2018-04-20 00:21 KST  
Global Voices Online - The world is talking. Are you listening?
Mobile Phone Subscriptions to Hit 4 Billion
Africa leads in annual growth rate of subscribers
Zachary Ochieng (Zach)     Print Article 
Published 2008-10-26 15:47 (KST)   
The number of mobile cellular subscribers worldwide will reach the 4 billion mark by the end of 2008, the United Nations International Telecommunications Union (ITU) has announced. The number of subscribers has surged nearly 25 percent annually for the past eight years. Mobile penetration stood at only 12 percent in 2000, growing to reach over 60 percent by the end of 2008.

"The fact that 4 billion subscribers have been registered worldwide indicates that it is technically feasible to connect the world to the benefits of ICT and that it is a visible business opportunity," ITU Secretary-General Hamadou Toured said in New York at a high-level event on the Millennium Development Goals (MDGs), eight anti-poverty targets agreed upon by world leaders in 2000.

OMNI's New Approach to Citizen Journalism
[Opinion] Democracy's Downfall
Technology Can Save Money, Planet
[Opinion] Iran Defends Peaceful 'Right'
Couchsurfing in Gaza
[Opinion] 'Donating' Sperm Is 'Dark,' 'Shady'
eLearning Maturity Emerges From Middle Management
[Opinion] Twitter Is Politics In Venezuela
Internet Eldorado
The Story of China셲 First Email Link and How it Got Corrected
The MDGs were adopted following the United Nations Millennium Declaration by UN Member states in 2000, representing an international commitment to eradicate extreme poverty and hunger, achieve universal primary education, promote gender equality, reduce child mortality, improve maternal health, combat epidemics such as HIV/AIDS and malaria, ensure environmental sustainability, and develop a global partnership for development that would include making available the benefits of information and communication technologies. ICTs have been recognized as an important tool to achieve the MDGs.

"Clearly, ICTs have the potential to act as catalysts to achieve the 2015 targets of the MDGs," Dr Toure added.

While the data shows impressive growth, ITU emphasized the need to carefully interpret it. A 61 per cent penetration rate does not mean in reality that every other person in the world is using a mobile phone; rather, the statistics reflect the number of subscriptions, not people. Double counting could occur if people have multiple cellular subscriptions, while some could be sharing their phone with others. This has often been cited as the success story of Grameen Phone in rural Bangladesh, for instance. Also, operators' methods for counting active prepaid subscribers vary and often inflate the actual number of people that use a mobile phone.

Since the turn of the century, the growth of mobile cellular subscribers has been impressive, with year-on-year growth averaging 24 percent between 2000 and 2008. While in 2000, mobile penetration stood at only 12 percent, it surpassed the 50 percent mark by early 2008. It is estimated to reach about 61 percent by the end of 2008.

The agency also cautioned that penetration rates vary by region and even within countries.

Rapidly developing economies such as Brazil, Russia, India and China are driving the growth in the number of cellular subscribers, with these nations alone accounting for over 1.3 billion by the end of 2008.

ITU further highlights that despite high growth rates in the mobile sector, major differences in mobile penetration rates remain between regions and within countries.

The impressive growth in the number of mobile cellular subscribers is mainly due to developments in some of the world's largest markets. The BRIC economies of Brazil, Russia, India and China are expected to have an increasingly important impact in terms of population, resources and global GDP share. These economies alone are expected to account for over 1.3 billion mobile subscribers by the end of 2008.

China surpassed the 600 million mark by mid-2008, representing by far the world's largest mobile market. India had some 296 million mobile subscribers by end July 2008 but with a relatively low penetration rate of about 20 percent, India offers great potential for growth. Market liberalization has played a key role in spreading mobile telephony by driving competition and bringing down prices. India's mobile operators increasingly compete for low-income customers and Average-Revenue-Per-User (ARPU) in India has reached around US$7, one of the lowest in the world.

ITU recently published two regional reports for Africa and Asia, which indicate how mobile telephony is changing peoples' lives. Apart from providing communication services to previously unconnected areas, mobile applications have opened the doors to innovations such as m-commerce to access pricing information for rural farmers and the use of mobile phones to pay for goods and services. While mobile broadband subscribers remain concentrated in the developed world, a number of developing countries, including Indonesia, the Maldives, the Philippines and Sri Lanka in Asia-Pacific have launched 3G (Third Generation) networks.

