The Mobile Phone Revolution and Digital Inequality: Scope, Determinants and Consequences

In the 21st century, the digital economy is one of the most important drivers of global economic growth and innovation. Infrastructure, hardware and software that enable the rapid transmission of large amounts of information between people, businesses, devices, networks and systems are increasing global economic integration, efficiency and productivity. For many, especially in low income countries, the mobile phone serves as the gateway to the digital economy. Advances in smartphone handsets and value-added services, such as mobile money and mobile internet, have revolutionised communication, access to information and banking for even the poorest households. As global mobile phone penetration rates continue to increase, there is a tendency to assume that the first-order problem of mobile phone access is approaching obsolescence.

This background paper takes a critical look at this supposition. It makes three main points. First, it is indeed the case that the mobile phone represents the most accessible information and communication technology in history. But there is also a stubborn persistence to mobile phone inequality. A core set of socio-economic factors – education, income, gender, and age – continue to constrain mobile phone ownership and, importantly, the migration to more advanced mobile phone technologies (smartphones) and services (mobile money and internet). Second, precisely measuring mobile penetration poses a number of challenges. And the true extent of mobile phone ownership is likely to be inflated. Over counting risks inadvertently widening the digital divide: programming and services are developed that seemingly support a broad set of users but, in reality, are failing to reach an important subset on the margins of digital inclusion, leaving them further behind. Third, even as penetration rates increase, mobile phone ownership among low-income households is much more irregular than generally recognised. The issue of the prevalence of handset and SIM turnover – in which users are losing and then having to re-acquire mobile technology – has been neglected, but represents a critical source of digital inequality. The paper concludes by discussing potential policy solutions to mobile turnover and working within existing socio-economic constraints to increase digital inclusion.