Business Day

MTN to offer entry-level smartphone­s costing $20

- Nick Hedley Senior Business Writer hedleyn@businessli­ve.co.za

MTN and partners, including China Mobile Communicat­ions Group, have developed an entry-level smartphone costing just $20 (about R290) in a bid to boost internet penetratio­n across its 22 markets.

Largely due to the high cost of entry-level data bundles and smartphone­s, only about a third of MTN’s 225-million subscriber­s in the Middle East and Africa used the internet regularly, group CEO Rob Shuter said in Cape Town on Tuesday.

Africa’s biggest mobile phone operator is aiming to sell about 10-million of the devices over the next three years.

Moving that many of its existing customers from basic handsets would be “a major boost for internet penetratio­n”, Shuter said.

Mobile operators are trying to grow internet traffic partly to offset a long-term decline in voice revenues.

Smartphone ownership in Africa remains well below the global average. According to a study by Pew Research Center, 51% of adults in SA owned smartphone­s in 2017, falling to 32% in Nigeria, 30% in Kenya, and just 13% in Tanzania.

The “world’s first 3G smart feature phone” was developed by MTN, operating software provider KaiOS Technologi­es, chip maker Unisoc and China Mobile, the world’s biggest mobile network operator.

Priced at $20, or slightly more in markets where import duties are high, the phone would cost about half of the next cheapest entry-level smartphone in most African markets, Shuter said.

MTN planned to start selling the device, which would come with its mobile money app, from the first quarter of 2019.

While the phones would not be made in Africa, their introducti­on would give local developers an opportunit­y to create apps, Shuter said.

Li Huidi, executive vicepresid­ent of China Mobile, said the partnershi­p would be “a good foundation for co-operation between us in the future”.

In September, China Mobile opened an office in Johannesbu­rg and signed an agreement with MTN for a “strategic alliance relationsh­ip”.

The Chinese state-owned operator said at the time that the two companies would collaborat­e on “internatio­nal business expansion, internatio­nal transmissi­on interconne­ction and network resources sharing”.

Chinese telecommun­ications groups are increasing­ly looking to Africa for growth.

Huawei Technologi­es, for instance, is building two distributi­on warehouses and a research & developmen­t lab in SA as part of its ambition to be the biggest seller of high-end smartphone­s in the country by the end of 2019.

Huawei ranks third in SA — behind Samsung and Apple — in terms of sales of smartphone­s priced at $600 (about R8,500) or more.

“This year we estimate our shipments will exceed 2-million [in SA] … Next year will be more,” Zhao Likun, head of Huawei’s devices business in SA, said in a recent interview.

 ?? Freddy Mavunda ?? Internet traffic: MTN group CEO Rob Shuter says the phone will cost about half of the next cheapest entry-level smartphone in most African markets. /
Freddy Mavunda Internet traffic: MTN group CEO Rob Shuter says the phone will cost about half of the next cheapest entry-level smartphone in most African markets. /

Newspapers in English

Newspapers from South Africa