INTELLIGENT BRANDS // Mobile Technology
Dominique Friedl, Head of Corporate Sales for South and sub-
Saharan Africa, MediaTek
F
or many years, African countries
served as the growth engine for the
global smartphone market. Recent
times, however, tell a different story. In
2016, according to Strategy Analytics,
global smartphone sales grew at a
modest 2% and the landscape in Africa
also saw a dip from what had been a
39% year-over-year growth rate.
However, smartphone manufacturers
and component developers believe
another boom is right around the
corner, and last year’s decline in
smartphone shipments into Africa is
likely to be a blip on the radar before
high-growth rates resume.
In many cases, external factors driven
by economic turmoil in several African
countries are to blame for some of
the smartphone industry stagnation.
Nigeria, for example, experienced an
economic downturn and a shortage
of foreign exchange, which impacted
sales of imported products, including
smartphones. That’s according to
Dominique Friedl, Head of Corporate
Sales for South and sub-Saharan Africa
at MediaTek. He says that stalling
smartphone growth last year caught the
industry by surprise, but shouldn’t be
seen as a long-term trend.
The slowdown is the result of saturated
market situations in several regions and
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INTELLIGENTCIO
Increased focus
on lowering
smartphone
costs could
drive next
African
smartphone
boom
complicated by economic headwinds
in some countries. Strategy Analytics,
though, expects the Africa Middle East
region to be the growth engine for
the global smartphone market in the
upcoming years.
The Middle East region of Africa is
projected to grow at 13% in 2017
and 9% in 2018, respectively. Both
figures rate as the top marks among all
major regions, thanks in part to lower
smartphone penetration rates and a
generally healthy economic climate.
With a sense of normality returning
to economics across Africa, what will
help the smartphone industry prosper
in the next few years? For one, industry
leaders are expected to increase
their focus on putting affordable
smartphones in more people’s hands
as mobile subscriber penetration
approaches saturation levels across
Africa. This focus on smartphones, in
turn, will help boost data revenues for
network operators in a market where
voice revenue growth has flatlined.
According to the GSM Association,
average selling price (ASP) of
smartphones has fallen significantly in
most markets across sub-Saharan Africa:
smartphone average prices across Africa
were $160 in 2015, down from around
$230 in 2012. Sub $50 smartphones are
becoming a reality, with prices below
$30 as the next target. Cost-effective
components, leaner operating systems
and larger volumes will help reduce the
pricing and drive sales.
Go high, go low
Two key factors could help bring the
cost of devices down for consumers:
the pending availability of Android Go,
a streamlined version of the Google
mobile operating system, and the rise of
chipset manufacturers offering systems-
on-chip (SoCs).
Android Go was designed for low-power
devices, and it has anticipated that the
operating system will enable handset
manufacturers to ship smartphones
that while not as full-featured as a
flagship device, still offer a reliable and
responsive end user experience. Also,
SoCs allow smartphone brands to design
rugged and affordable 3G and 4G LTE
devices for the mass market.
African countries continue to experience
a degree of volatility due to factors such
as currency and economic instabilities,
lack of locally relevant content and
technical literacy and affordability.
However, falling smartphone and data
prices should lead to the next African
smartphone boom in the longer-term. n
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