What will 2022 hold for the African mobile industry?

04 April 2022

Dario Betti, CEO of MEF (Mobile Ecosystem Forum)

Dario Betti, CEO of MEF (Mobile Ecosystem Forum)

Digital transformation – from fast to deep

Around the world the pandemic energized the move towards mobile and personal solutions. However, the transformation is not yet finished. Things have happened so fast we did not have time to appreciate and implement the true changes that are possible. The billion-dollar valuations accorded to OPay, and Wave in 2021, should be a reminder.

Nigeria and Senegal are top in the world for adoption of mobile payments. The mobile money push is an African thing, more precisely a sub-Saharan thing. According to the GSMA 64% of the world mobile money transactions were coming from this region in 2020. Adoption is a great first step, but mobile money has got the potential to make transactions more transparent, more economical, and open to new services such as micro lending. The potential of AI will enrich and charge the services we can offer. This is where the industry will pay more attention next.

Cyber Attacks – The emerging threat is now taking centre stage

The other side of digital transformation is now not just a novel type of fraud, but the main type of fraud. By 2025 cyber fraud is expected to be worth USD 10.5 trillion. This threat has been largely underplayed by many in the industry. The consumer is concerned, and the industry needs to coalesce in its efforts to fight and reduce this threat considerably. 2022 will be (has to be) the year the industry ups its game on preventing and detecting fraud.
In October 2021, Interpol reported the top five Cyber-threats in Africa were: phishing, digital extortion, business email compromise, ransomware and botnets. Afripol, the African Union and Interpol are increasing their collaboration against cyber fraud. Companies and telecom operator should do the same.

5G – Africa to be a follower

If you are expecting an African 5G revolution in 2022 you might be disappointed. The network maps show the world embracing the newest network technology for fast data transfer. However, Africa lags behind in this. South Africa led the pack, Nigeria and Mauritius have assigned frequencies and are seeing the first services, Uganda and Kenya should follow soon. More will follow but that pace has not been as fast as some hoped.

Many were anticipating a leapfrog of fixed broadband for the continent: 5G allows for a true broadband experience via wireless. Avoiding the expensive role out building-to-building is enticing for many operators. However, to deliver 5G the overall infrastructure must be modernised. Not just the last mile but also the fibre network and international connectivity might need to be optimised. The good news is coming. Liquid Telecom is busy rolling out its 100,000km pan-African network for 14 countries in the region. Africa Data Centers is building data centres in Nigeria and Ghana on top of the existing ones in Kenya and South Africa. Facebook is active too: it has deployed 770 KM of fibre in Uganda in partnership with BCS and Airtel, and 750-800 KM in Nigeria with MainOne. The investments are coming.

There is still much which 2G and 4G can do in the African countries. Yet it is time to prepare. 5G will bring a digital revolution in African households – alas not many of those will be reached in 2022.

The Metaverse is not here, but AR/VR are

So much talk about the Metaverse, yet it is not here. It will start somewhere, but at first it will be a patchwork of competing and not interoperable solutions. Roblox, Epic’s Fortnite or Meta’s Oculus? Who will win the metaverse platform race? Well in 2022, it will be the older ideas: augmented reality and virtual reality. The interest in the metaverse will generate more opportunities for the existing technologies like AR and VR.

And this can be seen in Africa too. Sam Media has officially launched its latest e-learning and entertainment product, XR Academy, at the end of 2021. The product provides immersive 3D technology to e-learning in Africa.

Mobile Marketing- An interlude year – but Messaging formats will grow faster
The death of the browser cookie and the subsequent revolution in advertising tracking has been postponed by Google’s announcement that the Chrome browser will still support tracking cookies until the second half of 2023. So more of the same for 2022?

Not really. In 2022 big advertisers will move quickly towards new solutions – expect more focus on AI based solutions as well as a continuing growth of messaging formats for marketing. Messaging is still a small part of the advertising spend but its engagement, tracking and response KPI’s are making it more central in marketing strategies.

The split mobile operator

All operators are asking themselves some existential questions about their future. The future investment in 5G and African mobile operators are beginning to address these questions, though seeing them as timely rather than urgent. Some operators are moving towards a more enterprise-centric model, others look at new digital services for the consumers such as payments and ecommerce.

The request for cloud services and connectivity is growing healthily across Africa. Creating solutions for enterprise customers is a key strategy for most operators: in the late 2010s business revenues accounted for less than 20% of the total for mobile operators. However, by the end of this decade enterprise revenues might represent 80% the of total for some mobile operators in the region. Things are changing now with flat or smaller consumer ARPUs (average revenue per unit). Expect more shifts in strategies in 2022, few can still afford to stay on the fence.

Foldables phones – the new form takes place

The news for 2022 on devices: you will be able to buy the first African made smartphone, courtesy of the Rwandan company Mara Group. It is an important step for technical production in the continent, but the device world is now trying to innovate on form factor: folding phones are now back in fashion. These are not the clamshell devices of the 2000s; nowadays, screens are folding as well. The Samsung Fold 1 in September 2019 was the category opener, but in 2021 we saw the Microsoft Surface Duo 2, the Samsung Fold and Z Flip and the Huawei Mate X2.

Our prediction is that as component prices lower, other big device vendors will join the ‘fold’ to differentiate. Google and OnePlus are top of our prediction list, but even Apple could start innovating on their line-up. In 2022, we will see the first mass market foldable phones.