How Nokia and Prepaid Airtime Fractionalization Gave Rise to Africa’s Digital Economy: Guest Post by Niti Bhan

What can we learn about the digital society emerging in Africa without the trappings of legacy infrastructure and institutions?

3 seemingly unrelated events in different parts of the world in the early to mid 90s converged, to culminate in the perfect storm  – what we now call Africa’s Rising digital economy.

One was in the mid 1990s, in a small city in northern Finland, where engineers and designers began work on the product development of a mobile phone that would eventually become one of the best selling Nokia models ever – the 3310, released in Europe and the Far East in the year 2000. The continent of Africa was not yet on their radar as a target market and Nokia’s impact on sub Saharan Africa, as well as its iconic success for its legendary durability was still some years in the future.

The second event was around the same time, in 1994 – 1995. Portugal Telecom’s mobile telephony division TMN, invented the prepaid business model whilst researching ways to lower barriers to credit services, and thus reach a wider audience. They too, were not thinking about the farmers, traders, or biashara vendors on the African continent, for whom the prepaid plan would turn out to be a godsend, matching their needs for flexibility and control over the timing and amounts spent on cellular services. This, too, was still a handful of years in the future.

The third is the liberalization of African state owned monopolies such as in telecommunications in the mid 1990s which opened the doors to private sector operators in cellular telephony, and thus, to competition.

These 3 events would prove to be a fertile time for the perfect storm and the firm foundation on which today’s African digital economy thrives.

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Why the Legacy of Uber’s App and Business Model in Africa will outlive the company

The legacy that Uber will leave behind in Africa’s mobile first decentralized digital economic ecosystem is the ability of a simple algorithm to collate disparate sources of demand for goods or services, and then redistribute them in the most efficient and productive manner among suppliers.

By Niti Bhan, 

As news of Uber’s possible decline and fall filters in, it behooves me to take a moment to ponder the implications for sub Saharan Africa’s digital economic ecosystem, particularly, the decentralized hybrid one emerging among the erstwhile informal sectors of the economy, such as motorcycle taxis like Safeboda and other on demand services.

While Uber itself has made waves in all the major urban metros across the African continent – Lagos, Nairobi, Johannesburg, etc – its inevitable end will leave a greater legacy than simply copycat taxi hailing services.

Continue reading “Why the Legacy of Uber’s App and Business Model in Africa will outlive the company”