As Africa telecoms grow Ethiopia, Somalia and Zimbabwe present great potential

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A telecoms committee has been recently formed to urge African Countries to focus their attention to broadband deployment and telecom services to rural communities.

Africa is still experiencing strong growth in telecommunication, broadband, non-voice services, rural expansion and efficiency strategies which have all been identified as the main opportunities for continued expansion within Africa.

Despite a global recession Africa’s telecoms industry will post an increasing number of mobile subscribers and data usage, it seems that the telecoms industry could single handily support the continued growth within Africa, but this needs to be supported by not only industry heads but also the government.

The report indicates that the Internet penetration level in the continent is a paltry 5.4 percent, with only 12 countries having a penetration rate of more than 1 percent.

The committee who will meet at the NGT Africa summit will be made up of the biggest Telecom companies on the Continent, which include Zain, MTN, Africell, Safaricom, Vodafone and France Telecom. They have announced their belief that voice services would remain the largest contributor to telecom operators’ revenue in the medium term, and data and value added services would also continue to grow within rural areas.

According to summit organiser William Austin, “Even though the African telecommunications industry is one of the fastest growing in the world, up to 85% of the population in some countries still doesn’t have access to basic wireless communications. In the past, these remote and rural locations have proven too difficult to serve for most operators, but as technology evolves, this untapped market is gradually starting to become more attractive and economically viable to the service providers in the region.”

Now that sub-sea cables have landed on mainland Africa, the continent has access to broadband and various other services that can be delivered via high speed internet. However, several key challenges still remain before subscribers can enjoy a reliable, safe and affordable service from Internet Service Providers (ISPs) and operators in the region. Before this African countries in the eastern region were dependent on satellite as a backhaul mechanism.

The NGT Africa Committee have also expressed their belief that the continent will witness increased consolidation and mergers; markets that have five or more operators are likely to see more mergers as players compete for access to lucrative markets. The future of telecoms within Africa looks positive but it will face many challenges such as inadequate regulatory frameworks, political instability and slow rate of market liberalization.

Ethiopia, Somalia and Zimbabwe are still considered virgin markets and it is these areas that will present some of the greatest risks as well as the greatest opportunities.

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