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In the area of handsets, a number of major manufacturers, including Nokia, have developed and introduced products designed specifically for the African market. Vodafone announced in May 2007 that it was launching ultra low-cost handsets for a number of markets, initially Egypt, Romania and South Africa, priced between $25 and $45 each.[1] Although this still represents a sizeable chunk of most households' disposable income, studies have found that handsets are often shared within communities to spread the burden of the initial capital outlay.

Both operators and handset manufacturers have chiefly targeted lower-income users in an effort to win and keep first-time customers, even if this means generating an initially low return on investment or spend per user.

Competition between network operators is also very fierce, resulting in lower tariffs and incentive offers to attract new users. Some have even introduced “borderless” networks to allow free roaming between states, designed specifically for rural communities, who often straddle two countries.

Another notable trend in African mobile phone usage identified has been the dominance of pre-paid, top-up cards as a means of buying credit. This has been favored over post-paid subscription services mainly because it does not require a fixed postal address, incurs low start-up cost for the end-users and exposes operators and resellers to minimal credit risk. According to a 2005 report by the International Telecommunications Union (ITU), some 87 per cent of African mobile phone customers were pre-paid users.

Mobile phones help to stimulate business at a micro-level and increase the efficiency of trade, particularly in rural areas. They can be successfully used as part of government-led campaigns, such as disease prevention or for raising awareness of the benefits of paying taxes. They can warn communities about natural disasters, as well as help seekers to find new opportunities and aid small businesses in gaining new customers. Mobile phones can also play an important role in financial services, particularly in remitting money to families from overseas or from urban to rural areas. Nigerians are known to mobilize demonstrations through SMS applications.

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[1] Mobile Telecoms In Africa: Mobile boom town, Brand Strategy, September 14 2007, Factiva

Note: The information on this page is extracted and based on the article, Mobile Telecoms In Africa: Mobile boom town.