Why Steve Jobs should let Africans buy his new toy.
BY DAYO OLOPADE | JUNE 24, 2010
When I touched down in Lagos, Nigeria, this week, the first thing I did was buy a cell phone. The city's Saka Tinubu district hosts dozens of mobile vendors arrayed in small shops, piled high with all the major brands: Nokia, Motorola, Samsung. Among them is Belle-Vista Phone Warehouse, which styles itself as a "Blackberry Outlet." Young professionals stopped by after working hours to scoop up the Storm, the Curve, and other popular smartphones nestled in the display cases. Apple's iPhone -- ubiquitous in American cities, and about to become more so with the release of the product's much-anticipated version 4 today -- was nowhere to be seen.
The best-kept secret about Africa in the last decade is the continent's rapid and creative adoption of modern technology. African countries have for the most part leapfrogged the technologies of the late 20th century to adopt those of the early 21st en masse. There are now 10 times as many cell phones as land lines in sub-Saharan Africa, and since 2004, the region's year-over-year growth has been the highest in the world. When Nokia's billionth handset was sold in 2000, it was in Nigeria.
Africa is a multimillion-dollar mobile market, and plenty of the major technology companies, Western and otherwise, are there already. Multinational telecoms like MTN, Safaricom, and Zain are competing to cover a continent of 500 million mobile consumers, improving connectivity and dropping prices. Low-tech Chinese imports and no-contract, prepaid plans have made the technology easily accessible; Belle-Vista alone sells 500 phones a month. Nokia, which established its first African research center in Nairobi in 2008, has just unveiled a telephone that will allow consumers used to toggling between two or three devices to use multiple SIM cards in the same phone. BlackBerry has likewise responded to explosive demand by opening an office in Nigeria this year. Google, whose Android operating system is the strongest competitor to the iPhone, has had a presence on the continent since 2007 and now operates in 45 African countries, hiring and training African developers to convert its well-known suite of Web applications (Maps, News, Finance) for local use -- often over mobile devices.
These companies and their technologies are opening a line into the flattening world we've heard so much about, creating markets, enabling information access, and building relationships in ways that have changed poor countries from the bottom up. But it's hardly philanthropic work -- market leader Nokia's regional revenues were 1 billion euros in 2009, and Research In Motion, named Fortune's fastest-growing global firm in 2010, sold 1 million BlackBerries last year in South Africa alone.
So where is Apple?
The earlier-generation iPhones are, ostensibly, available on the continent -- Vodacom, a subsidiary of British Vodafone, signed a 10-country distribution deal with Apple in 2008 that included South Africa and Egypt, and the phones do work on local networks. Vodacom has also announced that it will distribute and service the iPhone4 in Africa in the near future. But for the vast majority of Africans, Apple effectively doesn't exist. The iTunes store's music offerings have never been available on the continent; African IP addresses are blocked. The iPhone goes for $1,000 at local retailers -- 10 times the current U.S. price for the same model, a big-enough markup that most iPhones on the continent are purchased abroad instead -- and because of limited bandwidth and apps availability, owning one is "like having a Maserati in traffic," according to Tayo Oviosu, CEO of Pagatech, a mobile banking firm in Nigeria.
This is a shame, considering what even inexpensive, basic cell phones have done for Africa. In poor countries, cell-phone penetration has been linked to positive economic and developmental outcomes. A 2006 study of emerging markets suggests that a 10 percent increase in mobile penetration correlates with a 0.6 percentage point increase in economic growth rates. In Africa, the trend is lifting all boats: A fisherwoman without refrigeration in the Democratic Republic of the Congo can keep her catch on the line in the water, waiting for customers to call; selling access to a mobile phone in poor or rural areas of Uganda has become a viable business model. Professionals stuck in Johannesburg traffic make deals on their BlackBerries; demand for skilled labor in the information and communication technology sector has created 400,000 jobs in Nigeria since 2000.
The advent of mobile money -- the transfer of funds by cell phones, rather than banks or ATMs -- in poor countries has further expanded the reach and value of cell phones. Fifteen-thousand new mobile-banking customers sign up daily in Tanzania, 12,000 in Kenya, and 18,000 in Uganda. Paperless payment creates meaningful efficiencies: Bill-paying has ceased to be a day lost in line at the bank. Rather than sending an envelope full of cash with a bus driver to another town, an individual can text remittances to a distant relative or friend.
Africa has also led the way in putting mobile phones to NGO-like use. Using SMS platforms, organizations can send patients reminders to take medication, offer technical assistance to farmers, and provide mothers simple prenatal checklists. Ushahidi, a Kenya-based start-up, deployed its SMS-based crisis-mapping software in Haiti after January's earthquake, for which it was later honored by the Clinton Global Initiative. These mobile-centric models don't just do good -- they add real value to the sizable investment made by lower-income individuals in poor countries.
What could the iPhone contribute to this ongoing renaissance? The iPhone4 may serve these developmental functions better than anything else on the market, if its features are as described. The new FaceTime feature, for instance, which allows videoconferencing directly from a mobile device, could do much to support the distance education projects being pioneered at the University of South Africa and Makerere University in Uganda. In addition to GPS and access to the mobile Web, geotargeted applications could help traders find market prices, businesses find customers, and make news delivery and political organizing easier. All-in-one video shooting and editing software makes the iPhone4 a powerful media tool that competing smartphones like the BlackBerry or Nokia Nseries just can't duplicate. Even the longer battery life will add value in places where electricity is unreliable.
Most importantly, the iPhone's application development ecosystem would engage the talented, tech-savvy demographic on the planet's youngest continent. According to a paper from the Institute for Development Policy and Management at the University of Manchester, software production is an industry "essential for the growth of the economies of developing countries"; the $1.43 billion iPhone application market, with its low barriers to entry and friendliness to entrepreneurs, is ideal for Africa's burgeoning class of small-scale software programmers. In Kenya -- a country where software tinkering is popular enough to warrant a prime-time cable TV show -- some eager programmers created applications for the first iPhone well before it was even available in the country. "We're going to see people developing applications that solve specific challenges in the African context," says Oviosu. "If the iPhone comes here and catches on, of course we'll build [one]."
It isn't just Africans who are losing out from Apple's disinterest in the continent. As mobile data usage comes to replace traditional computing in Africa, the new unit of engagement for business, government relations, and humanitarian work may be the smartphone -- and it stands to reason that the company with the best local presence will reap the benefits of rising incomes and demand on a continent of nearly 1 billion. If it is Apple, it will reinforce the company's slogan: This changes everything. Again.
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