The African telecom market is changing. Covid-19 caused a shift in consumer demands. For experts, operators that can not keep up with the shifting demands may completely disappear.
In the long run, African telecom markets will be dominated by just two to three major players, according to MTN Group CEO Ralph Mupita (photo). Speaking during the recent “Think Big” webinar organized Tuesday (April 26), by financial service group PSG, the CEO explained that the “profit pool” is not enough to meet “the return and other financial objectives of a number of industry players.”
“Within the next few years, we will see a sector dominated by 2 to 3 major players who have the capabilities and capacity to rally massive amounts of capital investment locally and abroad, to sustain the industry’s expansion. MTN has every intention of being one of the scale operators in all of its markets,” he said. He then estimated that consolidation was “inevitable” because “having a market that is saturated by a number of players is not sustainable.”
In the past two years, demand for broadband internet and value-added services has increased significantly in Africa. This is an added pressure on telecom operators’ finances and only firms that can make the necessary investments to upgrade and expand their networks can meet the demand and survive to generate growing revenues. Operators that cannot cope with the quality demands may lose subscribers and gradually exit the markets.
The trend has already begun in several markets. In Gabon and Benin for instance, in 2014, two telecom operators exited, leaving the market for two. Also, in Ghana, there are currently four operators but, according to authorities, the market is moving towards a duopoly. The competition also forced Millicom International Cellular to exit its African markets while Africell left the Ugandan market for the same reason.
Isaac K. Kassouwi
Lebara Group is now bringing its affordable and reliable mobile services to Africa, starting with Ni...
• Maritime sector faces renewed risks amid military tensions in the Middle East• Blockade fears at S...
• Gates Foundation commits $1.6 billion over five years to Gavi.• Bill Gates warns of rising ch...
In a West African financial landscape marked by tighter regulation of the fintech sector, digital fi...
Transport and food prices have been climbing steadily across Africa in recent years. In Côte d’Ivoir...
• Record drought tests Zambia's dependence on hydropower, impacting its vital mining industry • Adoption of dedicated solar projects, such as the recent...
• The African Development Bank (AfDB) has approved €25.5 million in funding to boost Mauritanian SMEs and stimulate inclusive growth.• Mauritania’s...
• Blue Gold, active in Ghana with the Bogoso project, looks to grow its portfolio by potentially acquiring gold projects in West Africa.• CEO Andrew...
• Bassirou Diomaye Faye denounces credit rating agencies’ methodologies as ill-suited to African contexts.• Senegal urges reforms to enable fairer...
In northern Ethiopia, in the Tigray region, lies Axum (also spelled Aksum), an ancient city that once stood at the heart of one of Africa’s most powerful...
Lake Natron, located in northern Tanzania near the Kenyan border, is one of the most extraordinary and extreme lakes in Africa. Fed primarily by the Ewaso...