2011 African Fixed-line and Fibre Telecoms Markets and Infrastructure

Strong fixed-line growth in many markets driven by broadband demand and price sensitivity

While being the world’s most rapidly growing market for mobile telephony, Africa is also home to the fastest growing fixed-line markets in the world. More than a third of all countries on the continent saw double or triple digit growth rates in the fixed-line sector in 2010, a total of 30 markets had positive growth. The difficulties of rolling out fixed-line networks across its vast land mass have meant that in mid-2011 mobile users constituted around 90% of all African telephone subscribers. However, as lower income groups are being targeted, a price-sensitive market for lower-cost fixed or limited-mobility services has emerged. A surge in demand for Internet access and broadband capabilities is accelerating this fixed-line renaissance, but problems with vandalism and copper theft have lead many telcos to substitute traditional fixed lines with  fixed-wireless solutions for both voice and data services.

For over 50 operators across the continent, CDMA-2000 has been the technology of choice to provide fixed-wireless access. It supports full mobility, and converged licensing regimes are now allowing these operators to also move into the lucrative mobile sector in a growing number of countries.

International submarine fibre optic cables have reached several African countries for the first time in 2009 and 2010 or have brought competition in this sector to an incumbent monopoly provider, with more cables expected to go online in 2011 and 2012. This has started to revolutionise the market by drastically improving the supply and lowering the cost of international bandwidth. Many countries are rolling out national fibre backbone networks to take the new bandwidth beyond the capital cities to population centres in the interior. However, satellite will continue to play a significant role in reaching Africa's extensive rural and remote areas. Foreign investors are scrambling for positions in this very lucrative market as liberalisation continues, national telcos are being privatised and new operating licenses issued.

Market highlights:

• Key statistics for 38 African countries – fixed, mobile, Internet;
• Overall fixed-line growth is stagnant, but many markets are seeing excellent growth rates;
• Converged licensing regimes increase competition in the sector;
• Privatised national telcos are highly profitable;
• Fixed-line incumbents are expanding wireless systems and pushing fixed-mobile convergence;
• Over 50 CDMA-2000 network rollouts in progress, many supporting EV-DO broadband;
• New submarine fibre optic cables dramatically improve access to international bandwidth, with more cables expected to go online in 2011 and 2012;
• Details of national fibre backbone rollouts.

Fixed lines in Africa and annual growth – 1999 - 2011

(Source: BuddeComm based on ITU, company and industry data)