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Africa’s youth are behind smartphones boom


TWO industry reports project the rising uptake of smartphones in Africa over the next three years, driven by the growth of youthful users and an influx in affordable device financing plans, as mobile phones become integral in business and society.

Mobile phones kept people and businesses connected when social restrictions were introduced to curb the spread of COVID-19. Smartphones enabled remote working, learning and other aspects of life to continue with minimal disruptions – and are increasingly seen as a must-have tool for life on the continent in the 21st Century.

Over the past decade, the rise in the use of mobile phones has ignited Africa’s digital economy, which is projected to more than double to over 200 billion US dollars by 2025, from a current 115 billion dollars.

“As economies recover and restrictions ease, mobile technology will be even more integral to how people live and how businesses operate,” said the Global System for Mobile Communications Association (GSMA) in its 2021 mobile economy report.

The International Data Corporation (IDC) projects a 3.8 percent annual growth in smartphone shipments in the African market in 2022 following an 11.3 percent decline in Africa’s overall mobile phone market to a total of 48.6 million units last year, on global supply shortages.

While smartphone shipments declined 7.1 percent to 21.5 million units in 2021, IDC data shows some interesting patterns building up in the segment.

The share of smartphones with a price range of between 200 US dollars and 400 US dollars rose to 14 percent last year, from 10.1 percent in 2020.

“The growth in the midrange price band can be attributed to the launch of new feature-rich models by key vendors like Samsung, Xiaomi, and Transsion. This price band is expected to maintain its growth momentum over the long term,” said Taher Abdel-Hameed, a senior research analyst at IDC.

Interestingly, the share of more expensive smartphone brands costing over 400 dollars also rose marginally, from 3.1 percent to 4.8 percent over the period.

Low-end smartphones valued at less than 200 dollars – a segment which dominates Africa’s smartphone market – saw its share of shipments drop to 81.1 percent from 86.8 percent in 2020.

This trend highlights the growing popularity of premium smartphones – which come with higher specifications, including higher processing power, clearer photos and faster internet speeds – among young African consumers.

GSMA in its Mobile Economy Sub-Saharan Africa report 2021 shows 4G–powered smartphones adoption has begun rising and will more than double from 12 percent in 2020 to 28 percent by 2025, on improving device affordability.

Meanwhile, 2G adoption will drop significantly to 11 percent from the current high of 38 percent, showing a decline in popularity of smart feature phones, as 3G (which includes most entry-level smartphones) adoption remains almost unchanged at 58 percent over the next three years.

Overall, the association projects smartphone adoption to rise from the current 48 percent to 64 percent of all mobile connections in sub-Saharan Africa, by 2025, driven by youthful customers in key economies.

“With more than 40 percent of the region’s population under the age of 15, young consumers owning a mobile phone for the first time will remain the primary source of growth for the foreseeable future,” according to GSMA.

This means that young consumers will form the biggest percentage of around 120 million new mobile subscribers that will be added to the market by 2025, pushing up the total number of subscribers to 615 million, or, 50 percent of the region’s population.

A third of the new mobile users will come from Nigeria (22 million)-the most populous nation on the continent and Ethiopia (15 million), the second most populous country in Africa.

Other countries that will contribute the most first timer users are the Democratic Republic of Congo (DRC) with 11 million, Tanzania (7 million) Kenya (6 million) and Uganda (5 million).

Nigeria will have the highest overall number of smartphone connections at 163 million, followed by South Africa (89 million) and Kenya (52 million).

Asian smartphone brands dominate the continent with Chinese mobile phone maker, Transsion Holdings – better known for its popular Tecno, Infinix, and Itel Mobile models – controlling Africa’s smartphone market with a combined unit share of 47.9 percent.

Samsung controls 19.6 percent and Xiaomi at 7.1 percent, while the rest of the market is shared by Huawei, Nokia, Oppo and realme –all battling for the bulging youth market.

Lately, there has been an increasing battle for market share with these handset makers turning to instalment payment plans and introducing affordable models with faster processors and high internet speeds to attract young, tech-savvy customers.

In December 2021, Transsion partnered with Safaricom, Kenya’s largest telco in terms of subscriber base, to allow customers to upgrade their 2G powered phones to 4G-enabled, via a financing plan that accepts daily, weekly and monthly instalments.

In February, Nokia handset maker HMD Global introduced a device financing plan that targets its existing business partners to distribute the devices by offering credit – and earn interest in the process.

Recently, realme announced its intention to extend its ‘Go Premium Strategy’ to Kenya, following what it termed positive reception for its ‘affordable’ premium brands (which cost from under 200 to 400 US dollars) during the first quarter of 2022, especially among the youth.

“The company will maintain the momentum to produce tech-trendy premium handsets that integrate tech innovations and modern cultures for the young population with disposable income in Kenya and other markets,” said realme CEO, Sky Li, in a statement.

African governments and internet service providers have also been ramping up investments in undersea cables to boost internet speeds, lower the cost of access and meet the growing demand for cloud computing, streaming, gaming, connected devices, and customers’ demand for seamless service provision, with no interruption.

“Strong investor confidence and consumer interest in digital platforms point to a digital-centric future for Sub-Saharan Africa, with mobile at the centre of the creation and consumption of innovative solutions,” according to GSMA.

By The African Mirror

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