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The Sub-Saharan Africa telecoms market: trends and forecasts 2017–2022

Telecoms operators in Sub-Saharan Africa (SSA) are increasingly focused on developing and monetising data services as the growth of legacy services starts to slow down and consumers increasingly adopt digital services. This report presents Analysys Mason's core forecasts for the region, analyses the key trends, and assesses their impact during the next 5 years.


Executive summary

Telecoms revenue will grow at a 2.7% CAGR during 2016–2022 to USD45.2 billion amidst regulatory and macroeconomic challenges

Mobile handset data services will be the largest source of retail revenue growth in SSA between 2016 and 2022

Fixed and mobile revenue will grow in most countries, but competition and economic challenges will have a negative impact in some countries

Key trends, drivers and assumptions for the mobile and fixed markets in Sub-Saharan Africa

Key implications and recommendations for telecoms operators

Regional forecasts and cross-country comparison

Geographical coverage: We model eleven telecoms markets, which will account for 68.6% of SSA’s overall telecoms service revenue in 2022

Market context: The eleven countries modelled account for 51.0% of total population in SSA and 68.7% of its telecoms service revenue in 2016

Revenue and ARPU: Mobile and fixed data services will drive revenue growth in the region, but mobile voice revenue will continue to dominate

Mobile penetration: Connections will increase in most countries, driven by improved coverage and competition – but growth will slow down

Mobile connections: 2G will remain the predominant technology in SSA, while 4G will account for only 11.7% of mobile connections in 2022

Smartphones and LTE: South Africa will have the highest mobile 4G and smartphone share of handsets by 2022 – at 31.3% and 73.6%, respectively

Mobile broadband: Mobile connectivity has been central to tablet adoption, but substitution from smartphones and Wi-Fi will increase

Mobile ARPU: Spending on non-voice services will help to slow down ARPU decline in most countries in SSA

Data and revenue by generation: Improved network coverage, affordability of smartphones and price reductions are helping drive usage

Fixed services: Wireless access will retain the largest share of broadband services while fibre will experience the highest growth from a small base

Fixed broadband: South Africa is a regional leader in the wired broadband market thanks to competition and its developed infrastructure

Key drivers at a glance for each Sub-Saharan Africa market

Key drivers at a glance table: methodology
Individual country forecasts

Ghana: Service revenue will exceed GHS5.1 billion in 2022, driven by handset data as mobile voice services remain largely flat

Ghana – mobile: Non-voice services, including mobile money, will help to boost revenue despite modest growth in terms of SIMs

Ghana – fixed: Household penetration of fixed services remains low despite growing interest from large players to invest in fibre

Kenya: Service revenue will reach over KES300 billion in 2022, driven by handset data services, including mobile money services

Kenya – mobile: Demand for data and mobile financial services will encourage the continued growth of connections and revenue

Kenya – fixed: Fibre will be increasingly positioned as an alternative DSL and a challenger to the dominant cable segment

Nigeria: Worsening economic conditions will impact fixed and mobile markets in terms of investment and spend outlook

Nigeria – mobile: Strong subscriber growth against the backdrop of weak economic outlook which will impact consumer spend

Nigeria – fixed: Entry of new players and continued investments in infrastructure should help to stimulate demand for services

South Africa: Service revenue will grow at a 1.7% CAGR during 2016–2022, driven by handset data services and fixed broadband

South Africa – mobile: The release of LTE spectrum will improve competition while economic difficulties will weaken demand

South Africa – fixed: Investment and market competition will help boost broadband coverage and adoption

Tanzania: Service revenue will reach TZS3.4 trillion in 2022, and more than 40% will be from mobile handset data

Tanzania – mobile: Rising smartphone take-up, 700MHz auction spectrum and mobile money will support revenue growth

Tanzania – fixed: Market growth will depend on the government’s ability to convert investments into service adoption

Uganda: Mobile handset data and fixed broadband services will drive overall service revenue to almost UGX3.4 trillion by 2022

Uganda – mobile: The shift from voice to data usage will be accompanied by revenue growth, despite low adoption of 4G

Uganda – fixed: Wireless will continue to dominate the broadband market, while VoIP will help to offset some of the PSTN losses

 

Figure 1: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Sub-Saharan Africa, 2012–2022

Figure 2: Telecoms retail revenue growth by service type, Sub-Saharan Africa, 2016–2022

Figure 3: Telecoms retail revenue growth by type and country, Sub-Saharan Africa, 2016–2022

Figure 4: Summary of key trends, drivers and assumptions for Sub-Saharan Africa

Figure 5: 4G/5G share of mobile connections and NGA share of fixed broadband connections by country, Sub-Saharan Africa, 2022

Figure 6: Metrics for the eleven countries modelled individually in Sub-Saharan Africa, 2016

Figure 7: Telecoms retail revenue by service type, fixed voice and fixed broadband ASPU, and mobile ARPU, Sub-Saharan Africa, 2012–2022

Figure 8: Telecoms retail revenue by service type, total service revenue and growth rates, Sub-Saharan Africa, 2016–2022

Figure 9: Connections by type, and growth rates, Sub-Saharan Africa, 2016–2022

Figure 10: Active mobile SIM penetration by country (excluding M2M), Sub-Saharan Africa, 2012–2022

Figure 11: Mobile connections by technology generation (excluding M2M), and 3G, 4G and 5G’s share of connections, Sub-Saharan Africa, 2012–2022

Figure 12: Smartphones as a percentage of handsets, and LTE’s share of total connections (excluding M2M), Sub-Saharan Africa, 2016 and 2022

