Industry says Africa fastest growing mobile market

[November 09, 2011]  JOHANNESBURG (AP) -- Africa is the world's fastest growing mobile phone market, an industry group report said Wednesday, citing the continent's innovative uses for cell phones.

Gertrude Kitongo uses hers as a radio, library, mini cinema, instant messenger and bank teller. She even makes calls on it.

"I use my phone for everything," exclaimed the 24-year-old Kenyan-Ugandan who exemplifies Africa's cosmopolitan, on-the-move cell phone user.

Mobile penetration in Africa has reached 649 million connections, second only to Asia, a report released Wednesday shows. The report by the industry group GSMA, or Groupe Speciale Mobile Association, said Africa is the fastest growing mobile market. For each of the past five years, the number of subscribers across Africa has grown by almost 20 percent and is expected to reach 738 million by the end of next year.

Researchers have used cell phone technology to track animals for wildlife studies. Africans use cell phones to make payments across borders.

Kitongo, who was in South Africa to study marketing, said she cherishes her cell phone as a link to family and friends, from her grandmother in a Ugandan village to former schoolmates in Zimbabwe. When she has a spare moment, Kitongo downloads and watches movies or catches up on her Oprah magazine subscription. She makes payments and checks her bank balance using her smart phone, and her bank sends her a text message when she receives a payment.

Peter Lyons, a GSMA policy expert, said in an interview Wednesday that lack of access for many Africans to formal banking and financial services has spurred innovation.

In Kenya, a mobile phone banking service is all the rage. It allows people without a bank account to instantly transfer money between phones. The system uses the phone's SIM card like a bank card. Users can load money onto their phones at a small brokers or from bank accounts and send it to pay bills. The recipients can swap the credit on their phones for cash. More than 50 countries have such services, including Afghanistan.

Lyons predicts there will be more "mobile savvy citizens" like Kitongo in Africa who will demand better coverage and affordable service.

He said more roads and better electricity services will help mobile companies reach more rural customers.

When they do, he said, the improvement in communications will boost economic activity. Citing studies by the World Bank and others, GSMA says that in developing countries there is a 0.81 percent increase in GDP for every 10 percent increase in mobile penetration.

Lyons estimated that at least 5.5 million Africans are directly or indirectly employed by the mobile industry.

GSMA called on governments to allocate more mobile broadband spectrum and to cut taxes on operators to further spur expansion.

For all the convenience and opportunity, Kitongo questions some of the changes mobile technology has brought to social interaction. When friends get together for a coffee, she finds they're often paying more attention to their phones than to the people across the table.

When she was in high school, she said, boys used to write letters to ask her on dates. Now, she said, no one takes time to do more than dash off a text message, known as an SMS.

"Now, people break up by SMS," she said.

[Associated Press; By DONNA BRYSON]

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