Run on numbers: Robust mobile revolution boosts gig economy and fosters financial inclusion

Mobile cellular telephone subscriptions are subscriptions to a public mobile telephone service that provide access to the PSTN using cellular technology. File photo.

Mobile cellular telephone subscriptions are subscriptions to a public mobile telephone service that provide access to the PSTN using cellular technology. File photo.

Published Jun 22, 2024


Telkom stated in its latest annual report release, that mobile subscribers grew by 11.9% to 20.4 million, and mobile broadband subscribers grew by 9.5% to 12.7m.

Taking into consideration that the total population of South Africa is sixty million, one can exclude the portion of the population that is under ten years of age from the cellphone users, with some minor exceptions. That portion is ten million children and therefore the total number of potential cellphone users in the country must be sixty million.

Vodacom's 44.67m customers at the end of December 2022 increased to 47.26m by the end of September 2023. Consequently, Vodacom increased its subscriber market share among the four biggest operators from 40.5% to 42.8%.

MTN South Africa's service revenue increased from about R40, 85 billion in 2022 to R41,88bn in 2023, while its South African subscriber base jumped by roughly 893,000 to reach 37.4m in the year. “The number of postpaid subscribers grew by 4.4% for the year, reaching 4.1 m,” MTN said on March 25.

While Cell C is not a listed company in South Africa, its subscriber numbers are presented by Blue Label Telecoms which owns a large stake in the group. For its full-year results, Blue Label reported 17.2m subscribers for Cell C, up from 16.3m in the previous period.

The total of the above numbers adds up to 114,56m cellphone subscribers. Relative to a total population size of sixty-one million the ratio is 187%. If one excludes the children under ten years, the percentage of cellphone accounts to the likely user population the percentage is 225%.

– Definition: Mobile cellular telephone subscriptions are subscriptions to a public mobile telephone service that provide access to the PSTN using cellular technology. The indicator includes - and is split into - the number of postpaid subscriptions, and the number of active prepaid accounts, i.e. that have been used during the last three months.

The indicator applies to all mobile cellular subscriptions that offer voice communications. It excludes subscriptions via data cards or USB modems, subscriptions to public mobile data services, private trunked mobile radio, telepoint, radio paging and telemetry services.

– A high cellphone connection distribution can alleviate poverty and contribute to job creation. Here are ways in which widespread cell phone connectivity can help:

Access to information and services:

Mobile phones can provide access to educational resources and online courses, enabling people to acquire new skills that can improve their employability. Mobile health services (mHealth) can provide essential health information and services, reducing healthcare costs and improving overall well-being.

Economic opportunities:

Micro-entrepreneurship: Mobile phones allow individuals to start and manage small businesses with lower overhead costs. Mobile money services enable transactions even without a traditional bank account. It is well known that the many illegal immigrants in South Africa provide work, but they are unable to open a traditional bank account. Cash send enable them to receive payment.

Job creation:

Gig Economy: Mobile platforms facilitate gig economy jobs, such as ride-sharing, delivery services, and freelance work, providing flexible employment opportunities. Every one of the drivers on a Sixty-six delivery bike, can use his cell phone GPS to locate the address of an order.

Remote work: Mobile connectivity allows people to work remotely, increasing employment opportunities, especially in regions with limited traditional job prospects.

Financial inclusion:

Mobile Banking: Mobile phones enable access to banking services for unbanked populations, facilitating savings, credit, and insurance services, which can help individuals invest in businesses and education.

Social inclusion:

Mobile phones enhance communication, allowing people to stay connected with family and social networks, which can provide support during challenging times. Access to mobile technology can empower marginalized groups, including women and rural populations, by providing them with tools to improve their socio-economic status. It is a great asset for a concerned parent to be able to know they always have contact with their child or loved one.

Government services:

E-government services: Mobile phones can facilitate access to government services, subsidies, and welfare programs, ensuring that aid reaches those who need it most efficiently. It is often used to make appointments.

– Applications that run on mobile devices have exploded in recent years. Some of these apps are developed by people who are not professional developers. With the latest ChatGPT, and other similar platforms, coding has become within the reach of the ordinary citizen.

Determining the exact number of mobile apps that create an income for their developers is challenging due to the dynamic and vast nature of the app ecosystem.

– With regards to app stores and total apps, according to recent estimates, there are over 2.8m apps on the Google Play Store and over 2.2m apps on the Apple app store.

- Revenue-generating apps: Not all apps generate income. A considerable number are free and do not employ monetisation strategies. However, many apps do generate revenue through various models such as in-app purchases, subscriptions, advertisements, and paid downloads.

- Distribution of income: Industry reports indicate that a small percentage of apps generate most of the revenue. For instance, a report by Sensor Tower indicated that in 2022, the top 1% of app publishers accounted for over 80% of app revenue on the Apple App Store.

In conclusion, we can say that given the vast number of apps and the variety of monetisation strategies, it is estimated that a substantial number, in the hundreds of thousands, generate income for their developers. However, the income distribution is highly skewed, with a small percentage of apps accounting for most of the revenue.

South Africa’s internet penetration rate stood at 74.7 percent of the total population at the start of 2024. That places South Africa a few percentage points above the world average. Kepios analysis indicates that internet users in South Africa increased by 409 thousand (+0.9 percent) between January 2023 and January 2024. These user figures reveal that 15.35 million people in South Africa did not use the internet at the start of 2024, suggesting that 25.3 percent of the population remained off-line at the beginning of the year.

* Kruger is an independent analyst.

** The views expressed herein are not necessarily those of IOL or Independent Media.