Strategic Analysis of the Sub Saharan African Mobile Handsets Market

The mobile handsets market in Sub Saharan Africa is set to grow significantly, following a considerable period of time after the actual subscriptions have started to decline. The low-end devices segment will continue to accelerate growth in this sector and there is a growing trend of a shift to middle and high-tier devices, by both existing and new subscribers, fuelled by a year-on-year decline in the average selling price of the devices. However, network capabilities in the region are not aligned with device capabilities and the lower economies-of-scale of operators in the region continues to impact the uptake and pricing of devices. "High growth in the new subscriber base is spurring demand for mobile handsets," says the analyst of this research. "Growth in the low-end devices sector is increasing the availability of relatively affordable handsets." Mobile subscription growth in Sub Saharan Africa is higher than the global average, thereby boosting demand for mobile devices. As several handset vendors are aware of this fact, they have concerted their efforts to expand their low-end device offerings to more effectively penetrate the region.

However, mobile network capabilities in the region still lag far behind that of mobile devices. As a result, users in the region are deprived of a complete experience despite significant improvements in the devices to support various applications. Additionally, most devices are designed to better support data and broadband applications and the high cost of these services limits the uptake of the devices designed for this purpose. Therefore, low-end devices remain the key driver of growth in this region. Most mobile networks in sub Saharan Africa offer only voice and SMS-centric services. Though there are various applications on devices that could enhance user experience and encourage usage and adoption, they are very expensive, further reducing the uptake of some middle and high-tier devices.

"The current middle-tier devices should become the new low-tier devices in the region, in terms of price and functionality," concludes the analyst. "Through affordable devices that can support a wider range of data applications, vendors can effectively tap into a fast emerging segment in the region while enabling operators to increase their average revenues per user (ARPU) and data services usage, resulting in a win-win situation for all."

Technologies

The following technologies covered in this research:

• GSM
• CDMA
• WiMAX