4
Africa’s ICT Infrastructure
charges and different types of calls can be used to compare average prices over time and among countries. In 2009, for example, the cost of a representative monthly mobile call package ranged from $2 to $15, with an average of about $10. As networks have expanded, competition has intensified and operators have increasingly pursued new customers from low-income households, forcing mobile prices down. At the same time, the average amount of calling time used by subscribers has also fallen. These two effects have translated into operators generating lower average revenue per subscriber. The average revenue generated per subscriber in Sub-Saharan Africa fell from $43 per month in 2000 to $13 in 2008. Nevertheless, mobile call prices in Sub-Saharan Africa remain higher than in most other regions. This indicates that, although mobile prices in Sub-Saharan Africa have fallen considerably, scope can be found for further price reductions, which will benefit customers and bring mobile services within reach of more Africans. The price of fixed-line telecommunications services is similar to that of mobile services, with the cost of a standard monthly package averaging about $11 in 2008. Fixed-line prices exhibit greater geographical variation than mobile prices, however, with the cost of the standard package ranging from $2 in Ethiopia to $23 in Côte d’Ivoire. Given the low cost of fixed-line services, price is clearly not the reason for their relative lack of success compared with mobile services. Instead, other factors, such as convenience, flexibility, and the ready availability of handsets and SIM (subscriber identity module) cards, have given mobile a commercial advantage over fixed services. Fixed-line operators have traditionally kept international call prices high to subsidize unprofitable local call services. Recently, however, increased competition has limited the ability of operators to command these high prices, and prices have begun to fall. The regional average price of a call to the United States fell from just over $2 per minute in 2000 to $0.88 a minute in 2008, with the lowest price—$0.31 a minute—seen in Ghana, one of the region’s most competitive markets. Internet access in Africa remains very expensive, which partly explains why usage rates are so low. In 2008, the median price of a broadband connection was $92 per month—well above the average price in the member countries of the Organisation for Economic Co-operation and Development (OECD) and out of reach for the majority of Africans. The introduction of wireless broadband technologies is reducing prices, however, and as the number of operators providing broadband increases, these prices are expected to fall further.