MTN Collaborates IDC on Affordable Smartphones for Internet Penetration

MTN Nigeria has once again suggested that massive rollout of LTE broadband services can become more profitable through increased shipment of affordable smartphones in the country.

Speaking during quarterly seminar organised by the Nigeria Information Technology Reporters’ Association (NITRA) in Lagos recently, Mr. Olusegun Salami, senior manager, Transmission Access Planning Network Group at MTN, said that the actual journey of broadband penetration started in 2007, with the launch of the third generation technology called the 3G, which ended the era of narrowband service provided through the 2G networks.

In a paper presentation titled: ‘Foreign Direct Investment-An Impetus To Achieving Ubiquitous Broadband Penetration,’ Salami said Nigerians were beginning to see significant improvement in broadband penetration, but explained that by 2017, when more service providers must have launched their LTE services the broadband landscape would change.

According to him, Nigerians would experience faster browsing speed and navigation, while on the internet stressing that smartphone, which would help drive the use of broadband internet, must come cheap.

Salami’s position falls in line to Q4 2014 Handsets Tracker released by International Data Corporation (IDC), which indicated that smartphone shipments to Nigeria soared 135 percent year-on-year (y/y) in 2014, spurred by the increased availability of low-cost models and dual-SIM devices.

According to IDC, smartphone penetration in Nigeria today is arguably the highest in the world.

In 2013, over 10 million smart devices worth $1 billion (N167bn) were sold in Nigeria, according to analysts.

Smartphone shipments to the Middle East and Africa (MEA) saw unprecedented y/y growth of 83 percent in 2014, the majority of the growth in the smartphone category was witnessed in countries with larger populations but previously low penetration rates like Nigeria and Kenya. Kenya experienced the second fastest growth of 112 percent in smartphone shipments.

According to IDC, smartphone’s accounted for 41.9 percent of all mobile handset shipments to the region in 2014, up from 27 percent in 2013, with the overall handset market expanding 19.6 percent in volume y/y.

Feature phones have been hit hard by the increased availability of more affordable smartphones, with shipments down 4.5 percent y/y in 2014.

Smartphone priced under $100 captured 20 percent share of the MEA smartphone market in 2014, up from just 5 percent in 2013.

However, Salami said, “It is for this reason that MTN decided to come with low pricing smartphone that will enhance increased use of the internet, through mobile devices”.

He disclosed that fibre system remains the best way to achieve broadband penetration in an economy with population like Nigeria, adding that MTN is appreciative of Government efforts in employing policies to further open up the economy in a manner that the economy will be able to attract more FDI noting that further devaluation of Naira will attract FDI.

Salami lauded Government for moving in the direction of increasing its investment in the development of the nation’s infrastructure particularly in the areas of electricity power supply, roads, telecommunication saying that such would reduce the cost of doing business thereby wooing more FDI.

The Senior Manager, Transmission Access Planning Network Group at MTN, called on the Government to encourage production activity via production incentives and/or subsidies in order to increase the nation’s GDP.

Dr. Emmanuel Ekuwem, chairman of the occasion and group chairman, Teledom Group, cautioned against the devaluation of the naira in order to encourage FDIs noting that it place indigenous investors at disadvantage.

According to him, the interest of local investors must not be sacrificed on the altar of encouraging FDIs, adding that local investors are important in local content creation to enable the country compete favorably in the internet business.