Rural mobile expansion set to drive telecoms growth

2010-11-10 15:01

Mobile telecom expansion into rural Africa where fewer than one in 10 people has network coverage was tipped on Wednesday as a key driver of future cellular market growth on the continent.

“Connecting rural areas and proving ICT access is set to be the future of the industry, I think for the next few years specifically in this region,” said Nick Jotischky, principal analyst for Informa Telecoms & Media.

The number of African mobile subscribers passed more than 500 million people in September, making up a tenth of the world market, but mobile penetration into rural areas was typically below 10%.

Under-served rural areas presented growth opportunity for operators, Jotischky told the AfricaCom 2010 conference, a two-day gathering of the telecom industry focused on Africa.

“Globally mobile subscriber growth will continue to fall. That’s a natural effect of over saturation,” he said.

“In Africa the trend is going to be much the same in the sense that subscriber growth will falter but I think expansion into rural areas can and will boost growth and even cause acceleration.”

The biggest barrier facing operators in expanding to remote and rural areas was access to electricity, he said, citing a survey by Informa.

Another clear area for growth in Africa was mobile data with revenue set to double by 2015.

“Africa still is a vibrant growth market. It certainly has lost none of that vibrancy and we’ve seen that from the growth in revenues,” he said.

Mobile penetration for Africa stood at 48.35% at the end of September and the number of subscribers reached 506 million, according to Informa.

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