More Investment in Advanced Forms of 5G Will Unlock New Use Cases and Monetization Opportunities in Europe's Mobile Economy

"Digital infrastructure has been at the heart of social and economic progress in Europe for the better part of the last three decades. Today, nearly half a billion people across Europe are connected to the mobile internet, predominantly through high-speed 4G and 5G networks," according to GSMA's annual report on Europe's mobile economy.

The report points out that "[m]obile technologies and services now generate around 5% of GDP across Europe, a contribution that amounts to almost €1.1 trillion of economic value added. 5G, in particular, is expected to benefit most sectors of the European economy, adding around €164 billion of economic value by 2030. However, achieving further growth beyond this will be challenging within the constraints of the current regulatory environment."

The GSMA importantly notes that "Europe is at a crossroads in the development of crucial digital infrastructure, with key network-performance and consumer adoption metrics showing that it is falling behind some of its global peers. This underlines the need for urgent action by the European Commission and other authorities to implement critical policy reforms to ensure that Europe's digital economy – underpinned by strong, sustained network innovation – can re-establish a leadership position in the global tech race by 2030."

Below are the key trends shaping Europe's mobile ecosystem:

• The focus shifts to 5G standalone and 5G-Advanced. "By the end of 2024, 5G accounted for 30% of mobile connections in Europe, equivalent to over 200 million connections. However, 5G has not yet materially altered mobile revenue growth, which remains low in most European markets. Shifting investment to more advanced forms of 5G, particularly 5G networks based on the standalone (SA) architecture, as well as 5G-Advanced, will be important to unlock new use cases and monetization opportunities. However, this investment will not occur automatically, and issues that limit the mobile sector's capacity to invest will need to be addressed first."
• GSMA Open Gateway gains traction. "As of December 2024, 67 operator groups had signed up to the GSMA Open Gateway initiative, accounting for 75% of mobile connections globally. The geographic breakdown of operator commitments indicates regions at par, above or below their established market share. Europe is a leading region, with committed operators representing more than 20% of GSMA Open Gateway commitments despite accounting for around only 10% of mobile connections. Many of the early API launches in the region have focused on fraud prevention and security, using SIM Swap and Number Verification APIs. These represent easy wins, given the ever-present risks from fraudsters and breaches for operators and their customers."
• Driving AI transformation responsibly. "European operators are leading the way in generative AI (genAI) adoption, with a strong emphasis on network optimization, security and enhanced customer service. Mobile operators are catalyzing genAI innovation through strategic partnerships, exemplified by Telefónica's collaborations with technology partners, as well as Deutsche Telekom's development of telecoms specific large language models (LLMs) with the Global Telco AI Alliance. To foster responsible AI, operators are prioritizing ethical AI practices to ensure fairness, protect users and reduce inequalities. The EU's AI Act sets regulatory standards for responsible AI, while the GSMA's Responsible AI Maturity Roadmap offers a framework for ethical AI use."
• Momentum builds behind aerial connectivity. "Terrestrial networks remain the primary form of connectivity, supported by the wide area coverage of wireless networks and the mass production and adoption of mobile devices. In recent years, however, technological advances in various satellite and other non-terrestrial networks (NTNs) have helped to overcome several limitations associated with aerial connectivity. Recent developments suggest that European authorities are taking steps to keep up with their global peers in the development and application of satellite connectivity, as a complement to terrestrial-based mobile connectivity services. Recent examples include the award of a contract to the SpaceRISE consortium to develop, deploy and operate the IRIS constellation, as well as the emergence of new players across the European satellite ecosystem."

Infographic: GSMA Intelligence

The GSMA also presents a list of recommended policy reforms that will lead to increased investments in digital infrastructure that "will not only be felt across the telecoms and technology sectors but across every other industry as well":

• Re-evaluate the existing regulatory framework that was conceived 20–30 years ago, and update the policy objectives and principles to match today’s market realities and challenges.
• Implement additional measures to ensure fairness in the internet value chain by defining an obligation on content and application providers (CAPs) to negotiate with internet service providers (ISPs) on the terms and conditions for IP data transport services, thereby making the negotiating parties subject to a dispute resolution process in the event that an agreement cannot be reached.
• Take a more long-term view on investment and innovation effects. The Commission needs to initiate a review of the EU Merger Regulation, which has not been reviewed for 20 years, in order to put more emphasis on the long-term investment viewpoint.
• Establish a pro-investment approach to EU spectrum policy, including the adoption of best practices to achieve a more predictable and harmonized approach to spectrum auction designs, licensing costs, the prolongation of licenses and the identification of future bands.
• Apply circular economy principles to network equipment and incorporate the EU taxonomy for green investment in electronic communication networks, based on robust metrics.

With respect to the mobile mobile industry's impact on the UN Sustainable Development Goals (SDGs), the report says the impact is "driven by the increased reach of mobile networks and growing take-up of mobile internet services. SDG 7: Affordable and Clean Energy, SDG 6: Clean Water and Sanitation and SDG 3: Good Health and Well-being) have seen the biggest improvement in mobile industry impact score, according to GSMA research."

What are your recommendations for how to unlock new use cases and monetization opportunities in Europe's mobile economy?

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.

5G Expected to Contribute $10 Billion to Africa's Economy by 2030

"Mobile connectivity is a key driver of digital transformation and socioeconomic growth in Sub-Saharan Africa," according to GSMA's annual report on the state of the Sub-Saharan Africa's mobile economy. The report points out that "Governments and businesses are increasingly using 4G and 5G networks alongside technologies such as AI and IoT to enhance productivity and service delivery. Despite growing demand for mobile, a significant usage gap persists. This underscores the need for efforts by operators to address the barriers to mobile internet adoption, such as device affordability, online safety and digital skills."

The report's key findings include:

• Persistent Usage Gap: Mobile internet penetration in Sub-Saharan Africa reached 27 percent by the end of 2023, yet a substantial usage gap of 60 percent remains. This gap represents millions who live within network coverage but face barriers such as device affordability, digital skills deficits, and concerns around online security. Globally, 3.1 billion people – 39 percent of the global population – are impacted by the usage gap. Sub-Saharan Africa is the least connected region, with the largest usage gap worldwide.
• Expanding 4G Coverage and Early 5G Growth: The region's 4G adoption is forecast to reach 50 percent by 2030, overtaking 3G as the primary technology. Although 5G adoption remains in its early stages, it is projected to reach 17 percent of total connections by 2030, primarily in South Africa, Nigeria, and Kenya.
• Economic Impact and Infrastructure Needs for 5G: By 2030, 5G alone is expected to contribute $10 billion to the region's economy, accounting for 6 percent of the mobile sector's total economic impact. GSMA's report emphasizes the need for progressive spectrum policies, particularly the release of mid-band spectrum, to support long-term growth and equitable digital access. Additionally, 5G Fixed Wireless Access (FWA) is gaining traction as a primary broadband solution in countries such as Angola, South Africa, Nigeria, Kenya, Zambia, and Zimbabwe, addressing demand for high-speed connectivity in underserved areas.
• Strengthening Digital Security: South Africa became the first country in Sub-Saharan Africa to implement GSMA Open Gateway APIs, focusing on fraud prevention and security with Number Verification and SIM Swap APIs. This initiative is part of broader efforts across the region to improve digital security, particularly within digital banking​.
• Generative AI Potential: Generative AI is expected to contribute up to $1.5 trillion to Africa's economy by 2030, with mobile operators increasingly using AI for customer engagement and network optimization. MTN and Vodacom, for instance, are deploying AI-powered initiatives to enhance operational efficiency, although the region faces a shortage of skilled AI professionals.

