How the mobile phone has given hope to a new generation of African people
Tuesday 16 May 2006
Imagine your husband works away from home with little chance to visit you, and can't even let you know when he's next going to be sending you money. Imagine your child is away at school in town, staying with a relative, but unable to afford the bus fare home. And then imagine you can't even speak to them on the phone.
Mobile phones have given millions of African people the chance, for the first time, to stay in contact. No wonder they say in surveys that the ability to speak to family members and friends is the most important effect of the introduction of mobiles in recent years. Those of us who live in rich countries can't imagine any longer the social isolation that results from lack of access to communications.
The spread of mobile phones in Africa has been dramatic and is having dramatic effects, social and economic. The continent has seen the world's fastest growth in numbers of mobile subscribers since the late 1990s. Although it still lags other regions, an average of nine people out of 100 have a mobile subscription, up from close to zero less than a decade ago. In some countries this "penetration rate" is much higher: latest industry figures show it at 62 per cent in South Africa and 38 per cent in Botswana.
As mobile handsets are often shared among families and friends, or used as community payphones, access is much greater than the headline subscription figure indicates. There is no other indicator of economic development in which Africa as a whole is rapidly closing the gap with the rest of the world rather than falling behind.
What are the effects of this sudden entry to the world of telecommunications? There are scores of stories hinting that there's real hope for mobiles to transform the opportunities and living standards of many African people. Stories such as the fishermen of Mafia Island off the coast of Tanzania who call ahead to the ports to decide where they should land their catch for the best price. Or the clinic in Transkei which has reduced the delay in receiving results of tests for tuberculosis from weeks to a few hours using text messages, and as a result has increased the number of samples it can test more than fourfold.
There was every reason to expect mobile to be a successful technology in Africa. The infrastructure is less expensive than fixed telephone lines and more suitable for a densely populated and difficult terrain. In contrast to computers, you don't need constant access to the electricity supply to use a mobile and you don't need to be literate.
New business models, notably the South African innovation of prepay phones (an idea since exported successfully to the rest of the world) made mobile telephony accessible to people with low incomes and no fixed address or bank account. Importantly, too, some African governments licensed competing private mobile operators, rather than the inefficient and often corrupt state-owned telephone companies, to provide services.
This is all obvious with hindsight, but the extraordinary success of mobiles in Africa took everyone by surprise, including the phone companies themselves. One of the most encouraging aspects of the mobile revolution is that it has been profitably financed by private companies, some of them European multinationals but others African-founded businesses. Government has an important role, namely getting the regulatory framework right, but the spread of mobiles demonstrates that businesses can thrive in many African countries. The success of investments in telecommunications might already be encouraging investors in other industries.
We also know now that all the anecdotes about how people use their phones do reflect some systematic economic and social benefits. I chair the advisory panel steering Vodafone's research programme, and about two years ago a conversation with Alan Knott-Craig, the chief executive of Vodacom in South Africa, led us to commission researchers at London Business School and elsewhere to study the economic and social effects of the rapid spread of mobiles. Alan told us communities in the countries in which Vodacom operates are eager to get their own mast and will celebrate its arrival.
He said: "If he has a mobile phone, you turn an unemployed labourer in a township into a self-employed businessman." And indeed, everywhere, along the roads out of South Africa's cities or the small ads in Dar es Salaam's newspapers, you see these new entrepreneurs offering their services.
The creation of small businesses and the many improvements in the flow of information about employment or sales opportunities do seem to have a significant impact on economic growth, according to the research by Professor Leonard Waverman of London Business School and his team. Although it is difficult to distinguish the impact of mobiles from all the other factors that influence the economy, communications play a vital part in making markets work efficiently, and matching supply and demand.
In addition to this economic research, surveys conducted in rural communities in Tanzania and South Africa revealed that job search or business information are among the most important reasons for mobile phone use.
One of the striking findings of the surveys of callers in South Africa was that ownership of mobiles was less skewed than other consumer durables such as radios and televisions towards the better-off members of the communities. Substantial proportions of mobile users had little or no education and very low incomes. Many had no electricity in their homes; the researchers found a variety of methods of recharging the handsets. At Issuna Mission in Tanzania, somebody took all seven phones into town once a week to charge them. In Kwa Phake in South Africa, a hairdresser had set up a sideline renting out access to a car battery.
Respondents to the surveys also reported making a surprisingly high number of calls, which became easier to understand when the call costs were compared to the cost in money and time of a round-trip bus journey into town. Many communities lack any other forms of communication too - there are all too few fixed-line phones, post offices or bus services.
Needless to say, people expressed some concerns about mobiles too, such as the cost of making calls, and in a few cases health concerns. However, mobiles are becoming increasingly affordable. New Motorola handsets are now available for less than $30 (£16), and the survey evidence from South Africa is that a little more than a half (55 per cent) of those buying a new handset give their old one to another user. The wildfire spread of mobile use in so many countries speaks for itself.
The pattern of use does vary from country to country. Some African governments have not introduced a suitable framework for regulating the industry, which has inhibited investment. Some governments levy heavy customs duties and taxes on mobile handsets and calls, without appreciating that a wider spread of phones would grow the tax base of their economy much more effectively. Yet people will always grasp new opportunities to communicate. The spread of new communications technologies from the invention of writing onwards has been vital for economic and social development. And the story of the contribution of mobiles to this development is still new. For instance, mobile payments systems based on text messaging, which offer most Africans their only realistic prospect of getting basic banking services, are being introduced. Although the continent is still so lacking in the infrastructure and resources needed to grow businesses and reduce poverty, it is incredibly exhilarating to see the way that millions of people in Africa are grabbing the opportunities use of mobiles offers them.
Diane Coyle chairs the advisory panel for Vodafone's research programme into the social and economic impact of mobile phones. Its report can be downloaded from www.vodafone. com/africa.
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