Room for mobile growth in Africa

Martin Czernowalow
By Martin Czernowalow, Contributor.
Johannesburg, 29 Jul 2015
The number of mobile lines in service will surpass the world's population later this year, says TeleGeography.
The number of mobile lines in service will surpass the world's population later this year, says TeleGeography.

New data released by TeleGeography in its GlobalComms Database reveals global mobile subscribers have reached 7.1 billion, up from just seven million in 1989, and the number of mobile lines in service will surpass the world's population later this year.

Even so, the US-based company says regional differences in wireless penetration and subscriber composition leave significant opportunity for growth in some areas.

The data reveals there is room for continued growth throughout Africa, where wireless penetration stands at just 81% - well below that of any other region. The research firm says 2G remains the dominant mobile technology, by far, accounting for over 75% of the African continent's 912 million subscribers.

"While 3G continues to gain popularity, as it becomes more widely available, LTE is still almost non-existent in Africa, with less than 0.5% of mobile subscribers using the technology as of Q1 2015."

Meanwhile, the data shows Asia is home to 3.7 billion mobile subscribers, and continues to fuel global growth.

"Between Q1 2014 and Q1 2015, Asia added 194 million subscribers, or over 60% of net new global wireless subscribers. Nevertheless, the Asian mobile market is far from saturated, as there are over 270 million people without a cellphone," TeleGeography says.

The research firm notes China and India alone account for 2.3 billion subscribers, but while China has emerged as a meaningful 4G market, with 162 million LTE subscribers, 90% of Indian mobile subscribers remain on 2G networks, driving the region's ongoing reliance on the legacy technology.

Saturated market

Conversely, TeleGeography says the 138% wireless penetration rate in Europe is the highest of any region, and mobile subscribers there fell by six million in the past year, "due to several factors, including market saturation and the weak macro-economic situation".

While eastern and western countries each account for about half of the region's one billion subscribers, migration to 3G and LTE has been much slower in Eastern Europe, where 61% of subscribers remain on 2G networks. In the more developed markets of Western Europe, half of mobile subscribers are 3G, and LTE take-up has been relatively rapid with a 17% market share, says the research company.

"The United States remains at the forefront of LTE adoption, which has driven steady mobile subscriber growth across North America," according to the data.

Between Q1 2014 and Q1 2015, the share of regional wireless subscribers using LTE grew from 35% to over 50%, while 2G's share fell from 15% to just 7%. By the end of this year, North American wireless penetration is expected to reach 100%, says TeleGeography.

"Despite widespread mobile subscriber increases, growth is not as rapid as it once was," says TeleGeography analyst Mark Gibson.

"While opportunities for ongoing subscriber gains remain in some areas, many operators in developed, highly-penetrated markets are turning their focus elsewhere, to goals such as ARPU [average revenue per user] stabilisation via the migration of customers to 3G and 4G plans, user retention in the battle with low-cost MVNOs, and achieving growth via M&A activity."