However, mobile services have capacity constraints.
They use limited radio frequency spectrum, which means that mobile data typically has usage limits.
They also have high prices per unit (per gigabyte), which results in lower use per connection.
Fixed-line broadband, on the other hand, has significantly lower prices per unit.
It is often offered on an uncapped or unlimited basis and therefore has higher usage per connection.
This enables a wider range of services.
Fixed lines are expensive to roll out, butthese costs are falling.
So a question arises: is mobile enough for developing countries like South Africa?
In arecent paper, we looked at the question of substitution between fixed and mobile broadband services.
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Our findings suggest that relying solely on mobile networks to bridge the digital divide is not enough.
Thiscomparesto almost 50 percent across developing countries.
But even the low average internet access in South Africa masks importantregional disparities.
Where a household has a computer, fixed and mobile are less likely to be substituted.
The price ofsubscribing to service plays less of a role.
This is over and above the effect of expanding fixed-line coverage and providing households with computers.
At higher levels of employment and particularly self-employment, more fixed-line services will be needed.
This is important in view of arecent study.
Implications
These results have several implications for regulators and policymakers in developing countries, particularly in Africa.
Regulators have so far focused largely on interventions in respect of mobile data services.
But our findings suggest that this is not enough to expand access to broadband.
Firstly, it is important to stimulate the demand for broadband services.
This can be done by providing the tools, such as computers, for using such services.
Secondly, our findings show that, for large groups of consumers, fixed and mobile complement one another.
This means that greater fixed-line broadband adoption leads to greater mobile data adoption, and vice versa.
This suggests that relying solely on mobile networks to bridge the digital divide is not enough.