Through this report, the GSMA, a UK-based organization that aims to unify the mobile ecosystem to discover, develop and deliver innovation foundational to positive business environments and societal change, advocates for a series of critical actions to ensure sustainable growth and digital inclusion:

1. Affordability Reforms: High costs remain a barrier to mobile access, with the report calling for reduced taxes on the sector, such as lowering import duties on handsets and cutting activation fees, to make services affordable and accessible for all.
2. Revitalized Universal Service Funds (USFs): Many USFs in Sub-Saharan Africa are underperforming, often hindered by inefficiencies. The report calls for reforms to improve transparency, streamline disbursements, and direct funds toward impactful initiatives, such as digital literacy programs in underserved areas.
3. Progressive Spectrum Policy: With increasing data demands, the report urges governments to release additional spectrum, particularly in the 6 GHz band, and to adopt policies that ensure efficient, affordable, and environmentally sustainable mobile network expansion.

Infographic: GSMA Intelligence

With respect the mobile technology's contributions to the UN Sustainable Development Goals (SDGs), the report says the industry "contributes to SDG 4, which seeks to ensure inclusive and equitable quality education, and promote lifelong learning opportunities for all. Digital transformation is making learning resources more accessible, enhancing educational outcomes and supporting continuous learning. By bridging gaps in education access and improving the quality of education, mobile technology is fostering a more inclusive society."

What investment or commercial opportunities are you seeing in Sub-Sahara's mobile technology industry? What are your recommendations for closing the 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.

Toolkit Designed to Help Deliver Digital Skills Training for Impact in Sierra Leone

In my experience working in emerging and developing countries, many people mistakenly assume that if an individual is connected to the mobile internet, then they are able to utilize various life-enhancing applications. However, there is a stark difference between having access to the applications and the knowledge to make full use of these digital tools.

According to a report published by GSMA, "Mobile networks are the primary – and often only – channel for people to connect to the internet, especially in low-and-middle income countries (LMICs)." What is more, "Despite the rapid growth in mobile internet adoption in recent years, there remains a significant usage gap in LMICs: 48% of the population across LMICs still do not use the mobile internet. Of this group, 42% live within the footprint of a mobile broadband network but are not using the internet – this is known as the 'usage gap.' In Sierra Leone, the usage gap is significantly higher at 77%. Among people in this group, a lack of digital skills is one of the most significant barriers preventing them from adopting the mobile internet."

To address the digital skills barrier, the UK-based organization, which aims to unify the mobile ecosystem to discover, develop and deliver innovation foundational to positive business environments and societal change, says it "developed the Mobile Internet Skills Training Toolkit (MISTT), a free-to-use set of resources covering the fundamentals of the mobile internet, popular apps and use cases." The report also points out that "In order to gather evidence on the efficacy of the MISTT and identify potential areas for further improvements, the GSMA evaluated a digital skills training campaign conducted by Orange Sierra Leone, using MISTT. Specifically, the evaluation aimed to understand how effectively the MISTT delivers improved digital skills, what the socioeconomic impact is on trainees, and what improvements are needed to better reach the underserved."

Below are the report's key findings:

• "MISTT improved digital skills for the majority of trainees interviewed in Sierra Leone, by reducing the functional barriers to mobile internet use, boosting learners' self-confidence and sense of independence and increasing the frequency of internet use by the trainees."
• "There are indications that MISTT has had a positive socio-economic impact in Sierra Leone. This was visible in two main ways: enhancing trainees' potential to conduct business online has improved their prospects and income; and trainees have acquired greater knowledge and education across diverse topics."
• "The impact of MISTT training on business was most observable for women, as they experienced the greatest changes to their digital skills confidence levels, as well as day-to-day life benefits, including being able to do business online while at home. Women were also more likely to enjoy the spill-over effects of the training, as their spouses passed on what they had learned."
• "Incentives are a critical part of digital skills training – both for potential customers and trainers. The effectiveness of digital skills training can be greatly enhanced by providing appropriate incentives to potential trainees and their trainers. For trainers, this might involve providing financial incentives for the delivery of training that drives digital inclusion. For customers, this involves emphasizing how the mobile internet can be valuable to their lives and making them aware of any incentives, such as free mobile data and lunch, that are available to reward participation at in-person training events."
• "Face-to-face training provides numerous advantages for the underserved. Face-to-face or in-person training allows a more tailored learning experience with opportunities for practical application by learners. For example, in-person training enabled trainers to spend time answering trainees' questions and providing tailored support on some of the challenges that they encounter. This is most important for learners with lower literacy and education levels, as well as those in rural areas. However, while effective, in-person training may be more costly for implementers and more difficult to scale."
• "Digital skills training needs to consider the specific barriers that underserved users face. Issues, such as lower levels of education and a lack of basic digital skills and confidence, can impact on people's ability to access and participate in training activities. The evaluation also highlights the importance of adopting a gender lens to the delivery and expansion of digital skills training to ensure it is reaching women. There is a need to consider who might be excluded or disadvantaged from the proposed delivery approach, as well as ensuring the location, timing and content of the training, for instance, will meet their needs."
• "To enhance the scalability and viability of MISTT digital skills training, implementers can explore other approaches to delivering digital skills beyond in-person channels to understand their effectiveness. Remote channels, for example videos, voice messaging and radio broadcasts, may provide an effective way for delivering digital skills training and/or improving training awareness in a cost-effective manner. Both in-person and remote channels have relative advantages and disadvantages. While in-person channels may be more effective at reaching certain population segments, remote channels provide unique benefits to implementers as they are easier to scale and can be iterated or updated more easily than face-to-face channels. Depending on the training objectives, both digital and in-person channels can be used simultaneously to complement the other."
• "Combining digital skills training with other events or product pitches can extend the reach of digital skills training for the underserved and offer benefits to implementers. Delivering digital skills training alongside other activities, such as entertainment events or with the sale of a product or service, can encourage wider participation by reaching people who may be reluctant to attend a formal training event, for example, or linking it to something that is seen as relevant to them. Nonetheless, it's important to bear in mind the needs of underserved groups while designing these activities. For example, for women, the idea of 'standing in the street watching entertainment' may not feel culturally appropriate, as many are worried about theft or appearing to be lazy people who have nothing important to do."

