The Communication Commission of Kenya took a decision to extend the deadline from 31 December this year to April, to give users more time to replace counterfeit units and to compile information about the handsets.

“The extension will also allow mobile operators to undertake the requisite technical preparations in readiness for disconnecting counterfeit handsets,” said Acting CCK Director General Francis Wangusi.

Africa is the fastest growing mobile market in the world
According to the report, Asia remains the largest global mobile market however, growth rates in Africa are far exceeding those of any other markets. There has been a 20% increase in the number of mobile subscribers on the continent each year for the last five years. In 2010, mobile penetration exceeded 50% on the continent, and there are currently around 650 million mobile connections in Africa. By the end of 2012, it is expected that there will be over 735 million mobile subscribers in Africa and this number is only set to increase.

Mobile industry continues to provide
The report notes that the mobile ecosystem in Africa currently generates around $56 billion, or 3.5% of total GDP, with mobile operators alone contributing $49 billion. The industry also contributes significantly to government revenues on the continent, $15 billion according to the report. Furthermore, it is a huge source of employment on the continent, with over 5.4 million people employed either directly or indirectly in the mobile ecosystem.

Still room for growth
Despite the highest growth rates in the world, the report notes that there is still room for growth in the number of mobile subscribers in Africa. 36% of Africans in the 25 largest African markets currently have no access to mobile services showing a huge potential for further growth. The report calls on governments to introduce tax cuts within the industry, as well as allocating more spectrums for the provision of Mobile Broadband services. The potential benefits of reaching 100% mobile penetration could add over $35 billion in aggregate GDP, an increase of 2%, but more is needed from both governments and operators before such a target can be reached.

The agreement is in response to growing demand for mobile and data services in the country, and will cover 17 provinces and cities in Burundi. However, with recent statistics from the International Telecommunication Union showing only 2 internet users per 100 inhabitants in Burundi, it seems clear that there is still a long way to go before vast numbers of the population are using the internet, despite high demand for the service.

The network should help increase internet usage given the cost savings which should arise as a result of its implementation. The network should dramatically reduce broadband costs in the country, and will provide a foundation upon which future developments in Burundi’s telecommunications infrastructure can be made. The 1300km network will also link Burundi with other Eastern and Central African countries such as Tanzania, Rwanda and Congo, and will also connect Burundi with The East African Submarine Cable System (EASSy).

Burundi BBS is a joint venture between five local telecommunication operators, which receives funding from the World Bank. The network will provide all the operators with access to 3G technology.

75% of respondents* surveyed said that the improvement of access to and adoption of telecommunications services in rural areas is “very important” to their business. A further 20% thought it “moderately important”.

SIM penetration still remains under 20%
“SIM penetration still remains under 20% in a few parts of the continent, but even where penetration reaches the 50% mark, in rural areas penetration is in most cases below 10%. This represents a problem when two thirds of the continent’s population resides in rural Africa,” comments Nick Jotischky, principal analyst at Informa Telecoms & Media.

Government and regulators must play their part
“The ICT industry has the capacity to help Africa’s economy boom but government and regulators must play their part. There are several challenges to overcome and there is now a realisation that in order to improve the adoption of telecommunications services to rural areas, the public and private sectors must work together in partnership. Only then will ambitious universal access service targets become reality,” he adds.

Connecting rural and remote areas
As well as providing a platform for new organic growth for operators, connecting rural and remote areas presents opportunities for vendors across the telecommunications ecosystem.Over a quarter of respondents answered that the provision of cheaper devices represented the best opportunity for the vendor community, just ahead of network expansion (21%) and use of alternative energy sources (20%).

Low penetration in rural areas
Both the service providers and the Ministry of Information and Communication is alarmed by the low penetration rate into rural areas and and are intent on launching a countrywide campaign to educate people on the need to access the internet reports IT News Africa.

They both acknowledge the need to bring down costs:

Permanent Secretary, Ministry of Communication Dr Bitange Ndemo said that the Ministry was looking at conducting a countrywide sensitization campaign in an effort of increase the number of Internet users.

