Report: 4G key to unlocking value in Sub-Saharan Africa
May 18, 2022
Sub-Saharan Africa represents one of the last major growth regions globally for mobile services, forecast to contribute 29 per cent of global subscription growth this decade, according to research from Strategy Analytics.
The report, Sub-Saharan Africa Wireless Market Outlook: Operator Growth Strategies, highlights 4G as a major priority for SSA operators in the medium term, delivering cost-effective mobile broadband coverage and devices to lift ARPU, unlocking the FWA opportunity, and boosting digital inclusion.
According to the report, Sub-Saharan Africa is a region where 4G is still in its infancy, currently accounting for less than one quarter of mobile connections and with network coverage of 57 per cent of the population, leaving limited coverage outside of urban centres. 4G will be key to creating market value as mobile internet adoption moves beyond 2G and 3G. However, mobile operators in SSA have spent less on CAPEX as a proportion of service revenues compared to operators in Middle East & North Africa (MENA) and globally. With capital intensity of approximately 15 per cent, managed from a lower-ARPU customer base, high levels of network investment have been a challenge for some.
The report provides recommendations to operators in areas critical to unlocking revenue growth through digital inclusion. These focus on improving the availability of low-cost 4G smartphones and smart featurephones, and solving the challenge of extending 4G coverage into rural and remote communities where it is not uncommon for ARPUs to be below $1 per month.
Phil Kendall, Director of Strategy Analytics’ Service Provider Group and report author, commened: “4G network expansion requires the use of innovative products and network deployment strategies, with network-as-a-service and refurbished network equipment interesting developments in the region. Low-cost rural coverage is also as much about energy costs as hardware costs, with green site solutions key for the deployment business case. Governments also have a role to play here, both in terms of making low-band spectrum available for 4G and in terms of committing funds in national broadband plans and digital inclusion policies to support 4G for all.”