CAPE TOWN, Nov 13 (Reuters) - South Africa's biggest

mobile operator Vodacom is looking at taking a new

low-price phone that uses the cloud to offer smartphone-style

features to other African markets, an executive said on

Wednesday.

Mobile internet penetration in sub-Saharan Africa was just

27% at the end of 2023, with millions struggling to access

services because smartphones are too expensive or network

coverage unavailable, according to the GSMA industry body.

The South African unit of Vodacom, majority-owned by

Britain's Vodafone ( VOD ), recently launched a cloud-based

smart feature phone, which is manufactured by South African

mobile phone firm Mobicel. Vodacom is a reseller.

Vodacom introduced it as a way to reduce the cost of

smartphone access and to accelerate migrating customers from

legacy 2G and 3G networks to modern 4G networks as South Africa

starts phasing out these older networks.

"We have sold roughly a bit less than 100,000 devices in

South Africa," Davide Tacchino, managing executive for terminals

at Vodacom South Africa, told Reuters at the Africa Tech

conference, adding that the company was seeing interest from

customers and distributors.

"At this stage, it's South Africa, but we are evaluating to

expand in the other markets."

The phone, retailing at 199 rand ($11), leverages the power

of cloud computing to deliver a range of features typically

associated with entry smartphones at a more affordable cost.

It comes with popular applications such as YouTube, TikTok

and Facebook, all accessed via the cloud, giving users a

"smartphone lite" experience.

Mobile operators are racing to shift their customers to 4G

and 5G networks as South Africa has proposed gradually phasing

out and shutting down older networks by the end of 2027.

As well as introducing more affordable devices, operators

are offering pre-paid device financing options, but they have

also asked the government to cut taxes on smartphones.

South Africa's Communications Minister Solly Malatsi told

Reuters on Tuesday that he had held encouraging preliminary

talks with the Treasury about his proposals to cut those taxes.

($1 = 18.1781 rand)