> Posted by Center Staff
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In the first quarter (Q1) of 2015, smartphones comprised 47 percent of Africa’s market sales, while the market share of feature phones decreased by about 20 percent. Those are some of the big findings from the International Data Corporation’s “Q1 2015 Mobile Phone Tracker” released earlier this week. Examining both Africa and the Middle East, the report uncovered that between the two regions, compared to last year, smartphone sales increased by 66 percent during the first quarter of this year, totaling 36 million units. Nigeria and South Africa were the biggest smartphone markets on the continent, responsible for roughly 14 and 12 percent of sales respectively. By 2019, it’s projected that feature phone sales will dwindle to only 27 percent of the market in Africa and the Middle East.
The prevalence of inexpensive smartphones, aided in part through partnerships between mobile network operators and handset manufacturers, has helped fuel recent growth. Smartphones are being designed and introduced specifically for the African market. Harnessing supply chain efficiencies and accepting lower profit margins, handset makers are offering units in some cases as inexpensively as for US$30. According to market research firm GfK, globally, compared to the previous quarter, during Q1 of 2015 low-end smartphones saw a market share increase from 52 to 56 percent. Total smartphone sales increased by 8 percent to US$96 billion, while units sold increased by 7 percent to about 310 million. Most of this growth came from Africa, the Middle East, and emerging Asia-Pacific markets. Android is dominating in Africa. Eighty-nine percent of smartphones shipped in Africa during Q1 of 2015 were powered by Android – with about 45 percent of these priced below US$100.
Mobile and internet connectivity is expanding along with the rise of smartphones in Africa. In Ericsson’s latest Mobility Report, released last month, it was revealed that Africa now has 910 million mobile phone subscriptions, and 21 million were added during the first quarter of 2015. According to McKinsey, during the next three years, between 500 million and 900 million people around the world will start using the internet, with the vast majority of them doing so on cheap smartphones.
“By 2020 advanced mobile technology will be commonplace around the globe: smartphone subscriptions will more than double, reaching 6.1 billion, 70 percent of the world’s population will be using smartphones, and 90 percent will be covered by mobile broadband networks,” Ericsson’s report states. They forecast that 80 percent of the smartphones in the market by 2020 will be from developing regions such as Africa, the Middle East, and Asia Pacific.
Currently, in mobile money’s darling country of Kenya, the value of transactions flowing through the phone-based financial services network is equivalent to roughly 40 percent of the country’s GDP. The new Global Findex revealed that while only 2 percent of adults globally have a mobile money account, 12 percent of adults in sub-Saharan Africa have one. A recent report by the Boston Consulting Group found that, by 2019, mobile payments in sub-Saharan Africa will generate US$1.5 billion in fees for mobile money providers.
All this is to say, as smartphones continue to take off, Africa’s mobile money landscape is sure to be shaken up even more.
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