Getting spectrum award policies right comes with big rewards. By learning from past experiences, African governments and regulators can help expand mobile connectivity and the benefits it brings.
At the end of 2019, the economic benefits generated from mobile technology in Africa accounted for 6.2 per cent of the continent’s GDP. The rollout of mobile technology has driven a fifth of income per capita growth over the last 20 years. These are impressive numbers. But with some 900 million people in Africa still unconnected, there is more work to be done.
Spectrum licensing decisions, and pricing in particular, can play a crucial role in accelerating the adoption of mobile services and providing better networks and services for consumers. Our new “Effective Spectrum Pricing in Africa” report is unprecedented in scope and depth, tracking spectrum assignments across nearly 50 African countries for the 2010–2019 period.
The negative impacts of high spectrum prices on connectivity in Africa are clear to see. It is an issue that has to be addressed for the region to take full advantage of the benefits mobile broadband can bring. The aim with this report is to give governments and regulators the arguments they need in order to implement policies that help improve mobile capacity and expand connectivity.
The report’s key findings are:
Governments in Africa have assigned approximately half the amount of mobile spectrum compared with the global average. This gap in spectrum assignments has emerged and expanded over the last decade, making it difficult for operators to offer fast mobile broadband speeds. Governments in the region have also on average licensed 3G and 4G spectrum around three years later than other regions.
African countries account for a large proportion of the highest spectrum prices globally. When spectrum prices are adjusted by income, Africa accounts for about half of all the high or extremely high spectrum prices worldwide. Even excluding extreme outliers, spectrum prices remain high. Median prices are four times higher than in the developed world and twice as high as the global median.
Licensing more spectrum earlier and at affordable prices can pay dividends for consumers. Higher amounts of spectrum and lower spectrum prices are strongly linked to higher population coverage, download speeds and adoption. Countries that have assigned spectrum earlier have also achieved higher coverage levels.
In short, mobile industry simply cannot be viewed as cash cows anymore. Government interventions to maximise revenue generate negative consequences for citizens and the development of mobile services. Instead, governments should release more spectrum in a timely manner. This helps in order operators expand their network coverage, improve speeds and encourage adoption.
As highlighted in our recently released position paper on expanding mobile coverage, the key to improving mobile network coverage and capacity is a real partnership between governments and mobile operators.
Most importantly, setting the stage for more innovative mobile services and connecting more people, wherever they may live, are core parts of the GSMA’s mission. The “Effective Spectrum Pricing in Africa” report can be downloaded here in English and here in French.