As variety of services is being offered by the operators, African telecommunication market is likely to outpace the growth of any other region in coming years.
The auditing and business advisory firm, Ernst & Young, has projected that the African telecommunications sector will grow at a pace higher than any other region over the next 3-5 years, in spite of the ongoing economic turmoil, as reported by ENGINEERING NEWS.
In 2008, the mobile penetration level in six African countries was registered at over 80%. 24 nations dipped below the 20% mark, while 17 countries had 10% penetration level. Moreover, in the same year, Libya emerged as the first African country to surpass the 100% mobile penetration mark with South Africa following closely at 98%.
Telecommunication has brought about significant transformation in Africa, where ten years ago one would have struggled to find a phone. Now, the continent is considered as the world’s fastest growing mobile market. Despite the current economic slowdown, telecom market in Africa is expected to continue to grow faster than other regions.
Moreover, in contrast to the past growth that was achieved through increasing number of subscribers, future growth would be led by wide range of services. Although voice services would probably remain the largest contributor to operators’ revenue, data-based services are expected to play a critical role.
In addition, international ICT companies will certainly follow more focused and highly planned approach to expand their business activities in the continent against the opportunistic approach followed in the past. The pent-up demand in the African nations, corresponding to diversified penetration levels, indicates to the immense growth potential.
However, telecom operators are confronting a number of challenges such as expanding services to the consumers who have not used the mobile services before. Some operators are having special programs devoted to offer telecom services in rural areas while the rest are still targeting the market with their standard offerings.
According to a Research Analyst at RNCOS, “Since investors are seeking emerging markets in this unstable time, Africa’s emerging telecom market would be benefited. Africa is luring the worldwide operators as a favorable investment destination. With majority of population still living in rural areas, telecom players need to have an infrastructure that could reach these potential consumers in a cost-effective way.”
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