In Kosovo, where the war partially destroyed communication infrastructures, an Albanian
woman calls her son in Germany on a cell phone.
“Although a mobile
phone may nominally belong to a single person, in some African countries it is regarded
as the property of the community, because there is a culture of sharing the tools
of communication.” |
Throughout the developing
world, mobile phones are dramatically extending access to communications, but if
they are to benefit the poorest, bold government policies are still required
 Groups
of small farmers in remote areas of Côte d’Ivoire share mobile telephones so
they can follow hourly fluctuations in coffee and cocoa prices. This means they can
choose the moment to sell their crops when world prices are most advantageous to
them. A few years ago, they could only have found out about market trends by applying
to an office in the capital, Abidjan. Their deal-making was based on information
from buyers, and this was not always reliable.
These coffee and cocoa growers are just a few of the economic players in poor countries
who are today making shrewd use of the mobile phones, one of the star features of
the information society.
“Communication is a universal need, but communications technology can be used in
a variety of ways,” says UNESCO communications specialist Babacar
Fall. “Although a mobile phone may nominally belong to a single person, in some African
countries it is regarded as the property of the community, because there is a culture
of sharing the tools of communication.”
A
dearth of fixed lines
Fall cites
the case of Senegalese living in Dakar or abroad who have bought their relatives
a mobile phone to stay in touch. Sometimes, several families living in places where
the dream of getting a fixed phone line is unlikely to come true for at least 20
years share a mobile handset that they charge up from car batteries. Children run
to neighbours to tell them that a relative will be calling back in a few minutes
from New York or Rome.
Huge billboard ads in Africa have made mobile phones as popular there as Coca-Cola.
As one joke goes, “A man loses his mobile phone in a crowd and asks someone to call
his number. A few seconds later, the missing phone rings—in the pocket of the policeman
who was helping to look for it.”
Mobiles are popular because of the dearth of fixed telephone lines in Africa. In
1998, Europe had 37 lines for every 100 people while Africa only had two. The Democratic
Republic of the Congo (DRC) has one for every 2,500 people while Mali and Niger have
fewer than two per 1,000. In Asia, the average is 7.34 lines for every 100 people,
more than double the number in Latin American countries like Cuba (3.21) and Nicaragua
(3.13).
Mobile phones have started to fill this communications gap. Although 80 per cent
of them are currently found in rich countries, in the 1990s the number of subscribers
in poor countries grew faster than anywhere else. Africa had almost 3.5 million mobile
phone subscribers in 1998. More than 70 per cent of them were in South Africa, where
growth in this sector exceeded all expectations, according to the International Telecommunication
Union (ITU). In the same year, 17 per cent of all phone subscribers in Africa had
mobiles. The figure for Asia was 30 per cent. In developing countries like the Philippines,
Bolivia, Azerbaijan and Estonia, mobiles have caught on much quicker than expected.
“The less infrastructure a country has, the more attractive it is to invest in mobile
phones,” says Nagib Callaos, who teaches at Simon Bolivar University in Caracas.
“There’s no need to create a demand; it exists already. In Venezuela, for example,
there’s no traditional phone infrastructure and mobile phones have spread much more
quickly than in the United States.”
Forty million people in the world are on waiting lists for a fixed-line telephone,
according to the ITU. In Venezuela, where the wait is nearly five years, a lucrative
black market has set in, with people paying the equivalent of 10 times the minimum
wage to get a line. Now it is possible to sign a contract for a mobile phone and
start using it the following day.
This delights some Venezuelans, “who use the time when they’re stuck in Caracas’
endless traffic jams to catch up on the phone calls they’ve been meaning to make,”
says Callaos. Having a mobile phone is also useful from the point of view of safety.
“My daughter never goes out at night without her mobile. I can call her every hour
or less to see if she’s OK,” he says.
Exponential
growth in war-torn countries
A mobile phone
network can be up and running much more quickly than a fixed one. In Romania, the
firm Mobifon launched its service in 1996, just four and a half months after being
granted a licence to operate. Since there is no need to dig trenches for cables,
installation costs less and the investment is recuperated more rapidly. In Venezuela,
profits began to roll in only three years after startup.
Mobile phones are also ideal for countries whose infrastructure is inadequate or
has been seriously damaged by war. Examples include Lebanon and especially Cambodia,
where there are more mobile cellular subscribers than fixed telephones. The only
other country where the situation is comparable is Finland.
