| Mobile Money and Telcos |    869 VIEWS  |
| Mobile Money and Telcos | |
| 869 VIEWS | |
 | |
| PROSHARE | |
| PROSHARE | |
Tuesday, January 07, 2020 /2:15 PM / By FDC / Header Image Credit: biztechafrica
Consumers in African countries are paying some of the
highest rates in the world for internet access as a proportion of income,
according to a new report released in late October. The Alliance for Affordable
Internet (A4AI) assessed 136 low and middle-income countries for their annual
Affordability Report. Examples of middle-income countries according to the
report include Malaysia, Colombia, India, Jamaica, South Africa, and Ghana,
while low income countries were Nepal, Mali, Haiti, Liberia, Yemen, and
Mozambique.
The A4AI is an initiative of the Web Foundation,
founded by inventor of the Web Tim Berners-Lee, with partner organizations that
include Google and Facebook. The A4AI defines affordability as 1GB of mobile
broadband data costing no more than 2% of average monthly income. But the
average across the African continent is 7.12%, and in some cases 1GB costs more
than a fifth of average earnings.
Such prices are "too expensive for all but the
wealthiest few," the report states, citing cost as the primary reason why
an estimated 49% of the global population remains offline. The report authors
argue that sluggish markets and monopolies are a primary cause of high prices
and offer several policy prescriptions to address the issue. African countries
are subject to the least affordable internet prices in the world, according to
A4AI data.
Citizens of Chad, DR Congo, and the Central African
Republic must all pay more than 20% of average earnings for 1GB of mobile
broadband data. By contrast, the most affordable rates in the continent are in
Egypt at 0.5% and Mauritius at 0.59%. Overall, the report found that costs are
falling faster in low-income countries than middle-income counterparts, but in
many cases prices remain prohibitive. A4AI's primary recommendation is for
greater liberalization of markets and measures to increase competitiveness.
"Competition is core to successful broadband markets," the report
states.
The authors' estimate that moving from
"consolidated markets" -- monopolies -- to multi-operator markets
could drastically reduce costs of mobile broadband data. Recommended measures
to increase competition include "fair rules for market entry and
incentives to encourage new competitors," such as a liberal and
transparent licensing regime. A4AI has also created a Good Practices Database
with case studies of low and middle-income countries improving access, such as
Namibia, which has allowed new service providers to enter the market and seen
costs decline. Kenya was also cited for making internet access available for
millions of its citizens by eliminating a tax on handsets.
Related News
Signup with Facebook
Signup with Twitter
