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Ghana Telecommunications Report Q3 2011
Business Monitor International, June 2011, Pages: 97
Business Monitor International's Ghana Telecommunications Report provides industry professionals and strategists, corporate analysts, telecommunication associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Ghana's telecommunications industry.
BMI's Q3 2011 update on Ghana's telecoms market contains revised forecast figures for the country's mobile telephony, broadband and internet sectors. Our new mobile forecast is only slightly changed from our previous update. Our forecast is based on December 2010 data as published by Ghana's telecoms regulator, the National Communications Authority (NCA), as well as year-end data published by leading mobile network operators, including MTN Ghana, part of South Africa's MTN Group, Vodafone of the UK and Tigo Ghana, owned by Luxembourg's Millicom International Cellular.
At the end of December 2010, there were 17.494mn mobile subscribers in Ghana, according to figures published by the operators and the NCA. This reflected annual growth of 14% for 2010 and meant Ghana had a penetration rate of more than70% at the end of that year. In Q410, Ghana's mobile market performed well, with a net increase of more than 1.33mn customers. The increased growth was largely a product of intense price competition among major network operators. The strong Q410 growth completely reversed the earlier customer losses recorded in Q210 and Q310. These had been due to the introduction of compulsory SIM registration in June 2010.
In addition to ongoing price competition in 2011, we expect the launch of sixth operator Glo Mobile Ghana before the end of that year. However, we believe mobile customer growth may be tempered by strict implementation of SIM registration and disconnection of unregistered SIMs. The regulator has set 30 June 2011 as a deadline for SIM registration. Although we have not made any major changes to our mobile subscriber forecast this quarter, we made some significant changes to our 3G subscriber forecast, taking into account a larger market than we previously estimated. Reflecting on recent figures published by mobile market leader MTN, we estimate Ghana had 346,000 3G subscriptions at the end of 2010, equivalent to 2% of the mobile market. We predict by 2015, there will be more than 3mn 3G subscribers in Ghana, reflecting almost 13% of the total mobile subscriber base. We believe 3G services will play an increasingly important role in the competitive landscape as operators aim to diversify revenues away from basic voice and messaging services.
During this quarter we introduced a new set of forecasts for mobile ARPU levels in Ghana. Our ARPU forecast for Ghana is based on historical ARPU data published by three of the sector's mobile operators MTN, Airtel (formerly Zain) and Tigo. Examined as a market average, the mobile ARPU rate for Ghana fell by 8.6% in 2010 to reach GHS5 (US$3.3). We predict the rate of decline affecting Ghana's blended ARPU will gradually diminish in the latter years of our forecast. This trend will reflect a steady expansion in the number of 3G and mobile data subscribers in the sector.
Key developments in Ghana's telecoms sector include news that mobile number portability (MNP) will be implemented from 1 July 2011. Mobile market leader MTN responded to the imminent introduction of MNP and said it sees the new development as an opportunity to win new customers. At the same time however, the operator has noted that many Ghanaians already own dual and multi SIM cards and have therefore been benefitting from the services of different networks for some time. According to MTN, this means that customer migration following the introduction of MNP may not be that significant.
Another development with long-term implications for Ghana's telecoms market was the April 2011 announcement that the high capacity submarine fibre-optic cable Glo 1 had finally gone live in Ghana's capital Accra. The 9,800km long subsea cable network, which connects the West African nation to Europe, is the result of a joint venture between Nigerian-based Globacom and Alcatel-Lucent. The new cable system aims to deliver affordable, high speed internet connectivity to local businesses and residential customers.
The inauguration of new fibre-optic cable systems has particular implications for the development of broadband internet services in Ghana. This quarter sees revisions to our forecasts for Ghana's internet users and broadband subscriber forecasts. Our new forecasts reflect the impact which mobile broadband services are having on the sector. Mobile broadband services connect to the internet wirelessly via a highs-speed (3G/HSPA) network. A wide range of devices are used including 3G-enabled mobile phones, netbooks, smartphones and USB sticks. We now estimate there were over 1.66mn internet users at the end of 2010, equivalent to a penetration rate of 6.7%. Meanwhile, we estimate that Ghana had around 107,000 broadband subscribers at the end of 2010, equivalent to a penetration rate of 0.4%.
Ghana has fallen one position in BMI's Business Environment Rankings for the Sub-Saharan region. The country's lower overall score is due to a weaker rating in the Industry Rewards category. With the exception of the Industry Rewards category, in which Ghana scores below the regional average, all of Ghana's individual category scores are above regional average.
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