Malawi - Telecoms, Mobile, Broadband and Forecasts
Currency devaluation causing continuing difficulties for telcos
This report provides a comprehensive overview of trends and developments in Malawi's telecommunications market.
Subjects covered include:
Market and industry overviews;
Government policies affecting the telecoms industry;
Market liberalisation and regulatory issues;
Telecoms operators privatisation, acquisitions, new licences;
Major players (fixed, mobile and broadband);
Mobile voice and data markets;
Internet and broadband development and growth;
Convergence (voice/data, fixed/wireless/mobile);
Mobile data services, including 3G;
Average Revenue per User (ARPU).
Malawi is one of the world's least developed countries, but after a poor economic performance during the last two years GDP is expected to grow at above 5% for 2013. Telcos have been affected by the currency devaluation imposed in mid-2013, which has delayed their ability to fund network upgrades. In addition, the government in mid-2013 instituted a tax on internet services, the additional cost of services being passed on to consumers.
Mobile penetration remains very low in comparison to the African average, which allows for considerable opportunities for further growth. The market remains a duopoly between Bharti Airtel (formerly Zain) and Telecom Networks Malawi (TNM) given the failure of the potential third mobile operator, G-Mobile, to launch services. The operator's continuing delays encouraged the telecom regulator to revoke the company's licence in 2013.
To encourage additional market competition, the government has followed in the footsteps of several of its neighbours and introduce a converged licensing regime which now allows the two fixed-line operators, Malawi Telecommunications (MTL) and Access Communications (ACL) to enter the mobile market as well. Both are already operating CDMA-based fixed-wireless networks which support full mobility and broadband access using EV-DO technology.
The internet sector is reasonably competitive with 15 licensed ISPs, but the limited availability and high cost of international bandwidth has held back growth and kept broadband prices high. DSL services are available, and several ISPs are extending their WiMAX wireless broadband footprints. The two incumbent mobile networks have launched third generation (3G) mobile services based on UMTS/HSPA technology.
A national fibre backbone is being implemented, and the country recently gained access to international submarine fibre optic cables for the first time when a transit link via neighbouring countries was completed. Provided a suitable regulatory regime is put in place, this will bring down the cost of international bandwidth and deliver a boost to the broadband market.
Estimated market penetration rates in Malawi's telecoms sector end 2013
Market | Penetration rate
Mobile | 33%
Fixed | 1.6%
Internet | 5.7%
(Source: BuddeComm based on various sources)
Airtel Money registers over 500,000 users; converged licensing regime expected to boost competition; Airtel Malawi receives ten-year licence renewal; national fibre rollout; international fibre access helping develop the broadband market; white space spectrum trials to increase broadband availability; SimbaNeET contracted to build and operate a fibre-optic cable linking Lilongwe with Tanzania; market developments to early 2014.
Companies covered in this report:
Malawi Telecommunications Ltd (MTL); Access Communications Ltd (ACL); Bharti Airtel (Zain, Celtel); Telekom Networks Malawi (TNM); G-Mobile (GAIN); Celcom Ltd; Escom; MalawiNet; MTL Online; Skyband;Globe Internet; Broadmax; Burco.
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