The global transition to 5G is in full swing; there were 103 live 5G networks in 45 countries and territories around the world as of September 2020. GSMA Intelligence estimates that the number of 5G connections will reach 172m globally by the end of this year, representing just over 2% of total mobile connections.
Asia is ahead of the rest of the world; China alone accounts for around four in five 5G connections today, while in South Korea 5G accounts for nearly a fifth of total mobile connections.
The 5G era in Africa formally began in 2020 with the launch of commercial 5G mobile and fixed wireless access (FWA) services by two of the continent’s biggest mobile service providers, Vodacom and MTN, in South Africa. Indeed, the move came sooner than expected after the South African government assigned temporary spectrum in the 3.5 GHz range in the wake of the Covid-19 pandemic.
Elsewhere in Africa, Telma Madagascar and Cable & Wireless Seychelles have announced plans to launch commercial services, while 5G trials have been conducted in Egypt, Gabon, Kenya, Morocco, Nigeria, Uganda and the Indian Ocean island of Réunion.
The 2020s will see more widespread 5G activities, with commercial services set to become available in some of the continent’s biggest markets by 2025. By then, there will be just under 45m mobile 5G connections in Africa, equivalent to 3.3% of total mobile connections. This pales in comparison to the global average of 21%, and underscores the GSMA’s view that mass-market adoption of 5G is not imminent.
This view is based on both commercial and regulatory realities. From a commercial perspective, it is hard to justify the capital outlay for mass-market 5G deployment against current levels of demand for enhanced connectivity and use cases in Africa. From a regulatory perspective, the need to support traditional voice services for the foreseeable future makes leapfrogging difficult.
In markets where lots of voice traffic still runs over 2G networks and devices on 2G mode, it will be difficult to skip 4G and migrate to 5G without first taking steps to migrate 2G/3G voice to VoLTE over 4G networks.
In the short- to medium-term, therefore, governments and the mobile industry in the region will focus on efforts to increase 4G adoption among mobile users. This will involve strategies to make 4G devices more affordable and the provision of relevant digital content to drive demand for enhanced connectivity services.
A higher level of 4G adoption and demand for enhanced connectivity services will be crucial to preparing consumers for 5G, as well as strengthening the business case for 5G deployment for mobile industry players.
That said, as a natural progression from previous generations, 5G is inevitable and will ultimately thrive in Africa. The role of 5G in the future connectivity landscape is not in doubt, given the increased urgency for enhanced connectivity services for households and businesses during the Covid-19 pandemic.
Key expectations
So, how will the transition to 5G play out in Africa and what impact will the technology have on digital transformation in the continent? A good place to start is to understand the features and potential applications of 5G.
As an evolutionary technology, 5G will perform all the functions of 4G with the potential for more, and at a significantly greater scale: super-fast download speeds, extremely low latency, and high levels of reliability, capacity, device density, flexibility, and spectral efficiency. 5G will build on the successes of previous generations by delivering a platform that enhances existing services and enables new business models and use cases in the enterprise and consumer segments.
With this in mind, key expectations for 5G in Africa include the following:
5G will bring more homes and enterprises online: Covid-19 has put a spotlight on digital connectivity for people and enterprises, as many everyday activities, including work and learning, moved online during lockdown. Given the limited access to fixed broadband connectivity (fixed broadband penetration is typically below 2% in African countries), the immediate opportunity for 5G is to use FWA to bridge the gap in enhanced broadband connectivity for homes and enterprises, both large and small.
5G will facilitate the Fourth Industrial Revolution (4IR): Before the pandemic, some governments in Africa publicised their ambition to implement the concept of the 4IR. The pandemic has made such plans even more imperative, as 4IR solutions could be crucial to improving productivity and efficiency in the economy, as well as strengthening economic resilience going forward. 5G will enable intelligent connectivity – the fusion of high-speed networks, artificial intelligence (AI) and the internet of things (IoT) – which will support new and existing solutions to transform industrial processes and generate significant social and economic benefits. Key sectors in the region that could benefit include manufacturing, agriculture, financial services and the extractive industries.
5G will encourage tech innovation: Africa has a vibrant tech ecosystem, supported by a network of more than 600 tech hubs, a growing number and wide variety of investors, and the activities of mobile operators which, in many cases, provide key assets, including APIs and distribution networks, to tech startups. 5G-specific attributes, such as low latency and high device density, will create new opportunities for tech startups to develop innovative and locally relevant solutions for the benefit of society. Key sectors that can benefit from 5G-enabled transformative tech include healthcare, financial services and entertainment.
5G will enable new consumer services: Beyond enhanced mobile broadband (eMBB) for the consumer, 5G is well suited for immersive use cases, such as augmented reality (AR) and virtual reality (VR). These are undeveloped in Africa, partly because of the lack of connectivity to power such services. For example, 5G could support the streaming of live social events, such as weddings, which has become a popular way for well-wishers who are unable to attend in person, due to the travel and crowd restrictions brought about by the Covid-19 pandemic, to still participate in those ceremonies.
5G will help address network congestion in city centres: 5G will play a role in addressing network congestion in city centres, as an important part of the infrastructure options to support high traffic density. The problem of high traffic density will become more pronounced in the region as the rate of urbanisation picks up and cities become more densely populated. Urbanisation in Africa will grow from 38% in 2015 to 55% in 2050, while around 100 cities in the region will have more than 1m inhabitants by 2025, according to the UN.
5G will generate measurable social, cultural and economic benefits for the region: The GSMA estimates that mobile technologies and services generated 9% of GDP in sub-Saharan Africa in 2019 – a contribution that amounted to more than $155bn of economic value added. This figure is expected to increase significantly in the 5G era, especially as the technology will have a greater application in enterprise use cases, compared to previous generations. Socially and culturally, 5G will be the catalyst for significant long-term changes in the way people live, work and play, beyond what has been experienced with existing technologies.
Next steps
In view of the role that 5G will play in the future connectivity landscape in Africa, it is essential for all stakeholders, including governments, enterprises, service providers and other stakeholders, to put in place the necessary building blocks to maximise the opportunities that the technology can bring to society. These include making 5G spectrum available at an affordable price, supporting cost-effective network deployment, increasing digital inclusion among underserved population groups, and working together to develop relevant 5G use cases and applications for the local market.
The author is director, social and regional research, GSMA Intelligence
