In Africa, the transition from 2G to 4G coverage is an ongoing process. While 2G networks have historically been the backbone of mobile connectivity in many African countries, a concerted effort exists to expand 4G and 5G coverage across the region.
Alongside this push, mobile phone networks across Africa are progressively sunsetting 2G technology due to several compelling reasons:
- Technological Evolution: The shift towards more advanced networks (4G, and 5G) supports faster data speeds and enhanced connectivity, meeting the growing digital demands of the population.
- Efficiency and Capacity: Newer technologies offer better spectral efficiency, allowing networks to serve more users with higher quality of service.
- Economic Growth: As the continent embraces digital transformation, upgrading network infrastructure is vital for supporting economic activities, enabling e-commerce, online education, and digital healthcare services.
- Global Alignment: Phasing out 2G aligns Africa with global technological advancements, facilitating international communication and business.
Recent data indicates that 4G adoption is set to grow rapidly.
Forecasts predicted that by the end of 2023, there would be 470 million 4G subscriptions in Africa, surpassing 3G for the first time and extending to 730 million by 2028. Despite this, affordable phones reliant on older technologies are still essential in providing essential mobile services. This poses a glaring challenge. As networks move forward with plans to sunset technology , an affordability crisis for mobile internet looms on the horizon, potentially impeding digital inclusion efforts.
The tale of two generations is evident in Nigeria. As of August 2023, the percentage of mobile subscriptions using 4G technology in Nigeria was reported to be 28.07 percent, versus 60.32 percent on 2G networks. Contrast this with the actual coverage of 4G networks (MTN’s 4G network covers 80 percent of Nigeria, and Airtel claims almost 100 percent of its sites currently deliver 4G.), But with the networksthere, but why are consumers not migrating?
The importance of 2G Networks in Africa
The importance of services and applications running on 2G networks in Africa cannot be overstated:
Accessibility
- Widespread Coverage: 2G networks cover most of the African continent, reaching remote and rural areas where newer technologies have yet to penetrate. This coverage ensures that even the most isolated communities can access telecommunication services.
- Affordability: Devices compatible with 2G networks are significantly cheaper than those required for 3G or 4G networks. This affordability factor makes 2G services accessible to a more significant portion of the population, including those in lower-income brackets.
Reliability
- Robust Technology: 2G networks, being older and well-established, are considered solid and reliable. In areas where newer network infrastructures might struggle with stability, 2G provides dependable communication.
- Power Efficiency: 2G devices generally consume less power; a critical factor in regions where electricity supply is inconsistent or scarce.
Support for Basic Services
- Voice Calls and SMS: In many African communities, the primary need is for voice communication and SMS services, which are efficiently supported by 2G networks. These essential services are crucial for personal communication, emergency services, and small business operations.
- Mobile Banking: 2G networks facilitate mobile banking and financial services, pivotal in regions with limited access to traditional banking. Services like M-Pesa have revolutionized how money is saved, spent, and transferred in Africa, relying primarily on SMS technology.
Educational and Health Services
- Information Dissemination: 2G networks support services that disseminate educational and health-related information to a broad audience. This is especially important for public health campaigns and distance learning initiatives.
- Remote Health Services: In areas lacking sufficient healthcare facilities, 2G networks can support telemedicine services, allowing for remote consultations and health monitoring via voice or SMS.
Agricultural Development
- Agricultural Information: Farmers can receive timely information about weather forecasts, market prices, and farming techniques through SMS services, helping them to make informed decisions that increase productivity and income.
Inclusion & Empowerment
- Digital Inclusion: By providing access to telecommunication services, 2G networks are crucial in bridging the digital divide, ensuring that marginalized communities are not left behind.
- Empowerment: Access to information and communication services empowers individuals and communities by giving them the tools to improve their living conditions, advocate for their rights, and participate more actively in economic and social processes.
In Africa, where the digital divide and socio-economic disparities present significant challenges, 2G networks played a vital role in connecting people, enabling essential services, and fostering socio-economic development. Despite the global push towards newer technologies, the relevance of 2G in Africa underscores the importance of inclusive and accessible technology solutions that meet the needs of all population segments.
The Impact of 2G Network Sunset on Smartphone Affordability
The crux is this – the gradual sunset of 2G networks could inadvertently lead to increased smartphone costs for those most reliant on 2G technologies. Comparing the average price of a smartphone to the wages of the average African consumer involves considering both the cost of smartphones and the average salaries across the continent. The average price of a smartphone in 2021 was reported to be around $363. However, there have been significant increases in the average price of new smartphones in 2023.