A tense PS says, “We have to actively increase the number of users to a point operators are able to reduce costs,” Dr Ndemo said.

Kenya down the list of African internet usage
Kenya has about 3.5 million internet users, equivalent to 8.6 percent of the Kenyan population. Among the top African countries with the highest internet users are Egypt with about 12.6 million of its population , followed by Nigeria with 11 million, Morocco 10.3 million, Sudan 3.8 million, and Algeria 3.5 million in that listing.

Service providers have predicted that it could take up to three years before consumers would see a drop in rates.

According to TeleGeography’s GlobalComms database, Zain Nigeria was founded as Econet Wireless Nigeria (EWN) in 2001, named after the South African holding company Econet Wireless International (EWI) which held a 5% stake and a contract to run the cellco. Following a takeover attempt by Vodacom of South Africa in 2003, a protracted boardroom dispute ensued, with EWI unwilling to relinquish its stake or its management control. Eventually in 2004 EWN was renamed Vee Networks and its brand name changed to Vodacom. Barely six weeks after taking over the cellco, Vodacom pulled out of its contract and walked away from Vee Networks, citing ‘irregularities’ in the payment of the brokerage fees. Management of the company was handed to Dr Gamaliel Onosode, of the Delta State Ministry of Finance, and services were rebranded again, this time under the V-Mobile banner. Celtel International, a division of Zain, purchased 65% of the company in May 2006. EWI has since surfaced to try and gain a court ruling to overturn the sale to Celtel, claiming its pre-emption rights were breached when its predominantly Nigerian partners decided to sell their shares in V-Mobile to Zain in 2006.

Source: TeleGeography

Strive Masiyiwa

As founder and chief executive of Econet Wireless he has pursued his ambition of creating a truly African multinational business, spinning a web that spans seven countries, more than 25 million customers and generates an estimated $3bn (£1.8bn) in annual revenues. He has fought his way through Africa’s often tangled legal jungle and had the security forces on his tail – more often than not sitting outside his house.

Next week his legal team will enter a courtroom in the Netherlands to mount the next challenge: throwing a spanner in the works of what could potentially be one of the biggest deals in African history, the $10bn sale of rival mobile-phone operation Zain.

Read the rest on the Guardian website…

Source: Guardian

Juniper Research believes that, in 2008, approximately 45% of mobile devices sold worldwide were socalled ‘entry-level’ handsets (which… Nokia defines as being handsets with a retail value less than $60). A small but growing proportion of this total is accounted for by ultra-low cost handsets, which retail for $15 or less.

Of the 700 million low-cost handsets expected to be sold in 2014, Juniper Research believes that the greatest proportion – around 24% – will be sold in Africa and the Middle East…

Speaking to Mobile network Operators all over Africa, it appears that, as they move their focus to the poorer urban and rural communities, these ultra low-cost handsets are becoming even more important.

In support of this:

Africa’s largest mobile phone company, MTN Group Ltd, is planning to bring handsets with MTN’s brand costing as little as $12 in the first half of next year. MTN’s Vice President of southern and east African region, Tim Lowry, said the handsets would be manufactured in China and may be priced between $12 and $15.

Making these phones available will help many unserved African communities to take their first steps across the digital divide. The next step is to encourage the use of SMS and SMS based applications to enable them to experience the benefits of digital communications.

Source: Juniper Research, Wireless Federation

In an attempt to maintain growth rates, operators in the sub region are looking to develop new markets and services. With urban markets becoming relatively mature, they are seeking to add new subscribers in underserved markets, usually in rural areas. Another option for operators is to develop added-value services that will encourage subscribers to spend more on basic voice and text-message services.

Just about everyone in Africa has a phone but not everyone can afford high end services, for example the average monthly income in rural Nigeria  is just NGN5,000 (US$34). This point illustrates the gap between what consumers desire and what they can actually afford in Africa.

Mobile networks and operators have to strike this balance and innovate with services that are of real value to these consumers.