5G in Nigeria
On September 19, 2022, Ericsson announced that it had successfully launched 5G in Nigeria. The 5G hardware and software provider collaborated with Mobile Telephone Network (MTN) Nigeria to begin the first phase of deploying 5G technology throughout the country.

Phase one of the advancements has already started in certain parts of Lagos, one of the seven cities MTN aims to cover. Following this plan, MTN aims to roll out 5G networks throughout the country by the second half of 2022, to close the global digital divide.

The Continent’s Most Virtually Connected Country

Nigeria contributes to 29% of Africa’s internet usage and holds 82% of the continent’s telecom subscribers. This makes the country Africa’s most important information and communications technology (ICT) market.

According to a report by the Nigerian Communications Commission (NCC), the telecoms industry contributed up to 14.42% to the gross domestic product (GDP) of Nigeria in 2021. The commission accredits the growth to policy implementation, increased demand and investment.

The government of Nigeria (GON) views the ICT market as a key to the further development of the education, health care, agriculture and manufacturing sectors. The GON launched the National Digital Economy Policy and Strategy (2020-2030) in November 2019 to further diversify the economy from dependence on oil and gas. This program adheres to eight pillars including “Developmental Regulation, Digital Literacy & Skills, Solid Infrastructure, Service Infrastructure, Digital Services Development & Promotion, Soft Infrastructure, Digital Society & Emerging Technologies, Indigenous Content Development & Adoption.”

However, more than half of the Nigerian population does not have access to the internet. Those from poorer socioeconomic backgrounds have limited access to the internet, technology and ICT skills. This effectively creates a disparity in children’s education due to affordability, lack of infrastructure, perception of digital tech and already-present socioeconomic inequalities.

About 5G

According to the Ericsson website, “5G is the fifth generation of cellular networks, enabling faster connectivity and data transference.” It can use the same radio frequencies that smartphones, Wi-Fi and satellite communications currently use but with additional functions. The implementation of 5G allows reliable, accessible and secure real-time interactions between devices as well as efficient data processing at a higher capacity.

According to Ericsson, 5G is capable of aiding in economic recovery. Expectations determined that these new integrations in info and comms, wholesale/retail, public services and manufacturing will “contribute $13.2 trillion to the global economy by 2035.” Along with the internet of things (IoT) (how physical devices connect, exchange and store data), predictions stated that 5G digital technologies will reduce up to 15% of global emissions by 2030.

The Basics of Spectrum Trading

Spectrum trading applies the concept of property rights to radio frequencies. This ensures a more accessible market for users, increasing efficiency amongst businesses and companies which then invest back into new technology.

By relying on administrative assignments and increased accessibility, spectrum trading allows license holders to react to the rapidly changing markets. Some rights applied to license-protected spectrums include: how long it can be used, within what geographical area and what it can be used for.

In Nigeria, spectrum trading is under the jurisdiction of the NCC. Rules that the NCC set in 2021 outline requirements for eligible sellers and buyers by setting minimum spectrum-holding times and having “sound regulatory and financial standing with the Commission.”

In December of 2021, telecommunication companies MTN and Mafab Communications paid around $550 million for the licenses to distribute 5G in Nigeria. The companies received a deadline of August 24, 2022, to launch the service.

Complications with licensing consequently postponed efforts to develop 5G in Nigeria. At the start of August 2022, MTN had already prepared around 127 sites for testing. However, Mafab was still waiting for the proper licensing needed to distribute (both spectrum and Universal Access Service Licence (UASL).

Other challenges that have impacted the ICT sector include taxation at federal, state and local governments, several regulatory bodies, right of way (RoW) charges and damage to existing infrastructure due to cable theft.

Improving Connectivity for All

The National Information Technology Development Agency (NITDA) is implementing a “digital economy policy” for Nigeria to enforce a sustainable digital ecosystem. The policies include improved data privacy and protection, increasing digital literacy for youths, enforcing reliable internet connections and integrating digital solutions for different industries.

The successful establishment of 5G in Nigeria would improve healthcare, food security, manufacturing and IoT. The upgraded network would allow healthcare professionals to provide better diagnostics and treatment with hi-tech machinery (EX: EKG machines), digital record archives and telemedicine. This allows for more affordable and accessible healthcare services for those residing in remote low-density locations.

Applications related to IoT will reduce manufacturing costs and accelerate the development of smart cities/smart grids to enhance productivity and create new revenue streams. Smart agriculture/farming supported by 5G could enhance crop and livestock monitoring systems, allowing precise identification of areas that need water, are prone to disease or require pest management.

Plans are in the works to launch in Abuja, Ibadan, Port Harcourt, Owerri, Kano and Maiduguri to fulfill MTN’s first phase in bringing commercial 5G to Nigeria. The telecommunications company aims to provide full national 5G coverage by 2025.

– Aishah French
Photo: Wikimedia Commons

Smart Feature PhonesAccess to computing technologies and the internet are key to economic success in today’s post-industrial world. However, around 3.4 billion people, according to the Wall Street Journal, still do not have internet access. Smart feature phones may be key to increasing economic development in lower-income regions such as Africa.

Smart Feature Phones vs Smartphones

The primary barrier of a smartphone is financial: even the cheapest smartphones cost hundreds of dollars, a cost that is beyond the reach of many people in developing countries. On the other hand, smart feature phones can sell for as low as $20. Smart feature phones have a retro look but allow for plenty of modern features, including web browsing, email access, cameras and GPS systems. Compared to smartphones, the processing power of smart feature phones is limited, the screens are small and they lack advanced features such as high-tech camera lenses. Still, the absence of these extra features allows for longer battery life and greater durability, which are both major benefits for people in rural areas.