On the other hand, the average monthly salary in Africa is approximately $796, with the average annual salary around $9,549 based on exchange rates in April 2023. This suggests that the cost of a new average-priced smartphone in 2023 could be more than the monthly salary of an average African consumer, making it a significant financial commitment. For example, in Angola, a low-end smartphone can cost 40,000.00 Kz; higher than the national minimum wage.
The comparison indicates that, for many people in Africa, affording a new average-priced smartphone could be challenging, considering the disparity between the cost of these devices and the average earnings. This underscores the importance of more affordable smartphone options and financing or Buy Now Pay Later (BNPL) schemes to enhance accessibility for the average consumer in Africa.
While necessary for technological advancement, the shutdown of 2G networks could exacerbate the digital divide if not accompanied by strategies to make smartphones more affordable.
Strategies to Mitigate Affordability Issues
Recognizing the challenge of 2G network device affordability, GSMA has distilled a compendium of strategic interventions to empower users in developing markets. These strategies are pivotal in nurturing digital inclusion and ensuring that 2G networks continue to act as a gateway, rather than a barricade, to the burgeoning digital economy of Africa.
Firstly, it supports innovative financing models that have proven successful globally . Trustonic’s mobile device solution, offering flexibility and control per smartphone, has significantly increased loan repayments by approximately 70%. Emphasizing the role of mobile device financing or Buy Now Pay Later (BNPL) programs, this solution presents a cost-effective model for mobile operators, retailers and financiers to effectively bridge the adoption gap for smartphones. It’s an approach that resonates with the GSMA’s commitment to affordability and inclusion, ensuring mobile internet becomes an accessible commodity for all income brackets.
In addressing the digital divide, the GSMA champions novel business models and partnerships to invigorate the market with affordable phones. New ventures have been gaining momentum, such as redistributing used smartphones and producing handsets locally.
For instance, MTN Rwanda has recently partnered with the country’s Ministry of ICT and Innovation to deliver IKOSORA+, an affordable 4G enabled smartphone, as part of the Connect Rwanda 2.0. digital inclusion initiative. Schemes like this have made owning a smartphone more achievable for the average citizen.
Moreover, subsidies from nonprofit organizations and governments, exemplified by the South African Government and Vodacom collaboration, are instrumental in lowering smartphone prices for educators and other key groups.
The GSMA’s strategy expands beyond the affordability of hardware to the cultivation of digital skills. Realizing that digital literacy is crucial for individuals to leverage mobile internet for education, health, and economic development, it supports programs that facilitate this competency.
Concurrently, it’s lobbying efforts advocate for reducing taxes on low-cost devices, harnessing Universal Service & Access Funds, and supporting projects that enable device affordability — actions that can substantially lower the barrier of entry for potential smartphone users.
Conclusion
As Africa grapples with the impending sunset of 2G networks, the continent stands at a crossroads, facing the potential of an affordability crisis that could impede the progress of digital inclusion. The transition from 2G to more advanced networks is not just a technological upgrade; it is a transformative shift that could either widen the digital divide or become a catalyst for unprecedented connectivity and empowerment across the continent.
The importance of 2G networks to the African digital ecosystem has been profound, offering a lifeline of communication and services to millions.However, moving towards a 4G and 5G-centric future, the affordability of smartphones becomes a critical concern. With the average price of a smartphone potentially exceeding the monthly salary of an average African, the risk of disenfranchising a significant portion of the population looms large.
This is not just about access to technology but about ensuring equitable participation in the digital economy. Strategies to mitigate the affordability issue must focus not only on lowering the cost of devices but also on enhancing financial accessibility through innovative financing models, fostering digital literacy, and advocating for supportive policies.
Partnerships between mobile operators, device manufacturers, governments, and non-profit organizations are essential in this endeavor, creating a synergy that can drive prices down and make digital tools accessible to all. By ensuring that the cost of smartphones does not become a barrier, Africa can harness the full potential of its digital transformation, creating a more connected and prosperous future for all its citizens.
The journey ahead is arduous, but with strategic action and collaboration, the affordability crisis can be averted, paving the way for a digitally inclusive Africa that leaves no one behind.
