Nigeria has outpaced South Africa and became the leading telecom market in Africa due to the liberalization of the country’s telecom market in 2003.
Telecom research firm, Pyramid Research, says that Nigeria has evolved as the largest telecom market in the African continent by surpassing South Africa, as reported by Tmcnet.
Nigeria's telecom market recorded 23% growth in 2008, generating US$8.4 Billion as overall telecom service revenues. Presently, Nigeria has over 61 Million subscribers. Further, with just 42% penetration of mobile subscribers, total telecom revenue is anticipated to grow at a CAGR of 5.7%, reaching US$11.14 Billion by 2013 from US$8.42 Billion in 2008.
Fast pace growth rate displayed by the Nigerian telecom market is largely attributed to the market liberalization undertaken in 2003 that pulled in new market players. The oil-rich Nigeria is now attracting vendors of mobile network technologies who would benefit from more vigorous rollouts of data services and mobile voice. Moreover, higher number of subscribers will boost the demand for GSM and CDMA base stations. Mobile market is expected to account for the bulk of total service revenue, i.e. around 83% over the coming five years.
As per the government, the licensing of 3G services in 2007 is further increasing the broadband penetration in the country. Nigeria is typically regarded as a wireless applications' market. The Nigerian government has allocated frequencies to telecom firms, enabling them to conduct their business activities in a more precise way and on a large scale. The country will see massive broadband infrastructure rollout by the end of 2009, with fairly good speed.
However, Nigeria is no exception to the global economic meltdown as the oil prices have slumped drastically worldwide. Thus, it becomes essential to evaluate the cost-cuttings requirements because decline in subscribers' purchasing power will definitely push down the operators' revenue.
According to a Research Analyst at RNCOS, "The Nigerian telecom sector is growing at a rapid pace, attracting new telecom operators. Additionally, the number of mobile subscriptions is anticipated to grow with the similar growth rate in the coming few years; consequently, giving rise to cut-throat competition among the constantly increasing network operators."
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