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Africa leads in mobile growth and impact

By Semaj Itosno, Nairobi, Kenya

Mobile telephony is an economic booster in Africa and would create 6.6 million jobs in the region by 2020, a new GSMA report reveals.

Released today, the report, “Sub-Saharan Africa Mobile Economy 2013” shows that mobile contributes over six per cent of the region’s GDP, higher than any other comparable region globally, and this would rise to over eight per cent by 2020.

Tom Phillips, Chief Regulatory Officer at GSMA, said despite the significant impact of the mobile industry in Sub-Saharan Africa in recent years, even greater opportunities are ahead.

According to the report, Sub-Saharan Africa’s unique mobile subscriber base has grown by 18 per cent annually over the last five years, making it the fastest growing region globally.

“Beyond further growth for voice services, the region is starting to see an explosion in the uptake of mobile data. However, a short-term focus by some countries on generating high spectrum fees and maximising tax revenue risks constraining the potential of the mobile Internet,” said Phillips.

"Last year, the mobile ecosystem directly supported 3.3 million jobs and contributed US $21 billion to public funding in the region, including licence fees. By 2020, mobile is set to double its economic effect, employing 6.6 million men and women in the region and contributing US $42 billion to public funding," reads the report in part.

This is GSMA  latest comprehensive study of the socio-economic impact of the mobile industry in Sub-Saharan Africa.

"By mid-2013, there were 253 million unique mobile subscribers and 502 million connections. With many countries in the region seeing fixed line penetration rates of less than five per cent, mobile has emerged as the main medium for accessing the internet across Sub-Saharan Africa. While 2G connections still dominate in the region, 3G and 4G networks are gaining scale and smartphone ownership is on the rise. With unique subscriber penetration rates still less than 33 per cent, this opens up a major opportunity for growth in the next five years.

The report calls on operators and investors to fund the substantial investment needed to extend coverage to remote areas and meet the growing demand for higher speed connectivity.

According to the GSMA report,  the future of the mobile industry depends spectrum management whereby new spectrum is assigned using economically efficient methods that balance the socio-economic benefits with the capital expenditure required to deploy advanced networks.

The report says  spectrum should, as a matter of priority, be assigned to those operators that have previously demonstrated an ability to use the spectrum efficiently.

"With a number of existing spectrum licences coming up for renewal across the region, regulators must establish a transparent and predictable process for granting spectrum licences and renewing spectrum usage rights in order to allow operators to plan their investments. The renewal of spectrum usage rights should also be based on recovering administrative costs and promoting investment instead of maximising short-term fees," reads the report in part.

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