NAIROBI, Feb. 15 (Xinhua) – Retail telecommunications revenue in sub-Saharan Africa is projected to grow from 40 billion U.S. dollars in 2010 to 69 billion dollars in 2016, a report published by a research firm revealed on Wednesday.
The report by telecom research and consulting company Analysys Mason said the revenue in the region will grow at a compound annual growth rate (CAGR) of 10 percent during 2010–2016.
“With the exception of South Africa, telecom markets in the region are more heavily dominated by mobile voice services than markets elsewhere in the world,” said Roz Roseboro, co-author of the report and Lead Analyst of Analysys Mason’s The Middle East and Africa regional research program. “This trend will continue. Fixed voice retail revenue will decline at a CAGR of six percent and the number of connections will remain largely unchanged,” Roseboro said.
Analysts say the continent has enormous potential for growth as it has become the fastest growing telecom market in the world. Between 2001 and 2007 the industry grew by 49.3 percent with a total investment of 18 billion U.S. dollars, according to figures from the International Telecommunications Union (ITU). Despite such growth, Africa still lags behind the rest of the world when it comes to broadband technology.
Its slow development is one of the major topics of discussion at the summit. The report which was released on Wednesday says mobile voice services will account for most of the revenue growth. Retail revenue for such services is expected to grow at a CAGR of nine percent. However, it reveals that mobile voice revenue streams will be under continual pressure because of sustained, strong competition and the expansion of networks into more-rural and price-sensitive regions.
“The 3G penetration will increase from 3 percent of the population in 2010 to 20 percent in 2016 as a result of improved network quality and availability. 4G will have a limited impact in Kenya and South Africa, but only at the end of the forecast period, ” the report says.
The report which was published on Wednesday says mobile operators will need to provide services in secondary cities to increase subscribers, adding that mobile operators will need to focus on retaining their high-value customers. The report also predicts mobile and fixed broadband to generate only eight percent of retail revenue in 2016, adding that improved network availability and quality will drive increased usage of services.
The number of broadband connections in Sub-Saharan Africa will increase from 9 million in 2010 to 50 million in 2016, but this represents an overall penetration rate of only 5 percent of the population, mainly because of the lack of PCs in use across the region. “The good news is that operators in Sub-Saharan Africa are operating in an environment where there is a lot of growth potential,” Roseboro said. “The challenge is employing the right strategic mix of technological innovation, geographical expansion and consumer offerings to maximize the opportunity.”
The report says fixed voice services will not be a significant driver of operator revenue. The fixed markets in most countries of the region are dominated by national incumbent operators, which are rarely challenged to improve their services. However, CDMA-based limited-mobility fixed–wireless services are a threat to PSTN-based voice services in some markets. (Xinhua)
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