High internet cost hindering investor activity in sub-Saharan Africa, report shows

BY Onome Amuge & Grace Airhule.

Internet affordability and its diverse application in sub-Saharan Africa have over the years been punctured by the high cost of data. This, according to industry analysts, has not only widened the digital divide between sub-Saharan Africa and other regions of the world, but consequently hindered the penetration of innovative, digital-based investments across the region.

A recent report highlighting the cost of mobile data in different markets across the world brought this to the fore following a survey of the cost of internet in 233 countries.

The Worldwide Mobile Pricing 2022 report showed that five of the 10 most expensive countries to purchase mobile data globally are in sub-Saharan Africa. This, according to data analysis, explains why internet use in most African countries remains low despite an accelerated broadband internet coverage and growing number of businesses dependent on internet connectivity.

The report showed that 1GB of data costs $29 in Sao Tome and Principe, making it the 231st most expensive in the world out of the 233 listed countries. In Botswana it costs $16 per 1GB, while Togo ($13), Seychelles ($13), and Namibia ($11) also made the list of sub-Sahara African countries with the most expensive data packages globally.

According to the report, mobile data is so expensive in these countries that 1GB costs an average of $10, 250 times more expensive than Israel, the country reported to have the world’s cheapest data at $0.04 per 1GB.

Though the report showed that internet in the sub-Saharan region is cheapest in Ghana at $0.61, followed by Somalia, Nigeria, Tanzania, Sudan, Eswatini, Kenya and Mauritius where 1GB of mobile data costs less than a dollar, none stood in the list of the 40 most affordable countries.

Data affordability in the region is also in sharp contrast to countries such as Italy, San Marino, Fiji, India, Kyrgyzstan, France, Moldova, Uruguay, and Nepal where data costs below $0.28 per 1GB.

Commenting on sub-Saharan Africa’s high data valuation, Dan Howdle, consumer telecoms analyst at price comparison site Cable.co.Uk, said, “At the more expensive end of the list, we have countries where often the infrastructure isn’t great but also where consumption is very small.”

Howdle observed that a large number of people in the region are often buying data packages of just 10 megabytes at a time, making a gigabyte a relatively large and therefore expensive amount of data to buy.

A 2021 report by Statista attributed the high cost of data usage to various factors, including unavailability of infrastructure and high taxation in the African telecom industry.

This, it explained, has hindered economic growth and slowed job creation in the region, considering that many businesses in today’s world are largely dependent on internet connectivity for effective operation.

How affordable internet can be enhanced in sub-Saharan Africa

There is no gainsaying that today’s global economy is largely driven by digital innovations across all sectors of the economy. As a result, the adoption of data connectivity has played significant roles in the development of sectors such as agriculture, health, education, trade, among others.

On a global scale, the internet has enabled individuals, organisations and government establishments to exploit socioeconomic opportunities like never before. It has also led to the growth of digital economies and the penetration of venture capitalists and tech investors.

For sub-Saharan African countries to enjoy the boundless opportunities at affordable rates, analysts have called on the governments in the region to consider driving down the cost through the establishment of broadband policies.

Temitope Osurinde, vice president for marketing at Tizeti, West Africa’s pioneer solar-based internet service provider, noted that though it may be difficult to reduce the poverty level in Africa, it is easier to provide the enabling infrastructure for people to derive value online and contribute meaningfully to the digital economy.

Osurinde added that efforts, including partnerships between the government and private organisations, can help lower the price of internet-enabled devices. He further suggested that financing mechanisms to reduce the upfront cost to consumers will ensure more Africans have access to the internet