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Market |
Telecommunications |
Report Type |
Market Research |
Country |
South Africa |
Published |
9 March 2010 |
Number of Pages |
102 |
Download |
|
Immediate |
|
Publisher |
Business Monitor International |
Our Q2 2010 update on the South African telecommunications market contains revised forecasts for the country’s fixed-line, internet and mobile telephony markets. Our forecasts incorporate the latest fixedline and internet data published by South African incumbent operator Telkom SA, as well as end-of-year subscriber data published by the country’s largest mobile operator, Vodacom.
At the time of writing, only Vodacom had published subscriber figures for the three months ending December 31 2009. In the final quarter of the year, Vodacom’s customer base shrank by 3.9% q-o-q, its customer numbers having being adversely affected by the introduction of compulsory SIM registration in July 2009. By the end of 2009, we now estimate that there were around 49.76mn mobile telephony customers in South Africa. This figure reflects negative growth of 1.2% growth for the year as a whole. We now predict that South Africa’s mobile customer base could see a further decline in 2010. Media reports have indicated that efforts to register mobile users could take much longer than expected, especially in rural parts of the country. Furthermore, while SIM cards belonging to the significant number of illegal immigrants in South Africa will ultimately be deactivated, the deactivation process could be drawn out. In addition to efforts by the operators to deactivate inactive SIMs, it has been suggested that South Africa’s regulator could step in with forced deactivations towards the end of 2010. However, according to media reports, the introduction of compulsory SIM registration has been criticised by South Africa’s mobile network operators for harming people’s ability to get access to communications services. Rural areas and informal distribution channels are thought to have been hit hardest, as they are not geared up to ensure that every time a SIM card is sold the private details of the buyer are recorded.
In the past few months, other key developments within South Africa’s mobile market include the news that the country’s third largest mobile operator, Cell C, plans to launch a 3.5G HSPA+ network sometime before the end of 2010. South Africa’s third largest cellco by subscriber numbers announced in December that it aimed to invest a total of ZAR5bn (US$659.98mn) in its networks over the course of the year. Meanwhile, there is disagreement between the operators and the regulator with regard to the correct level at which mobile termination rates (MTRs) should be set. In February 2010, it was reported that the Independent Communications Authority of South Africa (ICASA) rejected the proposed MTR cuts that had previously been submitted by the country’s leading cellcos.
South Africa has slipped from third to fourth position in our latest set of Business Environment Ratings for Sub-Saharan Africa. The change of position reflects a weaker overall score, which is itself the result of a lower score in both the Telecoms Market and Country Risk categories. Although South Africa’s economy is emerging from recession, we continue to expect a sluggish recovery, with a contraction in private investment, and a subdued bounce-back for exports and private consumption conspiring to keep growth at a sub-trend level over the coming years
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