The recent recent report, by Global System for Mobile Communications Association (GSMA), that Nigeria broadband device market value has reached a N245 billion business is no news. What is news is how the nation has accomplished such within a about decade. That means the nation just expanded the economy, through broadband devices, by N245 billion within a decade.
As mobile devices penetrate and government sustains the deregulation of the telecom market, the market will easily double within three years. Data services is a huge opportunity we are yet to tap and it is time operators move into that domain since voice has become a no differentiator. Selling prepaid minutes is a commodity business and the margin has consistently gone lower. What companies need to do now is to find that new source of value.
That will come through VAS (value added services) where third parties will play more active roles in the services that are added in the ecosystem. As broadband price drops, more gadgets will be bought and more growth in the market will be expected. People will buy gadgets to connect online.
Nigerians will move into the domain of tablets and networks. However, companies will not adopt that immediately. The need to save cost will not encourage them to use dedicated devices. We think the consumer world will mature for these devices before they diffuse into the corporate market.
We also think that cybercafe will consistently diminish in importance and more people have access to the web through their devices. Tekedia expects the cybercafe industry to drop by 80% in Nigeria within the next five years. There is no future in this business model. As business pressure forces the telcos to lower tariff on their different packages, cybercafe will go.
Nigeria has the buzz in mobility in Africa now. We are coming late, but the prospects are very good. If penetration continues to take effect, the broadband device market can add N0.5 billion to our GDP in five years. Five years is certain, but this can happen in three years if the fiber optic high speed cables are completed in time.