PAPDA: 5G Smartphones Now in Nigeria, Consumers Are Waiting To Buy When Telcos Launch

The nation's influential phone trade group has told Technology Times that 5G smartphones have made inroads into Nigeria and consumers are willing to buy them once the licensed operators launch commercial services.

Anticipation has been on the rise after MTN Nigeria Plc and Mafab Communications emerged as winners of two 5G licences issued by the Nigerian government, which are expected to enable the winners to launch commercial service later this year.

According to the founding charter of the trade group registered in 2010, the Phone and Allied Product Dealers Association (PAPDA), currently led by Mr. Ifeanyi Akubue, was founded in 2007 to create equal opportunity for men and women in the mobile phone industry, irrespective of class, age, ethnicity, culture, or religion.

Mr. Ifeanyi Akubue, Chairman of Phone and Allied Product Dealers Association (PAPDA). Photo credit: PAPDA

"The 5G phones are there waiting for us to buy. If we go into Computer Village now, we can get 5G phones. It’s there already in the market but few in number. So we are waiting for a launch and the phones are there waiting for us to import."

Mr. Ifeanyi Akubue, Chairman, Phone and Allied Product Dealers Association (PAPDA).

PAPDA says the trade group is on a mission to help build, manufacture, and promote indigenous mobile phone brands, but also provides a vibrant platform for its members to trade a growing number of foreign brands that dominate the consumer technology market.

At the PAPDAN head office at the ever-busy Ikeja Computer Village, Mr. Ifeanyi Akubue, Chairman of PAPDA, spoke with Technology Times where he reviewed the Q1 2022 market trends for its members and the operating business environment.

The interview has been edited and condensed for clarity.

What have been the key economic trends in Nigeria in the first quarter of 2022 that have affected the businesses of your members?

Nigeria in particular?

Yes.

There are a lot of them. First of all, the direct one is still the dollar issue. The other one is not peculiar to Nigeria alone, it is a universal problem, and it could still be there because of the way we used to travel. We don’t travel that way again and our suppliers are even in short supply sometimes.

We have the challenge of low patronage. People are, because the economy is not well, so many people are not buying phones, and the few people that are buying are below the middle-class price.

Another challenge is traveling. People do not travel the way they used to. Importation is a little bit difficult now because traveling is kind of restricted. It is not the same number of flights that came from China before that are still coming now. There is a lot of shortage in everything - production and every other thing. As I said, we have few customers coming to buy goods because of the prices.

At the beginning of the year 2022, phone dealers complained that the effect of rising foreign exchange, particularly the Dollar, was having adverse effects on their businesses. Can you provide us with more insight into the situation thus far?

Well, the situation has not changed. Instead, it is getting harder. It is not getting better but is more challenging because the dollar is still fluctuating. If you buy the dollar, maybe you bought it at ₦570 today, in three days’ time, you are not sure of getting it at ₦570. It may be higher. So we are still having the same challenge and it is giving us problems, and a lot of stress, and does not allow us to plan our businesses ahead because you don’t know what tomorrow will be like in the business. So nobody can say that this is my plan between now and the next two months because you don’t know what the dollar will tell.

Nigeria is planning to launch 5G services with the issuance of licences to MTN and Mafab Communications. When do you think we will begin to see 5G smartphones and what should consumers expect in terms of pricing and other key factors?

The 5G phones are there waiting for us to buy. If we go into Computer Village now, we can get 5G phones. It’s there already in the market but few in number. So we are waiting for a launch and the phones are there waiting for us to import.

You know that once it’s a new product, the prices will be a little bit high, but when competition sets in, the prices will start to drop by the time every brand starts producing 5G products.

Samsung is now waiting for us to buy it because, in other countries, 5G is working there. So the phones are already in the market, outside there, maybe in China, Dubai, Korea, and so on.

Based on your market insights, what are the key services that Nigerian consumers expect on their smartphones today, and how are OEMs responding?

As I said, the problems are not only particular to Nigeria. Our OEMs are having challenges too in terms of producing up to their capacities because some of them are not producing up to their capacities because of the COVID-19 era.

So we are having problems with getting stocks in the quantity we need, and another thing is that the price is no more stable. They are changing prices every day, every week, and every month, so it becomes challenging for us, our members, and any importer because of what is happening out there that was not happening before.

Formerly, you may have a price with your OEM for one year without changing, but today they are changing prices every day. I don’t know what the cause is. You buy something today for maybe $5, but at the time you want to make another order, they will tell you it’s $5.5 and it’s going up and not coming down outside there, not even in Nigeria.

So we Nigerians are having two major challenges; our dollar is going up and the prices of OEMs are going up too. So it’s a lot of challenges we are facing.

I don’t know because this OEM issue is not something the Nigerian government can handle, it’s a kind of general problem both here and outside the country. Prices are changing there, which we were not even experiencing before.

As I said, if you could buy this phone for $10 before, if you go there after six months, it’s still $10, and after one year, it’s still $10, but today, we are not sure of what we are buying. If you finish selling what you have and want to make another order, they are increasing their prices. So it’s a serious challenge for us as importers of mobile phones and other gadgets.

Based on your market insights, which are the top 5 OEMs for smartphones by market share in Nigeria, and why do you consider them to be so?

Well, in terms of smartphones, number one is Samsung. Demand is high for Samsung, but because of the price, people cannot easily have access.

Then the second one, which is the middle-class ones, Tecno smartphones are on the high move, Infinix is on the high move, then Redmi is there moving too, before Nokia. Nokia has smartphones, but they're not moving like the ones I called.

Samsung, Infinix, Tecno, Redmi, Nokia, then there is Oppo. Oppo is struggling to be on the page too.

Which are the top 5 smartphone brands by market share in Nigeria, based on your assessment of the market trends in the first quarter of 2022?

Samsung, Infinix, Tecno, Redmi and Nokia.

Is there any other matter we may have left out that you may want to add?

You have covered everything. The only thing I’m just saying is that formerly, I was always capitalizing on the government to know what to do. We will still beckon to them to know what to do to help the situation, especially with stabilizing the dollar, because that’s the major challenge we are having, so we can face problems that are general, that is, the universal problems.

This dollar fluctuation in Nigeria, the government must know how to handle it so that you can plan your business and have the mind to invest because people are afraid to invest their money in businesses because they don’t know what tomorrow will be like. Having money in your bank is another dangerous thing because once the dollar starts going up, that money is being devalued.

Then, investing it outside there, you don’t know if, by the time you finish your order, the dollar will now go up and the people who have old stock cannot allow you to sell and by the time they won’t have stock again, the dollar may come down and it will affect you because if you buy at ₦580 today, tomorrow ₦585 then next week at ₦570. So it’s a big challenge for us. If the government could determine how to put that dollar to a stable price for some time, it would help us plan our businesses.