By Thandisizwe Mgudlwa
Johan van Huyssteen, PwC Communications Leader for Southern Africa reports that with billions of dollars of international investment flowing in and subscriber numbers rising across the continent, Africa’s communications market is at the inflection point where high potential starts to turn into high growth.
And more reports showing that strong growth in the telecommunications sector is being driven by increasing investment, rapid progress in technological and communications services and some deregulation across the African continent. But for many reasons these achievements to date are only just the beginning as Africa’s future potential dwarfs the growth seen so far.
These are some of the highlights from PwC’s publication: Communications Review: Telecoms in Africa: innovating and inspiring, recently released in South Africa.
This journal examines the issues and challenges facing the diverse companies that comprise the telecommunications industry.
The report focuses on a number of matters facing communications companies on the African continent, including the challenges confronting operators in Africa and around the world; a reflection on one of the continent’s highest potential areas of opportunity; and a focus on how CEOs in the communications industry are actively reshaping their go-to-market approaches and business models to boost their organisations’ ability to do more business globally.
According to estimates by Business Monitor International-TechKnowledge Group, total combined fixed and mobile cumulative capital expenditure made in Africa is set to grow from $78.8 billion in 2008 to $145.8 billion by 2015. “This rising tide of investment is undergoing an accelerating shift away from investment in fixed-line services and infrastructure, towards mobile,” says Van Huyssteen. As a result, by 2015 the mobile sector will account for over two-thirds – an estimated 68.9%, or $100.1 billion – of cumulative investment in African telecommunications, states the report.
Furthermore, the number of mobile operators, excluding MVNOs, rose from 158 in the first quarter of 2008 to 175 at the end of 2010, according to statistics issued by Africa & Middle East Telecom Week, of which 60% are affiliated with the major telecommunication groups.
Van Huyssteen says that big opportunities are still to come in the light of the remaining potential for new subscribers which may even be bigger due to multi-Sim behaviour. According to a report in 2011 issued by Gfk Retail and Technology, about one in ten phones sold in the Middle East and Africa are reported to be dual SIMs.
Although Africa is commonly characterised as a single marketplace, it is made up of 56 individual countries, and its markets can be considered in some ways more diverse than those of Europe.
“Alongside their varying levels of maturity, what further distinguishes African markets are their diverse regulatory structures. Regulation plays a vital role in the development of all communications markets, but especially ones changing and growing as rapidly as those in Africa.