December 21, 2020

Mobile Internet Coverage and Adoption Has Increased Significantly in Recent Years, but Millions of People Could Remain Offline in 2025

Most readers of this post will agree the following assertion from a report published by the GSMA, a UK-based organization representing the interests of mobile operators worldwide: "Connectivity has never been more important, and the world's reliance on the internet has never been greater." Authored by GSMA Intelligence, GSMA's research and consulting arm, the report further says "[t]he COVID-19 pandemic has underscored the importance of the internet and the critical role of mobile, which is the primary way most people access the internet. Internet access and services have helped to ensure the functioning of emergency services, allowed separated friends and families to stay informed and keep in touch, and enabled large parts of the workforce to continue to be productive throughout the crisis."

What is more, "Bridging the persistent digital divide and providing mobile internet access to the 4 billion people still not connected is more important than ever in the current context. Meanwhile, it is becoming increasingly challenging as the unconnected tend to be poorer, have lower levels of education and live in rural areas. As this report shows, there has been strong progress over the last five years, with significant increases in mobile internet coverage and adoption. However, if current trends continue, more than 40% of the population in low- and middle-income countries will remain offline in 2025."

Titled The State of Mobile Internet Connectivity 2020, "the report accompanies the fifth annual update of the GSMA Mobile Connectivity Index and analyses trends from 2014 to 2019. The report provides answers to the following questions:
  • "What are the key trends in connectivity over the period and how do these compare across regions, gender and rural/urban populations?
  • "What are the barriers and drivers to the use of mobile internet and how have these changed over time?
  • "What are the achievements and challenges in extending broadband coverage?"

The report's findings "are based on two analytical tools – the GSMA Mobile Connectivity Index and the GSMA Intelligence Consumers in Focus Survey. The Mobile Connectivity Index is a tool that measures the performance of 170 countries (representing 99% of the global population) against the key enablers of mobile internet adoption": infrastructure (the availability of high-performance mobile internet network coverage); affordability (the availability of mobile services and devices at price points that reflect the level of income across a national population); consumer readiness (citizens with the awareness and skills needed to value and use the internet); and content and services (the availability of secure online content and services accessible and relevant to the local population).

With respect to the Consumers in Focus Survey, which is available to GSMA Intelligence subscribers only, the report says the survey "has been carried out every year since 2017 and in 2019 included 15 low- and middle-income countries. Together, these provide objective, quantitative metrics to track the key enablers of mobile internet adoption and usage, as well as insights from consumers on what prevents them from using mobile internet."

The authors of The State of Mobile Internet Connectivity 2020 importantly clarify that "[t]he analysis contained in this report relates to mobile internet use and its enablers up to the end of 2019, before the outbreak of the COVID-19 pandemic in early 2020. While it is not yet possible to identify the full implications of the pandemic, some of the potential impacts are discussed throughout."

Below are the report's key findings:
  1. "Almost half the world's population now use mobile internet. By the end of 2019, there were 3.8 billion people using mobile internet (an increase of 250 million users since the end of 2018), with three quarters of all mobile internet users living in low- and middle-income countries (LMICs).
  2. "The coverage gap – those living outside of areas covered by mobile broadband networks – continues to narrow. It is now 7% (down from 10% in 2018) and stands at just under 600 million people, compared to 750 million in 2018. This reduction was driven primarily by South Asia – particularly India, where almost 99% of the population is covered by 4G, and by upgrades of 2G sites to 3G and 4G across Sub-Saharan Africa.
  3. "4G coverage is catching up with 3G coverage. It now accounts for more than 50% of mobile connections globally. In 2019, 82% of the population in LMICs were covered by 4G (compared to 90% for 3G). It has taken LMICs around seven years to reach more than 80% coverage for 4G, compared to 10 years for 3G.
  4. "There is still a considerable usage gap, as coverage continues to grow faster than usage. Approximately 3.4 billion people who live in areas covered by a mobile broadband network do not use mobile internet. This usage gap is now six times larger than the coverage gap.
  5. "The rural-urban and gender gaps in mobile internet use remain substantial but are narrowing, driven primarily by improvements in South Asia. People living in rural areas across LMICs are 37% less likely to use mobile internet than those living in urban areas. Women in LMICs are 20% less likely than men to use mobile internet, meaning around 300 million fewer adult women than men use mobile internet.
  6. "Smartphones have become more affordable, but handset affordability remains the main barrier to mobile ownership in many LMICs. The average cost of an entry-level, internet-enabled device in LMICs fell from 44% of monthly income in 2018 to 34% in 2019, driven primarily by increased availability of lower cost devices in Sub-Saharan Africa and South Asia.
  7. "Mobile data is becoming increasingly affordable but is still a significant challenge for the poorest in society. In 2019, the cost of 1 GB of data as a share of monthly GDP per capita had decreased by more than 40% in LMICs since 2016. However, more than half of LMICs still fall short of the Broadband Commission's target to make entry-level broadband services less than 2% of monthly income per capita.
  8. "Awareness of mobile internet is increasing but is far from universal. Nearly a quarter of adults are not aware of mobile internet across the LMICs surveyed. Encouragingly, awareness is growing disproportionately for rural populations and for women.
  9. "A lack of literacy and digital skills persists as the main barrier to use among mobile users who are aware of mobile internet in LMICs surveyed. In 2019, it was reported as the top barrier by a third of respondents, followed by affordability.
  10. "In LMICs, mobile users increasingly see mobile internet as relevant to their lives and are using a wider range of services. While instant messaging and social networking remain the most popular online activities, there was also increased use of mobile internet across a range of services in 2019, including for education, paying utilities, government services, applying for a job, reading the news and healthcare.
Lastly, the GSMA held a webinar about its mobile internet connectivity report. The webinar helpfully includes a demo of the Mobile Connectivity Index (at the 32:23 mark).

A post published on this blog provides steps a business should take when choosing their export market. In addition to evaluating a country's security (how safe is the physical environment?), political stability (how stable are political institutions?), government effectiveness (does political culture foster strong business environment?), and financial risks (how healthy is the local financial system?), just to name a few, business executives should evaluate a country's local infrastructure (will infrastructure deficiencies negatively affect operations?). Local infrastructure includes access to the mobile internet as businesses worldwide are benefiting from the increasing availability of digital services. And improved access to the mobile internet will lead to a more educated and trained workforce, which will close both the digital divide and skills gap – the latter of which may be done by accessing educational or training services via a smartphone.

What do you think of the report's findings? Do you have any recommendations on how a country can close its digital divide?

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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