GSMA seeks $20 devices to bridge usage gap, improve connectivity
06 November 2024 |
3:08 am
To address the handset affordability barrier, the Global System for Mobile Telecommunications Association (GSMA) has stressed the need to have about $20 devices to bridge the global usage gap.
To address the handset affordability barrier, the Global System for Mobile Telecommunications Association (GSMA) has stressed the need to have about $20 devices to bridge the global usage gap.
Stressing this, GSMA said it has established a global coalition, which involves key stakeholders, coming together to advance innovative solutions to enhance handset affordability for low- and middle-income countries (LMICs). It disclosed that members include major global mobile operators, vendors, device ecosystem players, international organisations and financial institutions.
As part of that initiative, the GSMA published research to assess the affordability of different device price points. It noted that there is no comparable device affordability target as there is for mobile data, where the ITU has set an aspirational target of ensuring that an entry-level, broadband subscription costs less than two per cent of income per capita.
According to it, the first step of the analysis was therefore to determine the proportion of income at which a device could be considered affordable. This was done by considering device affordability in countries with high smartphone adoption and comparing entry-level, device price points with mobile data prices.
The results suggested consumers can access devices at around 15 per cent to 20 per cent of their monthly income. GSMA said the median, entry-level, Internet-enabled device cost in LMICs is around $50. It pointed out that with 3.1 billion people living in an area with mobile broadband coverage but not using the Internet, around 700 million people (or nine per cent of the global population) could potentially afford a device of $50, based on an affordability of 20 per cent of monthly income.
The telecoms advocacy body stressed that a device of $20 could be affordable to around two billion currently unconnected people, making a potentially significant impact on closing the usage gap.
However, it said that based on the latest device pricing data for 2023, only 12 LMICs had devices available for $20 or less in 2023. “This suggests that achieving lower price points is a necessary but not sufficient condition to enable the unconnected to access devices. In particular, two additional challenges need to be addressed.
“First, many consumers may not be able to afford a device as a one-off cost but could instead repay over a longer period if they had access to innovative device financing schemes. Such schemes should therefore be developed, tested and eventually scaled when they become sustainable.
“Second, improving access to devices cannot rely only on ensuring consumers can pay. Efforts should also be focused on increasing perceived value and willingness to pay for consumers, by ensuring devices meet their needs,” it stated.
In terms of data price drop, GSMA noted that affordability of one and five GB continues to improve across most regions. The body noted that overall, the affordability of 1 GB was relatively unchanged in 2023 compared to 2022.
While the affordability of 1 GB became slightly worse in East Asia and Pacific and South Asia, it significantly improved in Sub-Saharan Africa, where more than 40 per cent of countries saw the affordability of 1 GB improve by more than 10 per cent.
GSMA said in most LMICs, the affordability of data plans either stayed the same or significantly improved. Meanwhile, the affordability of 5GB continued to improve in 2023, as operators continued to respond to greater demand for mobile data with cheaper tariffs, enabling consumers to access more data affordably.
Specifically, the regions where 5GB affordability improved the most over the last year were East Asia and Pacific, Latin America and the Caribbean and SSA.
In the latter, almost 50 per cent of countries saw the affordability of 5GB improved by more than 10 per cent.
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