The ITU says the percentage of mobile versus fixed lines is proof of the vigour of
the mobile phone industry in countries of the South. In Cambodia, mobile phones appeared
in 1992. Within a year mobile subscribers exceeded the number of fixed telephones
and today, they constitute 72 per cent of all subscribers. The authorities have even
questioned the need to expand the fixed network.
Fierce
competition between operators
Mobile phones
will soon overtake fixed lines in Lebanon (now 45 per cent mobiles) and Paraguay
(43 per cent). In the latter, mobile phone firms, mostly private and backed by foreign
investment, have benefited from the inefficiency of the state-owned fixed-line operator.
(Unlike most of its neighbours, Paraguay did not privatise its telecommunication
operator in the 1990s.) Many users choose to take advantage of the rivalry between
the four private mobile phone firms rather than remaining dependent on the bureaucratic
state company.
“The state has done poorly where fixed lines are concerned,” says the ITU’s Michael
Minges. “Its role should be to open up the market and create an open environment
for foreign investment.” But, he says, the state still has an important role as a
regulator, “to facilitate competition, to see that prices are fair and to establish
interconnections between different systems, including between mobile and fixed lines.”
In the beginning, it was thought that mobile phones in poor countries would only
be used by the wealthy, and governments granted only one national mobile phone operating
licence. But almost half the countries with mobile phones now have issued at least
two licences, and the fierce competition between operators has helped to reduce rates.
This does not however explain the current growth of a mass market, which is largely
due to prepaid call schemes.
The
boom in prepaid cards
The standard
way of paying for a mobile phone service is on the basis of a minimum use of, say,
two hours a month for a year. Potential customers have to provide proof of a regular
income, sign a contract and have a bank account and a permanent address. But because
the vast majority of rural people in developing countries do not have any of these,
operators are using the prepayment system.
This involves buying cards which provide phone time from five minutes to an hour.
Customers can use the credit as they like over a period of weeks, and so keep control
over their spending and enjoy a very cheap phone service. Prepaid cards are widely
available in local stores.
The potential market is huge. In 1998, three years after the first prepaid mobile
phone scheme was launched, 40 million people had opted for it—about 13 per cent of
the world’s mobile users. In South Africa, half of all subscribers chose prepayment,
and more than half in Mexico. In Senegal in 1999, one operator for the first time
offered a prepaid system as the only option.
After two months, the firm had won
4,000 customers. This system has tripled and perhaps quadrupled the potential Latin
American market for mobile phones, according to a study by the Strategis Group, an
international telecommunications consultancy firm.
The prepaid system, which has been called the “perfect marriage” between technology
and marketing, has led to an enormous increase in the number of mobile phones, but
their contribution to general development is still very limited. In Lubumbashi, in
southeastern DRC, for example, the mobile phones that some maize farmers have given
their security guards have proven an effective weapon against robbery and increased
their yields. Taxis in Kampala, the Ugandan capital, are now more efficient because
of them. And during the recent elections in Senegal, FM radio reporters used mobiles
to improve their coverage (see box p. 68).
But the cost of these calls is still too high for poor people to benefit from this
technology. The mobile phone faces a big challenge if it is to help the poor break
out of their isolation and to contribute to “the social and economic development
of peoples” that the first African Development Forum called for in Addis Ababa last
year.
State
initiatives
These are not
empty words. The Grameen Bank project in Bangladesh has shown that it is possible
to give very poor rural people access to mobile phones (see next article). Nevertheless,
“many governments still regard mobile phones as a luxury and won’t accept that they
offer the best opportunity of bringing modern communications to the least developed
areas,” says Michael Stocks, ex-chairman of the Global System for Mobile Communications
(GSM) Association.
The role of the state is vital, not just to ensure competition between mobile phone
operators but also to encourage ambitious projects. The ITU suggests that, just as
they subsidise water and electricity, governments could help the poorest people to
have access to mobile phones or distribute free prepaid mobile phone cards on a massive
scale. Such steps would give a big boost to a revolution that has so far been the
privy of those with money in pocket.
• World Telecommunication Development Report 1999, International Telecommunication
Union, Geneva.
• World Communication and Information Report 1999-2000, UNESCO.
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