ICT Services Are Getting More Affordable – Africa Sees A Big Gain In Penetration

International Telecommunications Union (ITU) reports that cost of bandwidth is going down (hope you do not need ITU to know that, anyway). The adoption of internet, usage and global penetration of ICT is on the rise. Costs of entry-level ICT services are lesser by 18% compared to two years ago and broadband cost has dropped by 50%.

Data from ITU’s 2010 ICT Price Basket also shows that relative prices for mobile cellular services decreased by almost 22 per cent from 2008 to 2010, while fixed telephony costs declined by an average of seven per cent over the same period, while the number of mobile cellular subscriptions worldwide grew from 4.0 to 5.3 billion.

Covering 165 economies, it is the only price basket to monitor the affordability of ICT services worldwide. This year’s IPB figures underline the fact that pricing remains a major factor in perpetuating the ‘digital divide’ between rich and poor. IPB results revealed a close link between the affordability of ICT services and national income levels. People in high-income countries pay relatively little for ICT services, while those in the world’s poorest countries pay relatively more.

The key highlights are:

 

• Consumers are paying 18% less for ICT services than they were two years ago

 

• The price for high-speed Internet connections dropped by 52% between 2008 and 2010, compared to a 22% drop in prices for mobile cellular services
  

 

• In developing countries, fixed broadband prices dropped by 52%, compared to 35% in developed countries
  

 

• Countries with the relatively cheapest broadband prices are high-income economies and include Monaco, Macau (China), Liechtenstein, the US and Austria

 

• In 2010, the cost of ICT services averaged 1.5% of GNI per capita in developed countries, compared to 17% of GNI per capita in developing countries
  

 

• Customers in 31 countries – all of them highly industrialized economies – pay only the equivalent of 1% or less of average monthly GNI per capita for an entry-level broadband connection but in 19 countries, a broadband connection costs more than 100% of monthly GNI per capita.

 

• Relative overall prices decreased by over 50% in Azerbaijan, Bhutan, Sri Lanka, Bangladesh, Venezuela, Guyana, Uganda and Austria

 

• Nine out of the top ten countries showing the greatest decrease in the ICT Price Basket value were from Africa –  of them had high values (i.e. high prices) to begin with

 

• While ICT prices are falling in all regions of the world, the greatest price drops occurred in Africa, where fixed broadband prices fell by over 55% and mobile cellular prices by 25%…

 

• …but Africa continues to stand out for its relatively high prices. Fixed broadband Internet access in particular remains prohibitively high and costs on average almost three times the monthly average per capita income