I appreciate how GSMA's report "highlights the key learnings from the evaluation of the MISTT digital skills training initiative implemented by Orange Sierra Leone. It provides key insights on the effectiveness of MISTT in improving digital skills acquisition among different underserved groups, as well as the socio-economic impact of the training." There is also value in how the report "identifies considerations for improving the effectiveness of digital skills training in reaching underserved groups." Importantly, however, the GSMA notes that "the insights and recommendations in this report do not represent our comprehensive view of how to implement MISTT. Rather, they are recommendations specifically arising from this evaluation, and can be a basis for further research and trial. This complements our existing research on digital skills and evaluation of MISTT implementations."

What are your recommendations on how to promote digital literacy and reduce the digital usage gap in LMICs?

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.

A Roadmap to Ensure That Every Citizen in Zambia Benefits From the Digital Revolution

My colleague, Aze Malawo, who leads the operations in Sub-Saharan Africa for Global Tactics, an multinational advisory firm that helps clients understand how the world is changing, and how that creates opportunities to be seized and risks to be managed, splits her time between Washington, DC and her native Zambia. Since my first meeting Aze in the mid-2000s, I have heard about the beauty of the southern African nation and the business opportunities that exist in several sectors including the information and communications technology sector.

It was, therefore, with great interest to read a report published by the GSMA, a UK-based organization that aims to unify the mobile ecosystem to discover, develop and deliver innovation foundational to positive business environments and societal change, highlights how "the digitalization of the economy is a key driver of social and economic growth in Zambia." According to the report, "By taking advantage of the opportunities offered by digitalization, the Government of Zambia can deliver on the development objectives that it has defined and achieve sustainable economic growth."

The report's key findings include:

• Adoption of digital technologies across both public and private sectors accelerates economic growth by promoting innovation and investment. It increases productivity across all sectors of the economy, improves access to global value chains (GVCs) and improves the efficiency and transparency of government and public services. Moreover, access to emerging technologies such as mobile money, artificial intelligence (AI) and cloud computing are desirable as drivers of digital and financial inclusion which in turn supports human development.
• This study identifies opportunities and quantifies the economic value of adopting digital technologies across selected sectors of Zambia's economy. Accelerated development of the digital economy would benefit both the Government of Zambia and the country's citizens in multiple ways. Economic growth would raise incomes, create jobs and raise tax revenues. Digital technologies would also provide direct benefits through enhanced access to information, productivity-enhancing technologies and improved educational outcomes.
• Mobile connectivity and mobile money both play a key role in digitalization. Mobile broadband connectivity provides the foundation for the digitalization process. Mobile money is also critically important, providing individuals and businesses an accessible and efficient route to financial inclusion.
• The mobile telecoms sector in Zambia has made steady progress in recent years but there remain significant challenges. These challenges include expanding access and increasing adoption of digital services, particularly among low-income households and in rural areas. This will require further network rollout and upgrades, support to ensure that devices and services are affordable for everyone and boosting adoption through stimulating demand for digital services.

The report importantly points out that "[p]olicy plays a critical role in the future development of the digital economy in Zambia. The growth and development of the digital economy is strongly influenced by policy and regulatory decisions taken by the government." The GSMA says its "study identifies how opportunities for economic growth and development can be unlocked through policy reforms. Overcoming the challenges facing the sector will require bold policy initiatives on the part of government to stimulate demand, reduce the cost of supply and promote investment in mobile telecoms networks and in mobile money services."

GSMA's report also "identifies a series of specific policy recommendations that, if implemented, would increase the number of internet users in Zambia by 2.1 million by 2028. This would reduce the internet usage gap by 9 percent points."

The priority policy reforms include:

• Reducing sector-specific taxes and fees on mobile telecoms services
• Reducing operating costs and improving the financial sustainability of the mobile business
• Modernizing the tariff regulation regime, to provide more certainty for operators
• Lifting restrictions on mobile money charges and removing the mobile money levy
• Stimulating additional demand for mobile telecoms services

If adopted, these policy reforms "will help Zambia to achieve its economic development objectives, including economic transformation across important sectors such as agriculture and manufacturing. The potential macroeconomic impacts are summarized below in Figure 1."

Image: GSMA

In a press release issued by the GSMA, Angela Wamola, Head of Sub-Saharan Africa for the UK-based organization, said: "The Zambian government has demonstrated strong commitment to digitalization through its National ICT Policy 2023 and the Eighth National Development Plan. Now, more than ever, collaborative action between the government, industry, and stakeholders is needed to create the enabling environment for digital transformation. The future of Zambia lies in digital connectivity. With the right policies, we can close the digital divide, empower communities, and unlock new economic opportunities. The Zambia Digital Economy Report provides a clear roadmap to ensure that every citizen benefits from the digital revolution. Now is the time for bold action."

What are your thoughts about the report's findings? What digital transformation opportunities are you seeing in Zambia's mobile technology sector.

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.

Mobile Internet Adoption Continues to Accelerate Among Women in LMICs, But Further Action is Required to Close the Gender Gap

In its annual report that explores the latest data on the mobile gender gap, the key barriers preventing women's equal access to and use of mobile, and what is needed to close the mobile internet gender gap, the GSMA says "Mobile phones and mobile internet can be life changing, enabling people to stay connected to each other and access information and services from anywhere, including health care, education, e-commerce, financial services and income generating opportunities. In 2023, the world was more connected than ever before with more than 3.7 billion people in low- and middle-income countries (LMICs) accessing the internet on a mobile phone." Moreover, according to the report, "Mobile is the primary way people are accessing the internet in LMICs, accounting for 84% of broadband connections in 2023. This is especially true for the underserved, including women and those who live in rural areas. In 10 of the 12 countries surveyed for this report, women who use the internet are more likely than men to access it exclusively on a mobile phone."

The report points out that "Across LMICs, 83% of women now own a mobile phone, 60% own a smartphone and 66% use mobile internet. However, mobile access and use remain unequal. Women are still less likely than men to have access to mobile phones, mobile money, mobile internet and other mobile services." Disappointingly, "Women are also less likely than men to have equal use of these services, particularly the most underserved women, including those who have low literacy levels, low incomes, live in a rural area or have a disability."

The GSMA says its "latest data shows that the mobile internet gender gap narrowed from 19% in 2022 to 15% in 2023 due to women adopting mobile internet at a faster rate than men. This brings us back to where we were in 2020, but it is not yet clear whether this trend will continue. It is essential for women, and societies more broadly, that this momentum continues and the mobile gender gap continues to close."

What is more, "Addressing the mobile gender gap provides significant social and commercial benefits to individuals, societies and economies. Connectivity is vital to achieving the United Nations Sustainable Development Goals (SDGs), including those related to health, education and financial inclusion. GSMA analysis has estimated that closing the gender gap in mobile ownership and use in LMICs over an eight-year period could deliver $230 billion in additional revenue to the mobile industry. The Global Digital Inclusion Partnership estimates that 32 LMICs are on track to lose more than USD 500 billion in GDP in the next five years due to the digital gender divide."

The report importantly explains: "We know that once women start using mobile phones and mobile internet, they usually see the benefits and it improves their lives to a similar degree as men. In 2022, we found that across the 12 survey countries, most people who use mobile internet believe it has had a positive impact on their lives and use it every day, with little difference by gender."

