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Nigeria Telecommunications Report Q1 2011
Business Monitor International, Jan 2011, Pages: 94
Nigeria Telecommunications Report provides industry professionals and strategists, corporate analysts, telecommunication associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Nigeria's telecommunications industry.
The latest figures from the Nigerian Communications Commission (NCC) suggest Nigeria’s mobile customer base grew 12% in the first nine months of 2010 to reach almost 82mn at the end of September.
This resulted in a mobile penetration rate of 52%, up from more than 47% at the start of 2010. BMI estimates that at the end of 2010 Nigeria had more than 84.5mn mobile customers, equivalent to a penetration rate of 53.4%. Despite having a mobile penetration rate which is more than 50%, we believe the sector has a high incidence of multiple SIM ownership and a large number of inactive prepaid users. We believe one of the biggest challenges for the sector will be expanding network coverage to underserved areas. Meanwhile, although Nigeria’s mobile market still offers considerable scope for growth, we predict the introduction of SIM registration, as well as the introduction of number portability in 2011, will result in slower growth.
Our newly revised and extended forecast for Nigeria’s mobile sector envisages a market with almost 93mn subscribers at the end of 2011, reflecting full-year growth of about 9%. By the end of 2015 we expect more than 128mn mobile customers; equivalent to a penetration rate of almost 72%.
Noteworthy developments in Nigeria’s telecoms market include the news in December that Etisalat Nigeria became the most recent Nigerian operator to acquire a licence to provide 3G services. Etisalat acquired its licence through the purchase of start-up Alheri Mobile Services, a wholly owned subsidiary of local conglomerate Dangote Group. Alheri was awarded a 3G concession from the NCC in April 2007, alongside established operators Airtel Nigeria (then Celtel), Globacom and MTN Nigeria. Etisalat plans to spend US$50mn on 3G equipment out of a total investment of US$400mn for 2011. The operator will initially deploy its 3G network in Lagos, Port Harcourt and Abuja, with plans to expand coverage to other areas later in 2011.
It was also reported in December that New Generation Telecommunications, the consortium which emerged as the preferred buyer for state-owned incumbent operator Nitel in February 2010, had been given an extension to pay a US$750mn bid security for the ailing operator. Nigerian President Goodluck Jonathon approved the consortium’s bid of US$2.5bn for a 75% stake in Nitel and its mobile arm M-Tel in October 2010. The New Generation consortium comprises Minerva Group of Dubai, Nigeria’s GiCell Wireless and technical partner China Unicom.
Nigeria has risen to first position in BMI’s latest set of Business Environment Ratings for Sub-Saharan Africa. The rise in our rankings to pole position is the result of higher scores in the Industry Rewards and Country Risk categories.
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