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African mobile subscriber growth is global highest; fixed prospects among lowest

African mobile subscriber growth is global highest; fixed prospects among lowest
2009-10-272013-02-11networksen
News from the United Nations Conference on Trade and Development (UNCTAD) that Asia is not the fastest growing region in terms of mobile subscriber growth points to an African nation hungry for mobile broadband services. According to UNCTAD's 'Information Economy Report 2009: Trends and Outlook...
Published October 27, 2009 by Simon Marshall in networks
News from the United Nations Conference on Trade and Development (UNCTAD) that Asia is not the fastest growing region in terms of mobile subscriber growth points to an African nation hungry for mobile broadband services. According to UNCTAD's 'Information Economy Report 2009: Trends and Outlook in Turbulent Times' report, Africa saw a 550% increase in subscribers from 54 million five years ago to around 350 million today, outperforming all other regions. But the continent still struggles with fixed broadband connectivity coverage, prices and availability - leaving the market ripe for mobile broadband investment to leap-frog fixed connections.

There are ten times as many mobile as fixed connections in Africa, and twenty times as many in the Sub-Sahara region, with mobile penetration at about one-third of the country's population. The growth in subscriber numbers can be accounted for by the continued reduction in handset pricing, with small and medium-sized enterprises finding the mobile handset a better business tool than even the computer. Africa also leads the world in mobile banking services that take advantage of the high level of handset ownership to enable dispersed populations to access and transfer money and value using their phones. Indeed, the latest forecast shows that about half a billion people will use mobile money transfer services within the next five years.
 
However, fixed broadband services in Africa continue to suffer from poor penetration rates, with Algeria, Morocco, Egypt, South Africa and Tunisia accounting for 90% of subscriptions. The low penetration rate originates with low levels of investment made in the country's fixed infrastructure, with the highest economically performing nations the first to benefit, leaving the rest of the country behind. This situation, coupled with high costs, is hurting Africa's potential to become a major player in the ICT global industry, as well as slowing trading links it has with more developed regions. Monthly subscription prices range from US$1,300 in Burkina Faso and Swaziland to just $13 in Egypt and Tunisia. But possibly the biggest factor in Africa's longer-term adoption of services is the lack of subsea fibre cable connectivity in the Sub-Saharan region, according to the report.

Although networks such as SEACOM became active in this region this year, with mobile handset penetration number so high it begs the question; would investors be better off channeling money into mobile networks instead of fixed?

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