Africa has, for all intents and purposes, emerged as a poster-boy of the global economic market. It has silenced its critics in several fields, including (but not restricted to) banking, education, agriculture, activism, etc.
The continent’s digital content space is no different. The segment has, over the years, grown by leaps and bounds, all while emphasising on the adage, “Content is King”. To illustrate-according to Statista, revenue from the digital media space in Africa and the Middle East is currently pegged at $882 million (2016). The largest segment within this market is video games, with market volume of $522 million. Equally sought after are online television, video streaming, gaming and social media. By 2019, as per Ovum, this order is likely to change to mobile based e-commerce and health and video applications.
So, what is driving this juggernaut? In a nutshell, a combination of rapid smartphone uptake and high demand for fast and accessible data are responsible. As is well known, the smartphone has made quite a splash in Africa. This is, as per industry reports, largely owing to a rapid decline in the average selling price of these devices. The bottomline is this-the availability of sub $100 smartphones implies that customers for whom devices such as desktop computers, laptops and tablets were financially out of bounds earlier now have the option of accessing data through smartphones. The result? Mass market adoption of smartphones, of course! Moving on to the larger picture, this is expected to have a three-fold impact on smartphone availability-to the tune of 540 million devices in 2020. Meanwhile, the number of mobile broadband connections in Sub-Saharan Africa is also set to increase from 24 per cent in 2015 to 57 per cent by 2020.
It stands to reason that the increase in smartphone demand will lead to a spike in the demand for fast and accessible data. This is overtly true, in Africa’s case, at least. According to industry reports, African countries have been developing high performance networks with at least 41 countries already using commercial 3G networks, and 23 countries having access to 4G networks. Going forward, by 2020, about three-quarters of all mobile connections will be on 3G or 4G, while Wi-Fi (another means to access the internet) is being offered free in a number of towns and cities.
Clearly, then, the explosion of digital content in Africa ought to be no surprise at all! For a clearer picture of what may be in store, here’s a quick laundry list of content that is likely to shape the industry, going forward:
It will come as no surprise that the continent’s youth segment is largely responsible for pushing gaming. This, too, is driven by the availability of games that come with a “made in Africa” tag. Essentially, these offerings are both culturally relevant and available on a variety of devices. It doesn’t end there, though-going forward, as per Statista, mobile gaming in Africa and the Middle East has registered double digit growth, from $228.6 million in 2015, slated to jump to $261 million in 2016. Age-wise, the 25-34 age group form the largest fragment of the 23.8 million global mobile gaming community while the 45 years and over segment are the least. Overall, the segment, as per PriceWaterHouseCoopers, is worth at about $217 million.
As per industry reports, the video segment in Africa is expected to witness a 45 per cent compound annual growth rate (CAGR) between 2015 and 2020. Of this, video-on-demand is beginning to hog the spotlight, with close to 100 platforms entering this very lucrative space.
According to The 2012-2017 Africa Mobile Learning Market report released by Ambient Insight, the five-year CAGR for the M-learning market in Africa is 38.9 per cent. Revenues are expected to increase more than five-fold to reach $530.1 million by 2017, up from $102.4 million in 2012.
Existing Grey Areas
Now for the flip side. Despite the very rosy picture portrayed by the space, it does have a fair number of grey areas which are yet to be tackled in a satisfactory manner. I allude to the issues of the lack of locally relevant content, high total cost of ownership, low literacy rates and the quite substantial gender gap across the continent.
Overall, though, the argument still stands-Africa is in tune with technology. This isn’t a distant dream propagated by armchair analysts anymore, it is an affirmation. The rest of the world, are you listening?