Mobile Phone Benefits

Mobile phones can greatly improve productivity in less ostensibly technological industries. Mobile phones are especially useful in industries such as agriculture where agriculture apps allow farmers greater market access and help increase their agricultural output. Mobile banking allows for safer and more stable commerce and marketing is often far easier and more effective online than in person. Additionally, remote communication between workers can maximize efficiency and weather advisory apps can improve productivity in any outdoor job. All of these functions are completely feasible on smart feature phones. Even illiterate people are able to use smart feature phones as models such as the KaiOS JioPhone features an extensive voice command system.

Increasing Popularity

KaiOS Technologies, a leading company in the smart feature phone industry, has spent much of the mid-2010s developing a mobile phone and operating system that can help stimulate emerging markets in the developing world. The company has formed partnerships with large telecommunications companies such as Orange and MTN, which are major operators in West Africa and South Africa respectively. So far, KaiOS’s efforts are paying off and the smart feature phone industry as a whole is growing rapidly. MTN alone plans on selling 10 million KaiOS-based phones between 2020 and 2023. Furthermore, smart feature phones have experienced “a 252% growth in demand in 2018.” KaiOS’s flagship product, JioPhone, is also selling well in India.

The Need for Infrastructure

As revolutionary as smart feature phones could be, the phones are not very useful without a reliable source of electricity and internet access. In 2017, only 22% of African people were connected to the internet, according to the International Finance Corporation. While some Africans lack internet access because they do not own a device, some are unable to access the internet due to high costs, lacking area connectivity and limited access to electricity.

The East African Cable System (EASSy), which launched in 2010, runs through 20 African states, reducing broadband costs by around 90%. EASSy has brought internet access to more than 250 million African people. In doing so, EASSy has contributed to economic growth in sectors, “increasing employment in some areas by as much as 10%.” Furthermore, internet expansion has helped East Africa increase its GDP by 14% since 2009.

The Road Ahead

Smart feature phones are on the rise in the developing world and may accelerate economic growth due to their affordability and digital functions. In the coming decades, these phones may significantly help formerly impoverished nations become major players in the global economy.

– Sawyer Lachance
Photo: Flickr

Mobile Money accountsMobile Money refers to digital payments that require no bank account to complete the transaction. A telecom provider, Verizon in the United States, for example, performs the function that a bank account would traditionally carry out. Mobile money accounts are particularly prevalent in emerging markets such as sub-Saharan Africa because individuals and small businesses in these places lack access to formal savings accounts and credit.

Mobile Money in Sub-Saharan Africa

There are more than one billion registered mobile money accounts worldwide and sub-Saharan Africa makes up nearly half of those accounts. The implementation of digital finance has the capability to boost an emerging nation’s GDP by 6% ($3.7 trillion) by 2025. Boosting sub-Saharan Africa’s economy by this amount would be the same as adding an economy the size of Germany to the global market.

COVID-19 Accelerates Mobile Money Usage

African governments have worked to increase the use of mobile money accounts to stimulate the national economy by reducing barriers to sign up. Rwanda implemented lockdown restrictions in response to the COVID-19 pandemic and mobile money transfers doubled within a week after the placement of these restrictions. Other African nations followed Rwanda’s lead and also eased restrictions on mobile money accounts, hoping to accelerate economic growth amid the global crisis.

The Success of Mobile Money in Africa

Roughly one in 10 African adults utilize mobile money accounts, which equates to about 100 million active accounts. This is more than double the number of accounts in the second-biggest region for mobile money, South Asia. MTN, the largest mobile telco in Africa, has 171 million customers, far outweighing leading African banks such as Ecobank and Barclays Africa, which have between 11 million and 15 million customers.

Mobile phone penetration in Africa is on average 80%, whereas banking penetrates approximately 40% of Africa. Telcos have found ways to create client experiences that are attractive to African consumers, with minimal restrictions and time investment necessary to set up mobile money accounts. There are often no transaction fees on bill payments and merchant acceptance is widespread, making mobile money an attractive way for African citizens to build wealth and manage their finances.

How Mobile Money Reduces Poverty in Africa

Studies predict that by 2025, 84% of Africans will have access to a mobile SIM card connection. Furthermore, mobile money payments will be crucial to the success of individuals, businesses and the overall African economy. Mobile payment technology allows people to manage their money securely, regardless of credit history. It also removes the barriers that people typically experience with bank account access. Mobile money essentially allows for financial inclusion. Mobile money transactions have the potential to reduce poverty in Africa and financially include millions of previously excluded people.

A study by the Gates Foundation found that mobile money directly impacts an African household’s ability to deal with shocks and extreme poverty. For example, in Uganda, mobile money increased food security by 45% for households far from a bank. In Kenya, mobile money account holders who experienced a shock had no decrease in consumption level, compared to a 7% decrease in consumption for households without a mobile money account.

The Future of Mobile Money

Mobile money fosters financial resilience and thus reduces poverty levels. Households with mobile money accounts are able to respond to unforeseen events. For example, if there is a flood, a household with access to mobile money can rely on the easy transfer of money from friends and family to support them even if they live far away. Since mobile money account usage increases per capita consumption and savings, it thus reduces the rate of poverty.

Mobile money has long-term impacts on poverty, especially in female-headed households. It has the power to empower millions of women. Digital payment platforms can give women in male-headed households more financial independence and can help them increase their savings.

According to research, increased consumption rates due to mobile money account utilization drove 196,000 households out of extreme poverty in Kenya. The ability of mobile money to lift African households out of poverty is impressive and shows promise for the continent’s future economic development.

Tatiana Nelson
Photo: Flickr