Africa's mobile boom powers innovation economy
- 1 July 2014
- From the section Business
Innovation is happening all over Africa in all different sectors, from education to energy, banking to agriculture.
"It's the best kind of innovation - the problem-solving innovation born out of necessity," says Toby Shapshak, editor and publisher of the South African version of Stuff magazine says.
As Technology of Business embarks on a month-long series of features exploring some of these innovation stories, we kick off by looking at Africa's main technology trends and the challenges facing this vast 54-nation continent of 1.1 billion people.
You cannot talk about Africa without talking about mobile. Most innovation involves mobile devices and wireless technology in some way or another.
It's not hard to understand why.
Installing a traditional fixed-line telecoms infrastructure made no economic sense across huge, sparsely populated, and sometimes difficult to cross terrains.
The mobile phone - particularly cheap "feature phones" such as the Nokia 1100 and the Samsung E250 - offered sufficient functionality combined with long battery life.
In a continent where access to electricity is still patchy, particularly in non-urban areas, battery life and energy-frugal applications are key. This is why so many essential mobile services in Africa are based around the SMS texting platform.
Information is power, and before mobiles came along, access to data was limited for millions of Africans.
But by the end of 2014 more than 600 million people - about 56% of the population - are likely to own a mobile phone, with some researchers estimating penetration could reach 80%.
When you consider that just 1% owned a mobile in 2000, the rate of growth seems all the more astonishing. There are now more than 35 mobile network operators in Africa busily extending their base station networks to improve coverage.
Foreign companies are waking up to the commercial opportunities this presents.
"Large, multinational consumer goods companies are now looking for ways to reach their customers and employees in Africa through mobile channels, and are viewing South Africa as a gateway to the rest of the continent," says Tielman Botha, South Africa country lead for Accenture Mobility.
Even though nearly two-thirds of these phones will be accessing 2G and SMS networks rather than the faster 3G and 4G, the range of services they can access is impressive.
Whether it is farmers accessing local market prices for their produce to arm themselves against profiteering middlemen, or nurses, doctors and patients accessing medical monitoring and data services, mobiles and wireless devices are transforming lives.
But it is as a payments platform that the mobile has really blossomed in Africa.
Vodafone and Safaricom's M-Pesa mobile payments system, launched in 2007, now handles about 1.15 trillion Kenyan Shillings (£7.72bn) a year - that's 35% of Kenya's gross domestic product.
The concept sprang from resourceful Africans using and swapping mobile airtime as a form of currency.
M-Pesa is now expanding across Africa, and has also launched in India, Afghanistan and Romania, while other mobile network operators have launched their own mobile banking services.
People can pay for solar lighting, water, groceries and other goods, and also receive credits and person-to-person money transfers via their mobiles.
Such payment systems - and the digital audit trails they leave - are also proving useful for governments tackling tax evasion and corporations combating fraud.
Internet for all?
In Nigeria, Africa's most populous country, about 42% have some form of internet access, according to the country's Federal Ministry of Communication Technology (FMCT).
But with broadband costing about 30% of a household's income, and half the country's 167 million people living in unconnected rural areas, take-up of high-speed services is understandably slow.
Mrs Omobola Johnson, FMCT minister, believes information and communication technology (ICT) is "the fourth pillar of the Nigerian economy, contributing about 7.8% to the country's GDP".
Her department is working on a broadband strategy that aims to achieve 30% penetration by 2017 through public-private partnerships, in the belief that a 10% increase in broadband connectivity could lead to a 1.3% increase in national GDP.
While mobile phone operators, such as Unitel in Angola, are beginning to roll out high-speed cellular broadband, this does require users to upgrade to more expensive smartphones and tablets.
So Microsoft's 4Afrika initiative is trying another way to bring broadband to rural and other unconnected communities.
It is using so-called TV white spaces, those unused parts of the wireless spectrum usually used for television, to provide internet connectivity.
Radio signals in the TV bands travel over longer distances than other radio signals and are less prone to interference from obstacles in their way. This means fewer base stations are needed, reducing costs.
Lack of widespread broadband internet is one problem; lack of education, training and skills is another.
"There's a disconnect between employers and educators - a skills gap," says Njideka Harry, president and chief executive of the Youth for Technology Foundation, based in Owerri, Nigeria.
"We fundamentally believe that technology should be a basic human right - accessible and affordable and available to every human on the planet."
About 21 million children are not in school across Africa, according to the United Nations Educational, Scientific, and Cultural Organisation (Unesco).
In the Central African Republic there can be 86 pupils to a classroom, while schools in other countries can lack water, basic sanitation and electricity. Textbooks are often in short supply, as are qualified teachers.
While technology would seem to offer some answers, electronic libraries, digital textbooks, online exam marking and distance learning projects can only flourish once faster wireless connectivity has been rolled out.
"Without this connectivity we will never be competitive - ever," says Farouk Gumel, partner at consultancy PwC Nigeria.
'Made in Africa'
As and when such ubiquitous connectivity is achieved, young people also need to be taught how to use these technologies and understand their potential, Ms Harry believes.
Her academy teaches "technology, entrepreneurship and life skills to young people" and is looking at the potential for "3D printing to transform the African continent from an 'Aid to Africa' to a 'Made in Africa' model".
By using low-energy, low-cost kit, such as the Raspberry Pi computer and inexpensive laptops and tablets, "our young people are creating an ecosystem of relatively inexpensive, yet innovative, technologies," she says.
Projects by her entrepreneurial students include domestic security systems and LED lighting programs.
"Technology is also enabling more people to create, record and edit their own content then distribute it cheaply via Facebook and Twitter," says Chichi Nwoko, chief executive of Hey What's On? - a media company based in Lagos and New York.
Home-grown companies like Jumia, Konga and Iroko TV are beginning to give global brands like Amazon and Netflix a run for their money, she believes.
Innovation is happening in other sectors, too.
For example, satellite mapping, GPS tracking systems, civilian drones and mobile cloud-based databases are helping farmers monitor their livestock against disease and theft, track pesticide residues in their crops and study weather patterns.
For Africa, it seems, necessity may be the mother of invention, but technology is its father.