According to ITU's African Telecommunication / ICT Indicators 2008, report released in May, Africa remains the region with the highest annual growth rate in mobile subscribers and added no less than 65 million new subscribers during 2007. At the beginning of 2008, there were over a quarter of a billion mobile subscribers on the continent. Mobile penetration has risen from just one in 50 people at the beginning of this century to almost one third of the population today. Mobile subscribers are also now more evenly distributed. In 2000, South Africa accounted for over half of all Africa's mobile subscribers, but by 2007, almost 85 percent were in other countries. Mobile success, driven largely by competition, is also spawning new services such as micro-payment prepaid recharging, single rate inter-regional roaming and the uptake of m-commerce applications.

In Kenya, mobile subscription is edging closer to 15 million - Safaricom 12million, Zain 2.5million and Telkom Kenya about 400,000. The number of subscribers in Kenya is greater than the entire other four East African countries combined, with Tanzania and Uganda each getting closer to 5 million. According to Information and Communications Permanent Secretary Dr Bitange Ndemo, penetration comes with greater efficiencies and improvement of service delivery.

"We need to encourage more value addition as this leads to job creation. Mpesa alone has to date more than 10,000 agents, thus creating real employment throughout the country. The government is working to put more services on the mobile platform in order to improve service delivery and create more jobs to our youth," Dr Ndemo says.

In Kenya, although the first mobile operator was only licensed in 1997, the mobile network surpassed the fixed network in 2000/2001and has since then experienced phenomenal growth. By 2006/2007, the mobile network was over 20 times the size of the fixed network, with a mobile teledensity of 19.42. This is according to the 2007 Kenya telecommunications Sector Performance Review, a survey conducted by Prof Timothy Waema of the University of Nairobi's Department of Computing and Informatics. Although mobile services are more expensive than fixed services, according to the survey, in order to access communications services or enjoy the benefits of mobility many people have opted for this "premium" service. This may be attributed to the relatively better customer service, the ease with which connections are obtained and the relative reliability of the mobile networks.

Investment in Telecommunications has been heavy. The mobile industry (Safaricom and Celtel, now Zain) invested KES8 billion (US$100 million) in the year 2005/2006 with a combined revenue of KES45 billion (US$562.5 million). This investment was for both network extension and service upgrade. The Average revenue Per User for Safaricom has consistently come down over the years. This trend is to be expected as the operator expands to reach poorer members of society. It is, however, interesting to note that the average annual revenue per user for Zain has been lower than that of Safaricom and remained around KES13,000 except for the 2001/2002 financial year when there was a phenomenal growth in revenue.

Mobile telephony was first introduced in Kenya in 1992, and the technology has moved from the initial External Total Access Communications Systems (ETACS) to the second and third generation of Global System for Mobile Communications (GSM). Safaricom was Kenya's first GSM operator and began offering services in 1997. Subscriber growth however did not take off until 2000 after a combination of factors, including the licensing of a competing GSM operator and the investment provided by Vodafone for network expansion. Kencell, the predecessor of Celtel, was the first licensed mobile operator and became the second GSM operator in January 2000. With the launch of the second mobile operator, competition in the cellular market had commenced. Since then, the growth has been phenomenal and is expected to continue with the entry of Orange and Econet.

The mobile network surpassed the fixed network in 2000/2001 and has since then experienced phenomenal growth. Prof Waema notes that of the 6,484,791 mobile subscribers by 2006/2007, 6,379,627 are pre-paid while 105,164 are post-paid (contract clients). This means over 98 percent of the mobile subscribers are pre-paid customers.

The tariff on mobile airtime has been reduced significantly, as has the cost of acquiring of a SIM card. There are also cheap handsets in the market, retailing for as little as KES2 000 (US$25).

©2008 OhmyNews
Other articles by reporter Zachary Ochieng

Add to :  Add to Del.icio.usDel.icio.us |  Add to Digg this Digg  |  Add to reddit reddit |  Add to Y! MyWeb Y! MyWeb

Ronda Hauben
Netizens Question Cause of Cheonan Tragedy
Michael Werbowski
[Opinion] Democracy's Downfall
Michael Solis
Arizona's Immigration Bill and Korea
Yehonathan Tommer
Assassination in Dubai
[ESL/EFL Podcast] Saying No
Seventeenth in a series of English language lessons from Jennifer Lebedev...
  [ESL/EFL] Talking About Change
  [ESL/ EFL Podcast] Personal Finances
  [ESL/EFL] Buying and Selling
How worried are you about the H1N1 influenza virus?
  Very worried
  Somewhat worried
  Not yet
  Not at all
    * Vote to see the result.   
  copyright 1999 - 2018 ohmynews all rights reserved. internews@ohmynews.com Tel:+82-2-733-5505,5595(ext.125) Fax:+82-2-733-5011,5077