Where is tech in Nigeria?

What is the true market size of that tech idea you have? What demographic does your product exclude? Read on to find out the effect of location on access to digital technology in Nigeria.

What is the true market size of that tech idea you have? What demographic does your product exclude? Read on to find out the effect of location on access to digital technology in Nigeria.

Digital technology has no doubt had a significant impact on the manner and scale in which things are done across the globe. From profound differences in ways information is processed to various utilities in entertainment, technology has affected all aspects of our livelihoods in one way or another. It is easy to overestimate the efficacy of digital technology at solving problems especially when creating solutions for emerging markets. Technology grows so fast, we often forget that for emerging markets, its dissemination and adoption is nowhere near as fast as seen in other parts of the world.  

The World Bank, in collaboration with the Nigerian Bureau of Statistics, has been conducting longitudinal surveys to get a better understanding of the living standards of Nigerian households. This article reports on typical households in different parts of Nigeria and their access to technology. Specifically, we use access to phone and access to internet as proxies for access to technology and we report on the regional distributions of technology access across different parts of the country.

About the data

The survey covered 17,713 (9,040 female and 8,673 male) individuals across 4,971 (1,593 urban and 3,378 rural) households. All individuals were at least 10 years old and the households were sampled from all 36 states in the country, including the nation's capital.

A stacked histogram chart showing the distribution of ages of individuals who participated in the survey. Colour encodes sector and we can 

Access to Telephones

Since the telecommunications boom that started in the early 2000s in Nigeria, access to telephones has got better over time. Of all individuals included in the survey, 79% had access to at least one phone. When looking from the point of view of households, 94% of households had access to a phone. The majority (81%) of those with access to phones obtained access using personal devices and these were mostly evenly split between rural and urban areas.

This stacked bar chart shows different modes by which people access phones nationally. The different colours encode differences in proportion for rural and urban areas.

The proportion (79%) of participants that have access to phone is respectably high. In the U.S, access to mobile phones is 98% as at 2019 according to Pew Research Center. Access to smartphones is much lower at 81%. A closer look at states shows some differences. Participants from Osun state had the highest likelihood (98%) of having access to phones while participants from Zamfara were least likely (49%) to have access to phones.  In addition, most states consistently showed more likelihood of having participants with access in urban than in rural areas. There are a few exceptions to this as shown in the chart below.

The percentage of people in rural and urban areas who had access to phones by state. Note that some states had very little data for rural or urban areas - for instance rural Lagos or urban Sokoto.

This density map shows 17,713 individuals in the survey who had access to a phone (green) and those who did not (red). Note that the location of individuals in each state should not be inferred from the position of the points on the map above.

Since its introduction in 2002, Nigerians have increasingly gained access to GSM mobile telephones. Although, high transaction cost limited access at the early stages, competition reduced entry barriers with such initiatives as, unbundled offers, per second billing, and free SIM cards. Recently, the industry regulator, Nigerian Communications Commission (NCC), reported that telecoms contribution to Nigeria's GDP increased to 10.6%  as at Q4 2019. In July 2020, FBN Quest Capital attributed telecoms growth to instant payment transactions conducted through mobile devices. Clearly, disproportionate access to mobile phones would have carryover effects to other key functionalities such as, finance and access to information.

Access to Internet

Another important aspect of technology is the internet. It enables digital communication across devices at different geographical locations. Nationally, only 26% of individuals (n = 4,658) indicated they had access to the internet. This varies significantly by state as shown in the charts below. States like Lagos and Abuja had the highest proportion of individuals with internet access. Further analysis also shows that individuals from urban areas are more likely to have access to internet than those in rural areas.

The percentage of people in rural and urban areas who had access to internet by state. Note that some states had very little data for rural or urban areas - for instance rural Lagos or urban Sokoto.

This density map shows individuals in the survey who had access to the internet (green) and those who did not (red). Note that the location of individuals in each state should not be inferred from the position of the points on the map above.

Internet access modes

The most common reported source of access to internet was from personal devices (69%) followed by devices owned by other members within the same household (17%). About 7% accessed the internet through cyber cafes while 6% had internet access through a relative or friend (i.e., in a different household).

This bar chart shows different modes by which people access the internet nationally.

Nationally, 55% of the individuals with internet access on their personal devices came from urban areas while 45% came from rural areas. Lagos and Akwa Ibom were the states with the most people who had internet access on personal devices while Yobe and Sokoto had the least. Individuals from Akwa Ibom, Gombe and Niger were most likely to access internet from another household device. Over a third of individuals who reported accessing the internet by cyber cafes were from Kaduna, Gombe and Abuja, with 15% coming from Kaduna alone.

Implications

The data shows that access to phones is far more widespread than access to internet. As a result, access to phones should not be used to imply access to internet. Instead, services and solutions should be built with regional sensitivity to what is available to the demographic. Moreover there are several factors that we have not explicitly considered in this article. For instance, of those with internet access, what sort of bandwidth can they afford? What sort of bandwidth do the Internet Service Provider's infrastructure provide access to? What utility does the internet  mostly serve e.g., communication, social media, e-commerce, education, entertainment? We talk about the speed of internet access in Nigeria in a separate post.

Increasing tech adoption in Nigeria typically implies significant investment. Yet, nailing down how Nigerians would respond to such innovations has been evasive. To cite just one example, results from large scale interventions to increase women's access to mobile banking in Nigeria, showed no difference between treatment versus control conditions. Such outcomes should cause stakeholders to pay attention to the basics; that is, what does the data we already have tell us about access to technology in Nigeria, particularly for underrepresented and marginalised groups?

If you would like a closer look at the data and visualisations from this article, see this observable notebook. A future post will explore the effect of gender and age on access to digital technology.

Acknowledgements

This article is based on data collected by the Nigeria National Bureau of Statistics. General Household Survey, Panel (GHS-Panel) 2018-2019. Dataset downloaded from www.microdata.worldbank.org on June 9 2020.

Revision History

11 July 2021 - updated 74% to 79% in second paragraph of the Access to Telephones section.