One of the most common questions we get is why we’re focused on building a game for smartphones: do people in Sub-Saharan Africa have phones? What types of phones? I thought I’d take a few minutes to answer that question.

In 2011, Marc Andreessen, a famous and outspoken Venture Capitalist, famously declared that “software is eating the world.” Two years later, Ben Evans, a partner at Andreessen’s VC firm, changed this guiding principle to “mobile is eating the world.” We believe this is true, and is increasingly the case in the African sub-continent too.

First, the smartphone market itself is growing incredibly fast. Driven by the explosion of affordable handsets,smartphones sales grew 66% in the first quarter of 2015. According to market research firm GfK, in March 2014, more smartphones were sold in South Africa than feature phones for the first time ever, and that symbolic change will also happen throughout the continent in 2016 – as smartphone shipments overtake feature phone shipments (see chart below). That’s a major milestone, and we believe the pace is only going to pick up as more manufacturers compete for the lower bands of the market. While the market has been dominated so far by Chinese phones, local operators (like Safaricom in Kenya or MTN in South Africa) as well as international behemoths like Google are now vying for that market – and releasing sub-$100 phones. Increased competition – focused on low-income communities who represent a massive market opportunity – will drive prices down, in turn pushing the pace of smartphone adoption up.

Key to this growth are the younger generations, particularly in low-income communities. Although half the 50 million people in South Africa live below the poverty line, more than 75% among those in low-income groups who are 15 years or older own a mobile phone. Granted this may be a majority of feature phones, but as smartphone prices drop, we expect the shift to smartphones to happen en masse. We saw a preview of this in our most recent trip to South Africa, where we witnessed children coming to school located in townships with smartphones. And those who didn’t had already, for the most part, played games on smartphones at home – confirming they had access to their parents’ smartphones. Comparing feature phone growth to smartphone growth also tells a compelling story: from 2013 to 2017, feature phones are expected to grow from just over 3 billion to just under 4 billion – a 30% growth. In contrast, the smartphone base in 2013 was just over 1 billion, but will practically triple to just over 3 billion in 2017 – a 300% growth. Smartphone adoption isn’t just growing faster than feature phone, it’s growing 10x faster than feature phones.

Data usage is also increasing rapidly. South Africa is the 5th country in the world when it comes to data usage. Across the continent, mobile data usages are expected to triple from 2012 to 2018.    We saw this firsthand in our different visits to Africa in the past year. In Gambia, one of the poorest countries in the world, the streets in rural areas are lined with large billboards advertising either election candidates or (more likely) smartphones and data plans. The villagers we stayed with either had a smartphone or wanted one without knowing it – they all told us they wanted a new phone “with Whatsapp” and to “share pictures with their friends” – in other words a smartphone. While in many countries, data plans are still expensive, we’ve seen people become extremely savvy with their data usage, switching providers (simcards) constantly over the course of the day to depending on each provider’s varying data cost. Additionally, data costs are plunging as the infrastructure is improving. Already in 2011, around one tenth of Africa’s geography was covered by mobile-internet services – a higher proportion than India! In the past few years, the activation of submarine cables, including EASSy, TEAMs and Seacom on Africa’s East coast and Main One, GLO-1 and WACS on the West coast, has significantly increased the data capacity available to the continent. Informa notes the benefits tend to be greatest in countries closest to the coasts and directly served by the new cables, but, driven by demand, other countries are sure to catch up.

To conclude, it’s clear to us that smartphones are taking over the continent at lightning speed. While it’s fair to say that the majority of the population doesn’t yet have smartphones, the impressive rates of growth (especially compared to feature phone growth), the reasons for growth (mainly driven by social media and ease of communications), and the sharp drop in prices of both hardware and data (through increased competition and improved infrastructure) tell us that within the next two years, the smartphone market will be the dominant mobile force in Africa.

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