Business Nigeria Telecoms: Industry growth rate slows

#1
logo.png


Nigeria's mobile phone industry, Africa's largest mobile market in terms of subscription, is currently experiencing a slow growth rate. the Nigerian Communications Commission (NCC) recently stated that the number of active telecoms line grew by 16 per cent from last year to 120.36 million.

“Given the slowdown in the growth of active lines and a tele-density rate of around 72 percent (on a population size of 167 million), we can comfortably say that most of the low hanging fruits have already been plucked,” FBN Capital research analysts, led by Gregory Kronsten, said in a note released Thursday.

According to the National Bureau of Statistics (NBS), Nigeria’s economic growth, which slowed to 6.6 percent in 2012 from 7.4 percent a year earlier, may expand 6.8 percent this year.

In comparison to the financial and manufacturing sector, the telecom industry was the largest contributor to growth in 2012, expanding by 34.2 percent, with a GDP of 7.05 per cent in 2012.

MTN Group’s Nigerian unit is the market leader in Nigeria with 55.23 million customers, followed by Nigeria’s Globacom with 25.0 million, New Delhi-based Bharti Airtel with 21.59 million, and Abu Dhabi-based Emirates Telecommunications Corp.’ Etisalat with 15.3 million, according to data on the NCC’s website.

According to some analysts, the mobile number portability (MNP), which was introduced in April 2013, may have contribute to the decline in the number of subscriptions, since customer have the option of migrating across operators, thus reducing the use of multiple handsets. While all the networks face challenges including frequent power cuts and the sabotage of phone facilities in the country’s mainly Muslim North, analysts say the sector still offers opportunities.

The telcos have responded by becoming more focused on investing to improve service and also to focus on non-voice revenue as the proliferation of smartphones, including the iPhone and blackberry is helping stimulate data usage and revenue.

MTN Group, Africa’s largest wireless operator, last week said first-half profit rose 22 percent, exceeding estimates, after subscriber numbers increased in markets including Nigeria. Operations in Nigeria were also the biggest contributors to data revenue growth, according to MTN, as sales advanced 9.8 percent to 65.2 billion rand ($6.5bn).
 
[1753]
advertise on Nigerian Bulletin - see rates per week
advertise on Nigerian Bulletin - see rates per week
Loading...
Your email address will not be publicly visible. We will only use it to contact you to confirm your post.
Top