Convergence Partners » Research

African Communications Market : Onward and upward (Research Report Vol 2 No.1 2009)

admin — Tue, 01 Dec 2009 13:49:27 +0000

This is an update to the Convergence Partners report entitled “African Telecommunications Market: Last Frontier For Growth” (Vol.1 No.1 of 2007) (”Report 1“).

Conclusion: The African communications growth story can no longer be viewed as a frontier opportunity as more and more players from developed markets enter the African market.

Rather, the market is showing signs of greater maturity reflected by, amongst other: (i) increased competition; (ii) reducing gross margins; (iii) declining ARPUs; (iv) greater complexity of product offering and mobile payment services; (v) active attempts by incumbent mobile and fixed-line operators to expand into other parts of the value chain; and (vi) the emergence of infrastructure sharing models. While subscriber growth remains superior to other regions, with significant pent-up demand remaining, these changes in the communications landscape is forcing operators to rethink their strategies and focus on the next wave of growth.

Significantly, there have been a number of major developments that will catapult the African communications market into another league from both a cost and bandwidth perspective. These include the arrival of new international submarine fibre optic cables such as Seacom connecting the East African seaboard to international submarine fibre networks and the accelerated liberalisation of African communications markets.

View the full report

CP Research Report Vol.1 No.2 2007: WiMAX = 4G

admin — Wed, 01 Aug 2007 13:45:42 +0000

Conclusion: The long-term evolution of GSM (LTE), commonly referred to as 4G, is planned to start rolling out from 2011 and will finally enable the promised benefits of 3G (fast internet, mobile TV etc.) to be realised. However, today technology is available that is able to already deliver most, if not all, of these benefits several years before LTE promises to deliver it.

WiMAX is this technology (the so-called “elephant in the room”): standards have been passed, mobility will soon be enabled, and the cost of its rollout can be achieved at a fraction of the cost of the capital requirements of a 3G network. The equipment is robust and manufacturers are pressing on with chip developments for the new generation mobile devices.

So why then does LTE continue to exist? In our view the answer to this question lies in the following:

Resistance from some existing network operators;
Limited availability of spectrum; and
WiMAX mobility is only starting to look possible.

Nonetheless, in this report we demonstrate that WiMAX serves as a cheap and viable solution to Africa’s wireless broadband needs, and is a serious contender that can be implemented by existing GSM operators and is in fact already being rolled out.

View the full report

CP Research Report v1 2007: African Telecommunications Market

admin — Sun, 01 Apr 2007 13:44:55 +0000

Conclusion: This report demonstrates that the stagnancy of the African communications sector experienced pre- 1993, was replaced by rapid growth and opening of new markets for telecommunications operators in the past five years. African markets are rapidly increasing in value and interest has been shown not only by regional operators, but increasingly by global operators. Despite the past strong performance significant growth potential still exists.

The introduction of innovative pricing models has opened previously untapped markets. This expansion is accompanied and supported by convergence, liberalisation of policy environments and rapid technology changes. The maturing of some markets has seen reduced revenue per user, but these are being offset by increased volumes, revenues and higher-end broadband offerings.

A few major international and regional players dominate the market, with significant corporate activity a strong feature.

View the full report