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THE IMPACT of MOBILE SERVICES in NIGERIA How Mobile Technologies Are Transforming Economic and Social Activities

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THE IMPACT OF MOBILE SERVICES IN NIGERIA How Mobile Technologies Are Transforming Economic and Social Activities THE IMPACT OF MOBILE SERVICES IN NIGERIA How Mobile Technologies Are Transforming Economic and Social Activities By Pyramid Research March 2010 The Impact of Mobile Services in Nigeria 5 Table of contents Table of contents .................................................................................................................................................................... 5 Table of exhibits ...................................................................................................................................................................... 9 Organizations mentioned .......................................................................................................................................................12 Acronyms and abbreviations ..................................................................................................................................................14 Executive summary ................................................................................................................................................................15 1. The mobile industry in Nigeria: Context and Milestones .....................................................................................................19 1.1 Nigeria’s political, economic and socio‐demographic context .......................................................................................19 1.1.1 Political overview of Nigeria ......................................................................................................................................... 19 1.1.2 Economic overview of Nigeria ...................................................................................................................................... 22 1.1.3 Socio‐demographic overview of Nigeria ...................................................................................................................... 24 1.2 Key events in Nigeria’s mobile telecommunications market .........................................................................................27 1.2.1 History of the telecommunications industry in Nigeria ................................................................................................ 28 1.3 Key activities of the Nigerian Communications Commission (NCC) ...............................................................................29 1.4 Evolution of mobile subscriptions in Nigeria .................................................................................................................34 2. The impact of the mobile services industry on Nigeria’s economy ......................................................................................38 2.1 Relevance of mobile services revenue to gross domestic product ................................................................................38 2.2 Mobile services revenue and Nigeria’s economy ..........................................................................................................40 2.3 Telecom licensing fees, taxation and Nigeria’s economy ..............................................................................................42 2.4 Employment and distribution networks of mobile operators .......................................................................................43 2.5 Investment in infrastructure by mobile operators ........................................................................................................45 2.6 Introduction of new technologies by mobile operators ................................................................................................48 CASE STUDY: Gramjyoti – “Light of the Village” – pilot program brought Internet access to a remote area of India .......... 51 3. The impact of mobile services on overall Nigerian society ..................................................................................................53 3.1 Mobile services and market players’ strategies in enabling connectivity ......................................................................53 CASE STUDY: Mobile phones for all — ultralow‐cost handsets by Zain and ZTE ................................................................... 57 CASE STUDY: A mobile number for all ................................................................................................................................... 58 3.2 Nigerian end users’ perspective on the overall impact of mobile services ....................................................................60 3.3 The impact of mobile services in breaching the urban‐rural divide ...............................................................................64 CASE STUDY: Millennium Villages ......................................................................................................................................... 66 CASE STUDY: Village Phone Uganda ...................................................................................................................................... 67 3.4 Adoption and use of mobile services in rural and urban environments in Nigeria .........................................................70 CASE STUDY: Rural Telephone Project in Nigeria brings communications to low‐income segments through a sustainable business model ..................................................................................................................................................................... 73 Millennium Village: Pampaida, Nigeria ................................................................................................................................. 76 4. The impact of mobile services by vertical sector .................................................................................................................78 ©Pyramid Research, 2010 The Impact of Mobile Services in Nigeria 6 4.1 The impact of mobile services on the education sector ................................................................................................78 4.1.1 Examples from abroad of leveraging mobile technology in the education sector — Tanzania and South Africa ........ 80 CASE STUDY: Mobile technology brings interactive education to schools in Tanzania ......................................................... 81 CASE STUDY: Dr. Math leverages a mobile social network in South Africa ........................................................................... 83 4.1.2 Mobile services and the education sector within Nigeria ............................................................................................ 85 CASE STUDY: Longman Nigeria introduces Mobile Reading to Nigeria ................................................................................. 87 4.2 The impact of mobile technologies on health services ..................................................................................................88 4.2.1 Examples from abroad of leveraging mobile technology in healthcare —South Africa and Uganda ........................... 89 CASE STUDY: Project Masiluleke targets HIV in South Africa ................................................................................................ 91 CASE STUDY: Text To Change targets HIV in Uganda ............................................................................................................ 93 4.2.2 Mobile services and the health sector within Nigeria .................................................................................................. 95 CASE STUDY: My Question, My Answer — an HIV/AIDS counseling and education program in Nigeria .............................. 97 4.3 The impact of mobile services on digitalization and productivity of enterprises ......................................................... 100 4.3.1 Examples from abroad of leveraging mobile technology in the digitalization and productivity of enterprises — the US and Senegal ......................................................................................................................................................................... 101 CASE STUDY: Mobility pays for Intel ................................................................................................................................... 102 CASE STUDY: SMS‐based market information in Senegal boosts productivity.................................................................... 103 4.3.2 Mobile services and the digitalization and productivity of enterprises in Nigeria ..................................................... 105 CASE STUDY: First City Monument Bank finds mobile technology indispensable ............................................................... 107 4.4 The impact of mobile services on financial sector ....................................................................................................... 108 4.4.1 Examples of leveraging mobile technology in the financial sector: Australia and Kenya ........................................... 109 CASE STUDY: Australian bank ANZ offers WAP‐ and Java‐based m‐banking service........................................................... 110 CASE STUDY: Safaricom Kenya targets the bottom of the income pyramid with M‐PESA mobile banking ........................ 112 4.4.2 Mobile services and the financial sector within Nigeria ............................................................................................. 114 CASE STUDY: MoneyBox
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