South Africa Telecommunications Report

Published 19 May 2015

  • 103 pages
  • Instant access to your report online and PDF format through your account library
  • Includes 3 free updated quarterly reports
$1,295.00
South Africa Telecommunications Report

BMI View: The implementation of mobile termination rate (MTR) cuts in South Africa in 2014 launched a period of intense price competition between the four mobile network operators , while contributing to especially strong subscriptions growth. Price competition eased in early 2015 and will result in much slower subscriptions growth over our five-year forecast; operators are therefore intensifying their efforts to launch new, higher value services, revolving around faster broadband, converged mobile and wireline services, and enterprise solutions. This is driving heavy investment in fibre optic and LTE networks and moves towards consolidation, which, if approved, stand to significantly reshape the competitive environment in South Africa's telecoms market.

Key Data

  • The mobile market grew by 1.6% quarter-on-quarter (q-o-q) in Q414 to bring total growth in 2014 to 12.8%.

  • Market average ARPU declined by 11.9% in 2014 owing to intensified competition, though showed signs of improvement in Q414.

  • 3G subscriptions accounted for 34.7% of the mobile market in 2014, by BMI estimates.

  • The broadband market grew by a 10.4% in 2014 to 7.6mn subscriptions.

Risk/Reward Ratings

South Africa jumped up two spots to 3rd position in this quarter's update to BMI's Risk/Reward Index for Sub-Saharan Africa, behind Nigeria and Botswana. Rather than an improvement to its own score, which actually fell by 0.3 percentage points (ppts), South Africa's ascension was due to sharp drops in Angola and Gabon's scores, as lower oil prices begin to take their toll on GDP growth and consumer spending power.

The 0.3ppt drop in South Africa's score was due to a 5-point decline in its Industry Risks score to 65. This fall is reflective of the lack of clarity on policy and regulations in South Africa's telecoms sector, which has resulted in the delay to digital migration and to a regulatory verdict on proposed acquisitions. Nevertheless, telecoms regulator ICASA published the final Radio...

BMI Industry View
7
BMI View
7
SWOT
9
Political
11
Economic
12
Operational Risk
13
Industry Forecast
15
Table: Telecoms Sector - Historical Data & Forecasts (South Africa 2012-2019)
15
Industry Risk Reward Ratings
19
Table: SSA Risk/Reward Index - Q315
23
Market Overview
25
Mobile
25
Regional Perspective
25
Table: South Africa Mobile Market Regional Comparison, 2014
26
Mobile Growth
26
Table: South Africa Mobile Market
30
ARPU
32
Networks
33
Table: Selected VAS Developments
38
Operator Data
39
Table: Market Overview
39
Table: Vodacom
40
Table: MTN
41
Table: Cell C
42
Table: Telkom
42
Mobile Content
43
Table: Selected Value-Added Services Developments, October 2014-January 2015
45
Wireline
47
Table: Telkom Fixed Telephony Access Lines ('000)
49
Table: Telkom Internet Subscriptions
50
Table: Selected Wi-Fi Developments
51
Table: Recent Fibre Developments
55
Industry Trends And Developments
56
Regulatory Development
58
Table: South Africa - Regulatory Bodies And Their Responsibilities
58
Latest Developments
61
Table: National Broadband Policy Access Targets
65
Competitive Landscape
66
Table: Key Players
66
Table: Selected Operators Financial Indicators (USDmn)
66
Company Profile
67
Telkom
67
Vodacom
72
MTN
76
Cell C
80
Neotel
84
Regional Overview
88
Demographic Forecast
92
Table: Population Headline Indicators (South Africa 1990-2025)
93
Table: Key Population Ratios (South Africa 1990-2025)
93
Table: Urban/Rural Population & Life Expectancy (South Africa 1990-2025)
94
Table: Population By Age Group (South Africa 1990-2025)
94
Table: Population By Age Group % (South Africa 1990-2025)
95
Glossary
97
Table: Glossary Of Terms
97
Methodology
99
Industry Forecast Methodology
99
Sources
101
Risk/Reward Index Methodology
101
Table: Risk/Reward Index Indicators
102
Table: Weighting Of Indicators
103

The South Africa Telecommunications Report features BMI Research's independent industry forecasts on the future strength of South Africa's ICT market, covering the fixed-line, mobile and internet segments and analyses latest regulatory developments and corporate news, including investment activity, mergers and acquisitions, joint ventures and partnerships. Leading operators and manufacturers are fully profiled, highlighting their quarterly financial performance, capital expenditure plans and latest contracts.

BMI's South Africa Telecommunications Report provides industry professionals and researchers, operators, equipment suppliers and vendors, corporate and financial services analysts and regulatory bodies with independent forecasts and competitive intelligence on the telecoms industry in South Africa.

Key Benefits

  • Benchmark BMI's independent telecoms industry forecasts for South Africa to test other views - a key input for successful budgeting and strategic business planning in the South African telecoms market.
  • Target business opportunities and risks in South Africa's telecoms sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in South Africa.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).

Coverage

BMI Industry View

Summary of BMI’s key industry forecasts and views, covering the ARPU, fixed-line, mobile (including 3G & 4G), internet and broadband markets.

Industry SWOT Analysis

Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the wireline and wireless sectors and within the broader political, economic and business environment.

BMI Industry Forecast Scenario

Historic data series (2010-2013) and forecasts to end-2019 for all key industry indicators, supported by explicit assumptions, plus analysis of key downside risks to the main forecast.

  • Fixed-line Telephony – Telephone lines (‘000); telephone lines/100 inhabitants.
  • Cellular Telephony – Mobile phone subscribers (‘000); mobile phone subscribers/100 inhabitants; and where available, 3G & 4G subscribers (‘000); 3G & 4G subscribers/100 inhabitants; 3G & 4G subscribers as a percentage of overall mobile market.
  • Internet Markets – Internet users (‘000); internet users/100 inhabitants; broadband internet subscribers (‘000); broadband internet subscribers/100 inhabitants.

BMI’s Telecommunications Risk Reward Index

BMI’s Risk Reward Indices provide investors (vendors, operators and suppliers) looking for opportunities in the region with a clear country comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide an Indices of highest to lowest appeal to investors, with each position explained.

Market Data Analysis

Detailed market analysis of the mobile, mobile content, fixed-line and internet segments, broken down into:

  • Market Data – Analysis of market size, operator shares, dominant trends, competitive landscape and key quarterly data.
  • Technology/Service Rollout – Analysis of rollout/adoption of new technology, such as 3G & 4G, WiMAX, IPTV, pay-TV, LTE and valueadded handset services (gaming, music, video, apps etc.).
  • Mobile Content – The latest trends in content and services available and being introduced by mobile operators, including a timeline of all the latest major mobile content developments.
    Company Database – A comprehensive breakdown of KPIs of the leading mobile operators, including subscriber figures by type (pre-paid and post-paid); 3G & 4G subscriber figures; net additions; market share; ARPU; churn rates; minutes of use; voice and non-voice revenue; financial figures (including operating revenues, net profits and EBITDA).

Regulatory Environment

Details of the regulatory bodies and their responsibilities, as well as a special focus on the rules surrounding competition and interconnection. Also covers the latest updates in the market’s development and regulatory rulings.

Company Profiles*

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate Company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

Sources

The Telecommunications Reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.

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