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Handheld Technology

Moto E Won't Make A-Grade in Africa Just Yet

This week Motorola launched a new Android phone, the Moto E, aimed at first-time buyers. Priced at US$129, the handset will be pushed through 80 carriers in 40 different countries and is designed to crack the low end of the global smartphone market.

Its arrival has already gone down incredibly well in India. Flipkart, the sole Indian retailer for the Moto E, saw its online shopping site crash within minutes of the handset launch on Wednesday evening, a repeat of what happened in February when its predecessor the Moto G was launched. But India is one of the more developed emerging markets when it comes to telecoms. Africa does not have the domestic players to create a fiercely competitive smartphone market. There is no native competition to undercut.

Whilst handsets such as the Moto E will make the smartphone a more realistic and viable option over here, I cannot see the devices actually being taken up en masse by first-time smartphone buyers in Africa anytime soon. The handset will undoubtedly help break down the barrier-to-entry by adding to the downward pressure on price, but it has a long, long way to go. Handset manufacturers like Tecno are targeting Africa heavily to achieve growth, with devices priced as low as $16, and smartphones starting at just $80. Motorola needs to knock around 60% off the price tag before it can be attractive to most Africans. The 'priced for all' smartphone is most certainly not priced for all emerging markets.

Until Motorola and other manufacturers wake up to this fact they will be missing out on a tasty, and not to mention lucrative, slice of the pie. The opportunities for growth within the smartphone market do indeed lie at the low end, which manufacturers clearly understand.  What they do not seem to be appreciating is that Africa presents the greatest window of opportunity before smartphone saturation levels are reached.  Just ask Tecno.

While smartphone penetration in developed countries such as the UK is projected to reach 90% sometime between mid-2016 and the end of 2017, Africa is predicted to reach only around 30% penetration by the same date. The smartphone storm is coming, but the death knell for the feature phone will not be ringing out just yet. It will only start sounding when manufacturers develop a cheap handset, in relative terms, with emerging markets in mind that they will realise the potential that Africa offers.

 

Amr Shady is CEO and co-founder of TA Telecom, a telecoms managed service provider in the Middle East and Africa

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Amr Shady

Amr Shady is CEO and co-founder of TA Telecom

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