African Startups are Using SMS to Build Apps for ‘Dumb’ Phones

By Business Insider

The lack of high-speed internet, smartphone ownership, and connected banking in Africa is forcing startups in the country to find novel ways of reaching and monetizing consumers, according to Times Live.

This is prompting developers in the region to build streamlined, text-based apps, to reach the hundreds of millions of users with basic phones via SMS.

Application-to-person (A2P) messages — also referred to as enterprise-to-person (E2P) — are SMS messages sent by an application from a business’ server to a consumer. Consumers are charged via their pre-paid or monthly phone bill, mostly on a per-use basis. Developers then receive a cut of the revenue from carriers.

The scale that SMS provides means that, in some cases, building basic apps is more lucrative than building apps for smartphones, according to Arnauld Blondet, South African carrier Orange’s head of marketing for Africa and the Middle East. A2P messages are expected to generate $71.4 billion globally in 2019, according to Infobip.

This is the case for a number of reasons:

  • SMS is ubiquitous and pervasive. SMS messaging does not require large amounts of data or an internet connection to work. Because of this, roughly 83% of the total global population has access to apps built on SMS, according to OpenMarket.
  • SMS is much more likely to be seen: Around 90% of all text messages are read within the first three minutes of being received and have an open rate of 98%, compared with 22% for email, according to Gigaom.