Motorola sees higher ARPUs

By Siyabonga Africa for Motorola

Johannesburg, 30 Oct 2008

Mobile operators can raise their average revenue per user (ARPU) by raising the value of the services they provide, says Motorola.

Massimo Sangiovanni, Motorola's VP of marketing for Europe, Middle East and Africa, says developing countries can learn from developed countries where mobile operators have higher ARPUs because they add more applications to their service offering.

“ARPUs are low in Africa because when you provide only voice to low-income consumers, you will find yourself having price competitions with other new operators,” Sangiovanni says.

The best way to beat other operators is to provide value-added services on top of voice such as data and MMS, he adds.

Motorola states that ARPUs stand at $13 in Africa, while in developed countries they reach more than $34.

Sangiovanni says operators that can provide these value-added services would benefit from the fact that Africa is one of the fastest growing mobile broadband markets in the world. Motorola states the African market grows at an annual rate of 35%.

Broad potential

Sangiovanni says opportunities in the African mobile broadband market lie in the number of new subscribers yet to be signed up.

“Africa has one of the lowest penetrations of broadband Internet, with less than 260 million being connected.”

He adds that Africa has a population of over 885 million.

Sangiovanni says other opportunities lie in bringing voice to countries on the continent which have been neglected. Long-term evolution technology will help bring faster data access at lower prices and this will help mobile operators raise their revenue, he concludes.