Figure 13: Mobile broadband connections by screen size and technology, Sub-Saharan Africa, 2012–2022

Figure 14: Mobile ARPU by country, Sub-Saharan Africa, 2012–2022

Figure 15: Mobile service revenue and ARPU by technology, Sub-Saharan Africa, 2012–2022

Figure 16: Data traffic (MB) and revenue per gigabyte, Sub-Saharan Africa, 2012–2022

Figure 17: Fixed broadband connections by type, and fixed voice, IPTV and mobile broadband connections, Sub-Saharan Africa, 2012–2022

Figure 18: Fixed broadband penetration of households by country, Sub-Saharan Africa, 2012–2022

Figure 19: Major forecast drivers: current situation (2012) and future trajectory (2017–2022), by country, Sub-Saharan Africa 

Figure 20a: Methodology for attributing scores to each element in the key drivers table (current and future) and impact of high scores

Figure 20b: Methodology for attributing scores to each element in the key drivers table (current and future) and impact of high scores

Figure 21: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Ghana, 2012–2022

Figure 22: Telecoms retail revenue by service type, total service revenue and growth rates, Ghana, 2016–2022

Figure 23: Connections by type, and growth rates, Ghana, 2016–2022

Figure 24: Mobile, smartphone and 4G/5G penetration rates, Ghana, 2012–2022

Figure 25: Mobile ARPU by type, and mobile ARPU, Ghana, 2012–2022

Figure 26: Summary of key mobile market drivers and assumptions, Ghana

Figure 27: Fixed penetration rates by service type, Ghana, 2012–2022

Figure 28: Fixed ASPU by service type, Ghana, 2012–2022

Figure 29: Summary of key fixed market drivers and assumptions, Ghana

Figure 30: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Kenya, 2012–2022

Figure 31: Telecoms retail revenue by service type, total service revenue and growth rates, Kenya, 2016–2022

Figure 32: Connections by type, and growth rates, Kenya, 2016–2022

Figure 33: Mobile, smartphone and 4G/5G penetration rates, Kenya, 2012–2022

Figure 34: Mobile ARPU by type, and mobile ARPU, Kenya, 2012–2022

Figure 35: Summary of key mobile market drivers and assumptions, Kenya

Figure 36: Fixed penetration rates by service type, Kenya, 2012–2022

Figure 37: Fixed ASPU by service type, Kenya, 2012–2022

Figure 38: Summary of key fixed market drivers and assumptions, Kenya

Figure 39: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Nigeria, 2012–2022

Figure 40: Telecoms retail revenue by service type, total service revenue and growth rates, Nigeria, 2016–2022

Figure 41: Connections by type, and growth rates, Nigeria, 2016–2022

Figure 42: Mobile, smartphone and 4G/5G penetration rates, Nigeria, 2012–2022

Figure 43: Mobile ARPU by type, and mobile ARPU, Nigeria, 2012–2022

Figure 44: Summary of key mobile market drivers and assumptions, Nigeria

Figure 45: Fixed penetration rates by service type, Nigeria, 2012–2022

Figure 46: Fixed ASPU by service type, Nigeria, 2012–2022

Figure 47: Summary of key fixed market drivers and assumptions, Nigeria

Figure 48: Telecoms retail revenue by service type and total service revenue (retail and wholesale), South Africa, 2012–2022

Figure 49: Telecoms retail revenue by service type, total service revenue and growth rates, South Africa, 2016–2022

Figure 50: Connections by type, and growth rates, South Africa, 2016–2022

Figure 51: Mobile, smartphone and 4G/5G penetration rates, South Africa, 2012–2022

Figure 52: Mobile ARPU by type, and mobile ARPU, South Africa, 2012–2022

Figure 53: Summary of key mobile market drivers and assumptions, South Africa

Figure 54: Fixed penetration rates by service type, South Africa, 2012–2022

Figure 55: Fixed ASPU by service type, South Africa, 2012–2022

Figure 56: Summary of key fixed market drivers and assumptions, South Africa

Figure 57: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Tanzania, 2012–2022

Figure 58: Telecoms retail revenue by service type, total service revenue and growth rates, Tanzania, 2016–2022

Figure 59: Connections by type, and growth rates, Tanzania, 2016–2022

Figure 60: Mobile, smartphone and 4G/5G penetration rates, Tanzania, 2012–2022

Figure 61: Mobile ARPU by type, and mobile ARPU, Tanzania, 2012–2022

Figure 62: Summary of key mobile market drivers and assumptions, Tanzania

Figure 63: Fixed penetration rates by service type, Tanzania, 2012–2022

Figure 64: Fixed ASPU by service type, Tanzania, 2012–2022

Figure 65: Summary of key fixed market drivers and assumptions, Uganda

Figure 66: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Uganda, 2012–2022

Figure 67: Telecoms retail revenue by service type, total service revenue and growth rates, Uganda, 2016–2022

Figure 68: Connections by type, and growth rates, Uganda, 2016–2022

Figure 69: Mobile, smartphone and 4G/5G penetration rates, Uganda, 2012–2022

Figure 70: Mobile ARPU by type, and mobile ARPU, Uganda, 2012–2022

Figure 71: Summary of key mobile market drivers and assumptions, Uganda

Figure 72: Fixed penetration rates by service type, Uganda, 2012–2022

Figure 73: Fixed ASPU by service type, Uganda, 2012–2022

Figure 74: Summary of key fixed market drivers and assumptions, Uganda

 

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