Get Ready For Mobile Commerce In Africa

Picture this – Your car is stuck in a jam on Uhuru Highway on your way to the Airport. Your mobile phones lights up and beeps with a message: ‘Flight K47 to London delayed with 30 minutes. Confirmed seat 39A. Upgrade to First Class available. Confirm Yes/No’.

Phew!!, you sigh with relief and your loyalty towards the airline grows. In another part of town, Anne, a banker, is about leave office.

She uses her mobile phone for a quick check of her bank balance, and the local weather forecast for the evening. Anne is due to meet her sister Mici for tea.

At 5.30 she receives a text message telling her that the five star hotel just across her office has a ‘Happy Hour’, when drinks are cheaper and bites are free.

She ignores it and quickly deletes it.

Anne has given her mobile service provider permission to relay such texts. She instead opts for window-shopping and checks to see which shops have sales and special offers. She then discovers that a shoe shop is offering half the price on a brand she loves.

Anne does not know the shop, but with a few clicks on her mobile phone, she is able to obtain precise directions from where she is! Mobile commerce is becoming a reality. In this era, powerful forces and technologies have come towards us with unprecedented speed.

Penetration speed has exceeded all expectations. Annual sales of mobile phones have surpassed sales of TVs and PCs, and have reached over 600 million users in the world: and growth continues. In Africa alone there are now over 50 million mobile phone subscribers.

The number of users globally are already above that of PC owners, and will, in few years, surpass even that of households owning TVs.

The capabilities of electronic business, combined with the coverage offered wireless devices, carries the potential of drastically changing the way we live, react, interact, buy play, and operate businesses. Information and content, be it text, data or images, will be leveraged to deliver customised services in a manner unseen before.

Mobile commerce technically refers to any transaction with a monetary value, that is conducted via a mobile telecommunications network.

This represents all commerce transactions, both in business-to-business (B2B) and business to consumer (B2C). Mobile commerce is a result of convergence between two or more technologies, such as wireless communications and the internet.

Emerging new media technologies will influence when and how potential mobile commerce is unlocked in the developing countries.

Currently mobile commerce (m-commerce) is in place in Europe and Asia. Faster wireless access and packet switched technology offers fast and full-time (always on connectivity). Upgrading of the network infrastructures to 2.5 or 3G will enable a bigger range of bandwidth intensive applications.

A number of handset devices are being developed to cater for customer needs. These are PDAs – mobile phone combinations smart phones with micro browsers, and others with enhanced functions and video capabilities.

Display and input capabilities are expected to improve overtime.

We also expect to see devices with the functionality just suited for specific applications such as tracking and tracing services. Mobile location-based technologies such as GPS services, provide ability to locate mobile devices in an area within a radius of less than 30m.

Telecoms: Obviously the telecom sector being the main builders and carriers of high-speed data and Internet access are the major players in m-commerce. In Europe, telecom companies will have invested over $300 billions over a period of two to three years in licence acquisition and building networks for mobile-data transmission. In Asia telecoms are doing the same. The US has also followed suit.

Media and Entertainment: These will be a major component of m-commerce. It is generally expected that they will account for more than 50 per cent of the traffic, ranging from downloadable music, games and location specific needs.

Motor Industry: Auto manufacturers might find themselves transforming into mobile service providers. They will leverage their brands and offer attractive data services. Auto makers are known to have the longest experience in developing effective devices, and this might create a situation where motorists prefer in-built car mobile services.

Financial Services: The mobile device is undoubtedly the unmatched channel for providing financial and banking services. This device also gives financial institutions a great opportunity to expand customer relations through other services alongside core financial services. It is certain that huge potential exists in m-commerce but the key questions remains how quickly these players move.

It’s time to get ready for the mobile commerce explosion

Pauline Wangui is a telecoms strategy analyst.

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