GSMA: Smartphone for under $40 to bring 3 billion people online

In Germany, a smartphone for beginners costs around 200 euros, and some can be found a bit cheaper. For many people, that is still too much money. The Global System for Mobile Communication Association (GSMA), which represents over 800 mobile network operators and 200 manufacturers of mobile phones and network infrastructure worldwide, is trying to provide a solution. A smartphone for less than 40 US dollars could become a reality as early as this year.

According to the GSMA, 3.1 billion people live in areas that are supplied with mobile communications and thus mobile internet, but cannot afford a device to use it. This corresponds to around 38 percent of the world's population. The GSMA wants to close this gap with a particularly inexpensive smartphone. It is to cost under 40 US dollars, perhaps even only 30 US dollars – a radical price given the rising costs of memory chips and other components. For comparison: According to Bitkom, German customers pay an average of a good 600 euros for a new smartphone, and the high-end segment in particular is growing. At MWC, one hears from manufacturers that, with current memory prices, it is hardly possible to sell a smartphone for 200 euros at a profit.

In 2024, the GSMA launched the Affordable Handset Coalition for this purpose, which has already achieved a great deal and attracted several partners. Six mobile network operators are involved in the ambitious project, which initially focuses on the African continent: Airtel, Axian Telecom, Ethio Telecom, MTN, Orange, and Vodacom from the Democratic Republic of Congo, Ethiopia, Nigeria, Rwanda, Tanzania, and Uganda. OEMs are also on board, but the organization does not yet name their names. The GSMA plans to expand the project to other countries and regions outside of Africa.

With such a price, of course, no smartphone is conceivable that technically plays in the same league as current high-end models. It will be 4G-capable devices with simple but robust features. The participating providers and OEMs are currently working out the details.

Government support is needed

For such an inexpensive smartphone to be created at all, the initiative relies on outside help. As Alix Jagueneau, Head of External Affairs at the GSMA, states in an interview with heise, it is less about direct financial contributions and more about tax relief. If, for example, customs duties on the import and export of raw materials and components, as well as taxes on sales and purchases, were waived for the project, much would have been achieved. The six participating mobile network operators in Africa and the involved OEMs are unlikely to profit from the project in the short term, but could benefit from the expanded customer base in the medium to long term, Jagueneau continues.

Part of the solution to close the gap for people without mobile devices could also be reconditioned: used smartphones. Such smartphones, sold as “refurbished,” are enjoying increasing popularity in Western markets, especially given rising prices, although usually in higher price ranges. In Germany alone, it is estimated that between 120 million and 190 million discarded smartphones are lying in drawers and cupboards; in Europe, the total is said to be over 640 million. Some of these could help supplement the planned sub-$40 smartphone, but many are too expensive or damaged. Alix Jagueneau sees no more than a small contribution to the solution in the interview.

The GSMA hopes to be able to present a concrete product this year. At the latest by MWC in Kigali, the capital of Rwanda, in June of this year, the organization intends to announce further news about the Affordable Handset Coalition. The first prototype of the sub-$40 smartphone is also to be presented to the public for the first time there.

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