Page 141 - ITU-T Focus Group Digital Financial Services – Technology, innovation and competition

ITU-T Focus Group Digital Financial Services
Technology, Innovation and Competition

7 Conclusion

• User preferences have shifted from basic phones to feature phones, moving towards smartphone use,
all of which are driven by a swathe of new manufacturers taking advantage of massive improvements in
System-On-A-Chip fabrication and expiry of key patents.

• Recent manufacturing data shows increases in feature phone component production. Similarly, in key
DFS markets, smartphone growth has flattened. Movement towards smartphones however is glacial.

• OTC activity will persist as long as poor user interfaces such as USSD and STK exist.
• Basic phones do not support IP-based data connectivity.
• The vast majority of feature phones do not support IP-based 3G (or 4G) and their variants. Most only
support narrowband 2.5G speeds.
• Smartphones will provide an enhanced User Interface and User Experience for customers, providing
access to a range of external DFS services. However, this benefit may be buffeted because many of the
devices currently being seeded into DFS markets are of low specification.

• Because not all MNOs have 3G coverage overlaid over their 2G coverage, the user interface for use of
applications that are bandwidth-heavy will be negatively affected.

• Smartphone penetration will increase when a trifecta of supporting conditions emerge, that is when:
– Devices improve in quality, particularly battery life and display resolution and robustness;
– National 3G coverage matches that of 2G coverage, allowing improved user experience; and

– Device prices drop to feature phone levels.

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