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Mobiles in Africa – a market we shouldn’t ignore

Charlotta Hedman

The mobile industry in Africa is booming. It is the fastest growing mobile market in the world and according to the BBC almost 75 percent of the continent’s one billion people will own a mobile phone this year.

Not many tech companies decide to launch in Africa, but perhaps they should. According to The Economist the International Monetary Fund expects Africa to grow at the same rate as Asia this year, 6 percent. And in the ten years from 2000 to 2010, six of the world’s ten fastest-growing countries were in sub-Saharan Africa: Angola, Nigeria, Ethiopia, Chad, Mozambique, and Rwanda. In eight of the past ten years, sub-Saharan Africa has grown faster than Asia, writes the Atlantic.

So what has happened in a continent that was once regarded as too poor for mobile phones? Some argue that it’s partly because of mobile technology that some Africans and some African countries have started competing with the economic boom in Asia.

“The advent of mobile telephones has brought instant communications to hundreds of millions of Africans, rich and poor, urban and rural. Africans are now on the move. Text messaging and digital money-transfer services, such as Safaricom’s M-pesa in Kenya, have transformed ordinary life.“, writes the Atlantic and adds that a commodities boom has also helped African economies.

Interestingly the technological revolution has happened largely without the help of aid workers and development agencies.

Blogs like Afrinnovator show that there is a burgeoning start-up scene in Africa. But some European start-ups are also taking note. In a recent edition of the Music Ally Report there was an interview with mobile music start-up, Spinlet. The company was founded in Finland, but target mobile music users in Africa .

The company is launching their app in Nigeria and South Africa and plan on breaking into the “final frontier of emerging markets” (the rest of Africa). Historically there have always been strong links between Finland and Africa. Finnish aid organisations have had a presence in countries like Tanzania for over 40 years. Another Finnish giant, Nokia, have a strong presence in emerging markets, which is why Spinlet also have Symbianversions of their software.

Spinlet is a mobile app that allows users to download music to their phones. They offer a two-tier model, where users can either download music or pay for a subscription. The company is focusing on both local music and international artists, where they have already built a relationship with rights holders.

The African market is huge, with about 50 million smartphone users in total at the moment. Nigeria has the highest number of mobile phone users in Africa, 93 million, which according to the BBC is 16 percent of the continent’s total mobile subscriptions, which might be why Spinlet is launching its services there and in South Africa.

But the problems in Africa are also an exaggerated version of what we see in Europe and the States. Piracy, in the sense of physical copies being sold on the street, is a huge problem.

“The market is growing at a fast pace, but there is zero legal music revenue being generated above South Africa and below the Sahara”, Sami Leino, COO of Spinlettells Music Ally.

According to some reports music piracy is having an even more violent effect on artists in Africa. In South Africa gospel artist Lusanda Mcinga was assaulted when she confronted a shop owner who was selling illegal copies of her CDs.

And in Cameroon one of the country’s most popular musicians, Ekambi Brilliant, told the crowd at a conference on piracy that many of the country’s musicians were too poor to pay for their health-care.

“This is because they made little or nothing from their work as musicians and this too because pirates undercut them and made money that should have rightly gone to the real authors of the music”, Ekambi said.

Although some argue that musicians in Cameroon add to the problem and have been caught pirating the works of their more successful colleagues.

Part of the African continent might be on the way up, but many of its one billion inhabitants still live below the poverty line. Sami Leino of Spinlet recognises the challenges and tells Music Ally that their pricing model has been adapted to a market where many of the consumers earn about $200 net per month. In a market like that it’s not possible to charge a dollar per song. But the country’s many mobile users and growing economies are still largely an untapped market. If start-ups like Spinlet manage to offer a viable alternative to piracy, there could be many opportunities for mobile and music companies on a continent that has often been over-looked in the tech industry.