The Impact of Global System for Mobile Communication (GSM) Revolution on Low Income Earners in Nigeria
Efe-Omojevwe, Zelda. A and Adesope, Olufemi M.
Department of Agricultural Economics and Extension University of Port Harcourt, Rivers State, Nigeria
Corresponding author’s email: email@example.com
revolution of information and communication technology (ICT) has brought
assurance to many people especially low income earners that they can
feed themselves or families, provide shelter for selves and have a
secured future. The Global Service for Mobile communication (GSM) serves
as a tool for economic, political and social interactions among people
of all profession, classes and status. The GSM is said to have improved
the capacity of small-scale entrepreneurs who rely on it as an important
means of communication needed to be able to do their jobs. The GSM usage
has also helped to bridge the communication gap between urban and rural
dwellers as was witnessed in the Niger Delta area of Nigeria.
(2009) noted that about 80% of Nigeria’s population are located in the
rural areas and to ensure the people’s security, there is the
important need for access to information and knowledge. Official
statistics shows that Nigeria has a telephone subscriber base of about
70million (NCC, 2010), of which about 62million are GSM subscribers.
Before now, access to telephone was the exclusive preserve of the rich
and privileged few in the country until 2001 when the GSM was
introduced. The first set of licensed mobile telephone operators were
ECONET wireless, now Zain; MTN and MTEL (a subsidiary of Nigerian
Telecommunications Limited, NITEL). In 2002, a fourth Digital Mobile
Licence (DML) was issued to Globacom Mobile (Glo).
2007, licences were granted to four indigenous firms in Nigeria to
operate 3rd generation (3G) mobile telephony technology. The 3G spectrum
which is a kind of broadband technology gives a wide area of wireless
voice telephony, video calls, wireless data transfer, simultaneous use
of speech and data services. It also increases the rate of information
transfer which is known as spectral efficiency.
NCC (Nigeria Communications Commission) has granted more licences such
as the Second National Operator (SNO) issued to Globacom, Fixed Wireless
Access (FWA), Unified Access Service Licences (USAL), Licences granted
to 24 companies on regional basis and 3G Licences granted to four
companies. According to the New Telecoms Frontier Reports of 2010, about
5million jobs have been created directly and indirectly in the telecom
industry and these include people that are directly employed by GSM
operators, dealers, vendors of GSM accessories, recharge card sellers
and printers as well as the ubiquitous ‘umbrella stand’ operators.
Indirect employment that has been created include jobs created through
contracts to construction firms, research companies, advertising
agencies and media consultants as well as suppliers of diesel and
order to encourage the emergence of internet services, the commission
has licensed several internet service providers (ISPs) and has also
initiated a class of licensing regime to simplify authorisation
processes for cybercafés and telecoms centres. With the establishment
of a fully operational internet Exchange Point for Nigeria, it is
believed that the rate of network growth would cause Nigeria to overtake
South Africa to become the largest telecom market in Africa (The News,
the purpose of this paper we shall dwell on the ubiquitous ‘umbrella
stand’ phone service providers. The rural dwellers have been involved
in small businesses such as the telephone or GSM call centres. To many
people, the introduction of the GSM into the country has transformed
them from unemployed or employee status to employers and successful
business men and women.
teeming population of ‘would have been’ jobless people have engaged
themselves in the business of phone calls. The umbrella stand call
centre is a prominent feature in every street of the rural areas and
even in the urban areas. These operators are never short of customers as
people are always patronising them for one reason or the other, ranging
from recharge card purchase to making of calls, some persons even
collect the phone numbers of some operators so that they can receive
calls through such centres. This business is very easy to start as all
that is needed is a space where the umbrella (parasol), table, chairs
and a mobile phone SIM (Subscribers Identification Module) ) can be set.
The major impacts of the GSM revolution are as summarised below.
initial bulk purchase of recharge cards will depend on the operator’s
starting capital, and this can be increased gradually as the operator
ploughs back some of his profit into the business. These operators use
special SIM cards meant for business, so that they attract a lower call
charges than the non business normal SIM card. The difference between
the call rates of the two SIMs is what amounts to profit for the call
operator. With as low as Nigerian Naira 12,000 (about 79USD), composed
of a phone of naira 5,000, a pack of recharge cards costing about naira
4,000, two plastic stools costing about naira 2,000 and an umbrella of
about naira 1, 000, one could start up the business. These ways has been
used by many jobless people to feed themselves, save to buy cloths,
domestic items and also save to provide themselves with shelter.
of Other Business
times, the rural dweller engages in the GSM business as a last resort
means of raising money to finance his or her major business of interest.
The low income earner does not have an easy access to credit facilities
needed to finance the business of their choice and so would readily and
willingly resort to the GSM business as a way of raising and saving fund
to later start the business of their interest.
was found that many of the youths involved in the GSM business where
people who were academically inclined but could not continue their
education as a result of inability to pay their fees and meet up with
other educational expenses such as purchasing books, transportation and
feeding. This has resulted in their withdrawal from school and engaging
in this business to raise money with the hope of going back to school in
have briefly highlighted the major areas through which the GSM
revolution has helped the low income earners in Nigeria. It was found
that many persons who suddenly found themselves in the labour market due
to retrenchment from their place of work have used this business to
sustain themselves and also, people with other established jobs partake
in this business to augments their income.
Communications Commission) 2010. Published article of the Tell Magazine,
January 25, 2010, pp: 29-37
Frontier (2010). Reports. Article of the Tell Magazine, January 25, 2010,
(2009). Citizen Security. Published in the Tell Magazine. September 28, 2009.
(2009). Editorial Report. Published November 02, 2009, pp 58