I concur with the following assertion made by the report's authors: "Ensuring that women can access and use mobile is essential, especially in our increasingly digital world. Mobile can enable women to be more resilient in the face of economic, climate and political crises and shocks. More attention, effort and investment are needed to close the mobile internet gender gap – a goal we must continue to strive to meet so that women, their communities and society can reap the full, life-changing benefits of mobile."

The UK-based organization that aims to unify the mobile ecosystem to discover, develop and deliver innovation foundational to positive business environments and societal change, presents the following recommendations for all stakeholders to close the mobile gender gap:

• Ensure there is a focus on gender equality and reaching women at an organizational and policy level through senior leaders championing the issue and setting specific gender equity targets.
• Understand the mobile gender gap by improving the quality and availability of gender-disaggregated data, and understanding women's needs and the barriers they face to mobile ownership and use.
• Explicitly address women's needs, circumstances and challenges in the design and implementation of mobile-related products, services, interventions and policies. This includes addressing the barriers women face related to affordability, knowledge and digital skills, safety and security, access and the availability of relevant content, products and services.
• Collaborate and partner with different stakeholders to address the mobile gender gap. Targeted intervention is needed from industry, policymakers, the development community and other stakeholders to ensure that women are no longer left behind.

While it is encouraging mobile internet adoption is accelerating among women in LMICs, further action is required to close the gender gap.

Do you agree with GSMA's recommendations for stakeholders to close the mobile gender gap? What would you add?

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.

Report Presents Crucial Role Mobile Tech Sector Has in Driving Nigeria's Digital Economy

A report produced by GSMA and Through Line Advisors, a UK consultancy, addresses the challenges hindering the growth and development of the telecommunications industry and the crucial role of the mobile sector in Nigeria's economic development. The report begins by pointing out that digitalization is one of the Nigerian Government’s key strategies to achieve the country's socio-economic objectives. "The Federal Ministry of Communications, Innovation & Digital Economy (FMCIDE) Strategic Plan 2023–2027 articulates a clear ambition for digitalization and provides a comprehensive program and set of targets," the report explains. "This recognizes the role that digitalization can have in economic growth, job creation and increased tax revenues across the economy."

The report adds that "The adoption of digital technologies by individuals and businesses has been shown to enhance productivity and raise household incomes." Encouragingly, "Consumers in Nigeria would benefit from increasing adoption and use of digital technologies. The faster the rate of digital adoption in Nigeria, the more quickly and extensively the country will benefit from these effects."

The telecoms sector is a major contributor to the economy of Nigeria and provides the foundations for the digital transformation process. "The mobile telecoms sector accounted for 13.5% of total GDP in 2023, including the direct value-added by wider ICT industries and the impact of the sector in enhancing the productivity of other sectors," according to the report. "Overall, the mobile sector's total contribution to GDP is estimated at 33 trillion NGN in 2023, with 2.4 trillion NGN in tax revenue contributions."

The report importantly notes that "a successful digital economy would have a material impact on the economy of Nigeria over the next 3-5 years. It is estimated that growth in digitalization in agriculture, manufacturing, transport, trade and government will result in an increase in GDP of around 2 percentage points by 2028. This would also create nearly 2 million jobs and raise an additional NGN 1.6 trillion in tax revenue."

The mobile sector, however, faces some major challenges across multiple areas of its business. "The financial performance of the mobile industry in Nigeria has slowed down in recent years after a long period of sustained growth." The report says the industry faces a number of significant challenges:

• The overall financial performance of the industry in recent years has not been sufficient to support the capital-intensive nature of the business.
• Revenue in Naira has stopped growing as the number of subscribers has increased. Falls in ARPUs indicate pressure on prices and reductions in average usage.
• Operating costs have increased significantly in the recent period. The primary driver of this has been increases in the cost of power for sites due to the rapid increases in the price of fuel, high and increasing costs of tax compliance because of the complex and overlapping tax structure within the country, and increased demand for forex due to contractual obligations for rollout that are denominated in USD.
• The cost of building and operating fiber-optic networks has increased because of the difficulty and expense of obtaining Rights of Way (RoW) from state authorities and the very high number of fiber cuts, primarily caused by construction work and vandalism.
• Underlying these trends in revenue and operating costs has been the deteriorating macroeconomic situation in Nigeria. The high levels of inflation have pushed up the cost of many inputs into the mobile service providers' businesses.

The authors suggest that "Mobile service providers need to generate sufficient revenue to cover their operating costs and support this level of capex over the medium-term. If this is not realized, they are likely to cut back on either capital or operating expenditure or both. This results in a shrinking sector which leads to subscribers receiving a poorer quality of service and delays in coverage expansion."

Moreover, "In the short term, it would result in a reduction in the amount of tax revenue generated by the sector. In the medium term, a slow-down in digital adoption will forfeit all of the productivity gains and service delivery improvements that go with digitization."

West Africa nation's mobile "sector would further benefit from a policy and regulatory environment that takes account of the impact on the financial and operational sustainability of service providers," the report notes. The authors note that "Decisions on issues such as tax, regulatory fees, spectrum fees, customs duties and other government levies all have an impact on this. In particular, the current approach of the regulation of both wholesale and retail mobile tariffs by the Nigerian Communications Commission (NCC) does not allow for the adjustment of tariffs to reflect the changing cost of inputs into the businesses and facilitate investment into improved network coverage and quality of service. By international standards, the NCC's approach to retail tariff regulation is not considered to be standard practice."

The authors add:

In addition to the financial sustainability of the industry, further progress on the national strategy for digitalization could be made through a partnership between the sector and the Government. The sector can contribute in specific ways to the Government's strategic initiatives. The Government, the NCC, and all federal and state ministries and regulatory authorities can, in turn, support the sector to deliver on these initiatives. This can be done by improving the sector's regulatory environment and its investment climate. Together, this will further support the Government’s digital economy objectives.

What are you recommendations for how the mobile tech sector can drive Nigeria's digital economy?

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.

Advances in AI Underpin New Mobile Services and Devices in China

According to GSMA's most recent annual report on the state of China's mobile economy, "The evolution of 5G can be viewed in terms of distinct phases. The initial phase was about enhancing fundamental connectivity aspects, including wide area coverage, capacity and solution reliability. With the number of 5G connections in China surpassing 800 million (45% of total connections) at the end of 2023, mobile operators are ready to move to the next phase of the technology's development, with investment in 5G-Advanced. This could enable the industry to focus on new growth opportunities from enhanced 5G capabilities while also delivering economic benefits."

The GSMA notes that China's artificial intelligence (AI) "sector has rapidly advanced since companies gained permission in August 2023 to release their large language models (LLMs) to the general public." The report adds that "Much of the early work on generative AI (genAI) in the mobile industry has focused on using the technology to support internal use cases, such as improved customer care via enhanced chatbots and automated development of marketing collateral." What is more, "Chinese operators have also demonstrated their interest in using genAI for network operations and management. For example, China Telecom is building its own AI-based system to identify the root cause of network faults. Meanwhile, China Mobile has discussed the potential to make AI native to its 6G networks."

