As explained by GSMA Intelligence presented in this website, "Building on insights from a survey of key local stakeholders, including policymakers, mobile operators and equipment vendors, this report establishes the outlook and expectations for the 5G era in Sub-Saharan Africa."
The survey covered six areas: network deployment; spectrum; use cases; business models and financials; policy and regulation; and collaboration and future outlook." Respondents to the survey included:
The transition to mobile broadband is underway
"By the end of 2019, there will be more mobile broadband connections (3G and 4G) than 2G connections in Sub-Saharan Africa. This reflects a growing shift from basic voice to data-centric services. Ongoing investments in 3G and 4G networks have taken mobile broadband coverage to around a quarter of the total population, while smartphone adoption has doubled over the last three years and now accounts for two in five mobile connections."
5G will be part of the future digital landscape, but mass adoption is not imminent
"5G in Sub-Saharan Africa is inevitable; it is a natural progression from previous technology generations. However, the 5G era is not imminent in most markets in the region as existing technologies are capable of supporting current use cases and demand for mobile internet connectivity. Around two-thirds of respondents to the survey for this report did not envisage commercial 5G services becoming available in their markets before 2025. That said, the time lag before large-scale 5G deployment could have positive implications for the region: it would allow the technology to mature and be fully tested in other markets. It would also allow economies of scale to be realized in 5G equipment and devices, potentially lowering costs for operators and consumers."
Market readiness is crucial to maximize value in the 5G era
"For all countries in the region, market readiness is necessary to determine the timing for the transition to 5G. This will help maximize value from 5G services for consumers, operators and the wider society. The GSMA 5G Market Readiness Index indicates that some countries are moving quickly towards a state of readiness, with 4G adoption approaching mass market and operators progressing with network modernization initiatives. By 2025, there will be commercial 5G services in at least seven markets, including Kenya, Nigeria and South Africa, with 28 million 5G connections (equivalent to 3% of total mobile connections) between them."
Localized FWA will be a primary 5G use case across Sub-Saharan Africa
"With fixed broadband penetration typically below 2% across the region, 5G fixed wireless access (FWA) will be a primary 5G use case, particularly in the early stages of network deployment and adoption. The cost benefit of addressing the growing demand for enhanced connectivity from households and businesses with FWA – relative to greenfield FTTx deployment – makes it an attractive proposition. However, the FWA opportunity is not universal; rather, it is dependent on local conditions. Localized and targeted deployments, as opposed to ubiquitous rollouts, will be the predominant approach as operators balance the potential cost of requisite cell densification with affordability constraints for many consumers."
The enterprise segment will drive initial 5G uptake in Sub-Saharan Africa
"5G presents an opportunity for operators to better serve the enterprise market. Initial use cases will center on 5G FWA, to address challenges around access, cost and reliability of current connectivity services, such as fixed broadband and satellite. Beyond connectivity, 5G will be a key enabler of the Fourth Industrial Revolution or Industry 4.0 – a time when technology is seamlessly embedded within society and especially in commercial and industrial processes. In Sub-Saharan Africa, 5G can enable new and existing technologies, such as artificial intelligence (AI) and the Internet of Things (IoT), to have a transformative impact on business processes, helping drive productivity and efficiency. A clear, supportive strategy and forward-looking policies to prepare for the 5G era and attract the necessary investment and skills are essential to realizing the aspirations of the Fourth Industrial Revolution, and to fully capture the social and economic benefits for the region."
The consumer segment will be a long-term play
"The consumer segment will be a long-term play as 5G adoption at the early stages of network deployment will be held back by a lack of affordable devices and immersive use cases, such as augmented reality (AR) and virtual reality (VR). Device subsidy will be crucial to 5G adoption in the consumer segment, but initial focus will likely target customer premise equipment (CPE) for FWA to the home, given the predominance of prepaid subscriptions in the mobile segment. In the meantime, therefore, 4G will continue to deliver high-speed mobile broadband, supporting the numerous and increasing connectivity needs of citizens and the economy."
The mobile ecosystem should lay the foundations now
"Ahead of 5G network launches, operators and network equipment vendors in the region need to make plans to prepare existing network infrastructure for 5G, adopt cost-effective infrastructure deployment solutions, and develop a framework to manage the complexity of operating multiple networks (2G, 3G, 4G and 5G) simultaneously. Further next-generation network deployments and the first phases of 5G rollouts will require significant capital investment; mobile operators in the region will invest $60 billion in their networks between 2018 and 2025. A fifth of this will be on 5G infrastructure. Given the growing pressure on revenues and margins, operators, vendors and other ecosystem players will need to explore ways to ease the financial burden."
Policymakers should look to foster a pro-investment environment
"The 2020s will usher in the 5G era in Sub-Saharan Africa; 5G-related activities will become more widespread across the region from mid-way through the decade. Now is the time to begin to put in place the necessary building blocks to facilitate the transition to 5G. Governments and regulators need to consider market structures that foster a pro-investment and pro-innovation environment for the development of the 5G mobile ecosystem. Specifically, regulatory focus should be on four key areas – network deployment, network flexibility, spectrum access and regulatory costs – in order to bring 5G in particular, and next-generation connectivity more generally, to fruition."
During my trips to the region during the past few years, I can attest to the report's assertion that "[d]igital transformation is well underway in Sub-Saharan Africa. This is evidenced by the emergence of new digital services and applications transforming the way people live, work, play and communicate."
What is more, "The emerging digital landscape in Sub-Saharan Africa is shaped by demand- and supply-side factors, each with the potential for significant, long-term impact on the digital economy."
What services and applications do you think will transform the way people live, work, play and communicate in Sub-Saharan Africa?
Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.
- Telecoms regulators from across the region;
- Mobile operators (group level and local operators) with a combined share of more than 75% of total connections in the region; and
- Equipment vendors with a combined share of more than 90% of the network infrastructure market in the region.
5G in Sub-Saharan Africa: Lay the Foundations presents the following key findings:
The transition to mobile broadband is underway
"By the end of 2019, there will be more mobile broadband connections (3G and 4G) than 2G connections in Sub-Saharan Africa. This reflects a growing shift from basic voice to data-centric services. Ongoing investments in 3G and 4G networks have taken mobile broadband coverage to around a quarter of the total population, while smartphone adoption has doubled over the last three years and now accounts for two in five mobile connections."
5G will be part of the future digital landscape, but mass adoption is not imminent
"5G in Sub-Saharan Africa is inevitable; it is a natural progression from previous technology generations. However, the 5G era is not imminent in most markets in the region as existing technologies are capable of supporting current use cases and demand for mobile internet connectivity. Around two-thirds of respondents to the survey for this report did not envisage commercial 5G services becoming available in their markets before 2025. That said, the time lag before large-scale 5G deployment could have positive implications for the region: it would allow the technology to mature and be fully tested in other markets. It would also allow economies of scale to be realized in 5G equipment and devices, potentially lowering costs for operators and consumers."
Market readiness is crucial to maximize value in the 5G era
"For all countries in the region, market readiness is necessary to determine the timing for the transition to 5G. This will help maximize value from 5G services for consumers, operators and the wider society. The GSMA 5G Market Readiness Index indicates that some countries are moving quickly towards a state of readiness, with 4G adoption approaching mass market and operators progressing with network modernization initiatives. By 2025, there will be commercial 5G services in at least seven markets, including Kenya, Nigeria and South Africa, with 28 million 5G connections (equivalent to 3% of total mobile connections) between them."
Localized FWA will be a primary 5G use case across Sub-Saharan Africa
"With fixed broadband penetration typically below 2% across the region, 5G fixed wireless access (FWA) will be a primary 5G use case, particularly in the early stages of network deployment and adoption. The cost benefit of addressing the growing demand for enhanced connectivity from households and businesses with FWA – relative to greenfield FTTx deployment – makes it an attractive proposition. However, the FWA opportunity is not universal; rather, it is dependent on local conditions. Localized and targeted deployments, as opposed to ubiquitous rollouts, will be the predominant approach as operators balance the potential cost of requisite cell densification with affordability constraints for many consumers."
The enterprise segment will drive initial 5G uptake in Sub-Saharan Africa
"5G presents an opportunity for operators to better serve the enterprise market. Initial use cases will center on 5G FWA, to address challenges around access, cost and reliability of current connectivity services, such as fixed broadband and satellite. Beyond connectivity, 5G will be a key enabler of the Fourth Industrial Revolution or Industry 4.0 – a time when technology is seamlessly embedded within society and especially in commercial and industrial processes. In Sub-Saharan Africa, 5G can enable new and existing technologies, such as artificial intelligence (AI) and the Internet of Things (IoT), to have a transformative impact on business processes, helping drive productivity and efficiency. A clear, supportive strategy and forward-looking policies to prepare for the 5G era and attract the necessary investment and skills are essential to realizing the aspirations of the Fourth Industrial Revolution, and to fully capture the social and economic benefits for the region."
The consumer segment will be a long-term play
"The consumer segment will be a long-term play as 5G adoption at the early stages of network deployment will be held back by a lack of affordable devices and immersive use cases, such as augmented reality (AR) and virtual reality (VR). Device subsidy will be crucial to 5G adoption in the consumer segment, but initial focus will likely target customer premise equipment (CPE) for FWA to the home, given the predominance of prepaid subscriptions in the mobile segment. In the meantime, therefore, 4G will continue to deliver high-speed mobile broadband, supporting the numerous and increasing connectivity needs of citizens and the economy."
The mobile ecosystem should lay the foundations now
"Ahead of 5G network launches, operators and network equipment vendors in the region need to make plans to prepare existing network infrastructure for 5G, adopt cost-effective infrastructure deployment solutions, and develop a framework to manage the complexity of operating multiple networks (2G, 3G, 4G and 5G) simultaneously. Further next-generation network deployments and the first phases of 5G rollouts will require significant capital investment; mobile operators in the region will invest $60 billion in their networks between 2018 and 2025. A fifth of this will be on 5G infrastructure. Given the growing pressure on revenues and margins, operators, vendors and other ecosystem players will need to explore ways to ease the financial burden."
Policymakers should look to foster a pro-investment environment
"The 2020s will usher in the 5G era in Sub-Saharan Africa; 5G-related activities will become more widespread across the region from mid-way through the decade. Now is the time to begin to put in place the necessary building blocks to facilitate the transition to 5G. Governments and regulators need to consider market structures that foster a pro-investment and pro-innovation environment for the development of the 5G mobile ecosystem. Specifically, regulatory focus should be on four key areas – network deployment, network flexibility, spectrum access and regulatory costs – in order to bring 5G in particular, and next-generation connectivity more generally, to fruition."
During my trips to the region during the past few years, I can attest to the report's assertion that "[d]igital transformation is well underway in Sub-Saharan Africa. This is evidenced by the emergence of new digital services and applications transforming the way people live, work, play and communicate."
What is more, "The emerging digital landscape in Sub-Saharan Africa is shaped by demand- and supply-side factors, each with the potential for significant, long-term impact on the digital economy."
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| Source: GSMA Intelligence |
What services and applications do you think will transform the way people live, work, play and communicate in Sub-Saharan Africa?
Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.
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