Africa’s ICT renaissance

Low penetration rates make Africa a key target for global operators.

As ICT companies prepare for next month's ITU exhibition in Cairo, it is clear that Africa is at the forefront of global telecoms growth.

With a population of some 925 million people, which is set to grow to 1.4 billion by 2025, Africa is viewed by many regional players as ripe territory for expansion.

In the past month alone, there have been numerous developments in Africa's telecom and ICT sectors that serve as reminders of the continent's enormous potential.

For example, Hits Africa announced its entry into Equatorial Guinea, and the Kenyan government recently started an IPO for a 25% stake in mobile operator Safaricom, in what is being billed as the largest IPO in east Africa.

In Egypt, Western operators are also keen to take a slice of the action, with France Telecom expressing an interest in buying Egypt's second fixed-line licence. The company joins five Arab companies that are interested in making bids: Orascom Telecom, Alkan, Giza Systems, Etisalat, and Atheeb group.

Another market that many operators are keeping a close eye on is Nigeria. The country - which has one of the biggest populations in Africa with 135 million people - saw its mobile market grew by around 57% in 2006.

In 2007, the country's three main mobile operators MTN, Globacom, and Celtel added more than 7 million subscribers, taking the total to almost 37 million, according to research from UK-based organisation Business Monitor International.

Demand for data services is also booming across Africa. For example, South African now has almost one million broadband subscribers, made up mainly from ADSL and HSDPA customers, according to reports in the local press.

While there remain problems in many countries, with political instability and economic crisis in Zimbabwe delaying liberalisation and growth of the sector, and political tensions in Kenya, the fundamentals of the continent are robust for ICT growth: fast developing economies, low mobile and internet penetration rates and large, young populations.

Despite the setbacks in some countries, these upward trends look set to continue to drive opportunities for those operators prepared to grasp it.

Roger Field is the editor of Communications Middle East & Africa.

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