Regarding AI's integration into mobile devices, the report asserts: "Smartphones, as the most ubiquitous personal consumer devices, were always going to be a prime focus for genAI commercialization. Recent technology advances in mobile chipsets, cloud computing and breakthroughs in smaller LLMs have made genAI on smartphones possible."

What is more, "The integration of genAI on smartphones will help hyper-personalize the user experience, enhance the OS feature set and evolve native digital assistants. On the app side, genAI is expected to help introduce a plethora of new functionality in mobile apps across verticals, such as text-to-digital content generation. Existing mobile apps should also see advanced AI-enabled improvements in functionality, such as text-analysis apps."

Available in English and Chinese, the report's additional key findings include:

• There are now 1.28 billion unique mobile subscribers in China – a penetration rate of 88%
• Mobile's overall contribution to the Chinese economy in 2023 reached $970 billion, or 5.5% of GDP
• 5G is expected to reach 1.6 billion connections in 2030, representing a third of the world's total, and forecast to contribute $260 billion to China’s GDP
• An additional 290 million people in China now use mobile internet compared to eight years ago (2015), closing the country’s Usage Gap from 43% to just 16%
• Mobile data traffic in China is expected to quadruple by the end of the decade

Infographic: GSMA Intelligence

As for China's mobile industry's impact on the United Nation Sustainable Development Goals (SDGs), the GSMA highlights that "the Chinese mobile industry accelerated its impact on the" SDGs with "SDG 6 (Clean Water & Sanitation) and SDG 4 (Quality Education) scored highest in the region, driven by rising mobile internet adoption and use, as well as the growing uptake of IoT solutions."

With respect to 5G driving innovation in water management, "SDG 6 focuses on ensuring the availability and sustainable management of water and sanitation for all," the report explains. "Mobile technology improves many aspects of water delivery and sanitation provision. Effective metering and revenue collection are central to a healthy, functioning water utility. At the same time, IoT solutions such as smart water meters are helping utility providers and their customers understand consumption behaviors to drive efficiencies in the energy and water sectors."

What do you think of the report's findings? Is your company developing mobile AI solutions for the China market?

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.

GSMA's Annual Report on the State of the Global Mobile Industry Looks at How Operators Are Exploring the Potential of genAI

According to the GSMA's most recent annual report on the state of the global mobile economy, "Mobile connectivity remains pivotal in driving digital innovation. It empowers individuals and enterprises with a wide array of transformative technologies while also aiding governments in delivering positive societal impacts."

Produced by GSMA's in-house research team, GSMA Intelligence, these reports contain a range of technology, socio-economic and financial datasets, including forecasts out to 2030. This year's report points out that "The impact of mobile connectivity is evidenced by its contribution to the economy. In 2023, mobile technologies and services generated 5.4% of global GDP, a contribution that amounted to $5.7 trillion of economic value added, and supported around 35 million jobs."

The report's key findings include:

• 5G will account for over half (51%) of total mobile connections by 2029 and reach 56% adoption by the end of the decade.
• 58% of the world's population were using mobile internet at the end of 2023, representing 4.7 billion users and an increase of 2.1 billion since 2015.
• Three billion people are still not using mobile internet despite living in an area covered by mobile broadband networks (the 'Usage Gap'), underscoring the urgency of addressing barriers to adoption highlighted in the GSMA's 'Breaking Barriers' campaign, such as handset affordability and literacy/digital skills.
• 5G is expected to benefit the global economy by more than $930 billion in 2030, of which the primary beneficiaries are expected to be manufacturing (36%), public administration (15%) and the services (10%) industries.

Infographic: GSMA Intelligence

The are two items that I found of particular interest. One is how eSIM adoption continues to gather pace. "The number of eSIM consumer devices launched has grown significantly over the last five years and the number of commercial eSIM services is also on the rise. This has set the foundation for eSIM adoption to gather pace over the course of the decade," the reports notes. What is more, "GSMA Intelligence's baseline scenario predicts around 1 billion eSIM smartphone connections globally by the end of 2025, growing to 6.9 billion by 2030. This would account for around three quarters of the total number of smartphone connections by 2030." The GSMA claims that "North America will be the region with the fastest rate of eSIM adoption due to Apple's launch of eSIM-only smartphones in the US in September 2022."

On the topic of mobile operators exploring the potential of generative AI (genAI), "the range of genAI applications is broad," the GSMA notes. "Much of the early work has focused on using the technology to improve customer services and support sales and marketing activities. However, as genAI matures, there is potential for operators to not only support internal use cases but generate new revenues from AI investments." Examples of operators generating new revenues from investments in genAI include "SK Telecom's bold AI pyramid strategy ... as do recent product announcements from the likes of KT, NTT and SoftBank."

As for maximizing the AI opportunity, the report says "The speed of AI adoption in the mobile industry may depend on several factors. First, mobile operators often face difficulties in accessing the internal data needed for training AI models, hindered by the diversity and volume of data sources. Additionally, operators must ensure the accuracy of AI-generated insights, as reliance on inaccurate data may lead to flawed decision-making."

With respect to ethical concerns around AI that still need to be addressed, the report boldly asserts that "The mobile industry is committed to the ethical use of AI in its operations and customer interactions to protect customers and employees, remove any entrenched inequality and ensure that AI operates reliably and fairly for all stakeholders. The GSMA's AI Ethics Playbook serves as a practical tool to help organizations consider how to ethically design, develop and deploy AI systems."

What trends are you seeing that are shaping the global mobile ecosystem?

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.

Forging a Resilient Digital Indonesia

"The government of Indonesia is keen to build a digital nation, in which digital technologies help improve the livelihoods of citizens and drive productivity in key sectors of the economy," according to a report by the GSMA. "This has been highlighted in several digitalization plans announced in recent years. The main elements of the plans align with the five components of a digital nation: infrastructure, innovation, data governance, security and people."

The UK-based organization adds that "Although steps have been taken towards a digital nation, there remains room for improvement and an opportunity to accelerate progress. This is particularly crucial in the context of 5G and other emerging technologies (such as AI and quantum computing) transforming Indonesian society and contributing to the government’s target for the country to become a top 10 global economy by 2030." The report encouragingly points out: "The industry (mobile operators and other ecosystem players) will invest nearly $18 billion between 2024 and 2030, mostly on 5G networks. 5G technology is projected to contribute $41 billion to Indonesia's GDP during that period."

