Sudan Telecommunications Report Q2 2010 (Business Monitor International)

Our Q2 2010 update on Sudan’s telecommunications market contains the latest operational and financial data published by the country’s leading network operators; they include Kuwait’s Zain Group and MTN of South Africa, respectively the largest and third largest mobile operators by subscribers. Our latest update on the Sudanese market incorporates Q309 data published by these two operators in order to produce a new five-year growth forecast for the country’s cellular subscriber market.

We estimate that Sudan had almost 16.8mn mobile customers at the end of 2009, up from nearly 15.6mn at the end of September. It appears that the market grew by around 40% in 2009 and reached a penetration rate of 42.6% at the end of the year. We believe that Sudani, the mobile business of fixed-line incumbent Sudan Telecom (Sudatel), saw slower growth than Zain and MTN in the first nine months of 2009. In addition to the strong competition from Zain and MTN, Sudani has had to contend with Vivacell and Gemtel, the two regional cellcos in southern Sudan. In recent months, Sudani has pressed ahead with the ongoing development of its mobile data network; in November 2009, the company announced that it had launched an HSDPA network under the Sudani One banner.

Although Sudan has an extremely low broadband penetration rate, more than 10% of the population are thought to be regular internet users; this figure is high by regional standards. Furthermore, recent months have seen some interesting developments that should have a positive impact on long-term growth. Firstly, in March 2009, it was reported that WiMAX ISP Jet Net had teamed up with Jordan’s Neu Group to launch a WiMAX voice and data service in Sudan. Initially targeting Khartoum and Port Sudan, the operator plans to invest between US$20-30mn in the first phase of its network expansion: investment will initially come from the Neu Group, but as it expands, it wants to diversify its sources of finance. The company will use equipment provided by China’s Huawei Technologies.

More recently, in October 2009, it was announced that the World Bank had approved a new project called the Central African Backbone (CAB). The project aims to increase the geographical reach and usage of regional broadband network services in up to 11 central African countries; it also aims to reduce internet access prices. Although the initial phase of the CAB project will focus on Cameroon, Chad and the Central African Republic, Sudan is one of several countries that are eligible to participate.

Sudan sits in 19th position in our regional Business Environment Ratings, having fallen from its previous 15th position. Although Sudan’s own score have not changed this quarter, it has been overtaken as a result of an improved performance by other countries.