Ben Evans:

There are about 5.3bn people on earth aged over 15. Of these, around 5bn have a mobile phone. This is an estimate: I’m going with the GSMA’s but most others are in the same range. The data challenge is that mobile operators collectively know how many people have a SIM card, but a lot of people have more than one. Meanwhile, ownership starts at aged 10 or so in developed markets, whereas in some developing markets half of the population is under 15, which means that a penetration number given as a share of the total population masks a much higher penetration of the adult population.

About 4bn people have a smartphone. How do we get to this number? Well:

  • Apple gave a number of 900m active iPhones at the beginning of the year, which is consistent with the unit sales that it reported until recently.

  • Google said at this year’s IO conference that there are 2.5bn active Android devices, and the Android developer dashboard says that about 95% of these are phones.
  • Google’s number does not include Android phones in China, which do not come with any Google services (conversely Apple’s number does include iOS devices in China). The Chinese government estimates just over 800m internet-connected smartphones in China, and perhaps 20% of these are iPhones, giving a round number of 650m Android phones.

How many of these are online? These sources are all based on devices that connect to the internet regularly in order for them to be counted, but ‘connection’ is a pretty fuzzy thing. The entry price for low-end Android is now well under $50, and cellular data connectivity is relatively expensive for people earning less than $10 or $5 a day (and yes, all of these people are getting phones). Charging your phone is also expensive – if you live without grid electricity, you may need to pay the neighbor who owns a generator, solar cells or car battery to top up your battery. Hence, MTN Nigeria recently reported that 47% of its users had a smartphone but only 27% were active data users (defined as using >5 meg/month). Of course, some of these will be limiting their use to wifi, where they can get it. These issues will obviously intensify as the next billion convert to smartphones (or near-smartphones like KaiOS) in the next few years. There are lots of paths to address this, including the continuing cost efficiencies of cellular, cheaper backhaul (perhaps using LEO satellites), and cheap solar panels (and indeed more wifi). The fratricidal price wars started by Jio in India are another contributor, though you can’t really rely on that to happen globally. But this issue means that on one hand there are actually more than 4bn smartphones in use in some way, but on the other that fewer than 4bn are really online.