Having advised government leaders in countries similar to Indonesia who are trying to build a digital nation, I appreciate the GSMA's assertion that "Realizing the government's vision of building a resilient digital nation and using digital technologies to drive economic growth relies on formulating and implementing policies to advance each of the five components of a digital nation." Accordingly, the report presents the following recommendations:

• Infrastructure: Implement spectrum pricing policies and other policy initiatives to ensure sustainable private sector investment in digital networks. Such policies will facilitate the continued expansion of the high-performance mobile networks and other digital infrastructure required to build a resilient digital nation.
• Innovation: Take a holistic approach to digital innovation across government, supported by agile policy approaches, such as regulatory sandboxes and policy labs, and make a concerted effort to increase research funding in Indonesia.
• Data governance: Continue on the path to the full enforcement of the personal data protection law, which was enacted in 2022, and consult widely with stakeholders across the public and private sectors on guidelines on the use of AI and other emerging technologies.
• Security: Develop a comprehensive cybersecurity law to streamline current fragmented laws, and adopt ecosystem-wide collaboration to strengthen cyber resilience, disrupt cybercrime and tackle other online threats.
• People: Accelerate efforts to bring more people online by closing the remaining coverage and usage gaps. Implement initiatives to build a digitally-ready workforce with the necessary knowledge and skills to utilize digital technologies across different sectors of the economy.

The report's authors adds: "The task of becoming a digital nation is multidimensional, involving many different actors from the public and private sectors and non-state institutions. Meanwhile, digital technologies continue to evolve rapidly, offering new opportunities but also challenges that need to be approached holistically. In this context, a whole-of-government approach (WGA) is essential to streamline efforts and realize efficiencies in formulating and implementing digital nation initiatives. This approach will bring together multiple stakeholders and diverse resources to provide a common solution to key issues."

In addition to Indonesia, other members of the Association of Southeast Asian Nations (ASEAN) have plans to building a resilient digital nation. The recommendations presented by this report can be a useful guide for how to successfully use digital technologies to drive economic growth.

Do you agree with the report's recommendations?

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.

5G's GDP Contribution in MENA Is Expected to Reach $60B in 2030, Representing 13% of the Overall Annual Economic Impact of Mobile in the Region

As the UN Climate Change Conference finds down in Dubai, many people unfamiliar with the Middle East and North Africa (MENA) are becoming aware of efforts to diminish the reliance on fossil fuel as the key producer of economic output. Having done business in the MENA region for several years, I have witnessed the efforts made by several governments to promote private sector development in several key industries including mobile technology. In its most recent annual report on the state of MENA's mobile economy, the GSMA points out that the region "home to some of the global leaders in terms of 5G adoption, reflecting the ambitious rollout plans of operators, backed by enabling regulations and strong demand from consumers for new services." Furthermore, "5G networks now cover 75% or more of the population in the GCC states, with operators in those markets increasingly shifting focus to improving 5G coverage in less densely populated areas while also ramping up investment to support the growing momentum behind use cases enabled by 5G standalone (SA) and 5G-Advanced." The GCC, or Gulf Cooperation Council, is comprised of six nations: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.

The GSMA notes that "5G's GDP contribution is expected to reach $60bn in 2030, representing 13% of the overall annual economic impact of mobile in the region." The report's additional key findings include:

5G SA and 5G-Advanced will be at the heart of 5G's next phase

"By September 2023, six operators in MENA had already rolled out 5G SA networks, contributing to 15% of the global total. Operators in MENA have also begun planning for 5G-Advanced. The use case for 5G-Advanced is straightforward: to enable 5G to support new market demands while waiting for the arrival of 6G. 5G SA and 5G-Advanced will help operators to serve consumer and enterprise customers more flexibly. The adoption of private 5G networks, meanwhile, has been slower in MENA compared with other regions, but there is growing evidence that this is starting to change."

Operators look to monetize tower assets

"The majority of tower assets have traditionally remained in the hands of mobile operators in MENA. However, following STC's creation of Tawal in 2019, the first tower company in Saudi Arabia, an increasing number of operators in MENA have embarked upon infrastructure reshuffling, including the monetization of underutilized tower assets. Independent tower companies have been among the main acquirers of operator sites, utilizing multitenancy to drive profitability. In other instances, operators have spun off infrastructure in partnership with private equity groups or issued IPOs for their tower assets. Tower sales and spin-offs enable operators to reallocate capital towards areas with higher growth prospects."

GCC telcos target stakes in European counterparts

"International expansion has been a core growth and diversification strategy for GCC telcos looking for opportunities to scale up and drive new revenue and subscriber growth. Historically, GCC operators had bet big on emerging markets across South Asia, Southeast Asia, Sub-Saharan Africa and other parts of MENA. However, recent developments suggest a growing interest in long-established European operators. e& and STC are leading the charge, having made several high-profile deals and announcements since early 2022. The strategic rationale lies in the potential to become global players in the TMT space, both in terms of scale and innovation."

The shift to circularity gathers momentum

"In response to escalating concerns regarding the generation of e-waste and the unsustainable depletion of natural resources, the concept of circularity has surged to the forefront of the agendas for policymakers and industry stakeholders. This amplified focus on sustainability is particularly evident in view of the region's role as the host for the 2023 United Nations Climate Change Conference (COP28) in Dubai. Governments and industry participants in the region are taking proactive measures to establish new channels and suppliers dedicated to collecting, refurbishing and reselling devices and network equipment."

Regulatory enablers and innovation hubs fuel fintech growth

"MENA has experienced a significant surge in fintech services, driven by increased investments and regulatory enablement. Regulatory sandboxes and dedicated fintech hubs have been important contributors to this, with digital payment solutions gaining prominence in recent years, including

contactless payments, open banking and buy now, pay later (BNPL) services. Mobile operators are actively involved in the fintech space, expanding access and inclusion for consumers and businesses through a variety of financial-services products and partnerships with established fintech providers."

Infographic: GSMA

Significant opportunities exist for MENA entrepreneurs to develop localized solutions in AI, IoT, cybersecurity, EdTech, fintech, digital health, e-commerce, and enterprise services. As the report explains, "Beyond its contribution to GDP, the mobile ecosystem also supports over 800,000 jobs (directly and indirectly) and makes a substantial contribution to the funding of the public sector, with $20 billion raised through taxation in 2022. This economic contribution underlines the importance of stakeholders taking the right steps to sustain the impact of mobile services on the digital economy, with spectrum availability a key driver of affordable 5G for all."

What opportunities are you seeing in the region?

​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.

While Mobile Internet Adoption Continues to Increase, the Growth Rate Slowed in 2022

The previous posts in the forum addressed the economic benefit 5G will bring to the Sub-Saharan Africa economy in the near future and the challenges and opportunities for scaling e-commerce adoption by small businesses in Africa. While 5G is expanding rapidly in low- and middle-income countries and smartphone adoption is projected to increase in the coming years, which will allow people to connect to critical services such as education, healthcare, and financial services, and provide income-generating opportunities, significant digital divides exists. Not only do these digital divides inhibit entrepreneurs from developing innovative localized technology solutions, but they prevent investors from providing essential financial capital and advisory support.

Therefore, it was with great interest to read GSMA's State of Mobile Internet Connectivity 2023 that "considers the importance of not just mobile broadband coverage but 'meaningful connectivity' – users having a safe, satisfying, enriching and productive online experience that is affordable. This requires an understanding of the key barriers and enablers for meaningful connectivity, including infrastructure, affordability, skills, safety and security, and relevant content and services. Each of these is considered in this report."

