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Africa's mobile star keeps rising

Admire Moyo
By Admire Moyo, ITWeb news editor.
Johannesburg, 22 Nov 2016
Africa has the highest growth rate of mobile subscriptions of any region on the globe, say analysts.
Africa has the highest growth rate of mobile subscriptions of any region on the globe, say analysts.

Report-after-report indicates Africa will make gigantic leaps in the number of subscriptions and data traffic.

A recent report by Research and Markets notes Africa continues to see strong growth in mobile broadband use and data traffic, the result of several factors which are providing a beneficial environment for investment and customer take-up of services.

Overall forecasts suggest mobile Internet traffic across the region will increase 20-fold by the end of the decade, says Research and Markets.

Ericsson's Sub-Saharan Africa Mobility Report, which was unpacked at the AfricaCom 2016 conference in Cape Town last week, reveals Sub-Saharan Africa has the highest growth rate of mobile subscriptions of any region on the globe.

Fellow market research firm Ovum last week also noted Africa is expected to cross one billion mobile subscriptions in the fourth quarter of 2016, reaching 1.02 billion by year-end. Ovum forecasts the total number of mobile subscriptions on the continent will rise to 1.33 billion at the end of 2021.

Meanwhile, according to GSMA in its Mobile Economy 2016 Africa report, subscribers across Africa are increasingly migrating to mobile broadband services, driven by network rollouts and mobile operator device and data strategies.

It notes mobile broadband connections accounted for a quarter of total connections at the end of 2015, but will rise to almost two-thirds by 2020.

In its report, Research and Markets says this strong growth is supported by increased international connectivity as consortia of operators continue to develop submarine and terrestrial cables to provide the necessary backbone infrastructure on which data and networks depend.

"Indeed, growth in international Internet capacity to Africa has grown faster during the last few years than in any other region globally. Capacity grew by about 40% in the year to mid-2015. Although connectivity in northern countries dominated growth for a number of years, the focus more recently has been on Sub-Saharan regions," the market research firm says.

It explains that major projects include cables connecting Southern Africa to Brazil and onto the US, while in August 2015, the West Africa Cable System was upgraded, delivering 5.12Tb/s capacity for connected countries along the route from SA to the UK.

The research firm points out that by 2020, about three-quarters of all mobile connections will be on 3G or LTE, and thereafter the impetus will favour LTE as operators are able to make use of spectrum released from the switch to digital TV.

"This process, which was expected to be have been completed by June 2015, was delayed in many markets which were unprepared, but this digital dividend spectrum will soon be made available for network operators to expand the reach of LTE networks beyond the major cities. In response, operators are transitioning their networks to accommodate the shift from a market dominated by mobile voice into one in which data services and customer retention are paramount."

In SA, most telcos are witnessing strong growth driven by their mobile businesses. Telkom recently delivered a solid performance, buoyed by its mobile business. The company says mobile voice and subscriber revenue increased 30% to R520 million (September 2015: R400 million). This is on the back of a 42% increase in the number of active mobile subscribers.

Mobile operator MTN South Africa also saw an improvement in revenue for the third quarter of the year despite subscriber numbers falling slightly.

The biggest mobile operator in the country, Vodacom, recently reported it added 2.3 million more active customers in the last six months, with the bulk coming from SA.

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