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The Sub-Saharan Africa telecoms market: trends and forecasts 2017–2022 based on 3Q 2017 data

The Sub-Saharan Africa telecoms market: trends and forecasts 2017–2022 based on 3Q 2017 data


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 provides an interim update of our 5-year forecast of more than 180 mobile and fixed KPIs for SSA as a whole and for 11 key countries.

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Executive summary
Telecoms revenue will grow at a CAGR of 2.7% during 2017–2022 to USD46.6 billion, amidst regulatory and macroeconomic challenges
The positive growth in telecoms retail revenue will be largely proportional to the economic growth across SSA, except in Ghana and Nigeria
Geographical coverage: we model 11 telecoms markets, which will account for 68.4% of SSA’s overall telecoms service revenue in 2022
Key trends, drivers and assumptions for the mobile and fixed markets
Key recommendations for telecoms operators
Regional forecasts and cross-country comparison
Market context: the 11 countries modelled provided 50.9% of the total population in SSA and 69.6% of its telecoms service revenue in 2017
Key mergers, acquisitions and market entries
Key drivers at a glance for each market in Sub-Saharan Africa
Market overview: mobile and fixed data services will drive revenue growth but mobile voice will continue to dominate
Mobile: 3G will become the predominant technology in SSA, while 4G will account for 13.7% of mobile connections in 2022
Mobile: the number of connections will increase in most countries, driven by improved coverage and competition, but growth will slow down
Mobile: spending on non-voice services will help to slow down the ARPU decline in most countries in SSA
Mobile: growth rates for SIM penetration will drop to single digits in most markets despite the sustained demand for mobile services
Fixed: wireless access will contribute the largest share of broadband revenue, but fibre will have the highest growth rate
Fixed: South Africa is a regional leader in the wired broadband market thanks to its developed infrastructure and level of competition
Fixed: increased popularity of wireless services will cause revenue to fall, while the growth of NGA will help to stabilise ASPU over the next 5 years
Fixed: fixed services in SSA generally offer poor quality at a high cost, and are not accessible to the majority of the region’s population
Business services: enterprise revenue is small, but growing more rapidly in Sub-Saharan Africa than in other regions
IoT: cellular M2M revenue growth is substantial, but connectivity revenue remains small
Individual country forecasts
Ghana: non-voice services, including mobile money, will help to boost revenue despite modest growth in the number of SIMs
Ghana: reluctance to acquire LTE spectrum will limit its adoption, and fixed broadband will remain unaffordable for most customers
Ghana: modest growth in the number of mobile connections but a growing demand for data and financial services will boost revenue
Ghana: the forecasts for the number of handset connections and the fixed broadband revenue have been revised
Kenya: the mobile market has potential for growth, while cable’s popularity and fibre deployments will support the fixed market
Kenya: the accelerated adoption of 4G will drive traffic growth; cable will maintain its dominance of the fixed broadband market
Kenya: there are solid growth prospects for mobile and fixed broadband adoption will benefit from better access
Kenya: there is a more optimistic outlook for fibre services thanks to recent deployments and stronger than expected uptake
Nigeria: difficult economic conditions will continue to impact the telecoms market in terms of investment and spend
Nigeria: increased 4G coverage and improved smartphone affordability will support the demand for data services
Nigeria: there is potential room for growth in the number of SIMs despite the crowded market and challenging operating conditions
Nigeria: projections for fixed broadband have been revised, taking into consideration new information that has become available
South Africa: service revenue will grow at a modest CAGR of 1.3% during 2017–2022, driven by handset data and fixed broadband
South Africa: there will be sustained growth for the mobile market but the fixed market will benefit from investment
South Africa: the open access model for LTE will delay the release of spectrum, while investment will help boost broadband coverage
South Africa: the forecast for mobile interconnect revenue is now more conservative in anticipation of a regime change
Tanzania: service revenue will reach TZS2.97 trillion in 2022, and more than 39.7% of this will be from mobile handset data
Tanzania: accelerated adoption of 4G services beyond urban centres will support data traffic and revenue growth
Tanzania: the mobile market offers growth opportunities despite competition while the fixed market will benefit from investment
Tanzania: mobile voice interconnect revenue will reduce nbsp; substantially due to a new aggressive termination rates glide path
Uganda: mobile handset data and fixed broadband services will drive service revenue growth to almost UGX3.29 trillion by 2022
Uganda: 4G services will be adopted slowly because of their unaffordability, limited coverage and low smartphone penetration
Uganda: the growth in the number of mobile subscribers resumed in 2017, but revenue is set to decline as wireless dominates
Uganda: there is an optimistic short-term outlook for fixed broadband adoption but a modest projection for postpaid uptake
Methodology
Our forecast model is supported by sound market knowledge
Examples of forecast input drivers
Key drivers at a glance table: methodology

