ICTlogy

Abstract:

This paper is part of a series that contributes to evidence-based Information Communication Technology (ICT) policy formulation and regulation on the continent by providing decision makers with the information and analysis necessary to assess the regulatory impact and policy outcomes of telecommunications reform against actual sector performance.

This paper reports on the findings of the second household and individual user survey of access and usage conducted by RIA between 2007 and 2008 across 17 African countries. It builds on the first household survey conducted by RIA in 2004/5 and a number of subsequent supply-side studies that have demonstrated that across the continent, even where there has been overall sector growth, sector performance has been sub-optimal. For the most part, the primary national policy objectives of delivering affordable access to telecommunications have not been met.

What the studies confirm is that mobile telephony is addressing the gap between those who have voice services and those who do not. However, the divide between those able to access the Internet and the range of enhanced services that have become necessary for effective citizenry and consumer participation, and those not able, has widened. This is not only as a result of limited access but also due to the high cost of communications that not only inhibits access but also constrains individual communication and inflates the input cost to business.

This demand-side survey provides insight into the continued marginalisation of large numbers of Africans, even from basic communications services, and confirms the sub-optimal use of communications services due to the high cost of access to services. The value attached to accessing and utilising communications is evident in the considerable portion of household income spent on communications and the multiple strategies used by individuals to maintain communication access according to their cash flow and the prices of alternatives.

The willingness-to-pay model arising from the survey suggests that relatively small reductions in the cost of equipment and services would result in increased uptake and usage, with a significant growth in revenue for operators. There is also evidence of considerable pent-up demand in countries such as Côte d’Ivoire, for example, where the amount that those without mobile services would be willing to pay for a handset is roughly the same price as the real cost of a handset.

What these findings indicate is that sector reforms have generally been sub-optimal. The introduction of limited competition particularly in mobile services has indisputably improved access particularly to voice services but insufficient competition or effective price regulation has constrained take-up and usage amongst those who have access to communication services and resulted in high prices.