A push by a coalition of telecom operators, system makers, and trade teams to convey $40 smartphones to market — a worth level seen as key to getting tens of tens of millions extra individuals on-line — is gathering momentum, however questions stay over whether or not producers can produce such ultra-low-cost units at scale.
This week at Cell World Congress in Barcelona, the advocacy and lobbying group GSMA said it’s working with main African cell operators — together with Airtel, Axian Telecom, Ethio Telecom, MTN Group, Orange, and Vodafone — and smartphone makers to pilot ultra-low-cost 4G units in six African markets: the Democratic Republic of the Congo, Ethiopia, Nigeria, Rwanda, Tanzania, and Uganda, in a bid to make smartphones extra reasonably priced and produce an extra 20 million individuals on-line.
Reasonably priced smartphones are extensively seen as key to narrowing the digital divide in growing markets, the place tens of millions of individuals stay inside cell broadband protection however stay offline, actually because internet-enabled units stay too costly. By way of its Handset Affordability Coalition, the GSMA is working with operators and producers to advertise units priced round $40 to assist shut that hole.
The initiative stays in early phases, with industrial negotiations underway between cell operators and smartphone producers to develop units assembly the focused worth vary.
The GSMA has engaged with greater than 15 smartphone producers as a part of the hassle, with seven firms expressing curiosity in supporting the initiative, Alix Jagueneau, the group’s head of exterior affairs, informed TechCrunch.
“The $30–$40 worth level is an ambition, based mostly on GSMA intelligence analysis on affordability and is to be understood as a greatest effort intent,” Jagueneau mentioned, including that rising reminiscence prices are including urgency and complexity to the hassle.
The ultimate worth of such units will rely upon a mix of things, together with financing schemes and tax insurance policies, Jagueneau informed TechCrunch. Improvement banks, donors, and different monetary establishments may assist scale back dangers for cell operators investing within the units. On the similar time, import duties and taxes on smartphones — typically handled as luxurious objects — can add as a lot as 30% to handset costs in some markets, Jagueneau mentioned.
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The GSMA has not confirmed which producers will produce the units, with Jagueneau saying industrial discussions with smartphone makers are nonetheless ongoing. Nonetheless, the group hopes preliminary proof-of-concept units may very well be produced this 12 months, with early shopper choices probably reaching markets by late 2026.
Not one of the six international locations recognized for the pilot program has but dedicated to decreasing import duties or taxes on entry-level smartphones, Jagueneau mentioned, including that the group is working with operators to construct an ongoing dialogue with governments within the coming months.
“We consider there may be an urgency for the general public sector to handle this a part of the equation for digital inclusion functions,” Jagueneau mentioned. She added that the group welcomed South Africa’s elimination final 12 months of a 9% luxurious excise obligation on smartphones priced under R2,500 (round $150), saying extra international locations ought to take comparable steps.
Skinny margins and rising part prices
Analysts say the trade could battle to supply smartphones close to the $40 worth level underneath present part value situations.
“Pushing smartphones priced within the $30–$40 vary may have been traditionally possible when reminiscence prices had been considerably decrease,” mentioned Ahmad Shehab, analysis analyst at Counterpoint Analysis.
Gadgets at that worth would possible include extraordinarily fundamental specs and skinny revenue margins, Shehab informed TechCrunch, including that securing low-capacity reminiscence parts may also be troublesome as suppliers more and more prioritize higher-capacity chips.
The typical promoting worth of smartphones within the Center East and Africa, per Counterpoint, stood at about $188 within the fourth quarter of 2025, highlighting the hole between present market costs and the focused $40 degree.
“Though just a few manufacturers have achieved ASP ranges under $40, these gross sales volumes stay negligible and are largely absent from main world distributors,” Shehab mentioned.
Makes an attempt to convey ultra-low-cost smartphones to rising markets have confronted challenges earlier than. In 2014, Google launched the Android One initiative to advertise reasonably priced smartphones in markets together with India, Pakistan, Bangladesh, and Indonesia earlier than increasing this system to Africa in 2015. Nonetheless, it struggled to achieve widespread adoption.
Google continued this system in some markets for a number of years, together with Japan, nevertheless it by no means turned a dominant platform for entry-level smartphones.
Jagueneau mentioned the hassle would require coordinated motion throughout operators, producers, and governments, however added that enhancing entry to reasonably priced smartphones stays crucial to bringing extra individuals on-line.