 

List of figures:

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

Figure 2: Growth in telecoms retail revenue and nominal GDP by country, Sub-Saharan Africa, 2016–2022

Figure 3: 4G/5G share of mobile connections and next-generation access (NGA) share of fixed broadband connections by country, Sub-Saharan Africa, 2016 and 2022

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

Figure 5: Metrics for the 11 countries modelled individually in Sub-Saharan Africa, 2017

Figure 6: Recent and upcoming market structure changes in Sub-Saharan Africa

Figure 7: Major forecast drivers: current situation (2016) and future trajectory (2017–2022), by country, Sub-Saharan Africa

Figure 8: Total fixed and mobile telecoms service revenue, Sub-Saharan Africa (USD billion), 2012–2022

Figure 9: Mobile connections by type, Sub-Saharan Africa (million), 2012–2022

Figure 10: Telecoms retail revenue and growth rate by service type, Sub-Saharan Africa, 2012–2022

Figure 11: Fixed connections by type, Sub-Saharan Africa (million), 2012–2022

Figure 12: Mobile connections by generation, Sub-Saharan Africa (million), 2012–2022
Figure 13: Mobile ARPU by type, Sub-Saharan Africa (USD per month), 2012–2022
Figure 14: Contract share of mobile connections (excluding IoT), Sub-Saharan Africa, 2012–2022

Figure 15: Mobile data traffic per connection, Sub-Saharan Africa (MB per month), 2012–2022

Figure 16: Mobile penetration by country, Sub-Saharan Africa, 2012–2022

Figure 17: Mobile ARPU by country, Sub-Saharan Africa, 2012–2022
Figure 18: Broadband connections by technology, Sub-Saharan Africa (million), 2012–2022

Figure 19: Fixed retail revenue by service, Sub-Saharan Africa (USD billion), 2012–2022

Figure 20: NGA broadband household penetration and NGA share of broadband connections, Sub-Saharan Africa, 2012–2022

Figure 21: Fixed Internet traffic per broadband connection, Sub-Saharan Africa (GB per month), 2012–2022

Figure 22: Fixed broadband household penetration by country, Sub-Saharan Africa, 2012–2022

Figure 23: Fixed broadband access ASPU by country, Sub-Saharan Africa, 2012–2022
Figure 24: Total market revenue from business services, Sub-Saharan Africa, 2012–2022

Figure 25: Total IoT value chain revenue by sector, Sub-Saharan Africa, 2013–2022

Figure 26: Total fixed and mobile telecoms service revenue, Ghana (GHS billion), 2012–2022
Figure 27: Mobile connections by type, Ghana (million), 2012–2022

Figure 28: Telecoms retail revenue and growth rate by service type, Ghana, 2012–2022

Figure 29: Fixed connections by type, Ghana (thousand), 2012–2022

Figure 30: 4G and contract share of mobile connections, Ghana, 2012–2022

Figure 31: Mobile ARPU, fixed voice ASPU and fixed broadband ASPU, Ghana (GHS per month), 2012–2022

Figure 32: Mobile data traffic per connection, Ghana (MB per month), 2012–2022

Figure 33: Broadband connections by technology, Ghana (thousand), 2012–2022

Figure 34: Total telecoms service revenue – current and previous forecasts, Ghana, 2012–2022

Figure 35: Total fixed and mobile telecoms service revenue, Kenya (KES billion), 2012–2022