Below are the report's key findings (copied in verbatim):

• Mobile internet adoption continues to increase, with 57% of the global population (4.6 billion people) now using mobile internet – but the growth rate at which people are adopting mobile internet slowed in 2022. Only 200 million people started using mobile internet in 2022, compared to 300 million in 2021 and in 2020. Just over three quarters of the growth in mobile internet adoption in 2022 came from low- and middle-income countries (LMICs), where 95% of the unconnected population live. In least developed countries (LDCs), almost 30 million additional people started using mobile internet in 2022, meaning one in four people in LDCs are using mobile internet.
• Mobile broadband coverage has remained relatively unchanged, with 95% of the global population living within the footprint of a mobile broadband network. With only marginal growth in coverage in 2022, the coverage gap – those living in areas without mobile broadband coverage – stands at almost 400 million people (5% of the global population). The remaining uncovered communities, which are predominantly rural, poor and sparsely populated, are the most challenging to reach.
• Most of those not using mobile internet live in areas covered by mobile broadband. In 2022, 3 billion people (38% of the global population) lived in areas covered by mobile internet but did not use it. With mobile internet adoption outpacing network expansion, this usage gap has been shrinking slowly in recent years, from 40% in 2021 to 38% in 2022. However, the usage gap remains almost eight times the size of the coverage gap. Considering only adults aged 18 and above, 23% are still not using mobile internet despite being covered by a mobile broadband network. The majority of those living within mobile broadband coverage but not using it do not yet own a mobile phone.
• Connectivity varies significantly between and within regions and countries, with 95% of the unconnected living in LMICs. Sub-Saharan Africa remains the region with the largest coverage and usage gaps. In LMICs, adults in rural areas are still 29% less likely to use mobile internet than those in urban areas, while women are 19% less likely to use mobile internet than men. In LDCs, only 25% of the population use mobile internet, compared to 52% across LMICs overall and 85% in high-income countries (HICs).
• The majority of the global population now own a smartphone, which is how most people are accessing mobile internet. At the end of 2022, 54% of the global population (4.3 billion people) owned a smartphone. Of the 4.6 billion people using mobile internet, almost 4 billion do so using a smartphone (49% of the global population) and around 600 million people do so using a feature phone (8% of the global population). There are also 350 million people who own a smartphone but do not use mobile internet.
• 4G and 5G continue to expand, but 2G and 3G remain important sources of coverage in LMICs. While the overall broadband coverage gap has remained broadly unchanged since 2021, the deployment of 4G and 5G continues to expand. Globally, 90% of the population is now covered by 4G, and 32% by 5G (up from 25% in 2021). Almost three quarters of the 5G network expansion in 2022 was in Asia-Pacific, and there was particularly strong growth in 4G network expansion in Sub-Saharan Africa. However, most mobile operators will continue to maintain 2G and 3G networks for the foreseeable future, with a significant portion of users continuing to use these networks, particularly in LMICs.
• Data usage and network quality continue to increase but significant differences remain between HICs and LMICs. Monthly global mobile data traffic per user increased from 8.4 GB in 2021 to 11.3 GB in 2022 – the largest absolute increase since it was first tracked in 2015. Network quality improved across all regions, driven by improved networks and consumers migrating to 4G or 5G. For the first time, all regions now have average download speeds of at least 10 Mbps, while the global average download speed increased from 27 Mbps to 34 Mbps. HICs record download speeds four times greater than those in LMICs.
• Awareness of mobile internet continues to grow but has slowed significantly since 2019. In nine of the 12 countries surveyed, more than 80% of the population was aware of mobile internet in 2022. However, women and those living in rural areas remain less likely to be aware of mobile internet, and lack of awareness remains a critical initial barrier to mobile internet adoption in some countries.
• Affordability and skills remain the two greatest barriers to mobile internet adoption and use. Across the countries surveyed, for mobile users who are aware of mobile internet but don’t use it, the top reported barriers to adopting it remain affordability (particularly of handsets) and literacy/digital skills. Safety & security concerns and lack of perceived relevance were reported less often but are also important barriers. For example, among smartphone owners, lack of perceived relevance is often cited as a top barrier to mobile internet adoption in several countries.
• Affordability of devices and data continues to disproportionately impact the underserved. Across LMICs, affordability of an entry-level, internet-enabled handset remained relatively unchanged, while affordability of data continues to improve across most regions. However, while the affordability of an entry-level device across all LMICs is equivalent to 16% of average monthly income, this increases to 40% for the poorest 40% of the population and 55% for the poorest 20%. Across LMICs, it is equivalent to 24% of average monthly income for women, compared to 13% for men.

GSMA's report also points out that barriers to digital inclusion are complex and interconnected:

• Knowledge and skills: "Improving digital skills and literacy, as well as driving awareness and understanding of mobile internet and its benefits, is critical to increasing digital inclusion. Digital skills initiatives should focus on users' needs and circumstances."
• Affordability of handsets and data: "Approaches to improve affordability should include efforts to lower the cost of internet-enabled handsets and data through innovative data pricing strategies and handset-financing options, in addition to adopting tax policies and providing targeted subsidies that promote the uptake of internet-enabled devices and data services."
• Safety and security: "Concerns about safety and security, including online harassment or cyberbullying, misinformation, disinformation and fraud, are preventing people going online and having a positive internet experience. Appropriate mechanisms and frameworks that recognize these online risks should be put in place to help build consumer trust. Stakeholders should provide users, especially women, with the tools to increase their knowledge and skills to mitigate online risks."
• Relevance: "Local digital ecosystems in many LMICs remain underdeveloped and under-resourced. Investment in local digital ecosystems and an enabling policy environment can accelerate growth in local content, services and applications that meet the needs of people and in their own language."
• Access: "Using the internet depends on enablers such as electricity, formal identification, sales agents and accessibility features. Stakeholders can increase mobile internet adoption by focusing on, for example, facilitating inclusive and transparent registration processes for mobile, and making services, sales channels and training facilities accessible to underserved groups, such as women and persons with disabilities, alongside improving accessibility features."

I appreciate how the report addresses the importance of having reliable mobile connectivity for people to access essential services. As the GSMA points out, "In recent years, mobile operators and governments worldwide have been working on advancing digital inclusion, recognizing its transformative potential for societies. While there have been notable achievements and mobile internet adoption continues to grow, this report shows that progress has slowed. Furthermore, with an ongoing cost-of-living crisis, many are now further at risk of remaining unconnected."

What are your recommendations on how to bridge the 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.

5G to Benefit the Sub-Saharan Africa Economy by $11 Billion in 2030

In its annual report on the state of the mobile economy in sub-Saharan Africa, the GSMA says the mobile connectivity on the continent "continues to drive digital transformation and socioeconomic advancements. This underlines the need for continued efforts to address the persisting barriers that impact mobile internet adoption in the region, particularly the affordability of devices, online safety concerns and the lack of digital skills." The UK-based organization that represents the interests of mobile operators worldwide adds: "Meanwhile, authorities and enterprises see an opportunity to leverage growing 4G and 5G networks, alongside emerging technologies such as AI and IoT, to enhance productivity and efficiency in service delivery."

