The beginning of Africa’s long, slow transition away from SMS – new browser kids on the block making mobile Internet access easier
At the end of 2011, there were the first signs of smartphone use on SMS: for the first time in some countries, rather than the volume of SMS growing inexorably, it declined for the first time. Russell Southwood looks at how wider use of mobile Internet may affect SMS volumes in Africa and at two of the new generation of interfaces designed to make it easier for Africans to use the mobile Internet.
You don’t need to be a rocket scientist to know that the number of smart phones and feature phones in African countries will increase. With this increase, many users will go from an unvaried diet of voice and SMS messages (with a soupcon of paid services) to a much more varied diet of use. It is not hard to envisage the day when the number of smart phone and feature phone users may make up as much as 40-60% of all subscribers
SMS is simply e-mail in “short trousers”: it’s easy to use but it’s significantly more restricted and more expensive than sending an e-mail. You can’t use it to share things like photos with friends unless you can use even more expensive MMS’s. But although price is one of the single biggest factors affecting consumer’s decisions on the continent, the other big factor is habit. The change of use requires not just a person to send an e-mail but someone to understand how to receive it.
This is where the new generation of browsers come into play. If both of those sending and receiving are on Facebook, then it solves that problem: they both understand how to do it. The widespread use of MXit on Blackberry in South Africa as an Instant Messaging tool to avoid SMS costs is another illustration of how this works. What starts with 15-24 year olds, slowly cascades across the age groups.
So whilst this may not have a short-term impact, there will come a point over the next 5 years where one or more African countries will reach “peak SMS”: the point at which growth will slowly flat-line and then decline gently for many years.
There are two things that affect this scenario. Firstly, increased numbers of subscribers will mean more SMS users enter the pool. But even now some African countries are approaching their “peak subscriber” moment, where the number of people who are still to subscribe is not enormous. The second thing that might affects SMS use is literacy, both of the simple “can this person read?” kind but also of functional literacy; can this person understand the tasks required to perform sending an SMS? Now the latter is more a brake than might first be understood: in Ghana only around 40% of all mobile subscribers use SMS.
If you take a clutch of the bottom end literacy rates from the UNDP Development Report 2011, the limit on certain countries growing SMS or mobile Internet beyond a certain point become obvious. Going from low to only slightly lower, the problem becomes obvious: South Sudan (27%), Mali (26.2%), Chad (33.6%) and Sierra Leone (40.9%). Now these figures have been improving but generally not dramatically: for example, Chad was at 26% a few years ago. There may be a sudden improvement in education levels in some African countries but it would be hard to predict this will happen in most African countries based on past performance.
But the transition that is occurring is that users are beginning to find browsers or interfaces that will allow them to not only send e-mails (with attachments) but also to use a far more varied diet of content beyond the 160 character boundary of SMS: a diet of content that will include audio, pictures and video. An analysis we did for a client last year of SMS content in one major African market showed that there was almost no difference between the different services offered by operators. Indeed many were simply sourced from the same content providers.
The dilemma for mobile operators is do you let your subscribers simply wander away from the rather limited content, black and white offers in your existing walled garden or do you go with them on the journey into the technicolor world of the Internet? As you will have judged from the way the question is put, there is only one answer to it otherwise as an operator, you risk losing the connection and loyalty of your customers.
At the high-end of the handset pyramid, the choices are easy for the customer: there are several smart phone browsers and you take your choice: iOS, Android, Blackberry, Windows and other lesser variants. But for feature phones and low end phones, there are not many alternatives. So imagine a group of young African sitting in a bar with their phones on the table: 1 of the 5 five can afford a smart phones but the others can’t yet. You need browsers and interfaces that will allow them to keep up with the people who’ve got the smart phones and get that more varied content diet. Of the two examples below, one operates using the Internet and the other using SMS outputs.
Australia’s biNu is a Java-based browser targeted at feature phones set up by Gour Lentell who grew up in Zimbabwe. It operates out of the cloud on a highly compressed, thin client. According to Lentell, it offers:”a ten times faster browsing experience than other browser, using a tenth of the bandwidth.” The latter has to be something that operators must be interested in as data volumes continue to grow.
Only made available in January 2011, it has grown in 12 months to 466,510 biNu users in Africa, out of a total global user base of 1.97 million. The table below shows the relationship between users and usage levels.
These numbers may seem modest but they have been achieved without any marketing and no relationship with operators:”It’s been viral growth.” The app has been available through places like GetJar and the Ovi Store.
The content currently available includes books (from the Guttenberg Project), dictionaries, news, sport, entertainment, financial news and foreign exchange data and last but not least, the all-important Facebook and Twitter. It has also signed a recent MoU with World Reader.
biNu is keen to talk to mobile operators and can offer a “white label” version that allows the operator to brand it as their own.
Mobile XL has been created by a company of the same name run by Guy Kamgaing and creates an interesting route for more low-end phone users to “get a taste of the Internet.” Once the consumer has downloaded the XL Browser, he or she will get immediate access to social media, local and national news, music updates and even access email:”It will allow something of the same experience for the user as the high-end phone and enable them to access relevant content. The billing is clear and it’s available on all devices.”
So for a user with a basic Nokia, Alcatel or Chinese phone, it will allow them to check their Facebook page and read e-mail with the only requirement being a GPRS connection. With or without a connection, you can go into the available applications which are all on a single platform.
This is a client side app that connects to the cloud:”We have a connection into Facebook’s APIs to get the content. When delivered to the user, it looks like a regular SMS.” Because it puts togther 3-4 SMSs, it enables you to read up to 600 characters of an e-mail.
Two years ago it did small pilots with Orange Cameroon, Safaricom and MTN Ghana for a year. Then it was approached by Vodafone in India (145 m subscribers and IDEA Cellular (95 m subscribers) and it will launch with both early in 2012:”We have gone from Africa to India, which is the reverse of what usually happens.” It will be launching with all the three African operators above in Q1, 2012. The pilot attracted 100,000 users across all three operators.
The early adopters used Facebook a lot but there were also interested in sport and local news: “In Cameroon it was possible to offer a local job search. Local content will drive usage.”
In terms of pricing, in India, they were allowed to introduce an unlimited bundle (to mirror the way the Internet is used) for 30 rupees a month (US59 cents a month). Safaricom is going to offer it for KS5 a day (US5.7 cents) or KS30 a month (34.7 cents) a month. In Cameroon, it will be 1,000 CFA a month (US$1.95):”It becomes like the Internet but it’s way cheaper.” The revenue share is 40-50% to Mobike XL depending on the size of the market.
It’s done deal with Alcatel and Nokia and MiFone looks likely to offer a MyXL handset in 2012.
These two offer different routes to giving users access to the Internet. In the long run, users will want the technicolor internet rather than the black and white world of SMS. So it’s time for operators to get on the bus before it leaves.
To follow the exchanges about this news, you need to be on Twitter. Follow us on @BalancingActAfr
In terms of content, Wikipedia is one of the most widely used sites in Africa. This week we talk to Chief Executive, Wikimedia UK Jon Davies about what it’s doing in Africa, its partnership with Orange and its desire to partner with other mobile operators:
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In our consultancy work, we have produced a report for the World Bank entitled: Ghana Country Study: A roadmap for the strategic application of information and communication technology. It looks at issues of online content, the need for a critical mass of users and the use of local online content. To download a free copy, click on this link: and go to the bottom of the right column and click on the World Bank logo.