Figure 36: Mobile connections by type, Kenya (million), 2012–2022
Figure 37: Telecoms retail revenue and growth rate by service type, Kenya, 2012–2022
Figure 38: Fixed connections by type, Kenya (thousand), 2012–2022  

Figure 39: 4G and contract share of mobile connections, Kenya, 2012–2022

Figure 40: Mobile ARPU, fixed voice ASPU and fixed broadband ASPU, Kenya (KES per month), 2012–2022

Figure 41: Mobile data traffic per connection, Kenya (MB per month), 2012–2022

Figure 42: Broadband connections by technology, Kenya (thousand), 2012–2022

Figure 43: Total telecoms service revenue – current and previous forecasts, Kenya, 2012–2022

Figure 44: Total fixed and mobile telecoms service revenue, Nigeria (NGN trillion), 2012–2022

Figure 45: Mobile connections by type, Nigeria (million), 2012–2022

Figure 46: Telecoms retail revenue and growth rate by service type, Nigeria, 2012–2022

Figure 47: Fixed connections by type, Nigeria (thousand), 2012–2022

Figure 48: 4G and contract share of mobile connections, Nigeria, 2012–2022

Figure 49: Mobile ARPU, fixed voice ASPU and fixed broadband ASPU, Nigeria (NGN per month), 2012–2022

Figure 50: Mobile data traffic per connection, Nigeria (MB per month), 2012–2022

Figure 51: Broadband connections by technology, Nigeria (million), 2012–2022
Figure 52: Total telecoms service revenue – current and previous forecasts, Nigeria, 2012–2022;
Figure 53: Total fixed and mobile telecoms service revenue, South Africa (ZAR billion), 2012–2022

Figure 54: Mobile connections by type, South Africa (million), 2012–2022

Figure 55: Telecoms retail revenue and growth rate by service type, South Africa, 2012–2022
Figure 56: Fixed connections by type, South Africa (million), 2012–2022

Figure 57: 4G and contract share of mobile connections, South Africa, 2012–2022

Figure 58: Mobile ARPU, fixed voice ASPU and fixed broadband ASPU, South Africa (ZAR per month), 2012–2022

Figure 59: Mobile data traffic per connection, South Africa (MB per month), 2012–2022

Figure 60: Broadband connections by technology, South Africa (million), 2012–2022

Figure 61: Total telecoms service revenue – current and previous forecasts, South Africa, 2012–2022

Figure 62: Total fixed and mobile telecoms service revenue, Tanzania (TZS trillion), 2012–2022

Figure 63: Mobile connections by type, Tanzania (million), 2012–2022

Figure 64: Telecoms retail revenue and growth rate by service type, Tanzania, 2012–2022

Figure 65: Fixed connections by type, Tanzania (thousand), 2012–2022
Figure 66: 4G and contract share of mobile connections, Tanzania, 2012–2022
Figure 67: Mobile ARPU, fixed voice ASPU and fixed broadband ASPU, Tanzania (TZS per month), 2012–2022

Figure 68: Mobile data traffic per connection, Tanzania (MB per month), 2012–2022

Figure 69: Broadband connections by technology, Tanzania (thousand), 2012–2022

Figure 70: Total telecoms service revenue – current and previous forecasts, Tanzania, 2012–2022

Figure 71: Total fixed and mobile telecoms service revenue, Uganda (UGX trillion), 2012–2022

Figure 72: Mobile connections by type, Uganda (million), 2012–2022

Figure 73: Telecoms retail revenue and growth rate by service type, Uganda, 2012–2022

Figure 74: Fixed connections by type, Uganda (thousand), 2012–2022

Figure 75: 4G and contract share of mobile connections, Uganda, 2012–2022

Figure 76: Mobile ARPU, fixed voice ASPU and fixed broadband ASPU, Uganda (UGX per month), 2012–2022

Figure 77: Mobile data traffic per connection, Uganda (MB per month), 2012–2022

Figure 78: Broadband connections by technology, Uganda (thousand), 2012–2022

Figure 79: Total telecoms service revenue – current and previous forecasts, Uganda, 2012–2022

Figure 80: Methodology for attributing scores to each element in the key drivers table (current and future) and impact of high scores

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