The future of emerging markets still lies in mobile

Advancements in mobile will have a positive effect on emerging markets. That’s been true for some time and, if the chatter both at the recent Mobile World Congress and around the tech scene is anything to go by, it will continue to be true for the foreseeable future.

There is a definite increase in awareness of emerging markets and the potential for massive growth in mobile therein. People increasingly believe that the next couple of billion connections will be in emerging markets, resulting in a substantial investment in upgrading networks and mobile infrastructure in these countries.

The importance of the transformative nature of mobile and its ability to lift people from poverty is exciting. We are seeing a strong trend towards everyone in the industry, including big brands, taking responsibility to ensure the public is connected. An interesting statistic is that for every 10% increase in broadband penetration there will be a 1.4% growth in the GDP for lower income economies.

Looking at trends in mobile social media, Facebook revealed that 90% of its users in Nigeria and South Africa access Facebook via mobile. Thirty percent of all Facebook registrations in India to date have been done via mobile. The fact that mobile allows anytime, anywhere connectivity and that people can upload content as and when they want to has been the biggest draw to mobile.

Bret Taylor, CTO of Facebook, reckons that Facebook and mobile were made for each other and if the mobile technology of today had been around when Facebook was created, it would have been designed for mobile first.

It appears that there will be a strong drive from Facebook into emerging markets as it believes developed markets are mostly saturated. This strategy ties in closely with general mobile trends in emerging markets.

Mobile money is also a hot trend and the issue of banks and mobile operators fighting for the same customers is increasingly under the spotlight. While it seems mobile operators are in a better position than banks, using their vast distribution networks as money shops, they will mainly be dealing with smaller transactions.

Banks will continue to deal with larger transactions since they specialise in these processes in addition to being well informed on security and regulatory requirements that are involved. It is amazing to see the potential that mobile money offers. It is an incredibly effective way to move cash around and, once again, anyone who has a mobile device has access to this service. It will be interesting to see how banks and operators come together to address this growing market of users.

There is a sense of urgency in using mobile to address humanitarian and social issues. At MWC, chairman of Airtel Sunil Mittal, appealed to the mobile industry to float a tender for 100-million smartphones in an effort to drive prices down to below US$50 per smartphone. As he put it, “Broadband is a game changer in the US and Europe but a life changer in emerging markets.” It is indeed everyone’s responsibility to drive costs down to get smartphones into people’s hands.

The recent announcement by the GSMA of its Disaster Response initiative was also widely praised. It aims to create more resilient mobile networks that can be restored as quickly as possible after natural disasters. This resilience is based on having backup power solutions, spare network capacity and encouraging inter-industry cooperation.

These trends are steadily making their way into emerging markets like South Africa. The real key will be tapping into these opportunities and making them work in businesses, while at the same time empowering the population at large with mobile.