The most influential Megatrends set to shape the world through 2030, identified by Euromonitor International, help businesses better anticipate market developments and lead change for their industries.
Countries in sub-Saharan Africa have experienced very high rates of growth in mobile telecoms usage since 2005, thanks to rising incomes and greater competition and investment. Wide variations persist across the region, however, with South Africa the most advanced market, but potential for growth remains in many countries. Mobile telecoms usage has benefited consumers and created opportunities for companies, but low spending power limits the types of services and products that can be marketed.
Sub-Saharan Africa is one of the world’s most promising markets for mobile telecoms. Its January 2011 population of 834.7 million is growing quicker than any other region in the world, at an average rate of 2.5% per year between January 2005 and January 2011. Average incomes have risen across most sub-Saharan countries over the same period, although dipped due to the global recession;
The number of mobile phone subscriptions in sub-Saharan Africa has risen from 88.7 million in 2005 to 342.6 million in 2010. Measured as a proportion of the population, subscriptions have risen from a penetration rate of 12.3% in 2005 to 42.1% in 2010. However this rate lags far behind the global average of 74.8% in 2010, leaving plenty of room for growth;
Major variations persist around the region. While more economically developed countries like South Africa have high mobile penetration rates (95.3% of the population in 2010), less developed countries lag far behind. This is due to a range of factors including high poverty rates, a lack of market liberalisation and the difficulties of installing infrastructure. The largest mobile telephone market in the region in 2010 was Nigeria, with 86.9 million subscribers, followed by South Africa at 48.1 million;
For consumers, mobile phone access facilitates communications, especially in rural areas where landline infrastructure is not available. They open up opportunities to use services like mobile banking and can speedily transmit market information to farmers and businesspeople. Areas with mobile Internet access allow consumers to get online without the need for fixed-line infrastructure;
For businesses there are still opportunities despite rapid growth and rising competition. However, this is tempered by very low levels of consumer spending on telecommunications services and products: in sub-Saharan Africa this was a combined US$22.6 per capita in 2010 compared to a global average of US$156.2 per capita. Many companies have tried to adapt and create low-cost services and products, e.g. handsets, specifically for the African market.
Although regional growth is strong, major differences persist from country to country:
South Africa has by far the highest mobile phone penetration rate of any country in the region at 95.3% of the population in 2010. This is due to higher average disposable incomes (US$4,087 per capita in 2010 compared to US$681 per capita in Nigeria) and a more advanced and competitive market;
At the other end of the scale in terms of penetration rates are countries such as Ethiopia (6.4% of the population), Eritrea (3.3%) and Somalia (8.1%), where mobile penetration rates lag far behind due to lower incomes, an unstable political or security environment and a lack of liberalisation. Ethiopia retains a state monopoly on landline and mobile telecoms, while Somalia is a highly unstable place for investors;
The quickest-growing markets for subscriptions in sub-Saharan Africa over 2005-2010 were Guinea at an average annual rate of 84.7%, Rwanda at 71.4% and Madagascar at 71.0%. All three were starting from low bases. The largest single market in sub-Saharan Africa is Nigeria, which has also achieved the biggest growth in absolute terms, adding an extra 68.3 million subscriptions between 2005 and 2010 and bringing total mobile subscriptions to 86.9 million – 25.4% of all sub-Saharan Africa;
Largest Mobile Telephone Subscription Markets and Penetration Rates in sub-Saharan Africa: 2010
millions / % of total population
Source: Euromonitor International from ITU/World Bank/trade sources
Ownership of mobile phones has far surpassed landlines across the region. In 2010 65.0% of Nigerian households owned a mobile phone, compared to 1.5% for a fixed-line telephone. Fixed-line telephones are increasingly redundant in many markets, as consumers and companies are “leapfrogging” fixed-line infrastructure and going straight to mobile phones and Internet.
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