Findings of the report, which is available in English and Français, include:

Growing 5G momentum

"In 2022, there was a marked uptick in 5G-related activities in Sub-Saharan Africa, including 5G commercial launches in 15 countries and a growing number of spectrum allocations. This comes at a time when 3G is the most dominant technology in the region (accounting for 55% of total connections in 2022) while 4G is already dominant in other regions, implying network and customer readiness for the transition to 4G. The approach to 5G in the region will need to consider the current connectivity landscape and unique market features that could affect the rollout and adoption of the technology. 5G network ecosystem players in the region must also find ways to deliver cost-effective and efficient 5G networks, balancing investment and value creation."

Steering growth with AI

"The emergence of new AI tools and use cases is accelerating the implementation of AI across various verticals and business processes. Most AI developments are occurring in advanced markets. However, the technology can be utilized in any scenario where there is sufficient data to draw insights. As a result, several industry players are already taking steps to apply AI across a variety of use cases in Sub-Saharan Africa. The potential benefit of AI in the region is significant, given that it can help offset the impact of limited resources and poor infrastructure in the delivery of many life-enhancing services, such as healthcare and education. Mobile operators in the region have employed AI at different levels, from improving network operations and customer services to achieving efficiencies and cost savings."

Climate-related risks spur circular economy principles

"The concept of circularity has risen to the top of the agenda for policymakers and industry players in light of growing concerns around the generation of e-waste and unsustainable levels of consumption of natural resources. Although the technical lifespan of a mobile device is now between four and seven years, the average use period of mobile devices is only around three years. Governments and industry players have a role to play in incentivizing consumers. This includes building new channels and suppliers to collect, refurbish and resell devices and implementing awareness campaigns on sustainability. Some operators in Sub-Saharan Africa are already taking a lead in this regard, with initiatives to drive circularity in mobile phones and other digital devices."

Infographic: GSMA

Improving smartphone access

"Smartphone affordability is a key barrier to using mobile internet. The average selling price of smartphones in Africa has reduced significantly in recent years, with an influx of devices priced at below $100 – but the cost remains unaffordable for many. The challenge for manufacturers is to produce devices at low enough price points that align with local earning capacities and allow them to gain market share. To ease the current cost burden, operators offer a range of initiatives, including device financing plans, instalment payments and entry-level smartphones through partnerships with manufacturers."

Collaboration and innovation in fintech is on the rise

"Fintech has become increasingly prominent in Sub-Saharan Africa, driven by the need to improve regional financial and digital inclusion. The industry has seen a rise in partnerships and innovation, leading to the diversification of products on offer, particularly in the payments segments. Operators have partnered with ecosystem players to expand products and offer options such as buy now, pay later (BNPL). At the same time, the growing fintech startup industry continues to attract investors, allowing them to improve access to a variety of financial products for both individuals and small businesses, such as microlending and B2B payments."

Policies for safe and inclusive development

"As cyberattacks continue to grow in scale and scope, governments face increasing pressure to protect their citizens and infrastructure and establish a framework for the mobile industry. Sub-Saharan Africa's rapid technological evolution makes the region an attractive target for fraud and cyberattacks."

Infographic: GSMA

According to the GSMA, "5G is expected to benefit the Sub-Saharan Africa economy by $11 billion in 2030, accounting for more than 6% of the overall economic impact of mobile." While it is encouraging to learn that mobile connectivity in Sub-Saharan Africa continues to drive digital transformation and socioeconomic advances, I have concerns about the mobile internet usage gap, which refers to individuals who are not using mobile internet despite living in an area covered by mobile broadband networks. of 59%. Nevertheless, the continent holds significant opportunities for entrepreneurs to develop innovative solutions in AI, IoT, cybersecurity, EdTech, fintech, digital health, e-commerce, and enterprise services.

What opportunities are you seeing the Sub-Saharan Africa's mobile economy?

​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.

Mobile Money Services Are Growing Faster Than Predicted, Says GSMA Report

According GSMA's State of the Industry Report on Mobile Money 2023 report, "mobile money is now considered a mainstream financial service in many countries." Funded by the Bill and Melinda Gates Foundation, the UK-based organization says: "During the COVID-19 pandemic, mobile money enabled millions of people in low- and middle-income countries (LMICs) to access digital financial services (DFS) for their daily needs." Available in English and French, the report "looks at the growth of mobile money in a post-pandemic world."

The report notes that adoption and active usage continue to rise. "Registered mobile money accounts grew by 13% year on year, from 1.4 billion in 2021 to 1.6 billion in 2022. This can be attributed, in part, to regulatory changes in Sub-Saharan Africa, particularly in Nigeria and Ethiopia where mobile money adoption rose rapidly."

What is more, digital transactions are increasing as the use of cash slows down. "Transaction values grew by 22% between 2021 and 2022, from $1 trillion to around $1.26 trillion," the report explains. "However, the share of cash-based transactions in the overall transaction mix declined, with cash-in and cash-out transactions dropping nearly two percentage points. This is due to a significant rise in digital transactions, particularly interoperable bank transfers and bill payments."

Encouragingly, global daily transaction values are exceeding predictions. "In 2020, global daily transaction values exceeded $2 billion. The State of the Industry Report on Mobile Money 2021 (covering data from 2020) suggested this could reach $3 billion a day by the end of 2022. This figure has been surpassed, with $3.45 billion transacted daily via mobile money in 2022."

Mobile money remains a key savings channel, according to the GSMA. In 2022, approximately 60% of mobile money providers (MMPs) "offered users a savings account. Half of these providers did not offer a savings product in 2021. The World Bank Global Findex 2021 found that 15% of adults in Sub-Saharan Africa, or 39% of all mobile money account owners in the region, saved using a mobile money account."

Disappointingly, women in LMICs are 28% less likely than men to own a mobile money account. "More women have a mobile money account than ever before and are using it at a similar rate as men on a 30-day basis. However, there is still a gender gap in account ownership that has recently widened in countries such as Nigeria and Pakistan." The report continues to explain that "One of the main barriers to closing the gender gap is mobile phone ownership: increasing mobile phone ownership can improve mobile money adoption rates among women. Other steps to close the mobile money gender gap include increasing women's digital skills and awareness of the benefits of mobile money, and tackling social norms and other barriers that are preventing women from using it."

Another key finding of the report is that regulation has been influenced by challenges such as taxation and fraud. "Regulation has focused on ensuring payment systems remain safe and efficient while also encouraging innovation. However, the mobile money industry is facing several regulatory challenges. Some countries have introduced taxes on mobile money transactions and fees that do not align with their financial inclusion objectives." Moreover, "Fraud also remains an industrywide issue, which many regulators are aiming to overcome through improved consumer awareness and capacity building."

GSMA's report on the state of the mobile money industry draws on the results of the annual GSMA Global Adoption Survey of Mobile Financial Services and data from the GSMA Mobile Money Deployment Tracker. I appreciate how this report provides insights on mobile money performance from the GSMA's engagement with the industry.

What do you think of the report's findings? What is your engagement with the mobile money industry?

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.