Africa offers promise and peril to telecom operators
Barcelona, 02 Mar – (ANA) - Poor infrastructure, fragmented markets and stiff competition mean Africa poses risks as well as potential rewards for telecom operators hunting for growth in countries like oil-rich Nigeria and post-revolution Libya and Tunisia. With new cheaper smartphones set to drive sales, a growing corporate market, and the fact that most in Africa will use mobile phones to access the Internet and do business, many operators are seeking acquisition targets in the continent. France Telecom and Vodafone now present on the continent could expand, but they'd have to compete with new emerging market players like Russia's Vimpelcom, South Africa's MTN or India's Bharti Airtel. Chinese companies, which already sell telecoms equipment in Africa, could move up the value chain by buying operators or licenses. In 2010, China Mobile lost a bidding war to Bharti that saw the Indian operator snap up telecom units in 16 African countries for $10.7 billion. But making money in Africa, one of the last remaining emerging telecoms markets not yet sown up, has proven very difficult, as some of the existing players have discovered. The market is fragmented in 56 countries, some of which have dozens of operators, while consumers in Africa tend to spend between $1 to $10 per month on telecommunications, far less than in Europe or the U.S., but still more than in India. Operators have also realised that the cost of running networks is high due to poor infrastructure, executives told Reuters this week at the Mobile World Congress in Barcelona. (ANA)
FA/ANA/02 March 2012----------