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[August 31, 2014]
Sub-Saharan Africa's telecoms market seen expanding 33% to USD 65bn by 2018 - Analysys Mason [IntelliNews - Weekly Reports]
(IntelliNews - Weekly Reports Via Acquire Media NewsEdge) Telecoms service revenue in Sub-Saharan Africa is expected to grow at a 6% CAGR (compound annual growth rate) in the next five years, rising to more than USD 65bn in 2018 from USD 49bn in 2013, according to a report by telecoms specialist Analysys Mason, quoted by IT News Africa. Growth will be driven by mobile services, both data and voice, with revenue seen rising by 6.7% annually, while the CAGR for fixed-line service revenue is seen at only 1.0%, constrained by structural and commercial barriers. The share of mobile services in the total telecoms revenue is projected to increase to 89.4% in 2018 from 86.5% in 2013.
Within mobile services, data revenue will grow significantly faster than voice revenue - at a 5-year CAGR of 19.6% compared to 4.7% for voice, driven by increased 3G coverage and capacity, the widespread introduction of low-cost smartphones and the widening reach of mobile money services. However, voice will remain the largest component of the telecoms market through 2018, as new subscribers, new market entrants and cuts in mobile termination rates (MTR) drive price competition and increased traffic. Mobile penetration of population was still below 80% in most Sub-Saharan African countries in 2013, with the exception of Ghana and South Africa.
At the same time, mobile handset data's share of total telecoms revenue is anticipated to almost double by 2018, reflecting the role of mobile devices as the main Internet access point for most users in the region. Smartphone penetration is also expected to more than double from 12% of handsets in 2013 to 26% in 2018.
Access to high-speed broadband services is expected to remain relatively low, with the share of 3G connections in mobile connections is seen at 23% by 2018 and that of 4G connections at 3%. Fixed broadband household penetration is projected at 3.3% in 2018, with levels well below 2.0% in most markets.
In global comparison, Sub-Saharan Africa's telecoms market is set to grow faster than that of any other region, but its share of worldwide telecoms revenue will remain low – at 3.6% in 2018, up from 2.9% in 2013.
According to Alexandra Rehak, a co-author of the report, the under-penetration of fixed and mobile data services in Sub-Saharan Africa and the growing demand for mobile financial services represent a major growth opportunity for investors. On the other hand, affordability, coverage and effective regulatory and market structures are the main challenges for successful telecoms development in the region.
(c) 2014 Emerging Markets Direct Media Holdings LLC Provided by SyndiGate Media Inc. (Syndigate.info).
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