the majority over those with basic or feature phones.
In almost every country, there is a voice-related app that has gained enormous popularity in a very short time. I have seen WhatsApp used by office workers for calling and messaging friends in Lagos and as I sit writing this in Bamako, those I have interviewed are telling me of a large Viber community using it for the same purpose.
So where’s the evidence beyond the anecdotes?
In mid-2013 Balancing Act carried out a detailed market research study in seven Sub-Saharan countries in the vanguard of adopting the Internet and social media.
The study has four parts and looks at how the Internet and social media are changing Africa’s communications and media landscape.
Below are some of the key findings of the study.
Everybody Wants A Smartphone
All respondents in the face-to-face surveys were most likely to upgrade their phone in the next 12 months.
For example, in Ghana 72% of respondents said they would do so. When asked what features they would look for in a new phone, the majority were looking for things found on a smartphone.
In Ghana the results were as follows:
- Play Music (90%);
- Access Internet (89%);
- Play Video (86%);
- Touch Screen (83%);
- Download Apps (77%).
Feature phone users were surveyed because there's more of them than smartphone users. Indeed, it’s becoming clear that feature phone users want to be smartphone users “when they grow up”. If smartphones below US$50-75 become widely available, then this will be a large market.
An Overall Increase In The Number Of Devices
Over the last five years, the number of Africans who own or have access to mobile phones, computers, laptops, smartphones and tablets has grown considerably.
These both act as media carriers (a mobile with a radio or TV receiver) or a media in their own right (a mobile accessing the Internet and Social Media).
Wider Access To Computers & Laptops
Computer ownership is much more constrained by the cost of the device. Nevertheless, the face-to-face surveys show that there has been an increase in computer use and what is probably a much wider pattern of shared use.
Ownership of desktop computers and laptops is highest in Ghana (18% and 19% respectively) and Senegal (19% each) and lowest in Tanzania (3% and 6% respectively) and Northern Nigeria (6% each). Taking into account sharing, 37-50% of respondents had access to some type of computer in Ghana and Senegal and 14-16% in Tanzania and Northern Nigeria.
Tablets users were almost non-existent amongst face-to-face survey respondents in Northern Nigeria and Tanzania but in Ghana (6%) and Senegal (5%) a significant number of respondents own a tablet of some form, which might also include “phablets” (large screen smartphones).
Continued Growth In Internet Use
The Internet and Social Media will also grow over the next five years.
Our forecast for the countries covered in this report in terms of Internet connection ownership is that it will grow to between 10-25% of the population depending on the country. The majority of Internet use will be on a mobile phone, but the level of household broadband connections will continue to grow.
Changing Behavior In Terms Of News And Information
Both the feature phone user research and the qualitative groups emphasize how those with access to the Internet use their mobile phones for getting both news and information.
In the case of the feature phone users, using the Internet in this way comes just behind radio and TV as a means of getting news and information whereas the percentage using Internet in this way is much lower in the overall population.
The Haves And The Have Nots
Until recently, access to the Internet was an almost entirely an urban phenomenon, although a small number of rural people now have access. But even in a more developed country like South Africa, only 24% of Internet users are in rural areas.
Furthermore, the speed of Internet connection has accelerated faster in urban areas (allowing access to video material) than in rural areas.
The Meteoric Growth Of Social Media
Over five years Facebook has grown from practically no users in Sub-Saharan Africa to become the most widely used social media platform. In the four countries where face-to-face surveys were carried out for this research, between 14% (Tanzania) and 27% (Ghana) of all respondents were using it. Facebook is the dominant platform although there are interesting local variations. All forms of social media serve as a source of news and information alongside more traditional media.
People “like” news media (newspapers, radio and TV stations) on Facebook to get information and receive similar “news” or “research” alerts from friends and colleagues.
My argument is not that these early adopters are part of an immediate change in behavior but the first signs of the way the road is going. Mobile operators can try and block developments like What’s App and Viber (as many have tried) but this will only delay rather than stop this kind of progress. Andile Ngcaba, CEO, Convergence Partners is fond of comparing the mobile operators to those who used to produce ice blocks for sale. Once the fridge was invented, it was downhill all the way for them.
So what are the choices for those currently metaphorically selling ice-blocks?
In a world where everything is data, there will be two types of companies and they will not be mobile operators: content companies and data companies.
To be clear, an African data company in the future will continue to supply both voice and data services but it will source those services and make its money out of the data users buy to make use of the services on its network.
It will be operating in a low margin, high-volume data business where its success will be predicated upon providing the best network at the lowest price.
An African online content company will be more akin to a media organization, delivering a range of content and services, including social media, news, entertainment and service.
Bandwidth will simply be a means to an end and it may choose to use its own network or someone else’s.
To stay competitive, the media company will have to have successful local and international content and its content and service offerings will differentiate it from other companies in the field. The company that is based on selling data will need to attract the best and most used content and services to its platform. In this future, no-one “owns” the customers: they are there because they want what you have.
In the short term, everyone will want to make a hybrid of those two functions but it’s not easy to be half pregnant; you either understand content and services or you understand how to run a network well. These are not the same things and it will be hard to create a company culture that encompasses both. But the important thing for Africa’s future is that the networks that have been developed are used in ways that reflect the continent’s language and cultures, entertain and inform its citizens and help its economies grow.
Cover Image: Ghanaian using a tablet | Sandiooses